Download Financing sustainable forest management: A comprehensive

Financing sustainable forest management:
A comprehensive approach to
resource mobilization at country level
Camilla Nordheim-Larsen
Global Mechanism of the UNCCD
Nadi, Fiji, 24 July 2012
Overview
The Global Mechanism
The challenge: mobilizing resources for
SFM
Financing for SFM/ SLM: integrated
approach within the framework of
sustainable development and poverty
alleviation
Developing Integrated Financing Strategies
(IFS): approach and lessons learned
The Global Mechanism
 Financial mechanism of the UNCCD
 Tasked to mobilise resources for sustainable
land management (SLM)
 Promoting synergistic implementation of the
Rio Conventions
 Supports developing countries in designing
Integrated Financing Strategies (IFS) leading
to multi-year investment frameworks
Similar challenges in financing SFM and SLM
The challenge: financing SFM
Demonstrating the benefits of SFM
• Increasing recognition of the multiple
values and functions of forests (e.g.
environmental services, NTFP)
• But: many of these services are not traded
in markets or accounted for in national
budgets, and forest owners and managers
do not receive any returns for them
This creates conditions for exploiting
forests unsustainably
The challenge: financing SFM
Adopting an integrated approach
People’s livelihood is not only dependent on
forests in isolation, but on the availability of
healthy soils, clean water, food production and
the safeguarding of biodiversity
Sustainable forestry, land water management,
climate change and biodiversity need to be
addressed in an integrated manner.
• Loss of land cover
• Deforestation
• Landslides
• Illegal logging
• Loss of soil
fertility
• Soil erosion
•Agricultural
encroachment
• Mining
• Dumping of waste
• Excessive resource
extraction
• Urban
encroachment
• High water-use
crops
• Increasing food &
water needs
• Declining soil
fertility & salinity
• Increasing
pollution
• Loss of arable land
• Excessive chemical
use
• Low farm income
• Water pollution fertiliser &
pesticides;
• Siltation
• Decreasing water
availability
• Rangeland
degradation
• Conversion to
agri lands
• Invasive species
Integrated financing strategy
National Development Plan, Sectoral Plans, National Action Plan, etc.
National
Context
Mainstrea
ming SLM
Internal
Sources of
Financing
External
Sources of
Financing
Innovative
Sources of
Financing
Integrated Financing
Strategy
Investment Framework
Socio-Economic Development and Poverty Alleviation
Analysis of the financing context
Financing sources, instruments and mechanisms
Internal resources
External resources
National
budget
National
funds (e.g.
Bilateral/
multilateral
cooperation
Non-ODA
national forest
funds)

Private
investments
(e.g. from


farmers,
companies,
individuals, etc.)

Local
budgets (e.g.
municipalities)
Direct foreign
investments
Remittances
NGO and
foundations
Decentralised
cooperation
Innovative resources
Market based
instruments



Emissions trading
Payment for environmental
services
Certification schemes
Investment instruments


Debt swaps
Conservation concessions
Fiscal instruments



Subsidies
Differential taxation on land
use
Deforestation taxes
Climate change funds


REDD++, Green fund
Adaptation fund
Analysis of the financing context
Opportunities and constraints for mobilising
resources for SFM
Opportunities
Policy frameworks in
place (international,
regional, sub-regional,
national)
Multitude of existing
‘traditional’ financing
sources, instruments and
mechanisms
Emerging innovative
financing sources (e.g.
climate change, market
based mechanisms)
Constraints
SFM not national
priority
Weak inter-sectoral
coordination and
collaboration
Inadequate legal and
institutional framework
Insufficient capacities
related to use of
relevant financing
sources and
mechanisms financing
Analysis of the financing context
Entry points for mobilising resources for SFM
Constraints
SFM not national priority
Weak coordination and
collaboration
Inadequate legal and
institutional framework
Insufficient capacities
related to use of relevant
financing sources and
mechanisms financing
Action points
Show the contribution of forests
to GDP and sustainable
development (e.g. economic
valuation)
Identify and analyse traditional
existing sources of funding
Identify and analyse potential
innovative sources
Strengthen inter-sectoral
coordination at all levels
Strengthen institutional and
legal frameworks
Mainstream SFM as a national
priority
Investment Framework
CC Resilience Integrated
Watershed Mgt.
National
Sources
External
Sources
Innovative
Mechanisms
MoA;
MoE; +
Landuse
Rehabilitation
of degraded
agricultural
lands
MoA; MoI;
+ research
institutions
Reduce
Deforestation
MoF; MoE; +
Local
authorities +
private inv.
Biodiversity
Conservation
MoE; MoF;
Land-Use +
Local
authorities
Alternative Income
Generation
MoT; MoF
+ Local
Authorities
External Sources bilateral (EC, GIZ, DFID); GEF and multilateral
(ADB, WB & IFAD) financing; FDI; Foundations etc.
Carbon financing, PES, conservation easements, debt-swaps;
innovative taxation schemes
Lessons learned
 Ensuring sustainable and predictable
financing flows requires a holistic,
comprehensive approach
 Lack of financing not always the issue:
enabling environment key for resource
mobilisation
 Challenge to develop projects and
programmes that cuts across sectors
 ‘First door’ of finance: domestic budgets and
national investments
Thank you!
Camilla Nordheim-Larsen
Programme Coordinator
The Global Mechanism of the UNCCD
www.global-mechanism.org