For cocoa farmers in the forested region of San Martin, Peru, adapting to new, sustainable farming methods may mean passing through the financial ‘Valley of Death.’
Agriculture is currently the main driver of forest loss in the tropics. If current farming patterns continue, the future looks increasingly bleak for tropical forests. Food production will need to increase by approximately 70% between 2005 and 2050, according to the FAO.
A recently announced USD 400 million fund could help leverage some of the money needed address deforestation. While urgently needed, such private sector initiatives should not replace other, more established ways of protecting the forest.
Bonds are well known financial instruments for corporations to access large sums of finance. ‘Green bonds’ are a variation designed to finance environmentally focused projects. Ultimately, these instruments could channel the billions of dollars needed to reduce deforestation and encourage sustainable land use.