Sydney-based investment manager New Forests has partnered European development finance institutions CDC Group Plc, Finnfund and Norfund to develop investment strategies for Sub-Saharan Africa.
New Forests has $5.9 billion in assets under management for sustainable forestry and related sectors across 1.1 million hectares. Its partnership with DFIs is designed to grow the sustainable forestry sector in Africa, as per a joint statement. The partners aim to raise up to $500 million over the next three to five years in the fight against climate change.
Africa is home to around 17% of the world’s forests, including 20% of all tropical forests. But these ecosystems are under pressure from biodiversity loss and deforestation, as the continent faces a growing wood products shortage as economies and populations grow.
The partnership will aim to provide capital to support the development and management of sustainable forestry practices. These practices include conservation of natural forests; expanding productive forest plantations, community forests and forest restoration projects across the region; facilitating development of nature-based climate solutions and accelerating the creation of green jobs, improving livelihoods, and generating sustainable and inclusive economic development in rural communities across Sub-Saharan Africa.
David Brand, CEO at New Forests, said that the firm sees the forestry and land use sectors as central to the transition to a sustainable future. “As we look towards fulfilling this vision, Sub-Saharan Africa must be part of the equation.”
New Forests’ investment portfolio consists of sustainable forest plantations, areas of natural forest conservation, carbon projects, rural land and row-cropping, and timber processing. Since its inception in 2005, New Forests has expanded and operates in Australia, New Zealand, Southeast Asia and the United States.
Nick O’Donohoe, CEO of CDC Group, said responsible investment in sustainable forestry will preserve Africa’s rich natural environment and is a key step toward addressing the climate emergency, while bringing prosperity and green jobs to rural communities.
Tellef Thorleifsson, CEO of Norfund, said this partnership will catalyse sustainable growth of the African forestry sector, creating jobs, reducing deforestation and addressing climate change.
Finnfund CEO Jaakko Kangasniemi added: “The forestry sector in Africa has enormous growth potential and by partnering with fellow development financiers and New Forests, we believe we can together bring the change needed to unlock that potential.”