Exploring the potential of territorial funds to achieve equitable and inclusive direct climate and biodiversity finance

Indigenous Peoples (IP), local communities (LC), and Afro-descendants (AD) need to play crucial roles if countries are to achieve our 2030 global nature, biodiversity, and climate goals. An estimated 2.5 billion IP, LC, and AD hold customary rights and use half of the remaining forests and biodiversity, which are key for providing critical ecosystem services to sustain human well-being (WRI 2024). At least 36 per cent of the world’s remaining intact forest landscapes are within IP’s lands (Fa et al. 2020). IP, LC, and AD safeguard knowledge and practices that can contribute to avoiding biodiversity loss and building resilience to climate change impacts (Dawson et al. 2020; Phuong Phan et al. 2021). However, despite the effectiveness in stewarding nature, developing solutions, and implementing strategies, less donor funding is being disbursed to IP, LC, and ADs in comparison to other climate and environmental measures. Drawing on the author’s work in research and philanthropy, this essay reflects on the potential of emerging territorial funding mechanisms for promoting equitable and effective direct biodiversity and climate finance outcomes. Territorial funds can contribute to addressing barriers and challenges to direct funding. In the face of unfavourable scenarios that question the future of international climate frameworks, territorial funds have the potential to strengthen the governance of tropical forest systems and the organisations underpinning the efforts to mitigate and adapt to the detrimental effects of climate change.

The global forest fund from Rio to IFF4: what issues remain

The paper reviewed the ongoing international forest policy deliberation on finance issues, and specifically a proposal to establish an international forest fund. The paper includes annexes from the report of the final sessions of the Intergovernmental Panel on Forests and the Intergovernmental Forum on Forests. Justifications given for Global Forests Fund include the need to pay for international public goods produced by forests and for the cost of making the transition to sustainable forest management practices. Opponents of the Global Forest Fund advocate better use of the existing funds before calling for a new mechanism. This paper provide a basis for further discussion by the Oslo Workshop of issues left unresolved.

Linking Policies to Address Ecosystem Restoration in Viet Nam

This brief summarizes key insights from a literature review and the National Dialogue on Ecosystem Restoration in Viet Nam, co-hosted by CIFOR-ICRAF, the Department of Forestry (MARD), and FAO in June 2024. The dialogue aimed to inform policy, identify gaps, and explore opportunities to advance restoration aligned with Viet Nam’s National Biodiversity Strategy and Action Plan (NBSAP). The NBSAP targets restoring at least 20% of degraded ecosystems by 2030, prioritizing forests, wetlands, and marine areas. Institutional coordination is led by the newly merged Ministry of Agriculture and Environment (MAE). The dialogue emphasized the need for improved data systems, funding mechanisms, and alignment with global frameworks such as the UN Decade on Ecosystem Restoration and the Kunming-Montreal Global Biodiversity Framework.

Reducing emissions from deforestation and forest degradation (REDD) in Indonesia: options and challenges for fair and efficient payment distribution mechanisms

The objective of REDD payment distribution mechanisms is to support policies and measures that reduce deforestation and degradation through transfer of revenues from international REDD funds or carbon markets to (or within) national levels. This may provide benefits of three types: a) shared responsibility for reducing a major driver of global climate change, b) financial payments and co-investment that exceed the economic opportunities foregone from decisions to maintain carbon stocks, and c) co-benefits through the other environmental service functions that well-maintained forests can provide. Given its track record of high emissions from land use and land use change of an estimated 2.5 Gt CO2e year-1, Indonesia provides a huge opportunity as well as serious challenge to reduce emissions. We report here on a series of stakeholder consultations and focus group discussions to identify options and challenges. To ensure demonstrable results on emission reduction, REDD mechanisms must be effective in targeting the wide range of agents involved in deforestation and degradation, learning lessons from past and ongoing conservation efforts that have apparently failed. They must reward good performance and incentivize improved performance compared to reference scenarios, and adequately compensate agents that suffer losses from changed practices. International payments are likely to be performance based, both in terms of emission reduction at national scale and the environmental and social impacts of the system, meaning that accountability, transparency, risk management, adequate benefits transfer and administration mechanisms will be essential for attracting investment. Indonesia will be effectively competing for attention and REDD funds with other countries with currently high pemissions and/or large forest areas. A strong international ‘bargaining position’ requires that internal conflicts and strategic positioning be overcome

Mapping of international funding flows to support the forest and environment sectors in Central Africa: An update

The forestry and environmental sectors’ funding has become a focal point for policymakers in Central Africa (CA). In 2019, the Observatory for Forests of Central Africa (OFAC) addressed this issue by conducting a study that mapped international financial flows to these sectors in CA. They also published an initial policy analysis paper examining international funding for these sectors from 2008 to 2017. During that period, CA received a measly sum of USD 2 billion, which represented 11% of the USD 15 billion in forestry and environmental official development assistance (FEODA) allocated to tropical regions. Subsequently, Central African Forest Commission (COMIFAC) member countries submitted their second revised nationally determined contributions (NDCs) to combat climate change impacts, making them eligible to apply for funding to international funding mechanisms for forestry and environmental sectors. Given these developments, it is necessary to update the previous study on international financial flows for forestry and environmental sectors in CA to assess any changes that have occurred since the initial research.

Policy learning in REDD+ Donor Countries: Norway, Germany and the UK

Almost 15 years have passed since the idea of REDD+ (Reducing Emissions from Deforestation and forest Degradation and the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries) was adopted by the United Nations Framework Convention on Climate Change (UNFCCC) and local, regional, national, bilateral, transnational and international policies, programmes and projects emerged under the banner of REDD+ (Corbera and Schroeder, 2011, Agrawal et al., 2011, Lederer, 2012). In recognition of the role forests play in climate change, major donor countries around the world, in particular the top five of Norway, Germany, the US, Japan and the UK, have increased their spending and institutionalization efforts on REDD+ (Dooley and Parker 2015). In 2015, the Paris Agreement sent a strong signal in favor of REDD+ in dedicating one whole article (Article 5) to the role of forests in addressing climate change (Korhonen-Kurki et al. 2019).

Mainstreaming Ecosystem Services from Indonesia’s Remaining Forests

With 120 million hectares of forest area, Indonesia has the third largest area of biodiversity-rich tropical forests in the world, and it is well-known as a mega-biodiversity country. However, in 2020, only 70 percent of this area remained forested. The government has consistently undertaken corrective actions to achieve Sustainable Development Goal targets, with a special focus on Goals #1 (no poverty), #2 (zero hunger), #3 (good health and well-being), #7 (affordable and clean energy), #8 (decent work and economic growth), #13 (climate action), and #15 (life on land). Good environmental governance is a core concept in Indonesia’s forest management and includes mainstreaming ecosystem services as a framework for sustainable forest management. This paper analyzes efforts to mainstream Indonesia’s remaining forest ecosystem services. We review the state of Indonesia’s forests in relation to deforestation dynamics, climate change, and ecosystem service potential and options and provide recommendations for mainstreaming strategies regarding aspects of policy, planning, and implementation, as well as the process of the articulation of ecosystem services and their alternative funding.

Mainstreaming revisited: Experiences from eight countries on the role of National Biodiversity Strategies in practice

Global biodiversity targets have not been met due to weak implementation at the national level. National Biodiversity Strategies and Action Plans (NBSAPs) are central for mainstreaming biodiversity by translating global ambition into national policies. This study analyzes the practical role of global and national biodiversity agendas. Interviews from France, Germany, Honduras, Indonesia, Mexico, Peru, Rwanda, and South Africa show that global targets and NBSAPs have raised awareness, mobilized initiatives, mobilized support for implementation, and fostered accountability. Nevertheless, conflicting interests, weak financial support, and poorly integrated institutional and regulatory structures remain challenges to implementation. Levers for harnessing the role of future NBSAPs to achieve the goals and targets of the Kunming-Montreal Global Biodiversity Framework are: improving communication; defining concrete measures and clear responsibilities; fostering cross-sectoral commitment; enshrining targets into national laws; ensuring adequate public funding; reforming harmful subsidies; ensuring coordination among sectors and levels of governance; and strengthening accountability frameworks.

Implementing forest landscape restoration in Latin America: Stakeholder perceptions on legal frameworks

Legal frameworks could play a key role in enabling countries to meet their ambitious forest landscape restoration (FLR) targets. In this paper, we examine the perceptions of different types of stakeholders from 17 Latin American countries on aspects of forestry and environmental legal frameworks that enable or hamper FLR interventions at the national level. We first reviewed general, environmental, social and financial aspects of existing legal frameworks in order to provide the basis for a mixed qualitative – quantitative analysis of perceptions. The analysis combines information from semi-structured interviews and a Likert-scale questionnaire given to relevant stakeholders involved in implementing FLR interventions in the countries assessed. We interviewed stakeholders from government, academia, national non-governmental organizations (NGOs) and local private and non-governmental organizations. We found that most legal frameworks are in the jurisdiction of either the agriculture or the environmental sectors. As a whole, we did not find evidence of the kind of legal frameworks articulation needed to enable the coordinated deployment of various forest FLR interventions across landscapes. We found efforts in Brazil, Colombia, Guatemala, Costa Rica, Ecuador and Mexico to improve cross-sectorial communication and legislation, and to develop innovative financial mechanisms to support FLR interventions. In general, interviewees had a positive perception of the content of legal frameworks in their countries; however, they highlighted weak implementation capacities, insufficient funding, sectorial and social conflicts, and lack of transparency as key impediments for policy implementation. Academic and NGO stakeholders perceived the content of the legal frameworks more negatively, whereas government officials were more positive. Different perceptions and the prevalence of cross-sectorial conflicts highlight the importance of efforts aimed at improving governance mechanisms and policy integration in the region. In addition, a targeted effort is needed to develop long-term, funding options that are public, private or mixed, and to disseminate information on the importance of FLR interventions for national economies and human well-being. We consider our results as a preliminary overview of the legal environment for FLR implementation in Latin America.

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