By Lisandra Paraguassu
RIO DE JANEIRO (Reuters) -China has signaled to the Brazilian government that it will invest in the Tropical Forests Forever Facility, a multilateral mechanism funding conservation of endangered forests around the world, two people with knowledge of negotiations told Reuters.
An investment by China in the fund, which Brazil first proposed in 2023, would signal an important shift in climate finance, which has relied on funding from wealthy nations most responsible for global warming to date.
China’s commitment to the fund could pave the way for emerging economies to contribute financially to climate change mitigation, moving beyond the mandatory requirements imposed on developed nations by the 2015 Paris Agreement.
The new approach comes as wealthy nations such as the United States retreat from ambitious pledges to fund projects curbing climate change, despite growing pressure from poorer nations struggling to cope with the impacts of a warmer climate.
At last year’s United Nations climate summit, leaders of developing countries lambasted wealthy nations over their annual $300 billion global finance target, covering just a fraction of the $1.3 trillion that economists say is necessary.
Chinese Finance Minister Lan Fo’an expressed the intention to contribute to the forests fund, known as TFFF, in a meeting with his Brazilian counterpart Fernando Haddad on Thursday, sources said. They spoke on the sidelines of a meeting of finance ministers in the run-up to the BRICS summit of major developing nations that starts in Rio de Janeiro on Sunday.
“(Lan) told (Haddad) that he considered the fund idea important and that China would collaborate,” said one source, who witnessed the conversation, adding that the discussion did not involve specific values.
The Brazilian government has taken the message from China’s finance minister as a signal that Beijing will contribute funds, the sources said, although a public announcement is not expected until the U.N. climate summit, COP30, in November.
China’s embassy in Brasilia and Brazil’s Finance Ministry did not immediately reply to a request for comment.
Brazilian President Luiz Inacio Lula da Silva had previously discussed the fund with Chinese President Xi Jinping during his visit to China in May, according to sources.
Brazil also aims to attract other resource-rich developing nations to the fund, particularly from the Middle East, the sources said.
The Brazilian government sees potential for the TFFF to be its main new deliverable at COP30, which it will host in the Amazonian city of Belem.
Policymakers have envisioned TFFF as a $125 billion fund, combining sovereign and private-sector contributions, to be managed like an endowment paying countries annual stipends based on how much of their tropical forests remain standing.
While sources do not expect the fund to launch at that scale, the idea received initial signs of support from the U.K., France, Germany, Norway, Singapore and the United Arab Emirates.
Early backing from the United States evaporated after President Donald Trump exited the Paris Agreement.
The interest in the TFFF underscores growing international attention on the preservation of tropical forests, rich in planet-warming carbon, as a powerful tool to combat climate change and stave off biodiversity loss.
(Reporting by Lisandra Paraguassu in Rio de JaneiroWriting by Manuela AndreoniEditing by Brad Haynes and Chizu Nomiyama )
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