Skip to Main Navigation
PRESS RELEASEFebruary 9, 2023

World Bank and Ethiopia Sign $40 Million Agreement to Cut Carbon Emissions Through Sustainable Landscape Management

ADDIS ABABA, February 9, 2023 — Ethiopia has signed a landmark agreement with the World Bank’s BioCarbon Fund Initiative for Sustainable Forest Landscapes (ISFL) that rewards community efforts to reduce carbon emissions by tackling deforestation and land and forest degradation.

The Emission Reductions Purchase Agreement (ERPA) unlocks up to $40 million that will help communities, government, and stakeholders to reduce carbon emissions and increase carbon sequestration through forest preservation and other environment-friendly land uses. This ERPA marks the first of its kind for ISFL, which will reward efforts to reduce around 4 million metric tons of CO2e [Carbon Dioxide equivalent] emissions through 2030 under Ethiopia’s ambitious Oromia Forested Landscape Program.

Signing this ERPA is a reason to celebrate,” said Ato Kebede Yimam, Director General for Ethiopian Forest Development. “It is the culmination of our careful planning, increased partnerships, and political commitment to managing our forests and agriculture sustainably as part of national efforts to combat climate change, build resilience, and ensure inclusive green growth.”

The Oromia Forested Landscape Program (OFLP) seeks to reduce greenhouse gas (GHG) emissions by improving forest and livestock management throughout the Oromia region. The region is home to more than 30 million people and 52% of the country’s forests. It is also where wood extraction, slash and burn agriculture and livestock farming are the main causes of deforestation.

ISFL grant financing has supported the OFLP since its start of implementation in 2017. It has enabled on-the-ground investments that have resulted in over 350 community cooperatives being engaged in afforestation and reforestation activities and participatory forest management, with plans and assessments covering more than 195,000 hectares of natural forests. Over 46 million tree seedlings have been produced and more than 9000 hectares of land have already been reforested. The program has also worked with the private sector and governmental entities to promote the adoption of new business models that ensure environmental and economic sustainability and development of forest-smart policies that support local initiatives to thrive and scale up.

With the activities underway, the ERPA will bring significant additional funding to the program in the form of results-based payments for the verified emission reductions. A comprehensive benefit sharing plan is prepared to ensure stakeholders are fairly recognized and rewarded for their effort in reducing emissions.

We are proud to sign our first ERPA with Ethiopia and reward the hard work of changing how land is managed to avoid deforestation,” said Roy Parizat, ISFL Fund Manager. “It is particularly gratifying to see local communities empowered to protect, manage, and decide on how to use the benefits accrued from protecting the forest and improving the environmental sustainability of other critical land-use sectors, most notably agriculture.

*The BioCarbon Fund Initiative for Sustainable Forest Landscapes (ISFL) is a multilateral fund that promotes and rewards efforts to reduce GHG emissions from the land use sector, including REDD+, sustainable agriculture, and climate-smart land-use planning, policies, and practices. Experiences and lessons learned from the ISFL have also contributed to the development of the Scaling Climate Action by Lowering Emissions (SCALE) initiative - the World Bank’s new “one-stop shop” for results-based climate finance. It aims to achieve emissions reductions in support of countries’ Nationally Determined Contributions and broader climate ambitions, including in the areas of agriculture, land use, forestry, oceans, natural capital assets-supporting sectors, and ecosystem services. It will allow countries to follow in the footsteps of Ethiopia to develop jurisdictional, integrated land-use programs that protect forests while improving the sustainability of other critical land uses, like agriculture, and reduce GHG emissions while improving the prosperity of local communities.



In Addis Ababa
Gelila Woodeneh
+251 11 66 27 00
In Washington
Daniella van Leggelo-Padilla
(202) 473-4989


    loader image


    loader image