Mexico is a major stakeholder in mitigating the climate and biodiversity crisis

Latin America and the Caribbean is facing a serious vulnerability issue due to climate change and loss of biodiversity. Mexico is no exception, due to its geography and socioeconomic conditions, which stresses the need to implement adaptation and mitigation policies through joint actions at the local, national, and international level to address these challenges.

In the past 20 years alone, the number of extreme weather events in Mexico grew from 3.5 to 5.8 events per year, on average, impacting over 557,000 people nationwide, with storms and floods being the most common disasters.

The Economy and Development Report (EDR) "Global Challenges, Regional Solutions: Latin America and the Caribbean facing the climate and biodiversity crisis" , prepared by CAF—development bank of Latin America and the Caribbean—, puts forward a number of scenarios that forecast that Mexico's average temperature will continue to rise in decades to come. It also foresees a drop in rainfall, which will become less predictable, with a negative impact on agriculture.

The presentation of the EDR was made together with the Ministry of Finance and Public Credit, at the Chapel of the Lerdo de Tejada Library on September 21. In his remarks, CAF Executive President Sergio Díaz-Granados noted: "The climate crisis is a reality that calls for a rapid, coordinated response from our generation, in order to give a chance to our children and grandchildren. Mexico has major challenges, but also opportunities that need coordinated work between the public sector, private sector, and civil society. With this recently published Report, we—as the green bank of Latin America and the Caribbean—are contributing to the debate with readily available solutions that we can start deploying as soon as possible."

In addition, Finance and Public Credit Undersecretary Gabriel Yorio González said: "Jointly with CAF, we will work on a financial tool focused on climate and social targets. Against the current backdrop, in which multilateral banks are tailoring their financial tools to global challenges, CAF's innovative efforts are noteworthy, as the bank takes the vanguard position among these institutions. Our goal is to lead the project to help the region leverage this innovative tool in favor of the environment and social well-being."

EDR section on Mexico

Agriculture in Mexico is particularly exposed to climate change.Some 44 percent of the crop area in Mexico is made up of farms of less than 2 hectares (5 acres), and 76% of farms are less than 10 hectares (24.7 acres). Furthermore, some 73 percent of the crop area is rainfed (seasonal), meaning that crops rely exclusively on rainfall for water. Variable rainfall and increased dryness pose a major problem for small and rainfed farms, which jeopardizes the food and nutritional security of small producers, particularly those who grow food for their own consumption.

The study also shows that the largest sources of emissions are different from the rest of the region, with the industrial sector (31%), energy systems (25%), and transportation (17%) being the largest emitters, followed by the agricultural sector (13%), land use change (12%), and buildings (3%). Moreover, Mexico is the second-largest emitter in LAC, accounting for 17% of the total emissions in Latin America and the Caribbean in 2019. Emissions per capita, however, are below the global and regional average.

"The Report underscores the need to implement public policies around the targets of adaptation, mitigation, natural capital preservation, stronger regional coordination, and capitalizing on opportunities derived from the global energy transition. Consequently, Mexico has put forward a positive plan to modernize 40 percent of its hydro-power plants, and to deploy an electric mobility strategy. Similarly, we also stress that it is the first country in the region to implement an emission trading system for large industries, which is still in the pilot phase," said Pablo Brassiolo, lead economist and co-author of CAF's EDR.

CAF's flagship publication also details how land use change—through deforestation, wetland drainage, and the replacement of natural grasslands—has a tremendous impact on the nation's ecosystems and biodiversity. Twenty-three percent of Mexico's area is preserved in a natural or semi-natural state. This percentage is below the regional average (45%). Thus, the nation has applied various policies to preserve natural capital, including the establishment of protected areas. Mexico's protected natural areas cover 11% of the land area and 23% of the marine areas, compared to the regional average of 22% in both types.

To sum up, the Report underscores three key messages: the effects of climate change and the pressing need for adaptation policies; the urgency of helping to lower greenhouse gas emissions; and the pivotal role that ecosystems and biodiversity play in the response to climate change and sustainable development in Mexico, Latin America and the Caribbean.