Blue Carbon Financing of Mangrove Conservation in the Abidjan Convention Region: A Feasibility Study

Financing mechanism Brief description

Category

Green Climate Fund

The Green Climate Fund (GCF) was established in 2010 as a finance mechanism under the UNFCCC. It is a mechanism to transfer money from industrialized countries to developing countries in order to assist them in adaptation and mitigation practices to counter climate change. The GCF supports projects, programmes, policies and other activities in developing countries, with the long-term aim being a 50:50 balance between mitigation and adaptation. The Amazon Fund aims to raise donations for non-reimbursable investments in efforts to prevent, monitor and combat deforestation, as well as to promote the preservation and sustainable use of forests in the Amazon Biome, under the terms of Decree N.º 6,527, dated 1 August 2008. The Amazon Fund is managed by the BNDES (the Brazilian Development Bank), which also undertakes to raise funds, facilitate contracts and monitor support projects and efforts. The funds that make up the Amazon Fund’s assets will come from donations and net return from cash investments. http://www. amazonfund.gov.br/FundoAmazonia/fam/site_en/Esquerdo/Fundo/ The Forest Investment Program (FIP) is a financing mechanism aimed at assisting developing countries in reaching their REDD goals. It does this by providing funds to bridge the investment gap in order to initiate readiness reforms identified through national REDD readiness strategy building, while promoting sustainable forest management. Additionally, according to its Design Document, the FIP works “to contribute to multiple benefits such as biodiversity conservation, protection of the rights of indigenous peoples and local communities.” Administered by the World Bank, the FIP is a component of the Strategic Climate Fund (SCF) and more broadly the Climate Investment Funds (CIFs). It was approved in July 2009. http://www. climatefundsupdate.org/listing/forest-investment-program Australia’s International Forest Carbon Initiative supports global efforts to establish a REDD+ mechanism under the UNFCCC. Jointly administered by the Australian Department of Climate Change and Energy Efficiency and AusAID, the initiative enables Australia to work closely with developing countries to find practical ways to reduce forest emissions. The Australian Government does not intend to set up a new fund or governance structure through IFCI, but will work through established channels of bilateral dialogue and cooperation at the international level. http:// africanclimate.net/en/node/6291 Tropical forests are among our most ancient ecosystems; indispensable to the livelihoods of hundreds of millions of people; habitat of half to one third of the world’s terrestrial plants, animals and insects; crucial for global, regional and local water supply; and an enormous carbon sink, which can provide one third of the climate change solution over the next 15 years. Norway has pledged up to 3 billion NOK a year to help save these forests while improving the livelihoods of those who life off, in, and near them. https://www.regjeringen.no/en/topics/climate-and- environment/climate/climate-and-forest-initiative/id2000712/ Debt-for-nature swaps emerged in the 1980s as a financial mechanism to limit steep shortfall reductions in highly indebted nations’ environmental and conservation budgets. It was an innovative idea that ameliorating debt and promoting conservation could be done at the same time. This form of finance has been used to fund environmental conservation in many developing countries. Wetland conservation for adaptation and carbon sequestration could now be considered as an additional objective for project activities funded under these types of initiatives. Typically a debt-for-nature swap involves a lending country selling the debt owed by a recipient country (the debtor) to a third party (for example, a non-profit organization) at less than the full value of the original loan. In exchange, the national government of the indebted country agrees to a payment schedule on the amount of the debt remaining, usually paid through the debtor’s central bank, in local currency or bonds. The third party then uses the debt repayments to support domestic conservation initiatives.

Funds (cont.)

Amazon Fund

Forest Investment Program

International Forest Carbon Initiative

International Forest and Climate Initiative

Debt-for-nature swaps

Other sources

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