One of Brazil’s main deliveries at the UN Climate Summit (COP30), the Tropical Forests Forever Fund (TFFF) reached the milestone of around US$5.5 billion promised in investments (with US$1 billion from the federal government itself) on Thursday, 6, the first day of the Leaders’ Summit.
The amount was seen as a victory by the Lula government, as the innovative proposal would have difficulty attracting the first investors. The goal is to reach US$10 billion in contributions by 2026 and US$125 billion in total.
The TFFF was proposed by Brazil at the Dubai COP in 2023, with the aim of combating the deforestation of tropical rainforests in the world, as these ecosystems are essential for regulating the climate.
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Since 2008, the country has had another conservation fund aimed at protecting its largest forest, the Amazon Fund. The fund was reactivated in 2023 after being paralyzed during Jair Bolsonaro’s government.
In both cases, the contribution is conditional on the reduction of deforestation, but the TFFF also accounts for the recovery of forest areas, which would generate greater potential gains for Brazil (compared to the Amazon Fund).
It also generates a progressively greater incentive for beneficiary countries to reduce the rate of destruction and encourage the recovery of forests, with a permanent and predictable availability of resources to plan policies in this area.
According to experts, several sources of financing are needed (from various funds to other mechanisms such as carbon markets, payments for environmental services and forestry concessions) to guarantee the protection of forests.
“The funds are complementary. We see this composition as super important to form the big cake necessary to finance the (maintenance of) nature and greener development”, says Maurício Bianco, vice-president of Conservation International Brazil.
See below how each one works and what the main differences are:
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Range
TFFF – Aimed at protecting tropical forests in developing countries, financing public policies to prevent, monitor and combat deforestation, management and restoration;
Amazon Fund – Aimed at financing projects and actions against deforestation and sustainable management in the Brazilian Legal Amazon.
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Financing model
TFFF – operates according to market logic, capturing public and private investments that generate dividends to remunerate investors and beneficiary countries;
Amazon Fund – captures non-refundable donations from foreign governments (mainly Norway and Germany) and national companies (it is being structured to receive money from multilateral institutions, NGOs and individuals).
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Transfer mechanism
TFFF – Fixed annual remuneration for developing countries with forests, per hectare conserved or restored, with a minimum percentage (20%) directed to indigenous peoples and local communities. The management foresees initial support from the World Bank and a collegiate composed of beneficiary countries and sponsors to supervise the mechanism and guarantee eligibility criteria for forest countries;
Amazon Fund – Directly benefits, through notices, projects from government agencies, NGOs and other entities that carry out projects in the Legal Amazon. It is managed by the National Bank for Economic and Social Development (BNDES), with a committee that establishes the fund’s guidelines, the Amazon Fund Guidance Committee (COFA).
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