Proposed ‘Tree Fund’ will fill an important gap in forest expansion in Africa
 
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Proposed ‘Tree Fund’ will fill an important gap in forest expansion in Africa

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Uganda Plantations for Africa’s Prosperity Study Tour Reveals…

The plantation industry potential all over the world is huge. Plantations can provide a route out of poverty for rural communities, contribute to moving fast-growing economies along a sustainable trajectory, take pressure off natural forests and restore ecosystems, and play a vital role in combating climate change. In Africa, governments have committed to expand forests through reforestation programmes, but the planting rates to reach their targets are too low.

Treetops of Dense Tropical Rainforest With Morning Fog Located Near The Malaysia-Kalimantan Border

Under the Bonn Challenge, Africa governments has committed to restore forests and tree cover on 100 million ha of land in Sub Sahara Africa by 2030 under the African Forest Landscape Restoration Initiative (AFR 100). However, only about 10,000 new plantations are established annually. An assessment by LTS shows that the combined level of new planting required to meet both the projected industrial and fuelwood deficits from regional plantation sources in Africa is in the region of 16-18 million ha (i.e, planting of 1.3-1.5 million ha/yr) between 2018 and 2030 which is still lower than the AFR target, but is almost 130-150 times the current rates of planting. Of the many challenges facing plantation establishment in Africa, securing sustainable finance is the most significant as demonstrated at the recently held Uganda Plantation for Africa’s Prosperity Study Tour, 4 – 8, June 2018. Private planting in Africa has primarily been done by entrepreneurial companies backed by private shareholders, not by investment funds since many Development Finance Institutions are reluctant to fund new plantation investments because of the many risks involved in new, long-term plantation establishment propositions. These are some of the issues that were explored in the study tour.

WWF-Uganda, in partnership with the New Forest Company (NFC) and the Forest Stewardship Council (FSC), hosted the study tour under the theme “plantations for Africa’s Prosperity”. LTS was one of the many participants from around the globe. The overall objective was to share lessons learnt in Uganda’s plantation sector and how responsible plantations can be an engine for sustainable development at scale. The study tour aimed at addressing five key underlying questions:

  1. What are the barriers to sustainable greenfield plantation forestry in East Africa?
  2. What innovative financing solutions can scale up sustainable plantation forestry in Africa?
  3. How can plantation companies partner with communities to Create Shared Value, by reducing   business risk and improving rural livelihoods?
  4. How can the plantation forestry industry, civil society and national governments work together to drive macroeconomic development?
  5. What role can plantation forests play in combatting illegal logging?

The study tour identified key priorities for responsible plantation forestry in Africa. There was a general consensus that blended finance is what Africa needs to expand forestry at scale, in order to address the tree growing finance barrier. This is also the gap that is being filled by the Tree Fund, an innovative new finance mechanism that LTS is designing for The Nature Conservancy (TNC) to stimulate tree planting in Africa by providing low-cost financing for growing trees at scale. The study tour therefore was very useful to this assignment as it re-affirmed the need for the fund.

At the end of the study tour, a few key points stand out.

Firstly, the case for plantation forestry at scale is a compelling one. Africa is already facing a timber deficit, and its remaining forests are becoming increasingly degraded. Planting trees is essential to tackling climate change, and the most cost-effective technology we have for taking carbon out of the atmosphere. Plantations also can give people living in poverty the hope of a better future.

Secondly, it is clear that there are huge challenges to establishing plantations in Africa – from the difficulties of attracting the upfront capital needed, to finding suitable land, to meeting the expectations of local people, to operating in areas lacking in education, technical skills and infrastructure.

Thirdly, and encouragingly, a diverse range of people are working to overcome these challenges – from businesses, to non governmental organizations, to local civil society organizations, to investors.







 
 


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