KATHMANDU, FEBRUARY 26
The government of Nepal has signed a landmark agreement with the World Bank's Forest Carbon Partnership Facility (FCPF), unlocking up to $45 million to support Nepal to decrease carbon emissions from deforestation and forest degradation through 2025.
With this Emission Reductions Payment Agreement (ERPA) in place, Nepal is expected to reduce nine million tonnes of carbon dioxide emissions in the Tarai Arc Landscape. The agreement was signed by the Secretary of the Ministry of Forests and Environment, Bishwa Nath Oli on behalf of the Nepal government, and the World Bank Country Director for Nepal, Maldives and Sri Lanka, Faris Hadad-Zervos recently.
"This scale of results-based payments for emission reductions is a first for Nepal," Finance SecretarySishir Kumar Dhungana has been quoted as saying in a media release.
"Nepal's Emission Reductions Programme builds on more than three decades of successful community forestry," said Hadad-Zervos.
"The emissions reduction purchase is one pillar of a strategic programme on forest landscapes and climate action in Nepal. This innovative financing agreement will address the drivers of deforestation and forest degradation, helping incentivise further community action across the country."
Nepal's Emission Reductions Programme in Tarai lowlands aims to lower rates of deforestation and forest degradation across 2.4 million hectares of land rich in natural resources, including 20 per cent of country's forest cover. The Tarai region supports some of the most productive forests, richest biodiversity and most significant protected areas in Nepal. The region also has the highest population growth, urbanisation, and economic development in the country, especially agriculture.
As a result, natural resources in Tarai face significant threats that emission reduction programme helps address.
This initiative will also focus on improving community-based forest management, transferring user rights for national forests to local communities, improving integrated land use planning, promoting alternative sources of energy and strengthening capacity for protected area management.
"Forests in Tarai region provide ecosystem services that are critical for climate resilience, including watershed protection, and drought and flood mitigation," said Oli. "This programme will help us to protect the forests that are inextricably linked to well-being of many communities here and across Nepal."
This programme also leverages support from other World Bank support on sustainable land management and social inclusion, and builds on complementary efforts financed by the Climate Investment Funds' Forest Investment Programme and the Dedicated Grant Mechanism for Indigenous Peoples and Local Communities.
Nepal is the fifth country in Asia-Pacific and twelfth globally to reach such a milestone agreement with the FCPF, which together have unlocked over $600 million in results-based financing.
Emission Reductions Payment Agreements are innovative instruments that incentivise sustainable land management at scale and help to connect countries with other sources of climate financing. Funding from the FCPF supports new opportunities to conserve and regenerate landscapes and biodiversity while simultaneously supporting more resilient, inclusive, sustainable and efficient economic growth - key for Nepal to build back better, and greener.
A version of this article appears in the print on February 27, 2021, of The Himalayan Times.
