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Wall Street investors have earned billions financing activities linked to deforestation in the tropics, with forest loss reaching record highs last year. But a major proposal by Brazil’s COP30 presidency wants to turn financial markets into allies of the rainforest. 

The Tropical Forest Forever Facility (TFFF), a proposed new fund seeking to raise cash for conservation efforts in tropical countries, is set to be launched at the COP30 climate summit in Belém later this year.

Brazilian President Luiz Inácio Lula da Silva has rallied behind the initiative and secured key endorsements from the eight South American nations home to the entire Amazon Basin. Private banks and countries in the BRICS group of large emerging economies have voiced support.

COP30 president André Corrêa do Lago has said “the TFFF is the right answer for forest conservation”.

The initiative comes as developing countries have complained about being unable to access existing forest funds at the Global Environment Facility (GEF), while foreign aid budgets which have funded forest conservation shrink in the US and Europe.

Yet finance needs in developing countries are large and growing, with estimates ranging between $20 billion and $72 billion every year to protect forests. In contrast, in 2022, the total finance destined for forests was just $2.3 billion.

    What is the Tropical Forest Forever Facility (TFFF)? 

    The TFFF is being proposed as a blended finance instrument, with funding from both public and private sources. It would seek to directly pay tropical countries that can show effective forest protection.

    On paper, the TFFF will get its money similarly to an investment fund. Donor countries and private investors put their money in the fund, which then invests the capital in financial markets. A part of the returns is used to pay back investors and what remains is allocated to forest protection in tropical countries.

    “Think of a bank that runs normal market operations but that directs its profits not to shareholders but to forests,” said João Paulo de Resende, undersecretary for economic and fiscal affairs at Brazil’s Ministry of Finance.

    In its most recent version, Brazilian officials propose that the fund starts with $125 billion in capital, of which $25 billion would come from donor countries and $100 billion from private investors.

    The payments to forest countries would depend on the returns of the fund, but an 8% yield would allow the fund to pay at a rate of about $4 per hectare of protected forest — which in total could raise an estimated $2.8 billion for rainforests every year.

    The Brazilian government has said donor countries could include the United Kingdom, Norway and the United Arab Emirates, while private investors endorsing the fund include investment managers PIMCO, Bank of America and Barclays.

    Recipients would include tropical countries in major rainforest basins such as Colombia, the Democratic Republic of Congo (DRC) and Indonesia, among others.

    An aerial view shows deforestation near a forest on the border between Amazonia and Cerrado in Nova Xavantina, Mato Grosso state, Brazil in 2021 (REUTERS/Amanda Perobelli)

    How is the TFFF different from other climate funds? 

    Other UN funds like the Green Climate Fund (GCF) or the GEF mostly give out one-time grants to countries that reduce emissions through projects and programmes to protect or restore forests (an approach known as REDD+). The TFFF would instead aim to reward countries that have kept their forests standing and can show results.

    This “results-based payments” system is not new – the GCF, for example, gave out more than $500 million between 2015 and 2020 in this way. However, a fund solely for countries that can show success in preventing deforestation is a new way to target large intact rainforests, which struggle to receive REDD+ funding, said Torbjørn Gjefsen, international forest finance advisor at the Rainforest Foundation Norway.

    “There is complementarity. It’s not competing with REDD+,” said Gjefsen. “If fully operational, it will substantially increase the amount of funding available for this kind of results-based payments.”

    Amid a context of tighter foreign aid spending, another key difference is that the TFFF would seek to attract investments rather than depending on donations from public budgets.

    The fund’s concept note claims that, if fully operational, the one-time investment from donor countries would allow payments to forest nations for as much as 40 years in the future.

    Finally, unlike the other UN environmental funds, the TFFF is being proposed as a mechanism hosted by the World Bank outside of UN environmental conventions.

    Sandra Guzman, founder of the Climate Finance Group for Latin America and the Caribbean (GFLAC), said this could potentially help convince large developing countries like China to contribute funds without having to assume donor-country responsibilities at the UN negotiations. Chinese officials have welcomed the TFFF and said they “hope it plays a positive role”.

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    How will the TFFF make money from financial markets? 

    In tapping financial markets, the TFFF will have to also deal with risk. If investments don’t generate the expected yields, payments to forest countries would need to be paused and paid out later, de Resende said.

    The Brazilian government’s estimates show that if the TFFF had been operating in the last 20 years, it would have been under financial stress on two occasions: during the 2008 financial crisis and during the COVID-19 pandemic. The TFFF’s models project a 60% chance that payments to forest countries would need to be slightly reduced at some point in the fund’s lifespan.

    The Brazilian authorities remain optimistic, as most value fluctuations are likely to be small, they say. De Resende said that “over the long run, this risk is minimal.”  

    The TFFF’s main strategy is to get cheap money from investors and lend money to emerging economies at much higher interest rates. Emerging market bonds would account for as much as 80% of its investments.

    Critics say this could be a risky strategy, which is precisely why these emerging countries pay higher interest rates. “The risk of Egypt’s state bond is just not the same as the risk of US treasury bonds,” said Max Alexander Matthey, co-founder of Climate Impact Auctions.

    Another key point is that, for the fund to achieve the promised payments, it would need to borrow money at a very low cost, so it would need a top-category AAA rating from credit rating agencies. Brazilian authorities have been in discussion with agencies on this and have said they aim to receive a “shadow rating” for the TFFF before COP30.

    As part of the strategy, the fund will also exclude any investments in polluting industries such as coal, oil and gas.

    Can COP30 turn adaptation talks into real-world investments?

    Who is allowed to receive payments from the TFFF? 

    According to the fund’s concept note, the 74 countries that are home to rainforests could be eligible to apply for TFFF payments if they meet the required criteria.

    To access funds, tropical countries must demonstrate that they are reducing deforestation in a defined area, have a robust forest measurement system and a set of forest policies, and demonstrate that the payments will not replace national resources.

    Countries would also have to commit to reserve at least 20% of payments for Indigenous people. While an important step, Guzman said this could be tricky in practice because of the challenges of directly transferring funds to these communities.

    “Indigenous communities do not always have formal legal structures or administrative capacity,” she said. “It’s not easy, but it is desirable that communities start building these legal mechanisms.”

    Currently not many forest countries meet the minimum requirements to be eligible for TFFF payments.

    Online platform TFFF Watch, built by NGO Plant for the Planet, calculates that major countries like the DRC and Indonesia would not qualify for payments due to high deforestation rates, and would be missing out on annual deals worth $400 million and $450 million respectively. 

    On the other hand, Papua New Guinea would benefit greatly if the TFFF goes into operation exactly as laid out in its concept note, according to TFFF Watch. The country is already eligible for around $120 million in annual rewards, the platform estimates. 

    As shown by recent wildfires in the Amazon, some countries could end up losing or seeing some of their forests degraded even with robust protection measures in place. In these cases, countries would get their payments cut by the same ratio as they lose forests. 

    Yet once they do receive TFFF funding, forest countries will have full authority over how to use the funds.  

    Brazilian government authorities have sent a letter of intent to the World Bank, which will have to decide by October whether it will host the TFFF. By COP30, Brazil plans to sign a declaration of intent with donor countries.

    The post Explainer: Brazil’s “right answer” to forest finance turns to markets to keep rainforest standing appeared first on Climate Home News.

    Explainer: Brazil’s “right answer” to forest finance turns to markets to keep rainforest standing

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    Island nations fight to save cultural heritage from climate change

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    Farmers and fishermen in the Maldives have long relied on an ancient calendar to guide their daily lives.

    The Nakaiy system divides the year into 27 distinct periods, each named after a star or constellation in the night sky.

    Any one period in the calendar tells you about expected weather and tidal patterns, navigational routes, and fishing conditions. The Nakaiy was created through centuries of careful observation and local knowledge, passed down through families as an essential tool for survival.

    But things are now changing. The climate crisis is leading to more extreme weather events across the Indian Ocean island nation and upending the Nakaiy calendar.

    “When you go and speak to communities and ask them what kind of impacts they are facing, a lot of elders will tell you that the weather, it doesn’t follow the calendar anymore,” explained Aishath Reesha Suhail, a programme officer in the Maldives’ Ministry of Tourism and Environment.

    As the effects of climate change worsen, it is a real prospect that the Nakaiy may be abandoned by local people, representing a major cultural loss to the Maldives.

    ‘Systemic and growing threat’

    With extreme weather becoming the norm, communities are observing a domino effect of consequences in their everyday lives. The slow onset of heritage loss is now being seen across continents, but notably among small islands in remote parts of the ocean.

    “Climate change represents a systemic and growing threat to cultural heritage worldwide,” a UNESCO spokesperson told Climate Home, adding that the World Heritage Committee has identified climate change as “one of the most significant long-term risks affecting properties across all regions.”

    UNESCO, the UN body for education, science and culture, defines the loss of cultural heritage as “the erosion of traditional knowledge systems, craftsmanship, social practices and identity, particularly where communities are displaced or livelihoods disrupted”. A clear example is historical sites and even entire islands washed into the ocean as a result of rising sea levels and coastal erosion. 

    The Maldives is dealing with such a situation now. The Koagannu Cemetery is a 900-year-old resting place, located on the country’s southernmost atoll, a mere 50 metres from the shoreline. The monument’s intricate coral gravestones are being actively threatened by the encroaching Indian Ocean. 

    The government and local community have responded to this challenge with emergency protection measures. Sandbags and concrete structures have been installed along the coastline, complemented by large numbers of palm trees to create a seawall. A wider solution is ‘beach nourishment’, a common practice in the Maldives where sand from elsewhere is brought in to replace what has been lost through erosion. Taken together, these solutions have so far protected the cemetery.

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    Among the many issues climate change creates, cultural heritage is not always front of mind. In the Maldives, one of the main barriers people face is awareness. “Most of what we are dealing with relates to the erosion of our islands along with areas such as fisheries… but we are quite limited in our capacity to do something about it,“ Suhail said.

    “We don’t understand the full breadth of the issue at present because we haven’t been able to do extensive research on the matter,” she added. However, assessing the extent of the damage – and how to respond effectively – is a key priority for the government, outlined in its latest climate plan, known as a Nationally Determined Contribution, and as part of its National Adaptation Plan process.

    Fishing is at the core of the country’s culture and identity, employing thousands of people. Most dishes include fish – “we have it for breakfast, lunch and dinner,” Suhail noted – but the climate crisis and overfishing are shifting how and when communities can fish. Tuna makes up 98% of all fish caught in the Maldives, but warmer ocean temperatures are changing migratory patterns, pushing the species into deeper, colder waters.

    As a critical economic and cultural resource, the government has outlined a range of solutions to protect the fisheries sector in its first Biennial Transparency Report to the UN. These include using real-time tracking data to improve the efficiency of fishing operations; investing in canneries to increase fish storage; and diversifying away from tuna through marine farming.

    Koagannu Cemetery, a 900-year-old resting place in the Maldives, is threatened by rising sea levels in the Indian Ocean. (Image: Ashwa Faheem) 

    Koagannu Cemetery, a 900-year-old resting place in the Maldives, is threatened by rising sea levels in the Indian Ocean. (Image: Ashwa Faheem) 

    Culture and nature go hand-in-hand

    The same pattern is playing out elsewhere.

    Palau and the Maldives are not close to one another. The two states are separated by around 4,000 miles and sit in different corners of the ocean. But both are experiencing very similar climate challenges, based on their position as a set of scattered, low-lying islands surrounded by an imposing body of blue water.

    In the same way as the Maldives, Palau’s cultural heritage is closely tied to “land, coastlines and traditional food systems,” according to Toni Soalabla, at the Palau Office of Climate Change.

    “Many of the places that hold stories, history and identity of our communities are located along the coast and are increasingly exposed to erosion and sea level rise,” she said.

    One of these places is Ngerutechei village, reportedly the oldest in Palau, and home to ancient stone paths and carvings. The village provides a glimpse into the past social values and culture of the people in this western Pacific nation.

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    As part of the development of Palau’s National Adaptation Plan, the government has worked with local leaders to identify similar sites of cultural significance. The plan encourages communities to use their own knowledge to create protective measures for these sites.

    Climate change is also prompting communities to take up traditional land and food practices again. These include cultivating taro, a stable food source that has historically supported water, soil and food security on the islands. 

    “These systems developed over generations in response to local environmental conditions, so strengthening them today is both a climate adaptation measure and a way of maintaining cultural knowledge that might otherwise fade,” said Soalabla.

    Cultural practices in Palau have developed alongside the natural ecosystems that people rely on to survive. It is within this context that researchers believe adaptation policies should be created. Recognising this relationship “can strengthen both community identity and environmental resilience at the same time”, according to Soalabla.

    Taro farming is making a return to Palau as a traditional source of food security. (Image: Kiara Worth / IISD / Palau Office of Climate Change)

    Taro farming is making a return to Palau as a traditional source of food security. (Image: Kiara Worth / IISD / Palau Office of Climate Change)

    An ancient monolith in Ngerutechei village is being protected against coastal erosion. (Image: Kiara Worth / IISD / Palau Office of Climate Change).

    An ancient monolith in Ngerutechei village is being protected against coastal erosion. (Image: Kiara Worth / IISD / Palau Office of Climate Change).

    Heritage on the global stage

    The issue of cultural loss has not gone unnoticed in international climate negotiations. 

    Small island states such as the Maldives have used their role at the UN to push for greater awareness and action, with some key successes.

    In 2015, the Paris Agreement established a Global Goal on Adaptation (GGA) which recognised that countries needed to do something about climate change now and not later. However, it took six years before a framework and a set of adaptation targets were agreed at the UN climate summit in Glasgow to pursue this goal. 

    From this came the establishment of seven overall themes – from poverty eradication to access to health – to guide adaptation action and a set of around 60 indicators to measure progress against the targets.

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    Emilie Beauchamp, an adaptation specialist at the International Institute for Sustainable Development (IISD), said that “cultural heritage was highlighted as one of the global priorities [of the GGA Framework] and is one of the seven themes, so it is considered very important by the international community.”

    The much-debated set of indicators, only finalised in Belém at last year’s COP30, include five related to cultural heritage with a focus on preserving cultural practices and important sites that are “guided by traditional knowledge, Indigenous Peoples’ knowledge and local knowledge systems”. A spokesperson for UNESCO said the inclusion of heritage indicators “marks an important recognition that climate impacts extend beyond economic losses”. 

    While critics said the set of final indicators was rushed through by the Brazilian presidency, they now serve as guidance for national governments that wish to implement plans to protect their common heritage. The missing piece of the puzzle remains how to finance these plans – something notably absent from the Belém text, which made clear that the adaptation indicators “do not create new financial obligations or commitments, nor liability or compensation”.

    The lack of financial commitments proved disappointing for many small states grappling with how to prevent their cultural history from being entirely forgotten, especially at a time when adaptation finance remains below requirements. A recent UNEP report found that developing nations would need an estimated US$310 billion per year in 2035 to adapt to climate change, while current public financing was around $26 billion.

    At these low levels “only a small percentage of what the framework outlines could be implemented,” according to Beauchamp.

    Recent research from WRI and UNESCO found 73% of non-marine World Heritage Sites are threatened by at least one severe water risk.

    Recent research from WRI and UNESCO found 73% of non-marine World Heritage Sites are threatened by at least one severe water risk.

    The challenge of cultural heritage

    When looking at low-lying islands on a map, they can appear as specks of land amid a vast ocean. Many of the stories from these remote places go unnoticed. But the specks represent millennia of human culture that is slowly being lost to the ocean.

    While the international community has now recognised the problem and solutions exist, the recurring issue of scarce finance may prevent governments from taking sustained action. Island communities have already been forced to move home as sea levels rise, leaving behind their cultural connections to a place.

    The value of any cultural asset, or of human heritage, can be judged by how it is engaged with over generations. Without human intervention, many historical sites, language, cuisine and other local customs would become a forgotten part of history. The rapid onset of climate change brings the role of cultural heritage into sharp relief, challenging communities to decide in real time what they value, what deserves saving, and how to achieve that.

    Stories of cultural loss are not confined to small islands but it is here where the challenge is presenting most acutely. The experiences of these vulnerable nations in protecting their heritage will provide the litmus test for effective adaptation responses elsewhere.

    Adam Wentworth is a freelance writer based in Brighton, UK.

    (Main image: The Isdhoo Havitha is an ancient Buddhist monastery in the Maldives, located moments from the shoreline. Photo: Ashwa Faheem) 

    The post Island nations fight to save cultural heritage from climate change appeared first on Climate Home News.

    Island nations fight to save cultural heritage from climate change

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    The Wabanaki Basketmakers’ Plans to Save Maine’s Ash Trees

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    The invasive emerald ash borer, native to northeast Asia, has spread to 37 states over the past quarter century, killing nearly all of the ash trees it infests. But in Maine, a coalition of basketmakers, scientists and government officials are plotting a future for their trees.

    Each strip of wood in Richard Silliboy’s hands started as a year of an ash tree’s life.

    The Wabanaki Basketmakers’ Plans to Save Maine’s Ash Trees

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    Toxic Ocean Crisis in Papua New Guinea Sparks Mass Marine Die-Off and Public Health Emergency

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    Thousands of dead fish are washing ashore and people are falling ill too, as officials investigate possible sources of contamination.

    It started in December, when dead fish began washing ashore New Ireland—a mountainous island in Papua New Guinea’s New Ireland Province, flanked by the Pacific Ocean and the Bismarck Sea.

    Toxic Ocean Crisis in Papua New Guinea Sparks Mass Marine Die-Off and Public Health Emergency

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