Luxembourg, 3 December 2019 – How did a community in the Dominican Republic use funds from a goldmine to convert disused sugarcane plantations and degraded farmland into fertile landscapes that benefit the local population? How did a smallholder farmers’ cooperative in Peru learn to process and sell cocoa, creating new income sources while reducing pressure on the rainforest?
A new study, “On the Way to Forest Landscape Restoration”, shares key characteristics and best practices from privately funded restoration projects like these, providing pathways for other practitioners to replicate and scale up these concepts elsewhere. The study was produced by the OroVerde-Tropical Forests Foundation in collaboration with the Global Nature Fund (GNF).
Among its key conclusions? Inclusive landscape governance involving every relevant voice is essential. Realistic return expectations and balanced risk-sharing between investors and smallholder participants are also crucial – particularly when those producers are encouraged to stretch beyond traditional practices to participate in global value chains. Transparent tenure and legal rights are also essential, concludes the report, based on four case studies of restoration projects funded through private investments or donations.
“The analysis focuses in particular on the protection of biodiversity and the involvement of local communities and Indigenous peoples,” said Anique Hillbrand, project manager with OroVerde-Tropical Forest Foundation and co-author of the report. It was launched during the Global Landscapes Forum (GLF) Luxembourg 2019 event, which brought together finance leaders from around the world to discuss ways of unlocking the power of sustainable financing.
“Since large-scale investments in agriculture and forestry in history showed that monoculture plantations with low biodiversity are a common problem, and huge financial risks are left with the farmers, we specifically looked from the perspective of the farmer, to see if their land rights were respected and local voices heard,” said Hillbrand. “Recommendations have been developed for impact investments in forest and biodiversity.”
The four case studies examined:
- Forest restoration work in the Dominican Republic, partly funded by a US$ 5 million donation from goldmine Barrick Pueblo Viejo, is working well, thanks to broad-based decision-making via multi-sectoral round tables. These involve all stakeholders, including smallholder farmers, their organizations, local communities, government agencies, academics and NGOs. A ‘Model Forest’ restoration plan contributes to achieving the country’s Bonn Challenge pledge to restore 0.12 million hectares of degraded forests and landscapes by 2030. Although the project provides an ecological role model, farmers still have difficulties selling their timber and cocoa, and the project is not yet financially sustainable. As such, participants still require capacity-building and support from the local NGO that is implementing the project.
- In Peru’s Madre de Dios region, innovative financing instruments are being applied to build capacity and establish local structures and projects that will lead to the sale of CO2 certificates and raw cocoa, to generate a financial return and create new income sources while reducing pressure on the rainforest. An EUR 5.6 million loan from the Althelia Climate Fund is helping to support cultivation and sale of cocoa through a smallholder farmers’ cooperative developed under the Fund. Simultaneously, some 570,000 hectares of rainforest in the Madre de Dios region is being protected; and 1,250 hectares of degraded agricultural land restored. However, case-study analysis suggests that investors should share more of the risks faced by farmers – for example, when Amazon forest fires destroy their cocoa agroforestry systems.
- In South Africa, support from Dutch-based private investor Commonland is providing loans through a local development agency to support work in the Baviaanskloof valley aimed at rehabilitation of degraded areas while providing local farmers with new sources of income. Organic cultivation and processing of rosemary and lavender is part of the project where ecological functions are being restored through regenerative agriculture and planting of ecologically valuable Spekboom trees. Long-term capacity building in the isolated area is supported by local NGO Living Lands. This case study has shown that a long-term involvement of the investor, lasting 20 years or more, in the landscape is key to ensure environmental and social sustainability of the project.
- The livelihoods of some 30,000 smallholder dairy farmers in the foothills of Kenya’s Mount Elgon are gaining resilience and local value chains are strengthened through financial support from private investors, including the Livelihoods Carbon Fund. Increased efficiency in local dairy cooperatives and use of agroforestry systems means that farmers now generate surpluses that sustainably meet the area’s high demand for milk. The case provides a strong example of landscape restoration work, using approaches adapted to local social, cultural, economic and environmental values.
Ultimately, the long-term success of restoration programs relies on economic profitability for local people, who must associate economic benefits or improvements in their living conditions with the restoration of landscapes, said Andrea Reuter, project manager in Business and Biodiversity with the GNF.
“Only then are they willing to take risks and change old behavior patterns,” said Reuter.
The research project was financed by Germany’s Federal Agency for Nature Conservation with funds from the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety.
For further information on any of the case studies or the analysis, contact: