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Author: Ajay Banga, President, World Bank
With the global summits on biodiversity (COP16) of this year, climate change (COP29) and desertification (COP16) quickly approaching, the consequences of the climate emergency are obvious everywhere. The floods have ravaged central Europe, the super-type Yagi has just struck Southeast Asia and the hurricanes Helene and Milton wreaks havoc in the south-east of the United States. Warm and darkest conditions have created ideal conditions for forest fires like those that have raged across Brazil, South Africa and Colombia, while droughts pushed people to food insecurity This year in Africa.
If the scale and speed of our response to climate change are inadequate to the threat, this new normal will only get worse, compromising hard development gains in low and intermediate income countries. In addition to braking emissions from fossil fuels on fire, one of the largest priorities must be to protect and preserve the remaining tropical forests in the world.
Tropical Fores Stores meaningful loves of carbon, and their Demise Would Result in a massive 1 degree Celsius Increase in Global Average Temperatures, not to mention the loss of untold biodiversity and the depletion of ecosystem services such as atmospheric rivers that water to food crop crops The world. Scientists warn that the degradation of several of these forests is approaching a tilting point where the remaining forest will not be able to maintain or recover.
Individuals, countries and NGOs intensify to protect and preserve the forests of the world of devastation. But we will need a combination of economic and environmental solutions to approach the complex and changing factors that cause illegal deforestation.
The path to COP30
Fortunately, such solutions are at hand. In Brazil, the administration of President Luiz Inácio Lula da Silva has already considerably slowed down deforestation. Between August 2023 and July 2024, the loss of tropical forest in the Brazilian Amazon was reduced by 46%, compared to the previous 12 months. And worldwide, Brazil, which holds the G20 presidency this year, underlined nature -based solutions to climate challenges as part of its program, paving the way for new progress in COP30 in Belém in 2025.
The TFFF aims to take advantage of sovereign and philanthropic funding to mobilize more private capital
For its part, the World Bank group supports similar public and private efforts in developing economies. The objective is to design solid policies, build credible institutions and mobilize investments in the infrastructure which is necessary to preserve and manage forests in a sustainable manner. Making forest finances more widely available and more affordable is the key.
The World Bank group also strives to transform the vast potential of carbon markets into a flow of income for developing countries that undertake to reduce emissions and keep their forests. Already, 15 countries benefit from a pipeline which could produce more than 24 million carbon credits by the end of 2024 – a victory for climate and development.
But those who are engaged in these efforts have long been tempted by the question of how to support the conservation of permanent long -term forests. Although the forest carbon markets have created new sources of income, they generally only reward countries, communities or developers of projects focused on reducing their deforestation emissions. Thus, forests that are not under the immediate threat offer no financial reward.
Forest financing
One solution is the installation offered on the Forever tropical forest, a large -scale mechanism based on performance that would use mixed finance to generate financial yields and reward countries to protect their permanent forests. Instead of carbon credits, the TFFF would provide long -term foreseeable financial support linked to hectares of permanent forests from a country, thus aligning economic incentives on environmental results.
Directed by the Brazilian Ministry of Finance and the Ministry of the Environment and Climate Change, and in partnership with other tropical countries, developed economies and non -traditional sponsors, the TFFF aims to take advantage of sovereign and philanthropic funding for Mobilize more private capital, therefore thus expanding forest finances beyond the purely public sector tools. Above all, it would allow private investors to support a global public good by quantifying and verifying the underlying assets with terms aligned with their commercial models.
This is the kind of daring and innovative solution we need if we want to make a real difference in the fight against climate change. One of the greatest advantages of TFFF is that it should not depend on rare donor grants and recurring replenishments. Instead, it would take a single and fully refundable investment of potential sponsors, which would therefore be presented with a conceptually new development model.
Those who design the TFFF also study how to simplify disbursement models (without any loss of rigor) through digital surveillance, reports and verification systems, and how to get rid of each year enough to keep the scales from the Deforestation. Finally, another important question which focuses on how to improve access to such mechanisms for indigenous peoples, local communities and other forest owners and intendants. Countries working on TFFF intend to solve these problems by COP30.
Forests are vital not only for the carbon they store, but also for their role in maintaining ecological balance, support for environmental health and promoting economic growth and human development. The period between the COP16 in Cali and the COP30 of next year in Brazil could be the ideal moment to launch the TFFF and prepare the land for a new era for forest conservation financing.
We must start the correctly enriching countries which have checked deforestation and redouble our efforts to keep existing forests for future generations.