Well-being of humanity under threat as deforestation rates remain high: Key takeaways from a new report on the state of global forests

Forests play a crucial role in ecosystems as they shelter 80% of terrestrial plants and

animal species, and help stabilise the global climate by helping to limit global warming to 1.5 degrees Celsius.

Here is a look at some of the key takeaways from the report.

Global deforestation continues

At COP26 in Glasgow, Scotland, countries had promised to stop deforestation and forest degradation by 2030. However, the world is nowhere close to this target.

The latest report found that countries are 63% off track to reach the goal, as 8.1 million hectares of forest — about the area of Austria — were lost last year. The worst affected were tropical forests, with 6.73 million hectares lost in 2024 alone.

The deforestation was largely led by clearance for permanent agriculture, accounting for an average of about 86% of global deforestation over the past decade.

Countries are also struggling to restore degraded ecosystems, including forests. At COP26, they had pledged to restore 30% of such ecosystems.

“Active restoration initiatives are currently underway on an estimated 10.6 million hectares of deforested and degraded land. This represents about 5.4 percent of global reforestation potential4 and only 0.3 percent of the global biophysical forest restoration potential,” the report said.

Imbalance between the finances for extraction and conservation

The report said international public finance for forests increased from an estimated $1.7 billion in 2018-2020 to $5.7 billion in 2022-2024. However, this amount is just 1.4% of $409 billion in public finance directed annually towards agricultural subsidies, which are the primary reason for forest loss.

Erin Matson, lead author of the Forest Declaration Assessment 2025, told Reuters, “Demand for commodities like soy, beef, timber, coal, and metals keeps rising, but the tragedy is we don’t actually need to destroy forests to meet that demand… The incentives are completely backwards.”

Note that $117 billion to $299 billion in financing is needed to reach the 2030 goals.

The report also revealed that financial institutions have failed to make required progress in assessing, managing, and mitigating forest-related financial risks. “Among financial institutions, only 40 percent of those most exposed to commodity-driven deforestation risk in their investments have a policy to address deforestation,” the analysis said.

Insecure land rights and weak enforcement undermine conservation

The report found that globally, the participation of Indigenous Peoples, local communities, women, and civil societies had been limited. It has also said that even in jurisdictions where there are strong forest rights, the role of women has been limited. This is when targeted initiatives have repeatedly shown that the participation of women can lead to better conservation efforts.

Moreover, only a handful of countries have implemented policies to strengthen the conservation of forests and enhance the sustainability of their forest sectors. In most countries, the political and economic power of industry has dominated, leading to deforestation and forest degradation.

For instance, “India finalized rules under the amended Forest Conservation Act, reducing protections for many areas of forested land and undermining the rights of forest-dependent communities,” according to the report.