The COP30 summit is taking place in Belém, Brazil. (Flickr)
World leaders at the COP30 summit in Belém, Brazil, have hailed the launch of a sweeping new global forest finance mechanism — the Tropical Forest Forever Facility (TFFF) — as a bold step towards valuing forests as global assets.
Designed to raise $125 billion for tropical forest protection, the facility promises to reward countries for keeping their forests standing, with at least 20% of funds flowing directly to indigenous people and local communities.
Brazil’s President Luiz Inácio Lula da Silva hailed the TFFF as “an unprecedented initiative”. For the first time in history, he said, “countries of the Global South will take the lead in a forest agenda”.
“Tropical forests play a vital role in tackling climate change, storing carbon, regulating water cycles and safeguarding biodiversity … The goal is for each country to receive up to $4 per hectare of preserved land. It may seem modest, but we are talking about 1.1 billion hectares of tropical forests across 73 developing countries,” he said.
The launch came with a flourish of pledges. Norway committed $3 billion over the next decade, Brazil and Indonesia each reconfirmed their $1 billion commitments, and other European governments announced smaller contributions, bringing the facility’s early capitalisation to about $5 billion.
In total, 34 tropical forest countries have endorsed the TFFF Declaration, covering more than 90% of the tropical forests in developing countries, including Indonesia, the Democratic Republic of Congo and Suriname.
The TFFF is a blended finance fund with a $125 billion target, combining $25 billion from donor countries and $100 billion from private investors. The fund invests in fixed-income portfolios to generate returns above its cost of capital.
Satellite monitoring tracks forest canopy, deforestation and degradation. Participating tropical forest countries are then paid per hectare of standing forest, with adjustments for deforestation or fire damage.
At least 20% of these payments go directly to indigenous peoples and local communities, while the remaining funds support broader forest conservation and sustainable management efforts.
“This is a landmark moment for nature and climate finance,” said Kirsten Schuijt, the director general of WWF International, describing the TFFF as a game-changer for rewarding countries for keeping their forests standing.
“It channels funding directly to indigenous peoples and local communities, the true stewards of our forests. And it’s designed for scale, sustainability, and impact, combining public, private and philanthropic finance to protect over one billion hectares of tropical forests in over 70 countries.”
The World Resources Institute noted that the facility could “flip the economics of deforestation” by making standing forests more profitable than clearing them.
“The next step is to design the operations manual, with transparent oversight and measures to prioritise and protect intact rainforests, while genuinely involving indigenous peoples and local communities.
“It must also deal with degradation – when forests are weakened by logging, mining or building roads – and leakage – where protecting one area simply shifts destruction elsewhere. Without that precision, the facility risks being another good-intention promise, not a breakthrough.”
Forest conservation is a response to two planetary crises of the century: climate change and biodiversity loss, said Mauricio Bianco, the vice president of Conservation International-Brazil.
“These are threats that require financial commitments commensurate with their scale … The TFFF is a financial instrument that puts us on the right path, one that aligns with the logic of the financial world,” he said.
However, more than 160 Brazilian, Amazonian, Asian, African and international civil society organisations have rejected the TFFF’s launch. They argue that it treats forests as commodities rather than living systems, reducing deforestation to a “market failure” instead of addressing structural drivers such as mining, agriculture and infrastructure.
The facility would operate like a commercial bank – borrowing large sums, seeking returns, then distributing only small payments per hectare to forest nations – risking the privatisation of forest‑finance rather than public or community control, the groups said.
“The TFFF does not prioritise indigenous peoples and local communities, nor does it establish gender and intergenerational equity in the allocation of resources. Eighty percent of the $4 per hectare will go to national governments, while only 20% (80 cents) will go to those who actually defend and preserve tropical forests.”
African countries must be cautious, said Wafa Misrar of Climate Action Network Africa. “This fund depends on loans and bonds, meaning that developing countries could end up paying interest through debt finance to carry out conservation.
“The mechanism sets complex conditions that some of the countries with these forests may not meet. This is neither new nor fair, but another distraction and market-based mechanism that benefits investors more than the countries they claim to support.’’
Tom Picken, the forests and finance director at the Rainforest Action Network welcomed the TFFF’s promise to mobilise large-scale finance for forest protection and direct funds to indigenous peoples and local communities.
“But it cannot succeed while banks and investors remain free to bankroll deforestation. Without strong regulation to stop the flow of finance to destructive industries, the TFFF risks becoming yet another well-meaning mechanism trapped in a broken system.”
Global Witness echoed those concerns, calling for binding rules to stop banks and investors from financing forest destruction.
Governments, it said, cannot “fix deforestation while their banks continue to profit from it,” noting that private institutions have made more than $26 billion from financing forest-destroying companies since the Paris Agreement on climate change.
Tropical forest loss surged to record-breaking levels in 2024, averaging a staggering rate of 18 football fields per minute, it said.
Power Shift Africa said that the current TFFF design concentrates decision-making power with donor or sponsor countries, financial managers, large conservation NGOs and financial institutions, with minimal participation by developing countries, indigenous peoples and local communities.
“This structure risks turning the facility into a top-down mechanism where countries of the Global North determine priorities, eligibility and performance metrics for forest protection in the South.”
For Africa, where most tropical forests are community-managed and integral to local livelihoods, the TFFF’s reliance on market-based incentives could deepen land tenure insecurity, privatisation of commons and social conflicts.
It said the TFFF’s framing obscures the historical and structural causes of deforestation, which lie largely in global consumption patterns, extractive industries and unequal trade relations driven by developed countries.
“It risks shifting responsibility for protecting the world’s tropical forests onto the shoulders of developing countries, while enabling the continued exploitation of forest-risk commodities by Northern corporations.”
“Putting a price tag on forests is just colonialism in a new suit,” added Fiore Longo of Survival International. “Forests are living homelands cared for by indigenous peoples – not carbon assets.”