Effective climate change policies in agriculture and forestry need an integrated, landscape approach

Bridging the divide between agriculture and forestry is imperative for climate action. The global and national race is on to steeply reduce emissions over the next six years. According to the watershed Global Stocktake report, released ahead of COP28 in Dubai, we face the daunting task of reducing emissions by 43 per cent by 2030 to retain the possibility of limiting warming to 1.5 degrees by the end of the century, and 27 per cent to stabilize at a 2-degree temperature increase. Since the Paris Agreement was signed in 2015, we have managed only to be on track for a 2 per cent reduction in emissions against 2019 baselines. Each subsequent year, we collectively feel the impacts of a hotter, more volatile climate as new records are set for temperature and natural disasters.

Countries have prepared roadmaps for action based on their Nationally Determined Contributions (NDCs) of varying degrees of ambition. Approximately 22 per cent of global greenhouse gas emissions are generated by the land-use sector, which includes agriculture and forestry. However, this is significantly higher in Southeast Asia, where in countries such as Cambodia, 78 per cent of national emissions were derived from the land-use sector in 2016. This is partly due to the conversion of forests to cash crops and is underlain in many places by insecure tenure, which disincentivizes sustainable management by smallholders living on the land.

The targets enshrined in NDCs appear deceptively simple and straightforward: reductions in deforestation, adoption of renewable energy sources and building the adaptive capacity of especially exposed sectors such as agriculture. However, these are all ‘wicked’ problems and interconnected issues that fundamentally must be addressed through an integrated, holistic approach.  

The land-use sector has direct, impactful and unique cross-sectoral linkages. By recognizing these more explicitly and formalizing systems supporting landscape approaches, we can fast-track our ability to address climate and a raft of related issues. The Global Stocktake report underscores the role of the land-use sector, noting that the intensification of sustainable agriculture, without further land expansion, is vital and can catalyse broader sustainable development benefits. Failure to do so dooms us to a trajectory falling short of the 1.5 or even 2-degree targets. 

An example of this is the growing awareness and emphasis on national food security and the focus on directing climate finance towards climate-vulnerable commodities. Improved methods, technologies, practices and even carbon sequestration methodologies can support the productivity and climate mitigation and adaptation potential of the agriculture sector. This support is necessary and urgently needs to be scaled up, especially given the 12 per cent reduction in climate financing to this sector in 2021—the first time climate financing for agrifood systems has fallen since the Paris Agreement.  Alarmingly, Asia experienced a 44 per cent drop in climate finance for agriculture, leaving small-scale producers disproportionally affected. The Food and Agriculture Organization (FAO) estimates that only 1.7 per cent of climate financing reaches local communities and smallholder groups who contribute the least to climate change and biodiversity loss.  

However, there is an additional piece to the agriculture and climate adaptation story: the critical role that commodity production can play as a primary driver of deforestation in the region. To what degree does climate financing which encourages commodity production, ultimately undermine climate goals by being a latent driver of forest loss? While additional funding for adaptation in the agriculture sector is necessary, its deployment must be carefully and strategically managed to avoid converting landscapes into net carbon emissions sources. 

The European Union Deforestation Regulation, which came into force in 2023, takes a positive step by requiring companies that sell products in Europe sourced from seven key commodities—cattle, wood, cocoa, soy, palm oil, coffee and rubber—to provide evidence that they are not derived from deforestation geographies. However, within Southeast Asia, many important deforestation-risk commodities fall outside the big seven and continue to benefit from national and regional subsidies. 

The banking sector is a key actor in shaping the structural incentives behind land-use decisions and is critically required at the table for any national NDC implementation plans. Financial institutions can play a unique role in redistributing climate finance to activities that positively benefit both the agriculture and forestry sectors while preserving biodiversity. However, they often do not have access to the large amounts of climate investment needed to address the challenges of rising food insecurity and deforestation in the region.   

What can be done? 

Countries must embrace the economic transition now required by climate change. The US government set the stage with the Inflation Reduction Act, offering incentives for American businesses investing in climate technology and clean energy. Thailand has also been a leader regionally and globally on several economic transition fronts: the rapid uptake of electric vehicles, the first global Article 6.2 deal signed with Switzerland, and in the land-use sector, the expedition of handing over land to smallholders through the National Land Policy Committee (Kor Thor Chor). Multilateral public climate finance, for example, the Green Climate Fund (GCF), can also provide the necessary catalytic capital to mobilize private finance. Ending deforestation alone would require USD 130 billion a year by 2030, and international climate finance, for instance, channeled to subnational, national or regional organizations through the GCF’s Direct Access Entity modality, can help countries crowd in more finance when they pursue climate-positive investments.

The pressure of cash crops on forests is a difficult challenge to overcome.  For this reason, financial policies, preferential rates and incentives must align with overall emission reduction goals in the land-use sector. Developing markets such as the voluntary carbon market, have experienced shocks over the past year, yet they offer tangible opportunities to incentivize smallholders to forgo land-hungry cash crops. Additionally, initiatives that promote ‘verified conservation claims’ like those being developed by the Rimba Collective, can secure long-term funding for sustainable integrated landscape management. 

Sectoral NDC plans are often developed internally within each department or sector and need to be better integrated cross-sectorally. Multilateral institutions such as the FAO and the GCF, through their regional Readiness Programme in Southeast Asia, may be well-positioned to support governments in establishing cross-sectoral networks and working groups. These groups should include all relevant ministries and can facilitate the exchange of knowledge while serving as checks and balances to prevent the objectives of one department from undermining those of another (such as biodiversity, food security and nutrition, rural livelihoods, watershed integrity, etc.). The diversity of government entities, along with the participation of external stakeholders such as academia, civil society and the private sector, can lead to innovative, impactful and efficient investment ideas for implementing the NDCs. Such inclusive partnerships—exemplified by a recent workshop hosted by FAO, RECOFTC and partners on making climate finance work for agrifood systems—can protect against threats to the ultimate reduction in emissions and the sequestration functions that countries can provide.  

Finally, traceability mechanisms, like those required for the big seven commodities under the European Union Deforestation Regulation, should be more widely adopted in the region for commodities not covered by the regulation, such as corn, cassava, sugarcane and fruits like pineapple. This initiative could be driven by proactive leadership from the producer countries and industries themselves, similar to the approach taken by the Roundtable on Sustainable Palm Oil.

At this juncture, there is no room for error or inefficiencies in the push to reduce emissions radically. Adaptation in the land-use sector, with strong implications for agriculture, must be accompanied by vital mitigation efforts linked closely with the forest sector. However, we must integrate all measures, policies and financing incentives into a comprehensive approach to ensure seamless complementarities. Nature-based solutions hold much promise for reducing emissions and critically acting as a sink for removing even more. Still, for this potential to be realized, countries, and the guidance generated globally need to push for a single, integrated vision of how landscapes and the people who inhabit them are achieving climate outcomes.

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Regan Pairojmahakij is a senior program officer on landscapes in a changing climate at RECOFTC. Georgii Nikolaenko is a knowledge management specialist for agriculture and climate change at FAO.

RECOFTC’s work is made possible with the support of the Swiss Agency for Development and Cooperation and the Government of Sweden.