First investment of the Land Degradation Neutrality Fund
Reforesting 9 000 hectares of degraded land in Peru
1.3 metric tons of CO2 emission reduction expected
The Land Degradation Neutrality Fund, which counts the European Investment Bank as one of its investors, just finalised its first transaction since its take off at the end of 2018. Its initial investment will go to a programme to restore degraded land in Latin America through agroforestry practices and is expected to improve the livelihoods of 2 400 producers.
The programme, named Urapi Sustainable Land Use and developed by ECOTIERRA, seeks to reverse land degradation and combat climate change by implementing sustainable agricultural practices and strengthening the economic models of cooperatives, while promoting social inclusion. The first project of the programme involves four coffee cooperatives and the reforestation of degraded land into productive agroforestry systems in Peru.
EIB Vice-President responsible for the Bank’s operations in Latin America, Emma Navarro, said: “The cost and number of climate related disasters are rising and accelerating land degradation, putting pressure on affected communities. With more than 1.3 billion people living on degraded land, the potential for forced mass migration and internal displacement is high and require large amounts of financial resources. That’s why the EIB is supporting the Land Degradation Neutrality Fund to invest in projects that will speed up active involvement and concrete actions to reach land degradation neutrality. I am pleased to see that the first investment of the fund will go to this reforestation project in Peru which will contribute to mitigate the effects of climate change and generate direct positive impacts for the people living there.”
Launched as a transformative contribution to the global fight against climate change, the Land Degradation Neutrality Fund seeks to support the sustainable management of 500 000 hectares of land, to reduce CO² emissions by 35 million tons, and to create jobs or improve livelihoods for over 100,000 people through its investments, with a focus on Africa and Asia. It aims to reach USD 300 million investment in land management and land restoration projects worldwide to achieve the Sustainable Development Goals’ land degradation neutrality by 2030.
About the Land Degradation Neutrality Fund (LDN Fund)
The LDN Fund benefits from the resources of the Mirova Natural Capital platform and the Althelia Funds range when making investments. The Fund’s investors include public investors such as the EIB, l’Agence Française de Développement, and the Government of Luxembourg, as well as private investors such as Fondaction, the Fund’s first North American investor, Fondation de France, BNP Paribas Cardif, Garance, and Natixis Investment Managers.
The LDN Fund provides long-term financing as well as technical assistance to sustainable land management project developers in the agricultural and forestry sectors. The Dutch entity IDH has been chosen to manage the Fund’s Technical Assistance Facility, which aims to maximize the positive impacts of projects funded by the LDN Fund, to balance the project portfolio, and to implement a framework to measure the project contribution. The Technical Assistance Facility became fully operational on the 15th of January when Agence Française de Développement signed off on a first contribution of €3 million.
As the LDN Fund enters its operational phase, the Fund’s Strategic Board met for the first time on the 15th of January, chaired by Monique Barbut, Executive Secretary of the United Nations Convention to Combat Desertification. Members of the committee include Patricia Espinosa, Executive Secretary of the United Nations Framework Convention on Climate Change, and Cristiana Paşca Palmer, Executive Secretary of the United Nations Convention on Biological Diversity. The purpose of the Board is to make recommendations on the Fund’s strategic direction and ensure its alignment with policies to fight land degradation and climate change.
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