Release date: 30 November 2021
Promoter – Financial Intermediary
SLB SASLocation
Description
The project consists of investments in about 2,200 hectares of forests in Romania aimed at enhancing the forest management regime towards closer to nature practices, natural regeneration and enhanced ecologic and biodiversity conditions. The project targets achievement of fully certified forestry assets by implementing sustainable forest management (SFM) principles.
Additionality and Impact
ROMANIA: The operation will contribute to the removal of Greenhouse Gas (GHGs) through enhanced carbon sequestration and storage (in trees, deadwood, litter and soil), to improved ecosystems' resilience against climate changes and to enhanced biodiversity conservation. Therefore, the project responds to the EU and EIB's Climate Action and Environmental Sustainability objectives.
The project addresses market failures with respect to public goods and externalities, which lead to undervaluation of forest products and ecosystem services. In the context of long-term rotation cycle of forests, and consequent long-term financing needs, the EIB loan tenor, grace period, availability period or financial benefit exceeds the conditions available on the domestic financial markets. The EIB financing plays a signalling effect on the market, helping to unlock additional financing from private and/or public investors in sustainable forest asset management. Without the EIB support, the project's environmental and climate benefits, and its contribution to a sustainable and circular forest bio-economy would not be achieved to the same extent. . The project will support employment and economic activities in remote rural areas from less developed regions of the EU, thereby contributing to the territorial integration and rural development and to the Bank's transversal Cohesion Objective.
Objectives
Investments target the natural regeneration and optimiaation of forest ecosystems in Romania, specifically respecting original growing and ecological environments. The forests will be converted to management under FSC certification and Continuous Cover Forestry principles to increase biodiversity and forest resilience to climate change. Forest operations will have a strong focus on ensuring forest protection and conservation of the forest ecosystems, including special attention to preserving soils such as avoiding interventions during excessively wet conditions and utilising light machinery, even animal traction. Brush clearing will be carried out manually and selectively, leaving native vegetation. Forest health will be subject to intensive monitoring and any stands with pest infestations such as bark beetle will be cleared and regenerated. The Promoter will also invest in infrastructure to make the forests accessible to wildlife observation, education and recreation.
Sector(s)
- Agriculture, fisheries, forestry - Agriculture, forestry and fishing
Proposed EIB finance (Approximate amount)
EUR 10 million
Total cost (Approximate amount)
EUR 13 million
Environmental aspects
The final beneficiary will be requested to comply with applicable national and EU legislation, as appropriate.
Procurement
The final beneficiary will be requested to comply with applicable national and EU legislation, as appropriate.
Status
Signed - 18/10/2022