Presentation at the Global Landscapes Forum 2015, in Paris, France alongside COP21. For more information go to: www.landscapes.org.

1. Mobilizing finance for
integrated landscape initiatives
Global Landscapes Forum,
Paris, 6 December 2015

2. What are the issues?
Main reservations from investors:
1. UNDERSTANDING of Scattered intelligence on these “landscape initiatives”
2. SCALE: Existing initiatives rather small and/or pilot and involving very few
impact investors and DFIs;
3. INDICATORS: Lack of “simple” performance indicators allowing investors to be
comfortable with such projects;
4. NO TRACK-RECORD of bankable projects.

3. Unlocking Forest Finance
Developing innovative financial mechanisms
at a landscape scale
to reduce deforestation
for capital markets
in Public – Private – People Partnerships

4. The regions we work in….

5. An International Climate
Initiative project
CDSA
Acre
Government and non-governmental partners

6. Finance partners and advisors
Current market trends and terms
Latest environmental standards
Includes major bond issuers and investors

7. Unlocking Forest Finance
PART ONE: The Portfolio
“How the money would be used”

8. Portfolio of investments
Upfront investments in:
1. Supply chains (land management systems)
2. Government sustainable livelihood programmes
3. Government conservation programmes

9. Complementarity with other
initiatives
Portfolio of investments- framework
Preservation of
culture and
traditions
Improved technical
capacity
Enhanced land rights
and food security
Social criteria
Reduction of GHGs
Use of degraded
land
Benefits for
biodiversity
Environmental criteria
Risks are negligible
or manageable
Positive NPVs and
attractive IRRs
Transaction costs are
acceptable
Financial criteria
Complementarity
with other initiatives
Cross-cutting criteria

10. Beef Cattle Milk Cattle Native Forests
Soy
Planted Forests
Rubber Brazil Nuts Aquaculture
State Conservation
Units
Indigenous
Communities
Portfolio of investments (Mato Grosso)

11. Milk cattle (Mato Grosso)
Problem
• UFF is targeting 5,000 small-scale milk cattle farmers in Mato Grosso
• Low production technology leads to low milk quality and low income for
producers
• Do not comply with Forest Code, leads to environmental problems
• State subsidised credit is available (e.g. (ABC, FCO, Pronaf) but:
• Difficult to access (land title, financial education)
• Limits on amounts, so resort to expensive private loans
Solution
• New, subsidised credit lines from private banks for Forest Code compliance
and intensification
• Training on how to access to finance
• Upscale existing intensification training program with Municipalities

12. Financial analysis - milk cattle (Mato Grosso)
Revenues
Costs
Cash flows
Cumulative
cash flows
Year
NPV: $17.5m
IRR: 26.3%
7 year
payback
period
4 year
return
period

13. Unlocking Forest Finance
PART TWO: The Finance
“How the money would be raised”

14. Risk mitigators
Technical assistance
Guarantees
Producers
Subsidised loans Insurance Technical assistance
Financial Mechanism
Financial intermediaries
Private banks Credit unions
Guarantee
providers
Insurance
providers
GrantsLoans
Grants
Non-financial intermediaries
Gov’t agencies Cooperatives
Note: For example purposes only, subject to revision

15. Bond issue
Bond Issuer
Financial
intermediaries
Loans
Technical Assistance Fund
Grants
Climate
Finance
Risk
mitigators
Guarantees
International, national and
local advisersGrants
Bond
Markets
Investors
Note: For example purposes only, subject to revision
Non-financial
intermediaries
Grants

16. Timeline
• December 2015 - Review cash-flows and loan/grant requirements for each
supply chain in the preliminary portfolio
• March 2016 - Select final portfolio of supply chains, draft Investment Proposition
• June 2016 - Produce final Investment Proposition, market to investors
• Early 2017 - Launch of the bond

17. Thank you, any questions?
uffmanagement@globalcanopy.org