SDG 15 – Life on Land

An increasing number of animal and plant species are dying out – the International Union for Conservation of Nature (IUCN) Red List indicates that almost 40,000 species worldwide are currently critically endangered. However, without decisive action this will just be the start of species loss which could shape the course of geobiological history. If the IPBES projections are accurate, the world is on course to lose one in eight species of flora and fauna.

This makes it necessary to create and protect conservation areas, especially in “biodiversity hotspots” which are primarily found in developing countries and emerging economies. However, as these are mostly poor countries like the Democratic Republic of Congo, Madagascar, Ecuador and Laos, there is still a significant shortfall. Earmarking more protected areas – currently, just under 16% of rural areas are protected, with some protection only existing on paper – requires additional funds that are sufficiently secure so that their use can be planned.

KfW is working on this. Among other things, it supports a range of nature conservation funds, such as the Caucasus Nature Fund as well as several environmental foundations and international NGOs, to identify new areas and to better manage existing conservation areas. This enables them to protect flora and fauna effectively while simultaneously ensuring that local people are sufficiently involved in using conservation areas. KfW has declared its intentions to involve more private investors than previously. It can thus use the limited development cooperation funds to open up new sources of financing for conservation.

It was for this reason that KfW set up the Legacy Landscapes Fund (LLF), which began its work in spring 2021. The fund supports areas in developing countries in which biodiversity is high but financial resources are scarce. This will make it possible to safeguard a good amount of the biodiversity that is vital for all of humankind. Its goal is to fund at least 30 sites for at least 15 years so that protected areas can do their job properly and truly protect nature. The fund’s special feature is that, in addition to public donors, private actors such as charitable trusts and companies are also involved. This ensures that more funds can be mobilised for conservation than would otherwise have been the case. KfW established the LLF on behalf of the German Federal Government with more than EUR 80 million in initial capital.

On behalf of the German Federal Government, KfW finances a total of over 600 conservation areas in 68 countries around the world, covering a total area of approximately 1.6 million square kilometres. That is more than the area of Germany, France, Spain and Italy put together.

Forests perform many important ecological tasks. As the “lungs of the planet” they supply oxygen, regulate the climate, protect against erosion, store drinking water, produce valuable raw materials, food and medicinal products, cushion the effects of storms and enable endangered species to survive. In rural parts of many developing countries, the forest is also an important economic factor that enables people there to survive. People have been transforming forested areas for millennia, usually for agricultural purposes. In the recent past, however, this practice has taken on extremely dangerous proportions, not least in relation to climate change, because forests play a key role in limiting global warming. Around 30% of annual anthropogenic greenhouse gas emissions are absorbed by plants, predominantly in forests, and stored in biomass. This makes forests particularly important greenhouse gas sinks.

As the originator of the concept of sustainability over 300 years ago (the term originally came from the German forestry industry), Germany is particularly involved in forest conservation. This takes various forms. First, there are nature conservation areas, which are highly important in fighting deforestation and conserving biodiversity. However, the interests of people and local users must not be forgotten in the process. Nature conservation can only work in the long term when both people and nature benefit in equal measure. It is about conserving forests and managing them sustainably. KfW is currently helping to protect over 100 million hectares of forest.

Second, it also promotes the REDD approach (Reducing Emissions from Deforestation and Degradation). The principle here is that climate and development funding is only provided if partner countries can demonstrate that they have reduced greenhouse gas emissions through forest conservation.

KfW also promotes sustainable management of existing forests, especially in Asia and Latin America. The Indonesian-German forestry programmes  (PDF, 153 KB, non-accessible), for example, were developed to address the problem of deforestation and slash-and-burn clearance. These programmes aim to develop and implement sustainable forest management methods and protect natural habitats.

Another important aim of KfW is to restore degraded tree-rich landscapes and forests which have been cleared. One concept in this area is forest and landscape restoration (FLR), which addresses both environmental and social factors.

Alongside forest and nature conservation, new economic practices are needed to avoid further endangering natural resources. These are currently under severe pressure due to activities that include mining, intensive agriculture and deforestation. Reversing this trend requires a transformation to a “green economy” which acknowledges the finite nature of natural resources and respects the “limits of the planet”. This requires incentives and capital. KfW sees itself as a driving force in this regard; it is supporting this change of direction through targeted programmes.

For example, in 2014 it founded the eco.business Fund  (PDF, 231 KB, non-accessible) on behalf of the Federal Ministry for Economic Cooperation and Development (BMZ). Through green credit lines, it promotes economic activity which contributes to the sustainable use of raw materials and the preservation of biodiversity. It started its work in Latin America and the Caribbean, where it focuses on four areas: agriculture, forestry, eco-tourism, fisheries and aquaculture. It was so successful there that in late 2019 it extended to include Africa. Since it was founded, the fund has helped to protect more than 160,000 hectares of land from deforestation and to save over 4 million cubic metres of water.