UK Loans Over $500 Million to Tropical Forest Preservation Fund

The Uk government announced plans to invest in the Tropical Forests Forever Facility (TFFF), a Brazil-led fund aimed at financing the protection of tropical forests globally through a new £400 million (USD$540 million) loan.

Launched in November 2025 at the COP30 climate summit in Belem, Brazil, the TFFF was designed to provide a mechanism to provide long-term, predictable financing to countries that protect and sustainably manage their tropical forests. The facility’s financing model combines public investment with private market borrowing, aiming to mobilize around $4 billion annually, to be distributed among forest countries,  which receive payments proportional to their conserved tropical and subptropical broadleaf moist forest area, through satellite imagery-based confirmation.

In a letter to the House of Commons announcing the investment, Katie White, UK Minister of State for Energy Security and Net Zero, said:

“This summer has seen record-breaking heatwaves and wildfires raging across the UK, and climate phenomena such as El Niño are expected to intensify many of the impacts we are already experiencing around the world. That is why the UK is acting now to protect these vital ecosystems that absorb nearly 30% of greenhouse gas emissions each year – crucial in protecting British families and businesses from the worst impacts of the climate crisis.”

In its statement announcing the investment, the government highlighted the UK’s new approach to climate finance, “acting as an investor instead of a donor,” with the investment structured as a loan and not as a grant, while noting as well that forest countries will not be expected to repay the funding, as the facility is designed to generate investment returns from its performance-based model, enabling it to both repay investors and reward countries that successfully protect tropical forests.

The investment remains subject to final due diligence, including a review of the facility’s final size, crediting arrangements, structure and the terms of the loan.