Brazil has introduced a new global fund aimed at safeguarding tropical forests, a proposal unveiled at the COP30 climate summit in Belém. This initiative, named the Tropical Forests Forever Facility (TFFF), seeks to create a sustainable financial mechanism to reward developing nations for the preservation of their rainforests. The fund’s primary objective is to make it more economically viable for these countries to protect their forests rather than clearing them for other uses, addressing a long-standing challenge in conservation efforts.
The TFFF is designed to be one of the largest multilateral investment funds for nature, with a target of raising $125 billion. The plan involves an initial $25 billion from “sponsor” governments and philanthropic organizations, which is intended to attract an additional $100 billion from private investors. The returns generated from these investments would be used to provide annual payments to as many as 74 developing countries that successfully maintain or increase their forest cover. This model aims to provide a reliable, long-term revenue stream for conservation, a departure from previous funding efforts that have often been insufficient or inconsistent.
A New Financial Architecture for Forest Conservation
The core of the Brazilian proposal is a blended finance model that leverages public funds to attract private investment. The initial capital from sponsor governments is designed to absorb a higher level of risk, thereby making the fund more attractive to private investors such as pension funds. The World Bank has been confirmed as the trustee and interim secretariat for the fund, a move that adds a layer of institutional stability to the initiative. The returns from the fund’s investments will be split, with a portion going back to the investors and the remainder being distributed to tropical forest countries as “forest payments.”
Eligibility and Payouts
To be eligible for payments from the TFFF, countries must demonstrate a low rate of annual deforestation, specifically below 0.5%. This requirement must be maintained year after year for a country to continue receiving funds. The fund is expected to generate an estimated $4 billion annually for conservation efforts, which would be distributed among the qualifying nations. The structure is intended to create a direct economic incentive for countries to prioritize forest protection.
The Urgency of Tropical Forest Protection
The proposal comes at a critical time for the world’s tropical forests, which are vital for biodiversity and climate regulation. These forests store vast amounts of carbon, and their destruction releases significant greenhouse gas emissions. Despite various national and international efforts, deforestation rates remain high globally, with the equivalent of 18 football fields of primary forest lost every minute in 2024. Decades of promises from wealthy nations to fund forest conservation have largely failed to materialize, creating a significant funding gap that the TFFF aims to address. In 2022, for instance, the total finance for forests was just $2.3 billion, a fraction of the estimated $20 billion to $72 billion needed annually.
Challenges and Criticisms
Despite the ambitious goals of the TFFF, the initiative faces several challenges. One of the main hurdles has been securing the initial buy-in from sponsor governments. While Brazil has committed $1 billion to the fund, and Indonesia has expressed its intention to invest, other nations have been more hesitant. Notably, the United Kingdom, which was involved in the early stages of the initiative’s formulation, has announced that it will not be contributing to the fund, citing stretched public finances. This decision is seen as a setback for the fund’s launch at COP30.
Concerns from Civil Society
The TFFF has also drawn criticism from some non-governmental organizations. The Global Forest Coalition, an alliance of Indigenous rights NGOs, has raised concerns about the fund’s heavy reliance on private investment and financial markets. Critics argue that conservation funding should not be dependent on “betting on stock market prices” and have called for new approaches to biodiversity finance. There are also concerns about the potential for the “commodification” of nature and a lack of involvement from Indigenous communities in the fund’s design and governance.
The Road Ahead for the TFFF
The official launch of the Tropical Forests Forever Facility is a key event at the COP30 leaders’ summit. Brazilian officials remain optimistic about the fund’s prospects, with Finance Minister Fernando Haddad stating that he believes the fund could raise around $10 billion by the end of the next year. The success of the TFFF will ultimately depend on its ability to attract the necessary capital and to demonstrate that its innovative financial model can deliver tangible results for forest conservation. The initiative represents a significant attempt to shift the paradigm of conservation finance, moving from a system based on aid to one based on investment. The coming months will be crucial in determining whether this ambitious plan can be realized and whether it can make a meaningful contribution to the global effort to protect tropical forests.