‘Dismal’ health of world’s forests is threat to humanity, report warns
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Version 0 of 1. Financial institutions pouring money into land clearance and undermining efforts to stop destruction, says Climate Focus Global forest health has plunged to “dismal” levels and threatens the wellbeing of humanity, warns a damning report that highlights how financial systems are pouring money into land clearance and undermining efforts to reduce destruction. Since 2021 when world leaders and corporate executives promised to halt deforestation, the new study found that forest loss has increased, driven by subsidies for livestock, monocrops, logging and other extractive industries. Last year, 8.1m hectares (20m acres) of forest – an area roughly half the size of England – were burned, pulled or cut down, which was higher than the loss at the time of Cop26 in Glasgow, when the target of zero deforestation by 2030 was signed. The world is now 63% off track to reach that goal, according to the latest Forest Declaration Assessment, which is compiled each year by a coalition of civil society and research organisations. “Every year, the gap between commitments and reality grows wider, with devastating impacts on people, the climate and our economies,” said the lead author, Erin Matson of Climate Focus. “Forests are non-negotiable infrastructure for a livable planet. Continued failure to protect them puts our collective prosperity at risk. “We already know what works to stop forest loss, but countries, companies, and investors are only scratching the surface. And even those initial efforts are facing strong pushback from the standard bearers of an economic system built on forest destruction.” Behind the grim trend is a grotesque imbalance between the finances devoted to extraction and conservation. Agricultural industries, which have been responsible for 85% of forest loss over the past decade, have received average annual subsidies worth $409bn (£307bn). This is almost 70 times more than the $5.9bn of international public finance provided each year for forest protection and restoration. “Efforts to protect forests don’t stand a chance as long as our economic system keeps rewarding quick profits from forest destruction,” said Franziska Haupt, a partner at Climate Focus. “To truly tackle deforestation, leaders must work collectively to implement bold, binding reforms that will transform the system that still generously rewards forest loss.” A growing cause of alarm is the spread of fire, which hit staggeringly high levels in the Amazon last year after record droughts turned swathes of the normally moist tropical rainforest into a tinderbox. Many blazes are started deliberately to clear land and spread out of control. The carbon dioxide released by the burning Amazon last year was seven times higher than the average over the previous two years and more than the total greenhouse gas emissions of Germany. The authors of the report said the fires were pushing the forest closer to a point of no return. Private financial institutions are further tipping the balance. A separate report released by Global Witness found that banks have made $26bn from financing deforesting companies since the Paris agreement was signed in 2015 – averaging around $7m every day. US banks, led by Vanguard, JPMorgan Chase and BlackRock, earned the most globally, making $5.4bn, according to the watchdog group, based on data from the Dutch research consultancy Profundo. Sign up to Down to Earth The planet's most important stories. Get all the week's environment news - the good, the bad and the essential after newsletter promotion This report found EU banks, topped by BNP Paribas and Rabobank, earned $3.5bn, while British banks made $1.2bn, with HSBC, Aberdeen Group and Schroders gaining the highest returns. Chinese financial institutions also secured $1.2bn, despite the country’s green finance policy supposedly restricting lending for companies with environmental or social governance concerns. “We are witnessing major banks bankroll a fire sale of the world’s rainforests,” said Global Witness forests lead Alexandria Reid. “And they’re reaping obscene profits from the ashes. “As long as tearing down forests remains more profitable than protecting them, the world will not meet its 2030 goal to halt deforestation, with catastrophic consequences for the climate. If world leaders want to change this, they must act now to shut down the profits fuelling this crisis.” Hopes for change are focused on next month’s Cop30 in Belém, the first climate summit to be held in the Amazon. The host, Brazil, has shown in the past that it can dramatically slow the speed of deforestation by stricter enforcement of the law. At Cop30, it will also be proposing a new conservation funding mechanism, the Tropical Forests Forever Facility, which aims to raise $125bn for countries that preserve their standing forests. “The overall numbers are dismal, but the future of forests doesn’t have to be,” said Matson. “New finance initiatives such as the TFFF offer a path to transformative change. If Cop30 delivers on its promise, we could be reporting a very different story next year – one of real progress.” For this to work, financial institutions also need to step up. They are expected to buy bonds worth fourth-fifths of the $125bn that the TFFF hopes to raise. This might help them allay growing criticism that they are profiting from destruction. Elisabeth Hoch, the international portfolio lead at Climate & Company, which is part of the coalition that produced the forest assessment, said only 40% of financial institutions have a deforestation policy, even though forests are worth $150tn a year in economic value. “I want companies and financial institutions to leave the Cop feeling, ‘I must do something or I will be losing out,’” Hoch said. “Cop can generate momentum. It depends on whether financial institutions finally have the guts to do something about this.” |