After spending the weekend at the Global Landscapes Forum’s fourth Investment Case Conference in Luxembourg, Daan Groot summarized some of his reflections:
- Having also been to the very first one, it’s evident that a lot has happened in the meantime. A great number of new funds have emerged in the last couple of years, whereas existing funds have increased their portfolio and are leading the way. At the same time, the major issue remains to be project development. As Director-General of the World Agroforestry Centre Tony Simons eloquently pointed out, most projects are either under- or overfunded in their development stage. Many projects have no funding at all or need to deliver a sound proposal for under $50.000, whereas some projects get a million. That seems great, but it limits upscaling potential. I would like to add that there is a vast amount of grant-driven projects that are now ‘wasted’ because they are not also looked at with a lense of landscape finance. We will not move from 100% donor-driven projects to 100% bankable projects overnight. We need to look into existing projects to see how we can use those as a proof-of-concept, scale them, bundle them and create spin-off to make incremental steps, even if this only means 10-20-30-40-50 percent bankability. In short, we need to leverage ODA much better.
- Although a lot has happened, it’s nowhere near enough. Another interesting perspective by Tony Simons. We need 800 billion dollars to restore 350 million hectares of degraded land. This is not a small amount. But if we take in the fact that we actually spend 5.2 trillion on subsidies on fossil fuel (and the amount to clean up for the damage done) and over 700 billion on agricultural subsidies which are effectively degrading the land, such a one-off investment doesn’t sound so bad. Why do we speak of value chains, when they are not adding value but extracting value. As Luxembourg minister for the Environment Carole Dieschbourg put it: How can something count as an investment if it’s destroying the planet.
- CIFOR Director-General Robert Nasi saved the best for last, narrating how our current plight emerges from our sins: such as our Hubris to think we are above nature, while we need to save ourselves rather than nature; our Greed to take more than the planet can sustain; our Procastrination: no longer can we kick the can to the next generation; finally our Cowardice: we are willing to take the risk to destroy our civilization, but not the risks of investing in a sustainable project that has no track record.
What are your thoughts? Please reach out to discuss through daan@nature-squared.org or +31 6 3824 8897.
Want to get to work? Click here to read more on our Landscape Finance Framework.
