ABSTRACT

Land degradation expresses a negative trend in land conditions as a long-term reduction or loss of biological productivity, ecological integrity, or economic value. Land degradation is directly or indirectly caused by humans and affects people and ecosystems. Human-induced drivers of land degradation include land-use changes and unsustainable land management, while agriculture is a dominant sector driving degradation. One-third of global land is degraded due to agriculture, and 75% of the terrestrial environment is severely altered by human actions (IPBES, 2018). Anthropogenic climate change increases the rate and magnitude of ongoing land degradation processes and introduces new degradation patterns. Also, land degradation is a driver of climate change through the emission of greenhouse gases (GHGs) and reduced carbon-absorbing. Land degradation occurs over a quarter of the Earth’s ice-free land area, affecting an estimated 3.2 billion people, most of whom live in poverty in developing countries (Olsson et al., 2019). Sustainable Development Goal (SDG) 15.3 aims to restore degraded land and soil and achieve a land degradation-neutral world. Land degradation neutrality refers to a state whereby the amount and quality of land resources necessary to support ecosystem functions and services for food security remain stable or improve (UNCCD, 2022). The United Nations Convention to Combat Desertification’s (UNCCD) goal of land degradation neutrality (LDN) aims to halt and reverse the global land degradation problem. More than 100 countries participated in the Changwon Initiative of the UNCCD, which supports national voluntary target-setting processes to achieve LDN. Land degradation can be avoided, reduced, or reversed by implementing sustainable land management, restoration, and rehabilitation practices which will provide many benefits, including adaptation to and mitigation of climate change. Therefore, combating land degradation and restoring degraded land are urgent priorities to protect the biodiversity and ecosystem services vital to all life on Earth and to ensure human well-being (IPBES, 2018). As a connected concept, land-use change expresses changes in the use or management of land, modifying the biological productivity, ecological integrity, or economic value of the land surface. Land-use change can result from human activities such as agriculture and irrigation, deforestation, reforestation and afforestation, industrialization, or urbanization and is considered a planetary boundary in the Planetary Boundaries Framework. This framework used the forest land area compared to the original forest cover as a control variable. Steffen et al. (2015) showed that humanity exceeded the land-system change boundary. Sustainable finance contributes to investing in activities that avoid land degradation and restore degraded land, namely sustainable land management activities. The benefits of land restoration include but are not limited to increased employment, increased business spending, improved gender equality, increased local investment in education, and improved livelihoods. The estimates of the Economics of Land Degradation (ELD) initiative led by the UNCCD show that the returns on investment from land restorations are very high. For example, sustainable land management could deliver up to US$ 1.4 trillion in increased crop production, and enhancing carbon stocks through soils could create a value of up to USD 480 billion (ELD, 2022).