Pradeep Kurukulasuriya, UNCDF Executive Secretary
Originally published in the Islamic Development Bank’s December 2024 edition of SDG Digest.
Land degradation is an escalating global crisis, threatening biodiversity, food security, water resources, and economic resilience.
UN estimates reveal that 1.52 billion hectares of land have been degraded, impacting an estimated 1.2 billion people worldwide.
Least Developed Countries and other fragile and conflict-affected settings are the hardest hit, lacking the financial capacity to invest in land restoration.
Limited fiscal space and high debt levels exacerbate financial risks and lead to prohibitive borrowing costs, challenges made worse by conventional financial mechanisms that don’t address the unique needs of underserved countries.
As a non-credit-rated hybrid development and finance institution, the UN Capital Development Fund is uniquely positioned to bridge this gap through blended finance solutions that de-risk investments in fragile contexts, helping spur much-needed investment at the pace and scale required to achieve the Sustainable Development Goals.
Being able to act as an off-balance-sheet de-risker for governments and development finance institutions, we have the ability to unlock larger flows of both domestic and private capital, amplifying the impact of the UN and the global development community.
As we look ahead to the United Nations Convention to Combat Desertification Conference of the Parties in Riyadh, attention is focused how sustainable land management can build climate resilience and help mitigate the increasing impacts of climate change; countries least equipped with the resources to protect themselves are often on the frontlines of this impact
Effective land restoration is now seen not only as an environmental imperative but as a driver of cross-border cooperation and conflict prevention.
Challenges and Opportunities in Financing Land Restoration
Among the challenges we face is the urgent need to finance land restoration.
Funding is scarce—particularly in fragile settings where transboundary resource management could have transformative impacts.
These areas require specialized support to implement nature-based solutions like water and soil conservation, reforestation, and pollination initiatives. These interventions are essential to combat land degradation and build peace.
To close the climate financing gap in these high-risk and early-stage markets—particularly in LDCs and conflict-affected regions—a comprehensive strategy is necessary.
This includes mobilizing capital for large-scale restoration projects, proving the financial viability of such projects, and building resilient communities through local partnerships. Recasting land restoration as a viable asset class, transforming land into a renewable economic asset, could attract investors and harmonize conservation efforts with sustainable economic development priorities.
The UN Capital Development Fund can amplify much-needed development impact alongside the UN Development System by leveraging its unique investment capabilities.
By combining patient capital with targeted de-risking strategies, UNCDF aims to foster community ownership, bolster financial ecosystems, and build long-term resilience.
This holistic approach ensures that restoration initiatives are inclusive, scalable, and sustainable – a future-forward model that delivers the environmental and socio-economic benefits of improved soil health, and enhanced water retention and drought resilience, while generating jobs, resilience and fostering peace.
For more information, please contact:
Cheryl Haines, UNCDF:
cheryl.haines@uncdf.org
