This pioneering study assesses the financial risks associated with biodiversity loss in Mexico, one of the most biodiverse countries in the world. Using an innovative approach that combines socioeconomic data, input-output matrices, environmental dependency and impact assessments (ENCORE), and spatial analysis with geolocated firm data, the report estimates the exposure of Mexico’s financial system to physical risks (such as water stress) and transition risks (such as the expansion of protected areas). The findings reveal that up to 66% of national output, 70% of employment, and 53% of the credit portfolio could be at risk due to high dependencies or impacts on ecosystem services. The study also identifies key industries and presents concrete scenarios to illustrate how nature-related risks can propagate through supply chains and affect the financial system. This assessment provides critical empirical evidence to inform public policy and strengthen risk management strategies among financial institutions and regulators.
Date:
Topic:
Finance Solutions
Country:
Mexico
