Why Financing sustainable land use matters

Halting the annual loss of more than 7 million hectares of tropical forests and tackling climate change, while ensuring growth in sustainable agricultural production to feed an estimated 9 billion people by 2050, are among the most defining challenges of the 21st century.

Agriculture, deforestation and forest degradation contribute to about one quarter of total annual emissions. Demand for timber and agricultural commodities such as palm oil, soy, cocoa and beef continues to drive tropical deforestation.

A recent IPCC report states that pathways limiting global warming to 1.5°C require rapid and far-reaching transitions in energy, land, urban and industrial systems. Without a fundamental transition to different land use models, the Paris Climate Agreement and the Sustainable Development Goals will not be achieved. The solution will have to include more efficient use of existing agricultural land, as well as prioritizing the use of degraded land rather than converting primary forests.

Public funding and government regulations alone will not be sufficient to change the deforestation trajectory in developing countries, where most of the commodity-driven deforestation occurs. Although forests and agriculture hold more than 30% of the climate solution, they currently receive less than 3% of public climate finance.

Answering this challenge, UN Environment launched the Land Use Finance Programme to proactively unlock and scale up private finance for sustainable land use by supporting a number of blended finance vehicles and by focusing on creating an enabling environment.

By partnering directly with private sector entities in the agricultural and financial industries, UN Environment can support member countries as they transition towards sustainable land use by providing financial incentives to smallholder farmers, supply chain companies, traders and finance institutions to systematically include climate and zero-deforestation targets.

The Climate Finance Unit also contributes to the UN-REDD Programme as research has shown that initiatives to reduce commodity-driven deforestation are most impactful when they combine REDD+ programmes, jurisdictional approaches and private sector commitments.

Contact: Ivo Mulder, Head, Climate Finance Unit ivo.mulder(at)un.org

UNEP and the & Green Fund collaborate to catalyse private finance for sustainable agricultural commodity production decoupled from deforestation, and to promote the protection and restoration of forests and peatland for the benefit of people, the climate, biodiversity, food and water security. UNEP and &Green will mutually support each other to channel private finance into sustainable land use. As &Green’s partner, UNEP acts as implementing agency for a Global Environment Facility (GEF) Contribution, and it will support &Green’s communication and MRV efforts, facilitate collaboration with other relevant finance facilities and UN Environment initiatives, and by creating an enabling environment by raising awareness towards UN Environment’s member states on how &Green can help meet international agreements on restoration, climate and biodiversity. In the coming years, both parties aim to further intensify the partnership and play a key role in the necessary transformation towards land use and agricultural production models that better balance the need to protect forests, improve rural livelihoods while enhancing efficiency and yields to produce enough food for a growing world population.

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