Finance to business-as-usual activities that have the potential to drive deforestation or forest degradation (“gray” finance) continues to dwarf finance dedicated to forest protection and restoration (“green” finance). Public support to the agricultural sector, usually made in the form of subsidies, is often geared toward advancing development objectives related to food security and poverty reduction. However, such support can present risks to forests. Subsidies can reduce farmers’ production costs, distorting their decisions on where and how much to produce, and incentivizing expansion into forest areas. As such, this type of finance is considered “gray” in the context of forests, and is essential to track given its potential to hinder progress on the goals set by the GLD.
Estimates suggest that between 2013 and 2018, gray public finance flows – in the form of government subsidies for the agricultural sector – ranged between USD 378 billion to USD 387 billion per year, globally. The upper bound is estimated at as much as USD 1 trillion per year, if data for all countries were available.
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Note: Data and underlying methodology are reported in the 2023 Forest Declaration Assessment.
Full description, licensing, and other information available at the original data source (FAO, UNDP and UNEP).
Finance to business-as-usual activities that have the potential to drive deforestation or forest degradation (“gray” finance) continues to dwarf finance dedicated to forest protection and restoration (“green” finance). Public support to the agricultural sector, usually made in the form of subsidies, is often geared toward advancing development objectives related to food security and poverty reduction. However, such support can present risks to forests. Subsidies can reduce farmers’ production costs, distorting their decisions on where and how much to produce, and incentivizing expansion into forest areas. As such, this type of finance is considered “gray” in the context of forests, and is essential to track given its potential to hinder progress on the goals set by the GLD.
Estimates suggest that between 2013 and 2018, gray public finance flows – in the form of government subsidies for the agricultural sector – ranged between USD 378 billion to USD 387 billion per year, globally. The upper bound is estimated at as much as USD 1 trillion per year, if data for all countries were available.
—
Note: Data and underlying methodology are reported in the 2023 Forest Declaration Assessment.
Full description, licensing, and other information available at the original data source (FAO, UNDP and UNEP).