Document

Shifting Finance to Protect Forests: 2017 Progress Assessment of the New York Declaration on Forests

24 Oct 2017

This report draws on, consolidates, and interprets data from various initiatives by leading think tanks and research organizations engaged in tracking finance related to forests, reducing emissions from deforestation and degradation, and the sectors driving deforestation. Key findings:

  • Current forest finance is not enough to end deforestation; integrated approaches are needed An estimated USD 200 billion is needed for transformation to deforestation-free commodity production. This is 10 times more than current commitments. Addressing deforestation will take unlocking the right combination of finance for differing contexts. The public sector needs to set incentives and the right conditions, but the private sector will be crucial in pushing forward a transition to sustainable land and forest use in the long term.
  • Forest finance does not reflect forest mitigation potential While tropical forests can provide up to 30 percent of the climate change mitigation needed to meet the principal objective of the Paris Agreement, mitigation finance for forests in deforestation countries accounts for just over one percent of global mitigation-related development funding.
  • Across sectors, green finance is dwarfed by grey finance The amount of “green” finance aligned with forest and climate goals  – roughly USD 20 billion since 2010 – is marginal compared to  the USD 777 billion in “grey” finance for the land sector that influences forests.
  • Achieving zero deforestation will require a dramatic shift of finance from traditional to sustainable investments Traditional investments in the drivers of deforestation must be redirected toward those in sustainable agriculture and forestry. Only the coordinated and strategic use of finance can enable this transition by targeting the vast existing flows of investment that have an influence on forests. The public sector has a range of tools available to them that can assist in developing an attractive sustainable investment environment for private sector actors to shift existing grey finance into.