Wednesday, December 2, 2020
Greening And Environment

New Restoration Seed Capital Facility launched to promote investment in forest landscape restoration

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A Restoration Seed Capital Facility with initial capitalization of EUR 25 million launched today aims to boost the contribution of private finance to forest restoration, helping to unlock their immense potential for climate change adaptation and mitigation, conservation of biodiversity and provision of sustainable livelihoods.

The Facility, launched by the UN Environment Programme (UNEP), the Frankfurt School of Finance and Management, the Governments of Germany and the Grand-Duchy of Luxembourg, aims to help private investment fund managers set up dedicated investment funds and forest restoration projects in developing countries, contributing to their efforts to meet the objectives of the Sustainable Development Goals and the Rio Conventions, in particular the Paris Climate agreement, Land Degradation Neutrality targets, and the Aichi biodiversity targets.  The Facility builds on the successes of the Bonn Challenge, and aims to scale up forest and landscape restoration significantly during the UN Decade on Ecosystem Restoration 2021-2030.

“Stimulating private finance is a major factor to meet the objectives under the Bonn Challenge and restore 350 million hectares forests by 2030,” said Svenja Schulze, German Federal Minister for the Environment, Nature Conservation and Nuclear Safety. “The Restoration Seed Capital Facility will help to catalyze restoration action and ambition in the UN Decade of Ecosystem Restoration, and will assist the world’s economic recovery from the COVID-19 pandemic.”

Nature-based solutions such as forest landscape restoration can reverse the effects of deforestation and degradation and regain the ecological, social, climatic and economic benefits of forests, positively impacting the lives of the roughly one-third of humanity that has a close dependence on forests and forest products.

Carole Dieschbourg, Minister for the Environment, Climate and Sustainable Development, Government of Luxemburg said: “We cannot address the climate emergency without investing in the planet’s natural capital. There is no mitigation policy, no adaptation policy, and no livable future, if we do not begin managing our landscapes, restoring forests and moving towards deforestation free and sustainable agriculture within a framework of strong partnership of science, business and finance. This facility provides crucial funding to mobilise private impact finance in forest landscape restoration to safeguard people’s livelihood, reduce vulnerabilities and preserve our ecosystems.”

The Facility supports fund managers and investment advisers who are already developing activities aligned with forest landscape restoration – or who are currently looking to develop such activities – enabling them to develop more forest restoration projects and move faster into the implementation phase. By requiring that cooperating partners bear at least 50 per cent of eligible costs, the Facility further guarantees that its funding is spent only on the most promising projects.

“Deforestation and forest degradation continue to take place at alarming rates, contributing significantly to biodiversity loss and the loss of livelihoods for forest-dependent communities,” said Inger Andersen, Executive Director of UNEP. Innovative finance mechanisms like the Restoration Seed Capital Facility hold the key to accelerating private investment for forest restoration, particularly in developing countries.”

By accelerating and scaling up private investment in forest restoration and sustainable land use, the Facility aims to support the restoration of degraded land, protect forests and thereby positively contribute to climate mitigation, adaptation, biodiversity and rural livelihoods.

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