Climate finance needs rethinking to reach Indigenous Peoples on the ground

By Jhony Zapata and Sophie Grouwels, Forestry Officers, Food and Agriculture Organization of the United Nations

Today marks the International Day of the World’s Indigenous Peoples, the first since the historic moment at the UN Climate Change Conference (COP 26) last November, when Indigenous Peoples were recognized as the guardians of the world’s forests and a major increase in financing was pledged to support them in this role.

Indigenous Peoples manage about 40 percent of all terrestrial protected areas and ecologically intact ecosystems worldwide, and are legally recognized as owning at least 12 percent of the world’s forest area. Yet in many parts of the world, Indigenous Peoples and local communities do not have tenure of the forest land they live on, despite the fact that when they do, they are better able to conserve it. A recent report found that forests owned by Indigenous Peoples in Latin America and the Caribbean have lower deforestation rates and lower carbon emissions. 

Indigenous Peoples are therefore vital to the achievement of many of the Sustainable Development Goals, including Goal 13 (Climate Action).

Yet less than 2 percent of global climate finance is reaching small farmers, Indigenous Peoples and local communities in developing countries. 

In one of the major breakthroughs of COP 26, the governments of the United Kingdom, Norway, the Netherlands, the United States and Germany, along with 17 philanthropic foundations, pledged to spend US$ 1.7 billion between 2021 and 2025 to protect the rights of Indigenous Peoples and forest communities to tenure of their ancestral land and support them as guardians of the world’s forests. 

But to realise this pledge in the true spirit in which it was made, funds need to be channelled directly to Indigenous Peoples. This would allow Indigenous Peoples, who best understand the situation on the ground, to decide how to use the funds.

However, this requires a rethink of the way climate finance is delivered in order to create a ‘pipeline’ along which funds can flow directly to Indigenous Peoples. 

In many countries, complex requirements and laws prohibit government development aid being released directly to Indigenous Peoples and local communities. At the other end of the pipeline, many local community organisations do not have legal status or the capacity to receive and manage large sums. They are often in remote areas where there are no banks and where nobody keeps receipts for transactions. 

Indigenous Peoples need be truly recognised and treated as equal partners in the global battle against climate change. And they need a genuine exchange of knowledge and support to strengthen their organisations and develop the capacity to receive and manage climate funds, eventually removing middlemen. 

The Forest and Farm Facility – a partnership between the Food and Agriculture Organization of the United Nations, the International Institute for the Environment and Development, the International Union for Conservation of Nature and AgriCord – has been advocating these goals as part of its work to support Indigenous Peoples and local communities.

Channelling funds directly to Indigenous Peoples is not impossible. Mechanisms exist to make this work and in some places Indigenous Peoples and local communities have already done the groundwork. For example, the Alianza Mesoamericana de Pueblos y Bosques, an association of Indigenous Peoples and forest communities in Latin America, has established the Mesoamerican Territorial Fund, through which international climate funding is channelled to its members. Funds are deployed to communities who combine ancestral knowledge and the latest innovative ideas to protect forests, improve livelihoods and lobby for recognition of their rights and expertise. The association is working to share its experience with Indigenous Peoples and local communities in other regions.

Indigenous Peoples account for almost 19 percent of the extreme poor. They are also often on the front line of conflicts over protecting nature, being killed as they try to protect the forests from illegal or destructive commercial activity.

The hopes of Indigenous Peoples have been raised that the world has understood the value of their vital work, that their rights will be recognized, and that they will receive their fair share of climate financing. 

We cannot afford not to make this system change to the financial architecture for climate finance. As the COP 26 pledge recognised, without bringing Indigenous Peoples to the table as equal partners, we cannot save the planet. 

David Kaimowitz, Chief Program Officer at the International Land & Forest Tenure Facility, contributed to this article.

This article was originally published by the International Institute for Sustainable Development (IISD).