The 2026 Annual Thematic Dialogue, under the theme “From Potential to Impact: Advancing Blended Finance for Forest-based Climate Action,” builds on the momentum of the 2025 Dialogue, which highlighted the importance of impact investment and multi partner collaboration in expanding AFoCOs strategic role. In 2026, the discussion moves a step further by examining how AFoCO and its Member Countries can translate that momentum into more structured and catalytic approaches for forest-based climate action.

This shift is particularly timely in light of AFoCO’s recent accreditation to the Green Climate Fund (GCF). The accreditation marks an important institutional milestone and opens a new phase in AFoCO’s operational development. It also raises strategic questions about how future projects should be designed, delivered, and supported in ways that are more credible, scalable, and responsive to evolving climate finance expectations.

This is especially relevant in the forest sector, where initiatives are increasingly expected to demonstrate not only environmental value, but also stronger implementation credibility, financial viability, and long-term sustainability. In particular, integrity, transparency, and accountability are becoming increasingly important for maintaining donor confidence, strengthening implementation trust, and enabling broader access to climate finance. At the same time, forest investments remain exposed to reversal risks, long return horizons, and other uncertainties, underscoring the need for stronger risk management and credible implementation arrangements.

Against this backdrop, AFoCO Member Countries face a broader strategic challenge. Forest action can no longer be framed solely as an environmental or development objective. It must also be aligned with economic incentives, business logic, and investable project design. In many cases, promising ideas do not advance because they are not yet structured in ways that can attract partners, reduce delivery risk, or demonstrate investable potential.

In this context, blended finance is becoming increasingly relevant. Its value lies in improving the risk return profile of projects that may otherwise be considered too risky or insufficiently attractive for private investors alone. By using public or concessional support more strategically, blended finance can help mobilize additional capital, expand access to funding, and support early stage or innovative initiatives that require proof of concept before broader investment can follow. For AFoCO, this also means recognizing that efforts such as stakeholder mapping, sector prioritization, field consultations, and pre-feasibility support already contribute to de-risking and project preparation.

In response to these shifts, the Dialogue will provide a platform for Member Countries, financing partners, and the AFoCO Secretariat to reflect on what this transition may mean in practice, and how forest-based initiatives can become more structured, resilient, and partnership ready over time.

The Dialogue aims to:

1. Enhance Member Countries understanding of the strategic implications of AFoCO’s GCF accreditation for future forest-based climate action;
2. Strengthen understanding of blended finance as a practical approach to improving project readiness, reducing risk, and enabling more diverse forms of partnership and financing;
3. Share emerging lessons from AFoCO’s ongoing efforts in project preparation and de-risking, including stakeholder mapping, sector prioritization, field consultations, and pre-feasibility support;
4. Provide insight into what financing and implementation partners look for in project design, delivery arrangements, readiness conditions, and expected impact pathways; and
5. Identify practical follow-up needs for Member Countries in order to develop more structured, credible, and partnership-ready project pipelines.