The Forest-Climate Nexus: A Fit-for-Purpose Framework for Climate Impact

This executive summary by the Climate Policy Initiative and Pontifical Catholic University of Rio de Janeiro (CPI/PUC-RIO) argues for the central role of tropical forests in climate mitigation. It proposes a new financial architecture, specifically the Reversing Deforestation Mechanism (RDM), to incentivize large-scale forest restoration and move tropical forests from being viewed as a climate risk to a climate solution.

• Tropical forests across 91 countries hold 1.27 billion hectares and store 593 gigatons of CO2 equivalent, representing roughly one-third of historical global emissions. These countries have lost more than 10 million hectares per year over the last decade.
• Restoring areas deforested since 2001 has the potential to capture up to 49 GtCO2. The report notes that deforestation rates and the presence of standing forests do not have a direct relationship with a country's per capita income, suggesting that forest protection does not hinder economic growth.
• Effective forest policy requires a combination of regulatory instruments (such as protected areas and land-use regulations) and economic incentives (such as Payments for Environmental Services and agricultural subsidies). However, these policies are often vulnerable to shifts in government priorities, necessitating a financial architecture that provides stable, long-term incentives.
• The report proposes the Reversing Deforestation Mechanism (RDM) to complement existing tools like Jurisdictional REDD+ (JREDD+) and the Tropical Forest Forever Facility (TFFF). RDM focuses on rewarding net carbon removals at the jurisdictional level, subtracting emissions from deforestation and degradation from the carbon captured through restoration.
• At a carbon price of US$ 50 per ton, the RDM could generate approximately US$ 100 billion in annual revenues and remove up to 2 GtCO2 per year. This would address an estimated 11-13% of the 2035 emissions gap required to limit warming to 2.0°C.

APA

Climate Policy Initiative (2025). The Forest-Climate Nexus: A Fit-for-Purpose Framework for Climate Impact. https://www.climatepolicyinitiative.org/publication/the-forest-climate-nexus-a-fit-for-purpose-framework-for-climate-impact/

Chicago

Climate Policy Initiative. The Forest-Climate Nexus: A Fit-for-Purpose Framework for Climate Impact. 2025. https://www.climatepolicyinitiative.org/publication/the-forest-climate-nexus-a-fit-for-purpose-framework-for-climate-impact/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=The Forest-Climate Nexus: A Fit-for-Purpose Framework for Climate Impact |date=13 October 2025 |url=https://www.climatepolicyinitiative.org/publication/the-forest-climate-nexus-a-fit-for-purpose-framework-for-climate-impact/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2025forestclimate, author = {{Climate Policy Initiative}}, title = {{The Forest-Climate Nexus: A Fit-for-Purpose Framework for Climate Impact}}, institution = {Climate Policy Initiative}, year = {2025}, month = oct, url = {https://www.climatepolicyinitiative.org/publication/the-forest-climate-nexus-a-fit-for-purpose-framework-for-climate-impact/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }