Deforestation-free supply chains as the key to biodiversity conservation and climate action
On this year's International Biodiversity Day, we are taking a look at one of the most important ecosystems on our planet - the forest.
The biological diversity on our planet secures the basic resources for all humankind. Forests are key hotspots of this biological diversity. They host more than 80 per cent of all terrestrial animal, plant and fungal species. Healthy forests are sources of income, preserve biodiversity, store carbon and thus contribute to climate change mitigation. Despite their significance for mankind, they belong to the most threatened habitats. Mankind is responsible for the destruction of around 10 million hectares of forest worldwide every year.
Worldwide deforestation to satisfy global supply chains plays a major role in global forest loss. Plantations and fields for globally traded agricultural resources such as soy, palm oil, coffee and cocoa are replacing forest areas - with direct consequences for biodiversity: habitats are being lost, species are becoming extinct and local communities are losing their livelihoods. The destruction of forests does not only mean that they are lost as carbon sinks. According to assessments of the Food and Agriculture Organisation of the United Nations (FAO), global deforestation and forest degradation contribute to roughly 11 per cent of global CO2 emissions. The change in land use in the wake of deforestation leads to further, additional greenhouse gas emissions.
The EU regulation on deforestation-free products: Europe's response to global deforestation
Creating deforestation-free supply chains is an important element in global forest conservation. Because only if supply chains are ecologically viable, socially just and climate-friendly can the loss of biodiversity be held back and the common livelihoods of all people be ensured.
Consequently, the regulation on deforestation-free products (EUDR) has been in force in the European Union since 29 June 2023. It compels companies to ensure that certain raw materials and products manufactured from them were not produced on land that was subject to deforestation after 31 December 2020. This requires a due diligence analysis that, amongst other things, requires the exact traceability of the areas of origin using geolocalisation data. The EUDR applies to beef, palm oil, soy, cocoa, coffee, wood and rubber.
IKI support for deforestation-free supply chains in producing countries
The International Climate Initiative (IKI) funds projects that contribute to deforestation-free supply chains, for instance within the framework of the IKI Medium Grants (IMG). The IMG supports smaller civil society actors in developing and emerging countries in the implementation of the Kunming-Montreal Global Biodiversity Framework and the Paris Agreement.
The projects funded by the IMG to fortify deforestation-free supply chains support local producers and help them in the transition to deforestation-free production methods. They promote more sustainable agriculture, improve traceability and certification, and strengthen the rights of indigenous people and local governance structures. Furthermore, they support political reforms for sustainable land use and hence, compliance with the EUDR.
Innovative financial services to support deforestation-free supply chains for coffee
This IKI project contributes to establishing deforestation-free supply chains for coffee in Uganda. Implemented by the Internationalen Ländlichen Entwicklungsdienst e. V. (ILD; International Rural Development Service), it supports 8,000 smallholder farming families in local smallholder cooperatives to bundle their coffee production, market the coffee together and sell it directly to small coffee-roasting companies in Germany. This is effected by applying international standards for sustainable coffee and associated certification systems. To enable sustainable coffee cultivation, the project supports various financing instruments such as savings and loan provider groups, where money is both saved and lent, as well as revolving funds, from which loans are granted and then flow back again. The project also makes use of these funds to support measures to increase energy efficiency and renewable energy solutions for households and companies.
Deforestation-free supply chains: agroforestry systems for smallholder cocoa farmers
This IKI project in Ecuador, which is also being implemented by the Internationalen Ländlichen Entwicklungsdienst e. V. (ILD), is aiming to reduce the deforestation of coastal forests for cocoa cultivation purposes. On the one hand, this contributes to the protection and conservation of areas with a high value for biological diversity and, on the other, generates or secures income for small farming families in the region.
For this purpose, it strengthens families and cooperatives in their aim of producing deforestation-free cocoa in agroforestry systems and marketing it in compliance with the EU regulation on deforestation-free supply chains. In six cooperatives with a total of 660 farmers, the project conveys specific topic-related knowledge and bundles trade relations with EU purchasers to comply with EUDR regulations. The project also promotes agroforestry systems to mitigate and adapt to climate change and is developing a vegetation monitoring system, including a traceability system and establishing it in the cooperatives.
Partnership for a deforestation-free supply chain for cocoa
In Ghana, the association Fairtrade International e. V. is working on enabling farming families to achieve economically viable livelihoods and contribute to the conservation of biodiversity and climate action at the same time. The project comprises training courses in climate-friendly agriculture and the use of traceability systems. In addition, the project strengthens the role of women and young people by offering them training in leadership and entrepreneurship. Furthermore, the project promotes the diversification of income sources beyond cocoa cultivation and facilitates access to funds. This opens new paths towards financial stability and reduces dependence on a single type of cultivated plant. This provides families with better access to the market and boosts the productivity of their land and income.
Development of digital solutions for deforestation-free resources from smallholder farmers (DigiDeFree)
The IKI project, implemented by "OroVerde - The Tropical Forest Foundation", promotes deforestation-free coffee and cocoa production by smallholder producers in Mexico. An innovative monitoring and data evaluation technology offers local smallholder producers the opportunity to submit proof of deforestation-free production, implement long-term analyses and make data-based adjustments to their production. The project also enhances the competitive capability of smallholder producers and provides them with access to the European market and hence to higher price segments. The inclusion of European importers ensures the functional capability and dissemination of digital solutions and establishes a common responsibility framework that involves all stakeholders.
Supply chains for smallholder agricultural resources
In Liberia, Deutsche Welthungerhilfe e. V. (German Agro Action) supports 4,200 smallholder farmers in implementing more sustainable agricultural and forestry practices. The project also introduces innovative information technologies for this purpose, which improve deforestation monitoring and provide decision-makers and smallholder producers with data and instruments for the implementation of sustainable types of farming and biodiversity conservation. In addition, a multi-stakeholder platform is being established to promote the coordination and the exchange of knowledge between governmental and non-governmental actors and supports compliance with accountabilities.
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International Biodiversity Day
About IKI Medium Grants
With the IKI Medium Grants programme, which is implemented by Zukunft - Umwelt - Gesellschaft (ZUG) gGmbH, the German government funds projects for climate action and biodiversity conservation that specifically involve smaller civil society actors in developing and emerging countries.
