Impact Fund Denmark has signed a guarantee agreement with European Development Finance Institutions Management Company (EDFI MC) supporting a USD 20 million investment in SA Impact Forestry Fund II (SAIFF II) in Paraguay.
The guarantee enables Impact Fund Denmark to invest in sustainable forestry, restoring native forests, and increasing carbon sequestration. Through the conversion of degraded grazing land into productive and sustainably managed forestry assets, the investment is expected to contribute to climate mitigation, biodiversity conservation, and long-term sustainable land use across more than 44,000 hectares.
The guarantee from EDFI MC is backed by the European Union through the EFSD+ programme under the EU Global Gateway strategy.
Risk-sharing enables higher-impact climate investments
With a guarantee from EDFI MC, Impact Fund Denmark can deploy capital into projects with strong development and climate impacts that would otherwise not be financed due to high risk.
This is the fourth time Impact Fund Denmark takes out such a guarantee.
Forestry is a key pillar of Impact Fund Denmark’s climate portfolio. Investments such as SAIFF II contribute to climate mitigation through long-term carbon storage while supporting the institution’s Net Zero 2040 pathway.
EU-backed guarantees help scale Impact Fund Denmark’s blended finance solutions
The EU-backed EDFI guarantee is a good example of how blended finance partnerships can unlock investments that would otherwise not be realised. For Impact Fund Denmark, both the European Commission and EDFI MC are strategic partners in expanding blended finance solutions and mobilising capital towards investments with strong climate and development outcomes. This type of partnership helps reduce risk, unlocks commercially viable investments and increases the scale of impact that can be achieved.
These guarantees translate EU policy ambitions into investments on the ground and strengthening European Global Gateway ambitions.
This EU-backed guarantee makes a good climate project investable. It is a good example of how we work with blended finance to mobilise capital into sectors and projects that would otherwise not move forward.
External Communications Director
Thøger Kirk
+45 53 76 08 05
