Cost
$ 28.8 /tonne
CO2 Tonnes
Smallholder Agroforestry - Nicaragua
This award-winning Smallholder Agroforestry carbon project is the largest reforestation initiative in Nicaragua, working with thousands of smallholder farmers to create long-term income opportunities from growing trees on underused parts of their land in exchange for direct payments over time as the trees sequester carbon from the atmosphere. In addition to supporting farmers, the project creates seasonal jobs to sustain its operations, including seed gathering, nursery building, and tree planting. By combining reforestation with economic empowerment, the program not only helps combat climate change but also fosters long-term socio-economic development for Nicaragua's rural communities.
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Project information
Restoring Nicaragua’s forests with smallholder farmers
The project works with smallholder farmers across Nicaragua to restore native, mixed-species forests on degraded land. Since launching in 2010, the project has expanded to operate nationwide, enabling farmers from across Nicaragua’s main regions to participate in long-term forest restoration efforts that support climate mitigation, biodiversity, and sustainable land stewardship. Deforestation and ecosystem degradation in Nicaragua have been driven largely by agricultural expansion and the intensification of agricultural production, leaving significant areas of land in need of restoration. However, many smallholder farmers face technical, financial, and administrative barriers that can make it difficult to establish and manage forests on their land.
To address these challenges, the project provides upfront financing to establish forests, along with ongoing technical support through local field technicians who deliver training and guidance at every step. Planting designs feature a mix of native species and are tailored to local environmental conditions, including regional rainfall patterns, while also reflecting local land-use needs and economic realities.
The project delivers environmental benefits through carbon sequestration, forest and watershed restoration, biodiversity enhancement, and improved soil health. These outcomes are supported through continuous education on sustainable forest management and environmental stewardship, helping to maintain positive impacts over the long term. In addition, the project generates social and economic benefits through carbon payments, employment opportunities, community engagement, and skills development, contributing to more resilient rural livelihoods while advancing large-scale forest restoration.
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Key information
Intervention
Afforestation, Reforestation, and Revegetation
Location
Nicaragua
Credit type
Carbon Credits: Removal
Standard
Plan Vivo
Assessment methodology
Keystone 2.0
Project performance
The Earthly rating
The Earthly rating is the industry-first holistic project assessment. Earthly researchers analyse 160+ data points, aggregating information across the three vital pillars of carbon, biodiversity and people. Projects in Earthly's marketplace all exceed a minimum score of 5.5/10.
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Carbon
~18,400
hectares being restored
Biodiversity
6
key watersheds being restored
Social
60%
of carbon revenue paid to farmers
Project impact
Local impact
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Positive for people
The project is based on the principle that forests will only be restored and maintained at scale if farmers can improve their livelihoods by growing trees. By creating economic opportunities linked to forest restoration, the project aims to ensure that environmental and social benefits go hand in hand. Participating farmers benefit from carbon payments, training, and access to sustainable forest-based income opportunities that can provide value over the long term while maintaining forest cover. Restored forests can also contribute to more resilient farming systems through improved soil health, water regulation, biodiversity, improved pasture, and protection from climate-related challenges. Beyond individual farms, the project creates employment opportunities and supports skills development within rural communities.
The project also supports more than 100 permanent local jobs and thousands of seasonal employment opportunities, including opportunities for landless workers. The project also works with more than 900 female farmers across Nicaragua, helping to broaden participation in forest restoration and the benefits it can provide. Observed and expected impacts include increased farmer participation in restoration activities, more diversified income sources, improved livelihood resilience, and stronger local capacity for sustainable forest management. Through long-term investment in people as well as forests, the project contributes to more resilient rural communities while supporting lasting environmental restoration.
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Good for earth
The project addresses key drivers of biodiversity loss by restoring native, mixed-species forests on degraded land and supporting farmers to establish and maintain long-term forest cover. Planting a diverse mix of native tree species increases vegetation diversity across agricultural landscapes, creating habitat, food sources, and ecological connectivity for wildlife while strengthening ecosystem resilience. Restoration activities are prioritised in areas where forests can provide broader environmental benefits, including watershed protection, improved water retention, and reduced soil erosion. By restoring forest cover in these landscapes, the project helps improve ecosystem function and supports the recovery of habitats that have been degraded or fragmented through land-use change.
These outcomes are reinforced through ongoing training and education on sustainable forest management and environmental stewardship, helping farmers maintain restoration activities and protect biodiversity over the long term. The project’s incentive structure is also designed to support the durability of restored forests. Carbon payments provide an initial source of revenue, while sustainable forest management can create longer-term economic opportunities that encourage farmers to maintain forest cover and the ecological functions it provides. By aligning environmental and economic outcomes, the project helps address some of the underlying pressures that contribute to deforestation and land degradation.
Observed and expected impacts include increased forest cover, improved habitat availability, greater vegetation diversity, healthier soils, enhanced watershed function, and increased carbon sequestration. Formal monitoring conducted in 2025 recorded more than 120 tree species across project sites, demonstrating the diversity being established through restoration activities. Through long-term stewardship and landscape-scale restoration, the project contributes to the recovery and resilience of biodiversity across the broader region.
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