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Kathmandu, Jan 24: Nepal has signed an agreement with the LEAF Coalition that could bring up to 55 million dollars in climate finance, marking a major step in its forest protection efforts. With this deal, Nepal becomes the first country in Asia to join LEAF, a global public-private partnership supported by governments including Norway, the United Kingdom, the United States, and South Korea, as well as more than 30 large companies.

The agreement recognises Nepal’s long-standing work to reduce deforestation and expand forest cover through its jurisdictional REDD+ programme. It also places Nepal in a new position in global carbon markets. Nepal is now the first government to offer carbon credits with corresponding adjustments to private buyers under LEAF. These credits can be used in formal compliance systems such as Singapore’s carbon tax and the international aviation offset scheme CORSIA.

Nepal’s forest recovery follows decades of community-based management. Once heavily degraded by grazing and firewood use, forests have rebounded through cooperation between government forest offices and local user groups. Forests now cover more than 46 percent of the country, and the government plans to expand this further with continued policy and institutional support.

Under the agreement signed with Emergent, which coordinates LEAF, Nepal plans to supply millions of tonnes of emissions reduction and removal credits from 2022 to 2026. The UK and Norway will guarantee the purchase of an initial one million credits. More credits may be sold to corporate buyers later, depending on verified supply. This setup reduces complexity for governments and gives buyers flexibility in timing.

If fully realised, the deal could channel up to 55 million dollars into Nepal through advance purchases of high-integrity forest carbon credits. With Nepal’s entry, the total potential value of LEAF agreements worldwide has crossed 325 million dollars.

Government officials say the deal reflects years of collaboration with communities and aims to ensure fair sharing of benefits, including for Indigenous Peoples and forest-dependent groups. Community leaders and Indigenous representatives have welcomed the agreement, expressing hope that the funds will reward local conservation work and support future efforts.

International partners, including the UK, Norway, and UN REDD, have described the agreement as a milestone that reflects Nepal’s steady progress in forest protection and its readiness to engage climate finance markets built on credibility and long-term results.

People’s News Monitoring Service