It seems like every week we hear about another major commitment to restore degraded forests and landscapes, and pledges of millions, even billions of dollars to do so.
For example, the government of Norway in January pledged $400 million for restoration, intended to catalyze a further $1.6 billion in private investment. At least $1.5 billion has been earmarked for restoration commitments in Africa through the AFR100 initiative. But how much of this money has actually been delivered to restoration projects on the ground? Not enough, says Douglas McGuire, coordinator of the Forest and Landscape Restoration Mechanism at the Food and Agriculture Organization of the United Nations. So his team is co-organizing a forum in Kigali, Rwanda to help catalyze investment in restoration in East Africa. We asked Doug to elaborate on the issues at the heart of the Forest and Landscape Investment Forum (FLIF) that will take place May 16th and 17th.
Landscapes for People, Food and Nature: Why have an event like this now? What is happening in the world of forest and landscape restoration that calls for FLIF?
Douglas McGuire, FAO: Investments needed to achieve the ambitious restoration goals to which countries committed in the context of the Bonn Challenge, the New York Declaration on Forests and their decentralized processes, such as the AFR100 Initiative, are huge. Between USD 36 and 49 billion of investments are needed every year, according to a recent FAO-UNCCD analysis. However, the main barrier to tackling these amounts is not the lack of investors willing to engage but rather the lack of knowledge of stakeholders on the variety of financing opportunities and on how to get ready to access them. In particular project promoters targeting private sector investments have to build bankable projects with underlying relevant business models. We need this type of forum to bridge this gap by promoting a broad spectrum of investments in forests and landscapes, be it for environmental, social, economic or financial returns.
“Participants will discuss business challenges and key factors for successful investments into FLR.”
LPFN: Who should attend the forum? Any particular geographies that you hope will be particularly well-represented?
DM: The Forest and Landscape Investment Forum is addressed to project developers and business champions from Eastern Africa, in particular from DRC, Ethiopia, Kenya, Madagascar, Mozambique, Rwanda, Tanzania, Uganda and Zambia and investors from all over the world seeking business opportunities in sustainable landscapes.
The primary target audiences are forest and landscapes companies and project developers; national and international cooperatives and agribusinesses; commercial banks, development banks, impact funds, and insurance companies; technical assistance providers that facilitate and support investments in sustainable land use business models such as incubators, accelerators, and PPP-facilities; and public agencies and institutions able to build an enabling environment for investments.
The forum will give the opportunity to these stakeholders to build new alliances or to reinforce partnerships towards increased engagements in forest and landscape restoration.
LPFN: What action will the forum try to catalyze? What will people do or be able to do when they leave that they couldn’t or wouldn’t have before?
DM: The Forest and Landscape Investment Forum (FLIF) offers a unique platform for exploring the potential of finance in enhancing livelihoods, the environment and food security benefits. By matching the offer in terms of landscape investment possibilities to the demand, this forum will operate as a marketplace for effective project design and increase awareness on investment opportunities. Participants will discuss business challenges and key factors for successful investments into FLR. The FLIF will showcase business opportunities in forest and landscapes, in particular through agroforestry and forestry value chains (wood and non-wood forest products) such as coffee, tea, timber, macadamia, silk, cassava, etc. Beyond plenary sessions, a booth exhibition and side-events will facilitate dynamic interactions between participants.
Beyond the FLIF a regional investment platform (or) helpdesk could be created to ensure systematic and long-lasting communication between project developers and investors. Such a concept is currently under design in the framework of the AFR100 initiative. The FLIF will provide the right platform to move forward on this agenda.
LPFN: Can you give us an example of other forms of marketplaces or investment platforms for restoration? Do they exist, and are they working?
DM: They exist in various forms and scales, yes, and have had some impact. For example, the National Climate and Environmental Fund of Rwanda (FONERWA), established in 2012, is a cross-sectoral financing mechanism supporting the implementation of inclusive green growth in Rwanda, which contributes as part of its mandate to Forest and Landscape Restoration (FLR) through afforestation and reforestation projects. Its ultimate purpose is to spearhead resource mobilization from different sources so that it grows to meet the country’s increasing environmental management needs. This is a relevant illustration of an environment fund with a significant forestry portfolio including national and international public funds, which often calls for proposals opened to NGOs, public and private sectors needing further investments. FONERWA disposes of a Private Sector Facility which could directly benefit from the FLIF orientations and partners. Such a fund also clearly has a marketplace function which is complementary to the one we hope to establish through the FLIF at the regional level.
LPFN: Who are you working with to put on this event? Why did they want to be involved?
DM: The principal partners convening the inaugural FLIF are the Ministry of Natural Resources of Rwanda (MINIRENA), the Rwanda Development Board (RDB), the National Agricultural Export Development Board (NAEB), and Rwanda’s Green Fund (FONERWA).
Governments are responsible for defining policies that will enable long-term sustainability of natural resource management actions. Hence, they have a double role to play for sustainable FLR finance: as promoters of enabling environments, e.g. for reducing risks for private investors, and as sources of finance and co-finance to leverage private investments. The private sector already engages in FLR in numerous ways, either with an orientation towards environmental or social returns (CSR approaches) or seeking financial returns (traditional investors), or desiring a mix of both (impact investors). Finally, NGOs play an instrumental role in fundraising and contribute to project implementation in the field, directly supporting tangible impacts of FLR interventions and ensuring sustainability of investments through e.g. monitoring of environmental and social safeguards.
Douglas McGuire is presently the Coordinator of the FAO Forest and Landscape Restoration Mechanism as well as the International Project Coordinator of the FAO-EU/ACP funded project “Action Against Desertification” in the Forestry Department FAO headquarters. Prior to his current assignment, he was Senior Forestry Officer and Team Leader of the Forest Resources Management Team. He has served FAO for more than 25 years working in various posts including overall responsibility for FAO’s work in watershed management and sustainable mountain development and as Coordinator for the Mountain Partnership Secretariat. He holds a BS degree in biology and a MSc in Forest Science from Colgate University and Yale University (USA), respectively.