news - FMO & Green Climate Fund tackle biodiversity loss & deforestation through USD 180 mln agreement to &Green Fund

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FMO & Green Climate Fund tackle biodiversity loss & deforestation through USD 180 mln agreement to &Green Fund

December 1, 2023

Today at COP28, Green Climate Fund (GCF) and FMO signed an agreement to provide a USD 180 million investment to the &Green Fund. The investment from GCF, the world’s largest dedicated climate fund, will help to unlock private sector capital for &Green which will further equip the fund in its mission to promote global food security while addressing deforestation and biodiversity loss in tropical commodity supply chains. 

As an accredited entity to the GCF since 2016, the program is FMO’s fourth collaboration with the Fund and its largest to date - following the USD 100mln that the GCF invested in Climate Investor One (CFM) in 2019, USD 137mln invested in the Green Growth Equity Fund (GGEF) in 2021, and USD 145mln invested in Climate Investor Two (CFM) in 2022.

andGreen COP

&Green, established in 2017 with an anchor investment by the Norwegian government, has to date invested over USD 165mln in sustainable growth companies operating in countries such as Brazil, Indonesia, and Colombia. The fund promotes sustainable commodity production and higher productivity on agricultural land in selected countries with important tropical forest resources, thereby decreasing the pressure to clear forests for agricultural purposes. The fund works to reduce emissions and increase the resilience of local communities by financing the transformation of tropical agricultural commodity supply chains from extractive to sustainable practices, in sectors such as livestock, palm oil, soy, rubber, cocoa, and forestry. GCF’s investment in the &Green Fund will focus on 11 countries – namely Brazil, Cameroon, Colombia, Côte d’Ivoire, Democratic Republic of the Congo, Ecuador, Gabon, Indonesia, Lao People’s Democratic Republic (PDR), Liberia, and Zambia.

With this achievement, &Green is well positioned to scale up and unlock private sector capital while it continues to make highly impactful investments through its rapidly expanding pipeline.

Michael Jongeneel, CEO at FMO, said: "We are very happy to be building on what has been a promising and rewarding initiative. This next chapter will allow the &Green Fund to attract much-needed commercial capital and further accelerate investments in the transition towards low-emission and climate-resilient tropical commodity supply chains in countries which need it the most. FMO is proud to continue to support the &Green Fund and its ability to tackle the climate transition in such a critical industry.”

Henry Gonzalez, Deputy Executive Director at GCF, added: “GCF’s catalytic capital means &Green can scale and unlock private capital to support this paradigm shift without compromising on returns. Sustainable land-use can contribute significantly to mitigating climate change and increase resilience, and help the world reach the goals of the Paris Agreement and meet Net Zero strategies.”

Nanno Kleiterp, Chairperson of the &Green Board of Directors, said: “FMO is ideally placed at the nexus between public and private investors to act as a partner for &Green in making the next, crucial step, which is to attract capital from the private sector in order to provide funding at scale for a commercial and highly impactful approach to end deforestation in tropical forests.”

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About GCF (www.greenclimate.fund)

The Green Climate Fund (GCF) is the world’s largest dedicated climate fund. GCF’s mandate is to foster a paradigm shift towards low emission, climate resilient development pathways in developing countries. GCF has a committed portfolio of USD 13.5 billion delivering transformative climate action in more than 120 developing countries. It also has a readiness support programme that builds capacity and helps countries develop long-term plans to fight climate change. GCF is an operating entity of the financial mechanism of the United Nations Framework Convention on Climate Change (UNFCCC) and serves the 2015 Paris Agreement, supporting the goal of keeping average global temperature rise well below 2 degrees Celsius.

About &Green Fund (www.andgreen.fund)

The &Green Fund is a private debt evergreen vehicle which was developed under the leadership of IDH in close collaboration with Norway’s International Climate and Forests Initiative (NICFI). It is a blended finance debt fund investing in commercial projects that can demonstrate decoupling of commodity production from deforestation, while being socially inclusive. &Green is focused on tropical forest jurisdictions with progressive forest protection strategies and targets in place. It targets commodities that are driving deforestation, such as palm oil, soy, beef, forestry (including rubber) and others. Dutch advisory firm SAIL Ventures acts as the fund’s manager.

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