Climate Finance Fundamentals 5: Climate Finance Thematic Briefing - REDD+ Finance

Since 2008, USD 5.6 billion has been pledged to multilateral climate funds that support efforts to reduce emissions from deforestation and degradation plus conservation (REDD+). There is and remains a longstanding interest in the potential to harness market-based mechanisms to support REDD+ programmes. Cumulatively, USD 2.9 billion has been approved for dedicated REDD+ activities since 2008. The Amazon Fund, with USD 705 million approved for 102 projects in Brazil and the Amazon biome, remains the largest dedicated REDD+ fund.

The year 2021 has seen relatively low approvals for REDD+ with USD 75 million, whereas this amount was relatively stable during the past five years averaging 263 million. The increase observed in the past years was due to the rise of funding from the Green Climate Fund (GCF). By November 2021, it had approved at least 16 projects involving forests, that are considering both adaptation and mitigation, and eight dedicated REDD+ projects with results-based payments for a total of USD 497 million under its multi-year REDD+ pilot programme, which is currently under review and likely to see a renewed financing phase in 2022. These projects reflect efforts to support developing countries’ move beyond readiness and capacity building to demonstration programmes and emission reductions with payments based on verified results. Despite stagnating REDD+ flows from the multilateral climate change funds, forest protection and conservation efforts have ramped up in 2021, including with the Glasgow Leaders’ Declaration on Forests and Land Use at COP26, and with several other forest protection financing initiatives.