Iraq

In 2026, Iraq submitted 17 National Biodiversity Targets (NBTs) to the Convention on Biological Diversity (CBD), aligning its national biodiversity priorities with the Kunming–Montreal Global Biodiversity Framework (KM-GBF). These targets form the foundation of Iraq’s National Biodiversity Strategy and Action Plan (NBSAP 2026–2032).

The Biodiversity Finance Initiative (BIOFIN) in Iraq (2026–2030) aims to address fragmented biodiversity financing and support the development of a more integrated, nature-positive financing system. Through the BIOFIN methodology, the project will assess existing policies, institutions and financial flows, helping bridge the gap between national biodiversity priorities and public financial management.

The project focuses on three priorities:

• Biodiversity budget tagging: Integrate biodiversity budget tagging into Iraq’s evolving public financial management systems to improve the identification, tracking and reporting of biodiversity-related public expenditure.
• Retention and reinvestment of environmental revenues: Explore the operationalization of fee-retention provisions under Article 31 of Law No. 27 of 2009 to enable the Ministry of Environment to retain and reinvest eligible environmental penalties and laboratory testing fees in environmental management and biodiversity conservation.
• Reforming biodiversity-harmful incentives: Assess existing subsidies and economic incentives across key sectors and identify opportunities to reform or redirect them towards more nature-positive practices.

Although BIOFIN Iraq is still at an early stage, the initiative aims to strengthen the integration of biodiversity into public budgeting, improve the effectiveness of existing financial resources and create the conditions for mobilizing additional finance to achieve national biodiversity targets. These efforts will contribute to more sustainable management of Iraq’s natural resources while supporting livelihoods, resilience and long-term development.

Potential Biodiversity Finance Solutions

Iraq is exploring seven potential biodiversity finance solutions to improve the effectiveness of public expenditure, reform incentives that negatively affect nature and mobilize additional resources for conservation and sustainable ecosystem management.

These options build on preliminary policy and institutional analysis and will be further assessed and prioritized through the BIOFIN process. None has yet been confirmed for implementation.

1. Biodiversity Budget Tagging

Explore the integration of biodiversity budget tagging into Iraq’s public financial management systems, including the Integrated Financial Management Information System (IFMIS). The proposed approach would improve the identification, tracking and reporting of biodiversity-related expenditure across government institutions and support more transparent and evidence-based budget decisions.

Stage: Under Consideration

2. Reforming Biodiversity-Harmful Subsidies

Assess agricultural, water and energy subsidies to identify opportunities to reform or redirect incentives that contribute to biodiversity loss. Potential reforms could support more sustainable agricultural practices, efficient water use and reduced environmental impacts while making better use of existing public resources.

Stage: Under Consideration

3. Strengthening Environmental Taxes and Fees

Assess opportunities to strengthen environmental taxes, pollution charges and other regulatory fees to generate resources for environmental management while creating incentives to reduce pollution and ecosystem degradation. The feasibility of these instruments will depend on existing legislation, institutional arrangements and revenue assessments.

Stage: Under Consideration

4. Strengthening Protected-Area Revenues

Explore opportunities to improve protected-area financing through visitor fees, tourism services and concession arrangements. The solution would also assess mechanisms for retaining and reinvesting appropriate revenues in protected-area management, conservation and ecosystem restoration.

Stage: Under Consideration

5. Biodiversity Offsets and Ecological Compensation

Assess the feasibility of biodiversity offsets and ecological compensation mechanisms to address residual biodiversity impacts from infrastructure, extractive and other development activities, after impacts have been avoided and minimized. Any future mechanism would require appropriate regulatory frameworks, measurable conservation outcomes and environmental safeguards.

Stage: Under Consideration

6. Strengthening Environmental and Biodiversity Funds

Explore options to establish or operationalize a dedicated financing mechanism that could pool eligible environmental revenues, public resources and international contributions to support biodiversity conservation and environmental management. Further legal, institutional and financial assessments would be required to determine the most appropriate structure.

Stage: Under Consideration

7. Payments for Ecosystem Services

Assess opportunities to develop Payments for Ecosystem Services (PES) mechanisms that provide financial incentives to communities, farmers and other land managers for conserving and sustainably managing water resources, rangelands and other ecosystems. Potential approaches could link payments to measurable ecosystem-management outcomes and community benefits.

Stage: Under Consideration

Establishing the Evidence Base for Biodiversity Finance
Preparatory policy and institutional assessments have provided an initial foundation for Iraq’s biodiversity finance planning. The findings are informing the identification of potential reforms to public financial management, environmental revenue systems and sectoral incentives.

Identifying Opportunities for Biodiversity Budget Tagging
Iraq is exploring the integration of biodiversity budget tagging into its Integrated Financial Management Information System (IFMIS). The proposed approach would improve the identification and tracking of biodiversity-related public expenditure and strengthen the integration of biodiversity into national budgeting and investment decisions.

Exploring Environmental Revenue Reforms
Preliminary analysis has identified opportunities to strengthen the collection, management and potential reinvestment of environmental fees and penalties. Further legal and institutional assessments will examine options for improving environmental revenue management and financing conservation and ecosystem restoration.

Advancing the Assessment of Biodiversity-Harmful Subsidies
BIOFIN is exploring opportunities to assess and reform subsidies and incentives in sectors such as agriculture, water and energy. Potential reforms could redirect existing public resources towards more sustainable practices, including improved water efficiency, soil conservation and reduced environmental pressures.

Exploring Natural Capital Accounting
Iraq is considering opportunities to strengthen environmental-economic accounting in line with the United Nations System of Environmental-Economic Accounting (SEEA). Such an approach could improve the use of ecosystem and natural resource information in public investment appraisal and development planning.