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Greening Latin America: Investing in Nature for a Sustainable Future

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SUGARCANE
Rodrigo Abd, AP

In the recent past, sugarcane growers and conservationists may have seemed unlikely allies.

Today, however, some of Latin America's leading agricultural businesses -- from sugarcane growers to ranchers to soy producers -- understand that improving sustainability has a positive impact on their bottom line, local communities and the lands and waters on which all life depends.

This understanding comes at a key moment. As much of the world battles economic and political crises, Latin America is producing good growth, increasing prosperity and political stability. And the outlook for the decade ahead is positive.

While a number of factors will contribute to the region's continued success, the health of its rich natural resources will be more critical than ever.

Governments and businesses in Latin America face an important decision: exploit those resources for short-term gain, or invest in and sustainably manage them to ensure that nature can keep providing for people in the long-term.

In Colombia, I recently met with sugarcane producers who are choosing the sustainable path. These no-nonsense sugarcane men aren't your typical tree-hugging environmentalists. But they understand a simple fact: their business relies on steadily-supplied, clean water. And they recognize the important role of nature in producing and filtering water. As a result, these leaders are keenly interested in working with environmental organizations to find ways to produce more with less and ensure the long-term sustainability of their water supply.

And it's not just agricultural companies that can benefit from integrating nature into their core business strategies. Other industries are similarly discovering that nature can be a smart and cost effective way to protect business assets, mitigate risk and create opportunities.

Latin America offers another powerful example of this idea in practice. Here, bottling company FEMSA has teamed up with The Nature Conservancy, the Inter-American Development Bank and the Global Environment Facility to help restore the natural systems that produce and filter water for 50 million people across Latin America.

The new Latin American Water Funds Partnership will significantly expand a successful model we developed in Quito, Ecuador, in 2000, through which utility companies, breweries and other downstream users voluntarily provide funding for the conservation of forests and watersheds upstream.

This simple concept is a triple win for businesses, communities and nature. Companies save money by preempting the need for more costly water treatment activities. Water resources are kept healthy and flowing for local communities. And natural systems are protected to provide habitat for wildlife and deliver clean water.

Moreover, the funds are self-sustaining. After a relatively small kickoff investment, large water users make voluntary contributions into the fund. Revenue from these investments then provide funding for projects ranging from protecting forests to creating incentives for ecologically sustainable cattle ranching. The concept is so elegant and powerful that it can be replicated throughout Latin America and beyond.

Fortunately, these aren't just isolated examples. Throughout the region, business leaders are recognizing the importance -- and urgency -- of ensuring that Latin America's natural systems remain intact. For example, The Nature Conservancy recently launched the Latin America Conservation Council, co-chaired by former U.S. Treasury Secretary Henry Paulson and former Alcoa CEO Alain Belda. The group brings together more than 30 of the region's top business and political leaders to focus on three areas that represent the most pressing conservation challenges in the region: water security, food security and smart infrastructure development.

As the Latin American economy and population both continue to expand, the private sector has a tremendous opportunity to take the lead in demonstrating that nature conservation isn't just an aesthetic luxury -- it's an essential investment in a sustainable future.

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