Catalysing Sustainable Impact through Blended Finance in Southeast Asian Forest

New Forests has developed an innovative blended finance structure for its latest investment fund for Southeast Asia—with the goal of enhancing investment in sustainable plantation forestry in the region and generating significant positive climate, community, and biodiversity impacts

Asia is a growing market for a range of timber products, including hardwood and softwood logs, lumber, woodchips, wood fibre, and pulp. Rising demand for construction timber, raw materials for industry and manufacturing, and paper, paperboard, packaging, tissues, baby diapers, and viscose fibres, points to continuing timber demand growth, particularly as economies across Asia become middle- and high-income countries. New Forests is aware that the Southeast Asian forest sector has been historically based on government concessions for the logging of once plentiful natural tropical forests and that the low capital cost of entry to the industry meant favourable returns were possible without operating efficiently or sustainably. However, we believe the forest sector in Southeast Asia needs to transform rapidly if it is to not only meet rising demand for timber but also align with community interests, climate change mitigation objectives, and protecting and enhancing biodiversity.

We believe the forest sector in Southeast Asia needs to transform rapidly if it is to not only meet rising demand for timber but also align with community interests, climate change mitigation objectives, and protecting and enhancing biodiversity.

To achieve these goals and support rapidly increasing global timber demand, New Forests believes that capital-efficient, sustainably managed plantation estates are essential. New Forests focuses on opportunities in Malaysia, Indonesia, Vietnam, Laos, and Cambodia, where it is commercially attractive to grow tropical forest plantations due to growing conditions, market access, and enabling environments for forestry investment and operations. New Forests is confident that investing in a forward-looking, long-term sustainable plantation sector in Southeast Asia is an attractive commercial opportunity with potential to generate significant positive environmental and social outcomes.

Blended Finance — Enhancing Investment and Impact

To achieve these goals and support rapidly increasing global timber demand, New Forests believes that capital-efficient, sustainably managed plantation estates are essential. New Forests focuses on opportunities in Malaysia, Indonesia, Vietnam, Laos, and Cambodia, where it is commercially attractive to grow tropical forest plantations due to growing conditions, market access, and enabling environments for forestry investment and operations. New Forests is confident that investing in a forward-looking, long-term sustainable plantation sector in Southeast Asia is an attractive commercial opportunity with potential to generate significant positive environmental and social outcomes.