Financing Sustainable Watershed Management in Ethiopia: Exploring Innovative Financing Strategies for Nature-Based Solutions

This research paper, a collaboration between the World Resources Institute and the Ethiopian Institute of Water Resources at Addis Ababa University, examines innovative financing strategies for nature-based solutions (NBS) to combat land and watershed degradation in Ethiopia.

• Ethiopia faces significant threats to agricultural productivity, water supplies, and livelihoods due to land and watershed degradation, which are exacerbated by inadequate financing and unsustainable conservation interventions.
• The paper identifies three specific innovative financing mechanisms that could accelerate conservation and water-related nature-based solutions in Ethiopia: water funds, payments for ecosystem services, and debt-for-nature swaps.
• To scale conservation efforts and achieve sustainability, Ethiopia requires a shift toward diversified funding sources—including private and blended finance—long-term funding for operations and maintenance, strong governance frameworks, community-led engagement, and landscape-scale interventions.
• Current funding from governments and donors is insufficient to combat the scale of natural resource depletion, necessitating the exploration of new funding sources and the attraction of domestic private sector and international climate and impact investors.

APA

World Resources Institute (n.d.). Financing Sustainable Watershed Management in Ethiopia: Exploring Innovative Financing Strategies for Nature-Based Solutions. https://www.wri.org/research/financing-sustainable-watershed-management-ethiopia-exploring-innovative-financing

Chicago

World Resources Institute. Financing Sustainable Watershed Management in Ethiopia: Exploring Innovative Financing Strategies for Nature-Based Solutions. n.d. https://www.wri.org/research/financing-sustainable-watershed-management-ethiopia-exploring-innovative-financing.

Wikipedia

{{cite report |author=World Resources Institute |title=Financing Sustainable Watershed Management in Ethiopia: Exploring Innovative Financing Strategies for Nature-Based Solutions |url=https://www.wri.org/research/financing-sustainable-watershed-management-ethiopia-exploring-innovative-financing |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{worldresourcesinstitutendfinancing, author = {{World Resources Institute}}, title = {{Financing Sustainable Watershed Management in Ethiopia: Exploring Innovative Financing Strategies for Nature-Based Solutions}}, institution = {World Resources Institute}, url = {https://www.wri.org/research/financing-sustainable-watershed-management-ethiopia-exploring-innovative-financing}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }