1. Key insights
1. Responses to deforestation must be flexible, comprehensive and make use of market forces, including trade and finance
There is no one-size-fits-all solution to deforestation. Sufficient flexibility is needed to adapt trade, climate and investment policies to different contexts, while serving EU and producer country goals of reducing deforestation and using forests to limit climate change. Addressing forest conversion requests action on many fronts, including clear and enforced legal frameworks, land-use planning, monitoring/transparency systems, and incentives for sustainable practices and investments. No single approach has the answer, but when different instruments come together, they offer potential for change.
2. Key actors in producer and consumer countries are seeing how global supply chain transparency can help them to deliver on zero-deforestation commitments
An increasing number of companies recognise that meeting commitments to deforestation-free commodity production is inherently linked to collective action and collaboration with local governments. They are seeing the need for monitoring and verification at the municipal or departmental level, understanding the limits of farm level certification to achieve net positive impact in deforestation hotspots, and realising the challenge of scaling this up in all relevant forest-risk supply chains within the timeframe needed.
While public funding needs to be redirected to ensure that the enabling environment for sustainable agriculture is in place, agro-commodity companies need to lead the investments into structural changes in their supply-chains. Innovative partnerships between the forest and agricultural sectors can play a key role in ensuring that both sectors reach their commitments.
Lessons from FLEGT VPA experiences can assist efforts to define the enabling environment stakeholders need to put in place to make zero-deforestation production and related trade a reality.
3. Understanding the volume and nature of investments impacting land-use contributes to the coherent implementation of Nationally Determined Contributions under the Paris Agreement on climate change
Countries need to critically assess their land-use spending and investments, as well as existing financial mechanisms and incentives. This will help them to increase the efficiency of spending, improve coherence and mainstream their climate objectives. It will help them to identify needs and build stronger cases for international support, as well as to leverage domestic public funds and private sector financing.
It will become increasingly essential for countries to be able to demonstrate the added-value and leverage effect that international public finance, such as the Green Climate Fund, can play in their investment strategies, and to design or improve efficient financing mechanisms which can unlock sustainable private investments.
A paradigm shift in smallholder financing and support will be needed if the private sector and governments are to achieve their zero-deforestation commitments. Incentive mechanisms, such as payments for environmental services in Côte d’Ivoire, are needed to help smallholders meet additional costs incurred in the transition towards more sustainable practices.
4. Cross-sectoral political dialogues among all land-use stakeholders need to be sustained beyond REDD+ strategy elaboration
REDD+ investment strategies and the review of relevant sectoral investment and policy frameworks require cross-sectoral dialogue and political support. Transitioning from the readiness to the investment phase of REDD+ can require changes in a country’s institutional arrangements and responsibilities for REDD+ coordination. These changes should be anticipated and discussed in a participatory and transparent way in order to ensure continuity of national and international investments made during the readiness phase.