Access to finance for forest and farm producer organisations (FFPOs)
Growing populations and consumption patterns are squeezing forests – especially through industrial agriculture. But many of the 1.5 billion people who live within the world’s remaining forest landscapes are farmers too, albeit smallholders. Many grow and protect trees. Most also hunt and gather from the forest. Forests provide them with beautiful and sacred spaces, homes, foods, fuels, materials and medicines – not to mention systems that protect soil fertility, biodiverse ecology, carbon sequestration and hydrology – the basis of climate resilience for us all. The aggregate gross production value of these smallholder producers approaches US$ 1.3 trillion, far in excess of the biggest international food corporations. Investment to add value to that production and make it sustainable and resilient will be key to delivering the Sustainable Development Goals and the Paris Climate Agreement.
Growing forest and farm producer organisations (FFPOs) can help to reduce the transaction costs of delivering such investment. But there is still much to be done to improve access to finance. This report outlines what can be done from the producer side, from the financier side, and by willing intermediaries. It highlights specific approaches to making more accessible finance from six main sources: Producer, friend and family finance; Buyers and trade chain finance; Semi-formal and microfinance; Formal banking finance; National public finance and; Climate finance and Overseas Development Assistance. The intention of this structured analysis is better access to finance for forest and farm producers.