New Delhi: As the annual climate change conference COP30 officially kicked off in Brazil’s Belem on Monday, the Brazilian hosts launched their Tropical Forest Forever Facility (TFFF) in the presence of delegates from 143 countries. On a befitting note, the fund to protect tropical forests around the world was launched in a city that is surrounded by the Amazon, the world’s largest tropical rainforest.
This permanent forest fund already has $5.5 billion in pledges from various countries within the first few days of COP30, including from Brazil, Norway, Indonesia and France. There are also investments from private players, like the Mindaroo Foundation, an Australian philanthropy. India, which accounts for 2% of the world’s total forest cover and is a major tropical forest country, has committed to being an observer in the TFFF, but has not pledged any funds yet.
As the COP30 progresses, Brazilian President Lula da Silva wants to raise more money to fulfil the goal of $125 billion for the fund.
“This is the COP of implementation, Lula (da Silva) even called it the COP of Truth,” said Sônia Guajajara, the Minister of Indigenous Peoples of Brazil, at a press conference on 6 November. “There is no better way to start than by ensuring the maintenance of the forests of Brazil and other tropical countries.”
The TFFF was first conceptualised by Brazil in 2023 at the United Nations Framework Convention on Climate Change (UNFCCC) Conference of the Parties (COP28) in Dubai. After negotiations and research in the last two years, with inputs from other countries with tropical forests, the Brazilian government decided to launch it during their COP presidency.
Partly a financial support mechanism and partly an investment fund, the TFFF is a unique blended-finance system whose main goal is to protect tropical forests across the world. It plans to do that by incentivising the 74 countries, including India—that together have more than 1 billion hectares of tropical forests in the world—to maintain their forest cover.
But the money for these incentives won’t come from a normal donor-based grant. Instead, the TFFF will be maintained by the World Bank as an investment fund, investing sponsor money in emerging market bonds. The returns from this initial investment will be used to both pay back the investor countries and also give financial incentives to tropical forest countries every year. Importantly, the TFFF also says that 20% of all incentives to tropical forest countries should go to the indigenous communities that actually protect the forests in their country.
“The Tropical Forest Forever Facility we are launching today is an unprecedented initiative. For the first time in history, countries of the Global South will take a leading role in a forest agenda,” said Lula da Silva, President of Brazil.
How will the TFFF work?
The Tropical Forest Forever Facility is not the first financial mechanism to support and protect forests in the world, but it is the first to focus on maintaining forest cover, rather than just reducing deforestation. The concept note shared by the Brazilian government mentioned other facilities like the Global Environment Facility and REDD++, which are both international funds for forest protection, and said that TFFF complements them.
“It fills a critical gap in the environmental finance landscape by rewarding forest cover maintenance and recovery,” read the note. “(It is) an incentive largely missing today in the global financial architecture for forests.”
The structure of the TFFF is thus: The initial investment of $125 billion will be managed by an independent body, most likely the World Bank, which will invest the money in market bonds. The TFFF concept note states that this investment will not be in fossil-fuel or related bonds. The returns on this investment, every year, will be used to give incentives to countries with tropical forests for maintaining their forest cover; the going rate is $4 per hectare of forest.
“The TFFF gives governments confidence that when they stop deforestation, they’ll be rewarded, year in, year out. And because of its design, investors will get their money back,” said Lord Zac Goldsmith, former UK Environment Minister, in a press release. “…history has been made here today, and those countries that are backing the TFFF will be thanked by generations to come.”
However, the TFFF is not without contention globally. Even before the fund was officially launched at the COP30, a report by the international NGO Global Forest Coalition and Bolivian NGO Fundación Solón called the TFFF a ‘false solution’ for tropical forests. Released in April 2025, the report questioned the market-based approach to forest conservation instead of addressing the genuine causes of deforestation.
Since the entire model of TFFF is based on returns on investment in ‘high-risk’ market bonds, the report cautioned that without these returns, the fund will fail to provide any money to tropical forest countries. Also, the report pointed out, that apart from the 20 percent allotted for indigenous communities, the rest of the financial incentive to countries with tropical forests will be provided without any oversight on how the funds are actually being used.
“The climate emergency is not a market failure but a failure of governance and responsibility. We need to confront the structural drivers of deforestation and invest in real solutions that empower local communities,” said Pablo Solón, Executive Director of Fundación Solón and co-author of the report, in a press release.
(Edited by Viny Mishra)
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