Financing strategies for integrated landscape managementSeth ShamesEcoAgriculture Partners

International Forum onLandscape restoration, governance and climate change

San Salvador, El SalvadorFebruary 17-18, 2014

Elements of integrated landscape management1. Shared or agreed management objectives encompass multiple benefits (the full

range of goods and services needed) from the landscape.

2. Field, farm and forest practices are designed to contribute to multiple objectives including human wellbeing, food and fiber production, climate change mitigation, and conservation of biodiversity and ecosystem services.

3. Ecological, social, and economic interactions among different parts of the landscape are managed to realize positive synergies among interests and actors or to mitigate negative trade-offs.

4. Collaborative, community-engaged processes for dialogue, planning, negotiating and monitoring decisions are in place.

5. Markets and public policies are shaped to achieve the diverse set of landscape objectives and institutional requirements.

Climate-smart agricultural landscapes: Food, livelihoods, mitigation, resilience, ecosystems

Landscapes for People, Food and Nature Initiative

Value of ILM vs non-integrated alternativesPublic and private benefits

●Efficiencies in public sector planning , inter-agency and spatial

●Diversified revenue streams provide economic resilience in the landscape

●Reducing supply chain risk

●Access to new markets including certified commodities and PES

ILM finance study objectives

●Identify mechanisms and strategies used by ILIs to access finance

●Identify mechanisms and strategies of financial institutions to finance and benefit from ILM

●Provide recommendations and mobilize dialogue with financing institutions to improve ILM finance

Asset investment and enabling investment

Enabling Investments

Funding the generation of the incentive to invest.

Often by FIs with no expectation of financial

reward.

Asset Investments

Finance for an activity that creates tangible value.

Mostly through loans and equity investments.

Motivations of finance institutions

Scoping Finance Institutions and Financing Mechanisms for ILM

> 200 Institutions; > 250 Mechanisms; Wide range of ILM investment

Finance institution case studies

Investment fund managers Althelia, Moringa, Ecoenterprise fund,

Commercial bank Rabobank

National Bank Brazil Rural Credit

Institutional investor TIAA CREF

Company Bunge Environmental Markets, Nestle

Multilateral public sector Global Environment Facility, WB BioCarbon Fund

Bilateral public sector NORAD NICFI, USAID

Types of ILIs by dominant actor

•Examples: Mt. Kenya East Pilot Project (now Upper Tana), Kenya; Gishwati watershed, Rwanda; Loess Plateau, China

•Types of finance: Multi-lateral and bi-lateral funds, DFIs, domestic funds

National government-led, large multi-lateral donors

•Examples: Lombok/British American Tobacco, Indonesia; Atlantic Forest Restoration PACT, Brazil•Types of finance: Multi-lateral, bi-lateral, banks, commodity roundtable investments, private foundations, labour

and in-kind contributions, PES

Regional initiatives and platforms

• Example: ASPROINCA, Colombia• Types of finance: Labour and in-kind, private foundation, PES, government (national,

regional or local)

Traditional, local or community-led

•Eamples: Namaqualand, South Africa; Bacia hidrográfica do Ribeirão do Boi, Brazil•Types of finance: Private foundation, Multi-lateral, domestic development banks, government, community

contributions, PES, labour and in-kind

NGO-led, civil society organizations

• Examples: Guyaki Yerba Mate; Sustainable Cattle in Practice - pilot phase, Brazilian Round Table on Sustainable Livestock

• Types of finance: Supply chain investments, private foundations, in-kind, PES

Private sector-led (small-scale farmers to agri-

business, forestry, mining)

Landscape initiative case studies●Atlantic Rainforest, Brazil, Espírito Santo

Regional platform: Atlantic Forest PACT

●Lake Naivasha, Kenya Government-led: Imarisha Naivasha

●Namaqualand, South Africa Conservation International

Scoping results: Mapping the flow of ILM finance

Examples of public and private finance mechanisms for ILM

Challenges of scale: time horizon, investment size, risk appetite

ILM enabling investment challenges and innovations

●Public sector institutions are siloed

●ILI start-up and coordination is underfunded

●Enabling investment is not sufficiently reducing risk for private investors

Recommendations

● Increase investment in enabling conditions for ILM

●Continue to clarify and communicate the ILM business case

● Reduce risk for private sector investment with public policy

● Reduce risk for private sector investment with innovative financial mechanisms

●Develop partnerships between financial institutions and landscape stakeholder groups

● Integrate sectoral planning at the landscape scale for green growth and climate change investments

Thank you!

sshames@ecoagriculture.org