Indonesia, Brazil, and Congo Hold Half the World’s Rainforests
More than half of the planet’s tropical rainforests are housed collectively within the Democratic Republic of Congo, Brazil, and Indonesia. In 2022, when Indonesia hosted the G20 summit in Bali, the three nations pledged to cooperate on financing forest protection. That formal commitment has not yet evolved into a cohesive bargaining alliance where member states share a unified stance and present a singular voice.
High Debt Loads and Meager Aid Slow Conservation Efforts
Developing forest nations face severe financial constraints while being asked to keep vast ecosystems standing for the global climate. Indonesia’s finance minister warned in April that high oil prices could push the national budget deficit to 2.9% of the economy. Meanwhile, discussions are underway for an arrangement where the Republic of Congo—which carries approximately US$5 billion in external liabilities—would secure the cancellation of a portion of its foreign debt in exchange for safeguarding its woodlands.
International aid from wealthy northern donors remains sparse and unevenly distributed. Research from the Center for International Forestry Research shows that the Congo Basin secured just 11% of global tropical forest financing between 2008 and 2017. During the same period, Southeast Asia captured 55% of the funding, while the Amazon received 34%.
New Global Funds Test Forest Payment Models
Financial returns for avoiding carbon emissions have historically lagged behind stated goals. A 2022 study revealed that Norway paid Indonesia roughly $1 per tonne of avoided carbon emissions, falling well short of Norway’s stated rate of $5 per tonne.
A newly established global financing mechanism aims to alter that dynamic. The Tropical Forest Forever Facility, launched in Brazil last year, plans to issue annual payments to countries for every hectare of conserved forest. The fund has gathered $7.3 billion from participating governments, though payments are unlikely before 2028. Notably, Brazil and Indonesia have each committed $1 billion, outpacing several wealthy donor nations that pledged only a few million dollars each.
Three Pillars for a Unified South-South Bloc
Operating in isolation leaves forest nations vulnerable to donor-driven terms that pit developing economies against one another for limited funds. A unified South-South coalition should establish common positions across three critical areas:
- Finance: Payments must be large enough to offset what a country gives up by not clearing its forest, arrive on schedule, and be delivered as grants rather than debt-increasing loans.
- Safeguards: Members should adopt uniform rules protecting local populations, ensuring that 20% of payments reach indigenous peoples and local communities.
- Pricing: The bloc must demand a minimum price floor for avoided emissions to close the valuation gap between the global South and Europe.
Bhima Yudhistira Adhinegara, executive director of the Center of Economic and Law Studies (CELIOS), and Muhammad Zulfikar Rakhmat, director of the China-Indonesia and MENA-Indonesia desks at CELIOS, note that cooperation should also extend to sharing technical expertise. Brazil utilizes satellite tracking to monitor forest loss, while Congo Basin countries maintain experience working alongside local communities.
Upcoming UN Climate Summit Sets the Timeline
COP31, the United Nations climate summit in Antalya, opens next month. Indonesia should use it to bring forest-rich nations to a single table with a unified bargaining strategy.
Common Questions About Tropical Forest Financing
When will countries receive payments from the Tropical Forest Forever Facility?
Disbursements from the $7.3 billion fund are unlikely to begin before 2028.
How much foreign debt does the Republic of Congo hold?
The Republic of Congo owes about US$5 billion abroad and is currently exploring a deal to cancel part of its debt in return for forest protection.
What percentage of international forest financing went to the Congo Basin between 2008 and 2017?
The Congo Basin received just 11% of international tropical forest financing during that period, compared with 55% for Southeast Asia and 34% for the Amazon, according to research from the Center for International Forestry Research.
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