Many well-intended incentives have often unintended consequences by being harmful to biodiversity.  As a result, they can be an important driver of biodiversity loss, often through over exploitation.  Eliminating, phasing out, or reforming harmful incentives is an important component for the conservation of biodiversity, but also in the sustainability of resources. The use of positive incentives for the conservation and sustainable use of biodiversity, on the other hand, by providing financial resources or other motivations to encourage businesses to undertake actions that will benefit biodiversity.  Article 11 of the CBD calls on Parties to adopt economically and socially sound measures that act as incentives for the conservation and sustainable use of biodiversity.  This target is related to SDGs 14, 15, and 17 and GFG 5.

There was uncertainty among the agencies that met in Baucau in November of 2023 about what incentives may be harming biodiversity in the country.  Hence, the first priority is to determine if any such subsidies exist in the country.

Responsible Ministry(ies): MAFFL, MTE, Ministry of Trade and Industry

Actions:

1. All relevant ministries will indicate and report subsidy programmes (to the Environment Department for the relevant National Reports to the CBD) and begin to assess impacts of these subsidies on target and non-target biodiversity.

2. Prior to implementing any subsidy programs, conduct research to determine non-target impacts on biodiversity.

3. Mitigate any subsidies found to have unexpected consequences for biodiversity.

4. Consider implementing positive incentives to reduce use of natural resources.