{"id":12931,"date":"2025-12-14T23:41:45","date_gmt":"2025-12-14T22:41:45","guid":{"rendered":"https:\/\/paddys.de\/?p=12931"},"modified":"2025-12-17T01:07:44","modified_gmt":"2025-12-17T00:07:44","slug":"lulas-regenwald-fond-persoenlicher-kommentar","status":"publish","type":"post","link":"https:\/\/paddys.de\/en\/lulas-regenwald-fond-persoenlicher-kommentar\/","title":{"rendered":"Lula's Rainforest Fund \u2013 personal commentary"},"content":{"rendered":"Reading time<\/span> 10<\/span> Minutes<\/span><\/span>\n
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It's no use, I still have to comment <\/strong>about the \u00a3125 billion Tropical Forest Forever Facility (TFFF) initiated by Brazilian President Lula. The intention is as follows, which I describe in the article \u201eThe professionals have their say\u201c <\/a>about the programme ARD Germany Trend \u2013 \u201eHow important is climate change to people in Germany?\u201c <\/strong>as described: <\/p>\n\n\n\n

\"President Lula announces a 125 billion forest protection fund, the proceeds of which will be used to \u201acompensate\u2018 nations that preserve primary forests (rainforests, primeval forests). not <\/strong>Deforest. Forests must be seen as an economic factor and included in GDP. Nice idea, but unfortunately only 5 billion has been raised, which I find somewhat indicative of international climate protection efforts.<\/em>\u201e1<\/a><\/sup> The professionals have their say \ud83c\udf10 https:\/\/paddys.de\/die-profis-haben-das-wort\/<\/a> <\/span><\/p>\n\n\n\n

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Photo: Rainforest in Costa Rica, Central America (Region on the narrow land bridge<\/strong>, which connects North and South America, and comprises the seven countries Belize, Guatemala, Honduras, El Salvador, Nicaragua, Costa Rica and Panama<\/strong> ) \u2013 <\/strong>quick shooting<\/a> \/ iStock by GettyImages<\/figcaption><\/figure>\n\n\n\n
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When I hear something like that, the numbers start rattling around in my head. The idea is that the more primary and natural forest we destroy, the more likely extreme weather damage becomes \u2013 including, quite specifically, on your doorstep.2<\/a><\/sup> IPCC AR6: Climate Change 2021 \u2013 The Physical Science Basis \ud83c\udf10https:\/\/www.ipcc.ch\/report\/ar6\/wg1\/<\/a> <\/span> At the end of the day, it's always about money.<\/p>\n\n\n\n

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Photo: Warning sign Flooding in a residential street in southern Germany, with a municipal utility truck in the background. \u2013 Animaflora<\/a> \/ iStock by GettyImages<\/figcaption><\/figure>\n\n\n\n
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Let's just take the Flood disaster in the Ahr Valley in July 2021: <\/strong>For me, the real cost is first and foremost 136 lives lost in the Ahr Valley alone, and a total of around 190 fatalities<\/strong> by the flood \u2013 the deadliest flood disaster in Germany in decades.3<\/a><\/sup> NHESS (2025): Causes of the exceptionally high number of fatalities in the Ahr valley flood of 2021 \ud83c\udf10https:\/\/nhess.copernicus.org\/articles\/25\/581\/2025\/<\/a> <\/span> The situation is different for the insurance industry: the German Insurance Association estimates insured losses at around \u20ac8.5 billion, while experts estimate total economic losses and public reconstruction costs at over \u20ac30 billion.4<\/a><\/sup> GDV (2022): 2022 natural hazards balance \u2013 The devastating floods in July 2021 alone caused damage of EUR 8.5 billion \ud83c\udf10https:\/\/www.gdv.de\/gdv-en\/media\/2022-natural-hazards-balance-at-eur-4-3-billion-an-average-claims-year-for-insurers-123850 <\/a><\/span>5<\/a><\/sup> Infras (2025): Extreme Weather in Germany \u2013 Understanding the Costs (Ahr Valley: ~\u20ac8.5 billion insured, ~\u20ac30 billion reconstruction programmes) \ud83c\udf10 https:\/\/www.infras.ch\/en\/projects\/extrem-weather-costs-climate-damage-register\/<\/a> <\/span><\/p>\n\n\n\n

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Photo: The devastating flood disaster in the Ahr Valley <\/strong>occurred during the night of 14 to 15 July 2021 after days of extremely heavy rainfall. 6<\/a><\/sup> SWR Aktuell \u2013 Four years after the Ahr Valley flood: four moving stories (video) \ud83c\udf10 https:\/\/www.facebook.com\/SWRAktuell\/videos\/vier-jahre-nach-der-ahrtal-flut-vier-bewegende-schicksale\/1240601280619311\/<\/a>  <\/span> The main road<\/strong> The B266, which runs through the Ahr Valley, was severely damaged during the 2021 floods.7<\/a><\/sup> Federal Agency for Civic Education \u2013 After the flood on the Ahr in 2021 (review and assessment of the damage) \ud83c\udf10 https:\/\/www.bpb.de\/kurz-knapp\/hintergrund-aktuell\/522893\/nach-der-flut-an-der-ahr-2021\/<\/a>  <\/span> 8<\/a><\/sup> Rhein-Ahr Anzeiger \u2013 Flooding on the upper Ahr \u2013 Altenahr (current flood warnings and local situation) \ud83c\udf10 https:\/\/rhein-ahr-anzeiger.de\/hochwasser-obere-ahr-altenahr\/<\/a>  <\/span> It runs directly along the river and has been damaged in many places by the floodwaters. washed away, torn away and impassable<\/strong>. 9<\/a><\/sup> Diercke \u2013 Ahr Valley: Flood disaster (overview map and background text) \ud83c\udf10 https:\/\/diercke.de\/content\/ahrtal-flutkatastrophe-978-3-14-100900-2-57-4-1<\/a>  <\/span> 10<\/a><\/sup> Tagesschau \u2013 Ahr Valley disaster: Investigation committee and political review \ud83c\udf10 https:\/\/www.tagesschau.de\/inland\/innenpolitik\/ahrtal-katastrophe-untersuchungsausschuss-100.html<\/a>  <\/span> \u2013 J-Picture<\/a> \/ iStock by GettyImages<\/figcaption><\/figure>\n\n\n\n
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Photo: Rubble and mountains of rubbish from the Ahr Valley after the flood disaster in 2021, Ahr Valley and Eifel, Rhineland-Palatinate, Germany.11<\/a><\/sup> phoenix \/ YouTube \u2013 The Flood: The Ahr Valley Four Years After the Disaster (documentary) \ud83c\udf10 https:\/\/www.youtube.com\/watch?v=XadTZ1E27G0<\/a> <\/span> \u2013  Fotomax<\/a> \/ iStock by GettyImages<\/figcaption><\/figure>\n\n\n\n
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Photo: Flood damage to the Nepomuk Bridge and buildings<\/strong> in Rech in the Ahr Valley12<\/a><\/sup> SWR \u2013 Flood disaster in Rech in 2021: destroyed buildings and historic Nepomuk Bridge \ud83c\udf10 https:\/\/www.swr.de\/swraktuell\/rheinland-pfalz\/koblenz\/rech-nach-dem-hochwasser-100.html<\/a> <\/span> 13<\/a><\/sup> German Foundation for Monument Protection \u2013 Nepomuk Bridge in Rech: severe flood damage and demolition debate \ud83c\udf10 https:\/\/www.denkmalschutz.de\/ahrtalbruecken\/nepomukbruecke.html<\/a> <\/span> 14<\/a><\/sup> Tagesschau \u2013 The bridge in the Ahr Valley that divides a village (damage to the bridge and 21 destroyed buildings in Rech) \ud83c\udf10 https:\/\/www.tagesschau.de\/inland\/gesellschaft\/brueckenabriss-ahrtal-100.html<\/a> <\/span> 15<\/a><\/sup> Ahrtal Foundation \u2013 Former Nepomuk Bridge: Damage caused by the 2021 floods \ud83c\udf10 https:\/\/stiftung-ahrtal.de\/das-ahrtal\/nepomuk\/<\/a> <\/span> and in the Eifel region. \u2013 Fotomax<\/a> \/ iStock by GettyImages<\/figcaption><\/figure>\n\n\n\n
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Reinsurers and supervisory authorities are now issuing very clear warnings that extreme weather risks are increasing with global warming \u2013 and that certain regions and risks will simply no longer be insurable on reasonable terms at some point in the future.16<\/a><\/sup> BaFin (2024): Natural catastrophes \u2013 The risks are on the rise \ud83c\udf10 https:\/\/www.bafin.de\/SharedDocs\/Veroeffentlichungen\/EN\/Fachartikel\/2024\/fa_bj_2405_Naturkatastrophen_Das_Risiko_steigt_en.html<\/a> <\/span>17<\/a><\/sup> Swiss Re \/ BIS (2023): Mind the climate-related protection gap \u2013 reinsurance pricing and underwriting considerations \ud83c\udf10https:\/\/www.bis.org\/fsi\/publ\/insights65.pdf<\/a> <\/span> Translated, this means that the bill for every hectare of forest cleared, for every additional tenth of a degree of warming, will ultimately be paid not by \u201eothers\u201c but by you \u2013 as a taxpayer, as an insurance policyholder and as a person who lives in the wrong valley when the next heavy rain system gets stuck.18<\/a><\/sup> Munich Re (2025): Economic impact of weather disasters \ud83c\udf10https:\/\/www.munichre.com\/en\/insights\/natural-disaster-and-climate-change\/weather-disasters-in-industrialized-countries.html<\/a> <\/span><\/p>\n\n\n\n

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Image: Swiss Re \/ BIS (2023): Mind the climate-related protection gap \u2013 reinsurance pricing and underwriting considerations. Editorial use.19<\/a><\/sup> Swiss Re \/ BIS (2023): Mind the climate-related protection gap \u2013 reinsurance pricing and underwriting considerations \ud83c\udf10https:\/\/www.bis.org\/fsi\/publ\/insights65.pdf<\/a> [\/footnote<\/figcaption><\/figure>\n\n\n\n
<\/div>\n\n\n\nDistribution of the \u201eforest protection return\u201c<\/strong>
Let's first look at how the few remaining primary forests are distributed across the planet. According to the FAO, there are around 1.11 billion hectares of primary forest worldwide, and three countries \u2013 Brazil, Canada and Russia \u2013 together account for over 60 per cent of this.19<\/a><\/sup><\/span> FAO: Global Forest Resources Assessment 2020 \u2013 Key Findings \ud83c\udf10 https:\/\/openknowledge.fao.org\/server\/api\/core\/bitstreams\/9f24d451-2e56-4ae2-8a4a-1bc511f5e60e\/content<\/a> <\/a><\/span> The rest is spread across a handful of other large forested countries such as the Democratic Republic of Congo, Indonesia and Peru.20<\/a><\/sup> Statista: Distribution of forest area worldwide in 2021, by country \ud83c\udf10https:\/\/www.statista.com\/statistics\/238916\/primary-forest-distribution-worldwide\/<\/a> <\/span><\/p>\n\n\n\n
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Find more statistics at Statista<\/a>\n\n\n\n

Illustration: Statista: Distribution of forest area worldwide in 2021, by country. <\/strong>Editorial use. Courtesy of Statista 15 December 202521<\/a><\/sup> Statista: Distribution of forest area worldwide in 2021, by country \ud83c\udf10 https:\/\/www.statista.com\/statistics\/238916\/primary-forest-distribution-worldwide\/<\/a> <\/span><\/p>\n\n\n\n

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The idea behind our Forest Protection Fund is deliberately simple: countries receive a Share of the annual fund return<\/strong> proportional to their share of global primary forest cover \u2013 but only if they actually protect these forests. If a country with 2 per cent of global primary forest consistently maintains zero deforestation, it receives 2 per cent of the \u201ereturn pot\u201c. If it starts clearing forests, we deduct a penalty.<\/p>\n\n\n\n

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Peru as a concrete example<\/strong>
Peru is one of the largest forested countries in the world: the current estimate for the country's primary Amazon rainforest is around 67 million hectares, compared to around 73 million hectares in the past.22<\/a><\/sup> MAAP #93: Shrinking Primary Forests of the Peruvian Amazon \ud83c\udf10 https:\/\/www.maapprogram.org\/shrinking_primary\/ <\/a><\/span> This means that Peru has lost around 6.1 million hectares of original Amazon rainforest to date \u2013 approximately 8 per cent of its original primary forest area, with a good third of this having disappeared since 2001.23<\/a><\/sup> MAAP #93: Shrinking Primary Forests of the Peruvian Amazon \ud83c\udf10 https:\/\/www.maapprogram.org\/shrinking_primary\/ <\/a><\/span>24<\/a><\/sup> OECD (2025): Deforestation in Peru \u2013 Key facts and main drivers \ud83c\udf10 https:\/\/www.oecd.org\/content\/dam\/oecd\/en\/publications\/reports\/2025\/10\/deforestation-in-peru_cd7c064a\/e7786877-en.pdf<\/a> <\/span> In percentage terms, this sounds manageable, but in reality it amounts to 6.1 billion square metres of rainforest \u2013 gone forever.
Taking the global primary forest areas from FAO and MAAP as a rough reference framework, Peru accounts for a maximum of around 5 per cent of the tropical <\/strong><\/em>Primary forests worldwide and approximately 10 per cent of the entire Amazon rainforest.25<\/a><\/sup> MAAP #93: Shrinking Primary Forests of the Peruvian Amazon \ud83c\udf10https:\/\/www.maapprogram.org\/shrinking_primary\/<\/a> <\/span>26<\/a><\/sup> WWF: The Amazon Rainforest \u2013 share by country \ud83c\udf10https:\/\/www.wwf.org.uk\/where-we-work\/amazon<\/a> <\/span> This is precisely why Peru is central to any serious forest conservation strategy \u2013 not as the last remaining green space, but as a global heavyweight.<\/p>\n\n\n\n

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Illustration: Peru on a globe, land area highlighted in red. \u2013 Harvepino<\/a> \/ iStock by GettyImages<\/figcaption><\/figure>\n\n\n\n
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Wilderness International and \u201egenuine\u201c protection<\/strong>
This is precisely where Wilderness International comes in: the organisation purchases specifically demarcated areas of rainforest in Peru, secures them legally and, together with local partners, protects them permanently from deforestation and exploitation.27<\/a><\/sup> Wilderness International: Conservation projects in the Peruvian Amazon rainforest \ud83c\udf10https:\/\/www.wilderness-international.org\/projekte\/peru\/ <\/a><\/span> Unlike many abstract \u201ecompensation projects\u201c, this is not about hypothetical CO\u2082 certificates, but about specific forest plots that you can see on a map \u2013 and which will then not be cleared.<\/p>\n\n\n\n

A small editorial note at this point: On the subject of dubious CO\u2082 certificates, I have, for example, in the article Africa: safaris and good business <\/a>Written. Definitely a personal recommendation.<\/em><\/p>\n\n\n\n

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Image: Banner reading tip \u201eAfrica: Safaris and good business\u201c<\/strong><\/figcaption><\/figure>\n\n\n\n
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If we apply our fund idea to this, countries such as Peru could receive a proportional share of the annual fund return for every hectare of rainforest that is reliably protected. Due to historical deforestation, we would conservatively deduct, say, 10 per cent as a penalty \u2013 Peru would then receive not five but 4.5 per cent of the return pot. To be fair, even that does little to change the fundamental problem, as a glance at the figures shows.<\/p>\n\n\n\n

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Photo: Landscape in the Peruvian rainforest, cleared areas \u2013 Christian Vinces<\/a> \/ iStock by GettyImages<\/figcaption><\/figure>\n\n\n\n
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Sample calculation: Peru vs. Ahr Valley<\/strong>
Let's take Lula's \u201eforest protection fund\u201c with a volume of 125 billion US dollars, invested like a global sustainable equity fund. Studies of thousands of funds and the MSCI World SRI Index suggest a long-term return of roughly 6 to 10 per cent p.a.; for the calculation, we will optimistically assume 9 per cent.28<\/a><\/sup> Performance of sustainable funds \u2013 evaluation of 11,000 funds and MSCI World SRI \ud83c\udf10https:\/\/greenfinanceguru.com\/blog\/2024\/05\/07\/performance-of-sustainable-investments\/ <\/a><\/span>29<\/a><\/sup> MSCI World SRI Index \u2013 Long-term return performance \ud83c\udf10https:\/\/www.msci.com\/documents\/10199\/486d87c0-6979-42c3-9d75-53fb018b7fe7<\/a> <\/span>
If the fund generates a 9 per cent return, that amounts to 11.25 billion US dollars per year. Assuming that half of this return (50 per cent) is distributed as a \u201eforest protection premium\u201c, US$5.625 billion remains in the pot. Peru would receive \u2013 in very simplified terms \u2013 around 5 per cent for its share of the tropical primary forests, minus a 10 per cent penalty = 4.5 per cent of the distribution.<\/p>\n\n\n\n

At an exchange rate of around 0.85 euros per dollar, that would amount to roughly:
\u2022 \u00a35.625 billion \u00d7 0.045 \u2248 \u00a30.253 billion
\u2022 0.253 billion USD \u00d7 0.85 \u2248 0.21 billion euros for Peru per year.<\/p>\n\n\n\n

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Figure: TradingView: iShares MSCI World SRI ETF market price (XETRA) over the last six years30<\/a><\/sup> TradingView: iShares MSCI World SRI ETF stock market price (XETRA) over the last 6 years \ud83c\udf10 https:\/\/www.tradingview.com\/x\/0q7dOss1\/<\/a> <\/span> \u2013 PatrickRuppelt <\/a>\/ TradinView<\/figcaption><\/figure>\n\n\n\n


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Even if we take a much more optimistic view in my original thinking (100 per cent distribution without the creation of reserves, higher Peru share, different penalty, slightly different parameters) and end up with around \u20ac0.4 billion, the shock of the magnitude remains the same: the flood disaster in the Ahr Valley caused over \u20ac30 billion in public reconstruction aid and economic damage in Germany alone.31<\/a><\/sup> Infras (2025): Extreme Weather in Germany \u2013 Understanding the Costs (Ahr Valley: ~\u20ac8.5 billion insured, >\u20ac30 billion total) \ud83c\udf10https:\/\/www.infras.ch\/en\/projects\/extrem-weather-costs-climate-damage-register\/<\/a> <\/span> In the best-case scenario, Peru would receive a few hundred million euros per year under the same global system \u2013 for preserving an ecosystem without which the climate crisis would escalate dramatically for everyone.<\/p>\n\n\n\n

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And Tuvalu?<\/strong>
What can a country like Tuvalu say \u2013 a country that has contributed the least to climate change and is feeling its effects the most? Tuvalu has around 1,000 hectares of forest, which is 0.000025 per cent of the world's total forest area.32<\/a><\/sup> Worldometer: Tuvalu's share of world forests \ud83c\udf10 https:\/\/www.worldometers.info\/food-agriculture\/tuvalu-food-agriculture\/<\/a> <\/span>33<\/a><\/sup> FAO: Global Forest Resources Assessment \u2013 Forests cover just over 4 billion hectares worldwide \ud83c\udf10 https:\/\/www.fao.org\/forest-resources-assessment\/2020\/en\/ <\/a><\/span> In our model, that would be a share of the return pot that literally amounts to a few euro cents per capita \u2013 while at the same time entire islands are disappearing below sea level, storm surges are washing away villages and drinking water wells are becoming salinated.34<\/a><\/sup> Tuvalu Forest Information \u2013 FAO data on forest area and vulnerability \ud83c\udf10 https:\/\/tuvalu-data.sprep.org\/resource\/tuvalu-forest-information-and-data <\/a><\/span>
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Photo: The Funafuti Lagoon (Te Namo) in Tuvalu<\/strong> captivates with its crystal-clear, turquoise water and the narrow atoll islands that surround it. 35<\/a><\/sup> Viajes al Pasado \u2013 Surcando los mares de Tuvalu: el universo del lagoon Te Namo (Travel report on Tuvalu and the Te Namo lagoon) \ud83c\udf10 https:\/\/www.viajesalpasado.com\/de\/surcando-los-mares-de-tuvalu-el-universo-del-lagoon-te-namo\/<\/a> <\/span> 36<\/a><\/sup> Funafuti Conservation Area \u2013 Marine reserve in the Funafuti Atoll, Tuvalu (area, biodiversity, history) \ud83c\udf10 https:\/\/en.wikipedia.org\/wiki\/Funafuti_Conservation_Area<\/a> <\/span> 37<\/a><\/sup> Protected areas of Tuvalu \u2013 Overview of marine protected areas and locally managed marine areas in Tuvalu \ud83c\udf10 https:\/\/en.wikipedia.org\/wiki\/Protected_areas_of_Tuvalu<\/a> <\/span> \u2013 Tamara_frvc<\/a> \/ iStock by GettyImages<\/figcaption><\/figure>\n\n\n\n
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You can see where this is going: even an ambitious forest protection fund worth tens of billions with optimistic return assumptions seems more like a consolation prize in view of the real damage caused by climate change. It becomes even more absurd when you consider that the actual global rainforest fund pledged after the COP only amounts to a good \u00a35\u20137 billion in contributions \u2013 a fraction of what the \u00a3125 billion example fund would achieve.38<\/a><\/sup> Reports on new commitments to the Amazon Fund, including commitments worth billions and global forest protection funding gaps \ud83c\udf10https:\/\/www.reuters.com\/sustainability\/climate-energy\/amazon-fund-rainforest-received-640-mln-new-pledges-2023-2024-02-01\/<\/a> <\/span>39<\/a><\/sup> Analysis of Lula's global rainforest fund (Tropical Forest Forever Fund) and the approximately \u00a36.7 billion in pledges made so far \ud83c\udf10https:\/\/earth.org\/will-a-new-fund-fill-the-gap-left-by-cop30s-failure-on-tropical-forest-protection\/<\/a> <\/span><\/p>\n\n\n\n


The point remains: the global North willingly invests in \u201esustainable\u201c funds with expected returns of 6\u201310 per cent, but when it comes to compensating those who bear the real climate damage and are literally saving our last rainforest, we are talking about fractions of a per cent of global financial assets. This is precisely why we need organisations like Wilderness International \u2013 and people who are not satisfied with a few billion pounds serving as a fig leaf for an escalating climate crisis.40<\/a><\/sup> Wilderness International: Protection of primary forests in Peru and other regions \ud83c\udf10 https:\/\/www.wilderness-international.org\/ <\/a><\/span><\/p>\n\n\n\n

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List of sources<\/h3>