“This project is more than a dream. It is everything that our ancestors were not able to realize. It is an assurance of income and employment, of dignity for our families.”
These are the words of Laura Ferreira da Silva, a quilombo leader from Ribeirão da Mutuca in Brazil. Her community has lived for generations in the tropical savanna of the Cerrado biome, one of only 36 biodiversity hotspots on earth—an area that contains irreplaceable plant and animal species found nowhere else. It is also gravely threatened. The Cerrado’s rich biodiversity must be protected for future generations, and that is exactly what Laura’s community has been doing.
Their efforts have been greatly expanded thanks to a unique set of climate grants for Indigenous peoples and local communities across the developing world: the Climate Investment Funds (CIF)’s Dedicated Grant Mechanism (DGM). Today, this mechanism has proven that it can empower communities in a sustainable way, with major external partners such as the Brazilian National Development Bank coming on board to give existing projects a boost and support new projects.
The DGM grew out of a simple fact: when it comes to protecting the valuable forests, wetlands, coasts, and savannas that act as a natural brake on climate change, the people who are living in—and relying on—these lands should take the lead.
This principle is hard-wired into the structure of the mechanism. In each country where a national DGM is established, Indigenous peoples and local communities themselves sit on the Steering Committee and make the decisions. As Manuel Aldrete, former co-chair of the DGM Global Steering Committee, put it: “The knowledge we've accumulated over generations helps restore balance between humanity and the natural world.”
Since 2009, $70 million from CIF’s Forest Investment Program has been allocated in this way, in 12 countries. In partnership with the World Bank and others, the DGM has funded 915 indigenous and local community initiatives across the developing world to reduce deforestation-related greenhouse gas emissions, halt land degradation, restore natural habitats, and protect natural carbon stocks.
In Brazil’s Cerrado, where large-scale agriculture is destroying vast tracts of forest and grasslands, the DGM Steering Committee measures all projects against an important yardstick: will they protect both the climate and local communities’ small-scale way of life? And will the money invested generate lasting change, empowering the community over the long-term?
That is precisely what Laura’s community wanted: to continue caring for the Cerrado while also sustainably raising incomes, which they hoped would stem the tide of young people leaving for work in the cities.
With a $30,000 grant, a small processing plant was installed in an old schoolhouse, allowing the community to make higher-earning products from their traditional banana harvest, including green banana flour, banana candy, and banana molasses. A communal “telecentro” was also created with free access to computers, where young people can learn IT skills and help sell the community’s products online. And the grant helped the community meet food safety regulations, giving their products a foothold in larger markets.
These investments have not only made the Ribeirão da Mutuca community more self-sufficient, but will help to ensure their continued stewardship of the land, in harmony with the traditional quilombo values of respect for the environment.
The results have been so impressive that in September the community was awarded a follow-on R$50,000 grant of Brazilian Reais (approx. US$10,000) from DGM Brazil, which they will use to build a new irrigation system. Twenty-five other communities in the Cerrado will receive similar allocations, to support the sustainable harvesting of coconuts, cashews, coffee, honey, and more.
And it has not stopped there. Thanks to the success of community grants like Laura’s, DGM Brazil has gone on to receive national recognition and support. The Brazilian National Development Bank, the second-largest national development bank in the world, has recently announced a new injection of funds for the mechanism, totaling 4.6 million Brazilian Real—or about $1 million.
In this milestone new step, decisions about projects remain in the hands of Indigenous peoples and local traditional communities.
The Brazilian experience is a model for similar initiatives worldwide. It proves that climate finance can help build coalitions of different actors—many of whom had never before worked together— to protect essential biomes. These coalitions can then go on to secure additional funding, creating a multiplier effect.
As a testament to the value of the DGM, a new $40 million window was announced in 2023 to ensure the mechanism can support Indigenous and local communities in countries part of the Nature, People and Climate investment program.
Banner Photo Credit: Chris Diewald
World Bank