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COP27: This past year in deforestation

After bold commitments, what is happening to forests, and what actions are coming next?

A tree that has been cut down

Deforestation is not on track to end despite flashy pledges. Image by Jesse Klein/GreenBiz.

Last year at COP26 in Glasgow, Scotland, 141 leaders of countries that hold 90 percent of the world’s forests committed to end deforestation by 2030. Getting three big holdouts from a previous deforestation commitment in 2014 — Brazil, Russia and China — was a big win, although India, Saudi Arabia and South Africa are still absent. As of January, that list grew to include four more countries: The Holy See, Nicaragua, Singapore and Turkmenistan. 

The announcement was one of the biggest at COP, with splashy headlines, press releases and quotes about protecting nature, but many experts and activists were skeptical, citing the 2014 deal that had failed to slow deforestation at all. They wanted details on the roadmaps for ending deforestation, data on tracking progress and an understanding of what would happen if a country failed to deliver.

As COP27 proceeds this week, what has happened on deforestation in the year since the COP26 commitment? The experts haven’t gotten everything they wanted, but there have been a handful of noteworthy developments. 

Deforestation as a whole

According to the 2022 Forest Declaration Assessment, deforestation won’t end by 2030 unless dramatic changes are taken. To end deforestation in that time frame, there needs to be a 10 percent annual cut in deforestation. This year, deforestation fell by 6.3 percent compared to a 2018-2020 baseline. 

It wasn’t even that rosy in the tropics, with a reduction of only 3.1 percent. Even worse, 2022 saw record-high deforestation in the Amazon. In just the first half of the year, 1,500 square miles of the Amazon rainforest vanished —  a loss larger than any since 2016.  

One bright spot: Indonesia was able to cut deforestation every year for the past five — the only country to do so — and Malaysia reduced deforestation by 25 percent in 2021. With these and other efforts, Asia is on track to get to zero deforestation by 2030. 

Country-level changes 

That record-high deforestation in the Amazon caught a lucky break in October, when Jair Bolsonaro, Brazil's hard-right president, lost in a runoff election. Bolsonaro oversaw a doubling in the rate of deforestation after he took office in 2019 compared with a 2012 to 2018 baseline. Before his tenure, the forest was losing about 2,500 square miles annually and in the past three years has jumped to 5,000. 

Bolsonaro's replacement, Luiz Inácio Lula da Silva, has been a champion of the Amazon. In his first term from 2003 to 2006, Amazon deforestation dropped by 43.7 percent, according to Tasso Azevedo from MapBiomas. And it dropped a further 52.3 percent during his second term ending in 2010. 

Across the Atlantic in the European Union, new regulations took aim at products that cause deforestation in the manufacturing of those products. In November 2021, the EU published a proposal for regulation that would require companies to do comprehensive due diligence on their supply chains to identify and reduce links with a high risk for deforestation. The regulation focuses mainly on palm oil, beef, timber, coffee, cocoa and soy, each of which has a history of deforestation. The finalization of this proposal should happen this year. 

Show me the money

The participating countries knew that money is key to achieving their deforestation goal. Twelve countries including Japan, Denmark, Korea and the U.S., along with the EU, created the COP26 Global Forest Finance pledge to provide $12 billion in funding between 2021 and 2025. According to a press release from COP27, $2.67 billion of that $12 billion was spent in year 1. 

An additional $1.7 billion was committed to supporting Indigenous peoples and local communities and their forests. A report from the Forest Tenure Funders Group claimed that in 2021 the donors delivered 19 percent of that $1.7 billion, but that the money was mostly channeled through NGOs with only 6 percent going directly to Indigenous or local organizations themselves. 

To end deforestation in that time frame, there needs to be a 10% annual cut in deforestation. This year, deforestation fell by only 6.3%.

Movement on another fund announced at COP26, the $1.5 billion committed to helping protect forests in the Congo Basin, started this summer. A working group was established to help support the Democratic Republic of Congo (DRC) finance the protection of forests and peatlands in the basin after the DRC agreed to cap forest loss at the 2014-2018 average and work to reduce deforestation rates in November 2021. 

So what about COP27?

COP27 is ongoing in Sharm el-Sheikh, Egypt, and deforestation is once again making headlines. On Nov. 7, 25 world leaders including Japan, Pakistan, the Republic of Congo and the United Kingdom launched the Forests and Climate Leaders’ Partnership (FCLP) at the conference to continue to scale the work from last year. 

This is part of the roadmap experts were looking for in 2021, as this partnership will help determine the long-term strategies and accountability mechanisms. The FCLP will focus on six action areas: international collaboration on supply chains; mobilizing public and donor finance; shifting the private finance system; supporting Indigenous peoples and local communities; strengthening and scaling carbon markets for forests; and partnerships and incentives for preserving high-integrity forests.

Curious about what happened at COP? Catch up with all our reporting on the global negotiations.

In the early days of COP27, the roadmap promised from Cargill, ADM, Bunge & Co. to combat deforestation around soy, beef and palm oil debuted, but experts felt it was lackluster and fell well short if we are to keep to the 1.5 degrees Celsius of warming. 

The next big announcement is from the The Lowering Emissions by Accelerating Forest finance (LEAF) Coalition. The organization is teaming up with VW Group, H&M Group, Amazon, Salesforce, among other corporations, and for the first time an asian national government, South Korea, to provide $500 million in private sector funding to countries seeking to protect forests in addition to the previous $1 billion. Ecuador is the first country to sign the memorandum of agreement with the LEAG Coalition that outlines next steps as well as a binding timeline for an Emissions Reduction Purchase Agreement (ERPA). Another win was finally ironing out the action plan for last year’s commitments.

Finally, the financial institutions are taking aim at commodity-driven deforestation. The Finance Sector Deforestation Action (FSDA), which includes leading financial institutions such as AXA, Schroders, Storebrand and JGP, are focusing on moving investment away from companies whose product supply chains cause deforestation. For example, the members developed and published investor expectations that include addressing their deforestation impacts, assessing their deforestation risk exposures, transforming their supply chains to eliminate deforestation impacts and disclosing their deforestation risk exposures. 

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