Government shows no interest for $1bn to protect forests

Eron Bloomgarden — Foto: Sandy Young/PA Wire
Eron Bloomgarden — Foto: Sandy Young/PA Wire

The lack of engagement of the federal government is leaving Brazil out of an innovative initiative by three countries — the U.S., Norway, and the United Kingdom — and a group of large companies with an initial $1 billion to protect forests.

It is the Leaf Coalition (Lowering Emissions by Accelerating Forest Finance). It pays countries or local governments for their performance in stopping deforestation faster, while helping them achieve their Nationally Determined Contributions (NDCs) under the Paris climate agreement.

In an interview with Valor, Eron Bloomgarden, founder and CEO of the Emergent organization, which launched the Leaf Coalition, said 20 major companies are already participating. They include Salesforce, Amazon, Nestlé, Unilever, BlackRock, Burbery, EY and Walmart, for example. Another five are about to be announced.

According to the executive, many companies are interested in paying for the reduction of deforestation in the Amazon, but that it takes political will to make this happen.

The way the coalition operates is with an open call for proposals. In the first call, last year, the coalition received 35 project proposals, half of them from countries such as Costa Rica, Ecuador, Ghana, Nepal, Vietnam, and half from states or municipalities, which together cover more than half a billion hectares of forest.

In the case of Brazil — a country considered key to combating deforestation globally — the federal government has not presented any proposal, but eight states (Acre, Amapá, Amazonas, Maranhão, Mato Grosso, Pará, Roraima and Tocantins) have made proposals in order to have access to resources — and the Legal Amazon Consortium wants to sign a memorandum of understanding.

However, without Brasilia, the situation is complicated. “The states need approval from the federal government to participate. We will not sign a contract [with the states] unless there is approval from the federal government,” Mr. Bloomgarden said. And so far, there is no sign of engagement from Brasilia.

According to the executive, Brazil is a green superpower that should be thinking “about how to preserve this asset to help solve the issue of climate change and for its economic growth.” He says that what the Leaf Coalition is trying to do is “provide a very clear path for companies to help support Brazil by paying to reduce deforestation.”

“Unfortunately, the trends are going in the other direction, at least in Brazil, where there was almost a 65% jump in deforestation in the first three months of 2022 compared to last year. So, the problem is an urgent challenge. We are ready to be a partner,” he added.

Under the Leaf Coalition, emissions reductions are made across entire countries or large states and municipalities through programs that involve key stakeholders, including indigenous peoples and local communities, in five-year contracts. The initiative will use satellite imagery to verify results over wide areas. The monitoring would, at least in theory, prevent governments from protecting forest in one place only to let it be cut down in another area, for example.

A global effort that already exists called REDD+ is seen as affected by bureaucratic problems, for example. The Leaf Coalition says that while the international community has historically paid $5 per tonne of CO2 avoided, it pays a minimum of $10. And if the companies buying the credits sell them above that amount later, the extra resource goes to the country or state.

This new model of public-private finance for forests is attracting growing interest, and an illustration of this is Mr. Bloomgarden’s participation this time at the World Economic Forum in the Swiss Alps.

“At COP 26 in Glasgow it was the first time that nature and forests played such a large and relevant role,” he says. “And now this idea of protecting, preserving, restoring nature as a climate solution is high on the international agenda. There are many other things happening in the world with Ukraine and Russia, and the pandemic. [But] there’s urgency to do that now, both for companies and for biodiversity communities.”

“Companies are saying: you build climate strategies for the next 5-10 years. We would like to use high quality credits, say from Brazil, to protect forests,” he says. According to the executive, if it is shown that there is high-quality supply and political will on the ground, the initial $1 billion fund could reach $10 billion.

Source: Valor International