Forests, Finance, and Food Insecurity

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   COP21 has seen rich countries and global financial institutions promise a raft of investments for reforestation and sustainable agriculture in developing countries. The UK, Germany, and Norway pledged $5 billion in total over a 5-year period to support initiatives in countries that can prove their commitment to sustainable agendas. Colombia has announced that it will work alongside the the same 3 donor countries in a $300 million project to reduce deforestation. And the World Bank has committed to investing $1 billion into the African Forest Landscape Restoration Initiative, which aims to restore 100 million hectares of land in 14 countries over the next 15 years. But however sizeable these figures may seem, they are dwarfed by the finance driving deforestation.

   The agricultural production of just 5 commodities causes roughly 60% of global deforestation. The annual value of the trade in these commodities is $136 billion. So despite the ambition and commitment their $1 billion-a-year donation shows, the UK, Germany, and Norway have set out to fix deforestation with a tool that is well over 140 times too small. Furthermore, most forest countries are hard pressed to fund the conservation and resource management necessary for healthy water systems and soil. This puts future agricultural productivity at risk. Domestic economies already provide over 2 thirds of the $25 billion currently invested in landscape conservation. A recent report by the New Climate Economy shows $250 billion annually is necessary to meet conservation targets in developing countries. As Dr. Ngozi Okonjo-Iweala, formerly Nigeria’s Minister for Finance, recently argued at the Global Landscapes Forum in Paris, ‘How can this need be met where most of the land in question is densely occupied, often by very poor people?’

   Large-scale commercial agriculture drives 80% of global deforestation. Clearly, while rich countries must take more responsibility for their environmental impacts, the corporate and financial sectors must also reform their business and investment practices to achieve the Consumer Goods Forum’s goal of stopping deforestation by 2020. Change is underway, with a recent groundswell of zero deforestation pledges from influential companies including Unilever and Marks and Spencer. But while the rising number of progressive policies and commitments is encouraging, the complexity of supply chains makes implementation problematic. The labyrinthine nature of cross-continental networks of production, transit, processing, and sale means that even if companies commit to reducing deforestation in their supply chains, they often struggle to enact the new policies across the board. As Aida Greenbury, director of sustainability of Asia Pulp and Paper, recently put it, ‘we are only one actor among many in the landscapes in which we operate. We need all actors in those landscapes to pull in the same direction if we are to achieve meaningful change.’

   Current levels of public finance for conservation are insufficient, and the minority of corporations trying to reform their supply chains are struggling to implement challenging new business models. The future looks bleak. The Grantham Centre for Sustainable Futures recently reported that over the last 40 years, deforestation and intensive farming methods left a third of global arable land infertile. Their research dovetails with the Intergovernmental Panel on Climate Change’s prediction that food production per capita in developing countries will sharply decline in coming decades. The United Nations expects the global population to reach 9.6 billion by 2050, and believes growth will be concentrated in developing countries. Failure to reform commercial agriculture will force millions, perhaps billions, into poverty and starvation. However, landscape restoration has been shown to improve agricultural productivity and resilience, increase local household incomes, and mitigate climate change. Investment in forests and sustainable agriculture in areas with unpredictable weather patterns, political uncertainties, and deficiencies in infrastructure is risky. The alternative, though, is still more dangerous.


Author: Robert Newton

Image credit: Neil Palmer, CIAT

This blog was also published on the Global Landscapes Forum website: