ImpactAlpha, October 20 — Nearly 10 million acres of forests in Africa, one of Earth’s most important carbon sinks and soil, are disappearing each year. British International Investment, Norfund and Finnfund are investing a combined $200 million in New Forests’ new open-ended African Forestry Impact Platform.
AFIP will invest in plantation forestry companies and projects in sub-Saharan Africa, with a focus on forest conservation, restoration of degraded land and expansion of community-based forestry programs.
Sydney-based New Forests manages 2.7 million acres of forestlands for sustainable timber production and conservation (see, “Packard Foundation pushes forest fund beyond business as usual”). Mitsui & Co. and Nomura agreed to acquire New Forests earlier this year.
The fund “will increase funding for nature-based solutions, the supply of sustainable wood, [and] restore natural capital while also boosting jobs within rural communities,” said Clarisa De Franco of BII, which committed $75 million in the fund. Norfund will allocate $76 million; Finnfund will allocate $48 million.
New Forests plan to raise an additional $300 million from institutional investors for the fund over the next two to three years.
The African forestry fund aims to make an impact in four main areas: Climate change mitigation, biodiversity conservation, gender and diversity, and community and livelihoods. The fund will invest at least 30% of its assets in businesses with an explicit gender lens.
“Addressing the climate emergency in Africa must include gender-smart actions,” De Franco said.
In its first deal, AFIP will acquire Green Resources, a private Norwegian forest development and wood processing company managing 94,000 acres of pine and eucalyptus plantations in Tanzania, Uganda and Mozambique.