African governments are developing new models to finance forest protection and restoration, with Ethiopia, Kenya, Nigeria and Gabon emerging as key examples of how domestic budgets, international support, carbon finance and results-based payments can be combined to protect forests while supporting economic development.
The examples are highlighted in the first Progress Report of the Forest Finance Roadmap, released on September 23 during the Forest & Climate Leaders’ Partnership Forest Finance Day at Climate Week NYC.
The report says credible forest-finance mechanisms are beginning to gain momentum, but warns that investment is still moving too slowly to meet the global commitment to halt and reverse forest loss by 2030.
Forests receive less than 1% of global climate finance despite offering an estimated one-fifth of the world’s cost-effective climate-mitigation potential, according to the report. The Forest Finance Roadmap was established to help close an estimated annual forest-finance gap of US$66.8 billion.
Africa is central to that effort. The continent is home to about 663 million hectares of forest, representing around 16% of the world’s forest area. The future of these forests will be critical to international efforts to cut emissions, protect biodiversity, strengthen food systems and support climate resilience.
The report argues that African countries are increasingly moving beyond calls for international conservation funding and are creating country-led systems that connect forest protection with national development priorities, local livelihoods and public investment.
“Forests cannot be an afterthought in the international climate agenda,” said Emelyne Cheney, Director of the Forest & Climate Leaders’ Partnership Secretariat. “They need to remain at the centre of it.”
Cheney said the report offers a clearer picture of where forest finance is flowing and where gaps remain.
“Pressures on forests are intensifying and the solutions are clear, but they need sustained political attention and investment at scale to turn into action,” she said.
Ethiopia is highlighted as an example of how domestic public financing can support long-term restoration and attract additional international investment.
Land degradation is estimated to cost Ethiopia about US$4.3 billion annually through reduced agricultural productivity and the loss of ecosystem services. In response, the federal government is allocating between 0.5% and 1% of its annual budget—estimated at US$40 million to US$80 million each year—to the Green Legacy and Landscape Restoration Fund.
The nationally owned mechanism supports forest and landscape restoration and has helped Ethiopia attract hundreds of millions of dollars in concessional finance and co-financing from development partners.
The approach seeks to make forest restoration part of core economic planning rather than treating it as a stand-alone environmental activity. By investing public resources, Ethiopia aims to support watershed protection, agricultural productivity, soil health, biodiversity and rural livelihoods while creating a stronger basis for private and international investment.
In August, Ethiopia also became the 17th country to endorse the Intergovernmental Land Tenure Commitment, strengthening political backing for the rights of Indigenous Peoples and local communities in forest and land landscapes.
Ethiopia’s role is expected to receive greater international attention as Addis Ababa prepares to host COP32 in 2027. The report said this provides an opportunity for the country and other African governments to shape the global forest-finance agenda from a position of demonstrated leadership.
Kenya has mobilised at least US$229 million in new external finance for forest- and landscape-based economic development, according to the report.
The funding includes a US$200 million World Bank operation and a US$29.2 million Green Climate Fund grant focused on the Lake Region. The finance is intended to support restoration, sustainable land use and the development of economic activities linked to healthy landscapes.
Kenya has also increased its domestic forestry budget. The country raised its allocation by approximately US$38.7 million in the 2025/26 fiscal year and retained a higher forestry budget of about US$143.8 million for the 2026/27 fiscal year.
The report points to a wider pipeline of investment in Kenya’s forest bioeconomy, including institutions seeking to mobilise US$10 billion by 2030. It also notes commitments covering 3.7 million hectares for protection and restoration.
The Kenyan model demonstrates how domestic public spending can complement multilateral climate finance. By combining external funds with national budget allocations, governments can create stronger conditions for long-term investment in restoration and forest-based value chains.
Nigeria is preparing to launch its Securing Nigeria’s Forest Future Country Package internationally at COP31 in Türkiye later this year.
Developed with support from the Forest & Climate Leaders’ Partnership, the package is designed as a government-led framework that aligns forest, climate and biodiversity objectives with investment from development partners, financial institutions, philanthropic organisations and private businesses.
The initiative aims to strengthen forest management, restore degraded land, conserve biodiversity and build climate resilience. It also seeks to improve conditions for private-sector investment, blended finance and carbon-finance projects.
Nigeria’s Minister of Environment, Balarabe Abbas Lawal, said forest finance must produce practical benefits for communities.
“We must strengthen the enabling environment for private investment, blended finance [and] carbon finance, and ensure these investments translate into real benefits,” Lawal said. “That includes livelihoods linked to conservation, commercially viable forest value chains, meaningful participation for women and young people in the green economy, and recognition of forest-dependent communities as partners, not bystanders, in sustainable forest management.”
The Nigerian package reflects a wider shift in forest policy, where governments are seeking to use environmental finance not only for conservation but also to support jobs, enterprise development and local economic resilience.
Gabon is advancing results-based models intended to generate greater economic value from keeping forests standing. The country is a partner in the Central African Forest Initiative, known as CAFI, which is developing a payments-for-ecosystem-services pipeline across the Congo Basin.
CAFI’s current pipeline totals US$290 million and has an ambition to mobilise up to US$2 billion by 2035 from domestic and international public and private sources.
The programme aims to reach about 7.8 million direct beneficiaries and enrol approximately 2.9 million hectares in payments for environmental services and related performance-based schemes. At least half of the programme’s resources are intended to flow directly to farmers, local communities and Indigenous Peoples.
Gabon launched its Forest & Climate Leaders’ Partnership Country Package in 2025, creating a national framework to align forest, climate and development priorities with investment and international partnerships.
The Congo Basin contains one of the world’s largest remaining tropical forest systems and plays a major role in global climate regulation. The report suggests that results-based payments and ecosystem-service finance could help provide an alternative economic rationale for forest protection in countries that face pressure to exploit natural resources for short-term revenue.
The report also points to broader innovation across the continent. Côte d’Ivoire has introduced Africa’s first Sustainability-Linked Finance Framework and secured West Africa’s first sustainability-linked sovereign loan, worth €433 million. Uganda, meanwhile, is piloting an approach to integrate forest and agricultural resilience into sovereign debt and credit analysis.
Taken together, the initiatives show that African governments are beginning to place forests more firmly within national economic, financial and investment strategies.
However, the Forest Finance Roadmap warns that the scale of finance remains far below what is needed to halt deforestation and land degradation by 2030. The key test, it says, will be whether these models can attract and deploy finance fast enough—and ensure that the benefits reach local communities, farmers and Indigenous Peoples.
The report concludes that the mechanisms are increasingly available. What is now needed is sustained political commitment, larger investment flows and faster implementation to turn forest protection into an economic opportunity for African countries and their communities.
