ABF Closes 2,000 Hectares Reforestation Deal in the Amazon
November, 2022 — Unlocking private finance for Amazon conservation enterprises is critical to stopping and reversing deforestation in the Amazon region. The objectives of the Amazon Biodiversity Fund (ABF) are to conserve biodiversity, address deforestation and climate risks, and create positive socio-economic and well-being outcomes for local communities in the Legal Amazon.
ABF signed an innovative agreement with Centro de Estudos Rioterra and Reforest'Action for the first project in the environmental services portfolio. The investment will pay for the reforestation of 2,000 hectares of permanent protection areas ( APPs) on small rural properties in the Amazon. This will encourage producers to keep the forest standing, improve local ecosystems, and enhance smallholder livelihoods.
“For us, it will be a milestone: a pilot project that could be later replicated in other areas in the Amazon and across Brazil,” says Rosana Della Mea, investment manager and ESG analyst at Impact Earth, the new organization behind the ABF. They dedicate 100% to impact investing, and innovation at scale.
Impact Earth team designed ABF jointly with USAID/Brazil and the Alliance of Biodiversity International-CIAT. CIAT provided the anchor capital. It was created to overcome financial challenges faced by businesses, start-ups, and projects in the Amazon, offering long-term impact investing to finance sustainable enterprises.
Earlier this year, ABF received further support from the ASN Biodiversity Fund, managed by ASN Impact Investors, as well as other investors.
So far, ABF has also invested in: Manioca, a food brand that sources sustainably produced raw materials from smallholders, promotes Amazonian products and attracted the attention of internationally recognized chefs, such as Alex Atala and Helena Rizzo; Horta da Terra, a company that grows unconventional food plants from the Amazon, such as taioba and jambu, and sells them in the form of dehydrated powder; Inocas Amazônia, uses agroforestry systems to grow Macaúba, a native fruit used as an alternative to palm oil, and other crops on small and medium sized land holdings; and Amazônia Agroflorestal, engages rural producers in the recovery of degraded areas transforming them into fair trade, high yield coffee agroforestry systems, building on the Café Apuí project, and conserves remaining forest through a REDD+ conservation programme.
New Investment Target — The project developed with Centro de Estudos Rioterra and Reforest'Action promote reforestation in areas degraded by pastures in the Lower Rio Jamari basin, located in the state of Rondônia. The initial plan is to recover 75 percent of the area with direct planting and 25 percent with applied nucleation, an innovative method that connects and generates a new habitat for native species. This method has never been implemented on a large scale in Brazil.
Restoration activities will take place in 2024 and will be implemented on family farms by Centro de Estudos Rioterra. Only native species will be used.
“The project has a huge potential for replication and scale gains for several biomes, as well as for social impact. This is a model that can be adapted to different realities and can shed light on the issue of environmental regularization of rural properties in the Amazon,” says Alexis Bastos, project coordinator at Centro de Estudos Rioterra.
Selected producers will receive an initial investment to carry out restoration activities, followed by payments per hectare conserved for 30 years. “We are very excited about this project, the first of its kind,” adds Rosana.
Reforesterra - Restauraçao de Ecossistemas Florestais, a new Brazilian company created by Reforest’Action and directed by Reforest’Action, ABF and Rioterra, will pilot the project. Reforesterra is also in charge of the VCS and CCB certification and will generate carbon credit with high levels of climate and social impact, issued for forest restoration.
“Reforesterra will use Reforest’Action methodologies for climate, environmental and social impact assessment”, says Pierre Gaches, COO of Reforest’Action and President of Reforesterra - Restauraçao de Ecossistemas Florestais Ltda. board.
Monitoring — The fund also has a monitoring program, in which an innovative methodology is being used to calculate the environmental impact associated with the implementation of sustainable practices.
TerraBio, as it is known, adopts a monitoring, evaluation, and analysis approach to generate evidence on environmental impacts. It supports businesses that commercialize forest and sustainable agriculture products and invest in sustainable business models.
Furthermore, TerraBio integrates cutting-edge sensing technologies with innovative techniques for collecting biodiversity data through eDNA technology. Satellite data are collected through a partnership with the SERVIR-Amazônia program and the Spatial Informatics Groups (SIG), which also support TerraBio's data analysis.
In order to carry out eDNA analysis, it is necessary to collect soil samples from selected areas, and send them to specialist labs for analysis. Two ABF-funded projects have already collected material — Amazônia Agroflorestal, in September, and Horta da Terra, earlier this year (more information here).
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