Unlocking Forest Finance - Mobilisation of private sector capital to reduce deforestation through Public/Private Partnerships for forests and rural livelihoods.
As of: August 2018
Objective and activities
The Project aims to increase capacity among policymakers in Amazonia to mobilise large-scale public/private funding through innovative financing mechanisms that enable the conservation and sustainable use of forests as natural capital (I), adaptation to climate change (II) & climate friendly economic development (III). Focussing on Amazonia, this project will increase the capacity among policymakers in three case study regions to generate public/private funding to halt deforestation, reform agriculture and improve rural livelihoods. It will design large-scale innovative financing mechanisms (IFM) at the jurisdictional scale of a state or municipality, to fund the transition from business-as-usual (BAU) to sustainable ecosystem management (SEM), working with the financial sector and sub-national governments.
State of implementation/results
Project in implementation
- A portfolio of investments has been formulated by the local partners in all three pilot regions. These investments will sustainably increase production in agricultural supply chains while supporting conservation and sustainable livelihoods. Project partners will determine which investments remain within the portfolio by assessing their environmental, social, and economic benefits/costs, against criteria such as return on investment, climate risks, impacts on biodiversity, employment, etc
- For each of the 3 portfolios, the UFF project team has gathered economic data and is finalising estimates of the cost of investing in the transition to sustainable development, as well as potential returns. UFF has held regular meetings with our advisory group, receiving strategic advice from 3 international financial institutions, 2 private banks, potential insurance/guarantee providers and specialist investment consultants
- The project team has interviewed numerous local and international stakeholders, while using the results to develop a suitable preliminary financing mechanism
- GCP presented the UFF project as part of the Global Landscapes Forum of the COP 21 in December 2015, with the involvement of EIB, Finance in Motion, Althelia, Credit Suisse und UNCCD
- Joint development of a loan mechanism with AGROBANCO in Peru to incentivize agricultural loans that are conditional on environmental and social performance indicators
- Creation of the knowledge platform financingsustainablelandscapes.org