While COVID-19 has highlighted many weaknesses in our global systems and though most of the lessons from the pandemic are still being uncovered, it’s clear that our relationship with nature has broken down and we need to speed up our efforts to fix it, lest we face dire consequences.
The continued displacement of wild habitats and forests – largely for industrial agriculture – has put humans into closer contact with animals, creating more opportunities for zoonotic diseases like COVID-19 to spill over to humans.
But public health isn’t the only casualty of our destruction of nature and biodiversity. Long before we had heard of COVID-19, we were facing an urgent climate crisis that could (and will) only be solved by making a radical global shift from business as usual.
The Risk of Mispricing Nature
Over half the world’s GDP depends on nature and its services, which generates around USD 44 trillion in economic value. But continued investment in high-polluting industries, such as those that depend on coal and crude oil, or in unsustainable agricultural practices that destroy biodiverse ecosystems could drain nearly USD 10 trillion from the global economy by 2050.
With an influx of upwards of USD 14.9 trillion earmarked for recovery strategies, there’s an opportunity to direct funds towards the climate crisis, but so far, nature has largely been left out of the picture and most governments have chosen not to use recovery funds to enhance nature or tackle climate change.
Directing more stimulus money into forests and sustainable land use would not only prevent irreversible damage to nature and reduce the risks of further spillover events, but it could also dramatically lower future costs of protecting the planet.
Kickstarting Regenerative Economies
Investing in regenerative business models that create value from standing forests and other natural ecosystems is one of many measures that could be taken for economies to make a truly green recovery. While it is well established that forests and nature are 30 per cent of the solution to decarbonisation, they receive just three per cent of the currently available climate finance.
Katie McCoy, team leader of the Partnerships for Forests (P4F), which incubates regenerative business models in tropical forest landscapes, notes that there are already business models in place that both mitigate the risks of investing in nature and offer profitable returns.
“Where we have evidence that these models exist and are successful, we need to prioritise getting them to scale and crowding others in to replicate them,” she says.
“To realise this vision, all must be involved – governments, private and financial sectors, and the communities that live and depend on these landscapes.”
Producing While Protecting
Cleaning up supply chains and focussing on the key commodities driving deforestation, to restore the landscapes that have been ecologically plundered, is an important part of this strategy.
In Ghana, a third of forest cover has been cleared to satisfy global demand for cocoa, and rising temperatures coupled with unsustainable practices continue to threaten those that remain. French cocoa trading company, Touton, leads a consortium of private and public sector partners investing nearly GBP 100 million into Juabeso-Bia – one of the world’s major cocoa-growing landscapes – to produce deforestation-free and climate-smart cocoa.
Last year, Touton provided GBP 57.3 million of capital through a combination of direct investment, funding tied to sustainability improvements, and climate smart cocoa price premiums into the landscape. By 2023, this could make the 240,000-hectare production landscape – an area the size of Cape Town – deforestation-free.
Building Back Bio-Economies
In addition to greening existing supply chains, a second strategy is to build bio-economies around commodities that have traditionally been overlooked by markets and reimagine how we value standing forests.
One example of this can be found in the forests of Borneo, which have suffered for over half a century from the production of commodities such as pulp, paper, and palm. But a speciality commodity, illipe nut, is giving extractive industries a run for their money by incentivising local communities to take care of an endemic tree species for strong financial returns.
Ethical commodity producer, Forestwise, is supporting communities to increase illipe nut production while also securing nut purchase commitments in excess of GBP 1 million from international buyers, including in high-end global cosmetics markets.
Local collectors have also seen significant increases to their incomes. Those in the pilot have earned six times more for each harvest, amounting to an annual income boost of 17 per cent. Forestwise plans to support these communities to sustainably harvest other products in their surrounding forests.
Speeding Up Adaptation
If stimulus packages were to refocus their sights on enabling private investments into these models, it would set the stage for more businesses improving their practices to create a transformational shift across sectors.
We’re at a critical juncture and we cannot justify ignoring nature protection by taking short-sighted responses to economic recovery. We can, and must, use this opportunity to build much stronger, regenerative economies that improve our longer-term climate resilience, all while reducing our risk to future health threats like COVID-19.
In their more than 100-million-year history, there has never been a more important decade for the future of tropical forest ecosystems. It won’t be possible to reverse the decline in these ecosystems (and the associated impact on climate, biodiversity and health – to prevent the emergence of deadly viruses like COVID-19 in future) without investing in forests and nature.
Far from being a risky move with uncertain returns, it’s an essential part of shoring up the future of our life on Earth.
Learn more about Partnerships for Forests’ (P4F) work on sustainable business models. P4F catalyses investments in which the private sector, public sector and communities can achieve shared value from sustainable forests and sustainable land use. P4F is managed by Palladium in partnership with SYSTEMIQ. P4F is funded with UK aid from the British people.