The biggest ever fund set up to battle deforestation was launched today, targeting the vast Congo basin rainforest in central Africa. Britain and Norway are providing £108m and will also supply satellite imaging technology to monitor the area.

The fund is intended to provide African governments and people living in the rainforest with a viable alternative to logging, mining, and felling trees for firewood and subsistence farming.

The Congo basin rainforest is the world's biggest after the Amazon, at about twice the size of France, but is rapidly dwindling. It is being cut down at the rate of 25,000 football pitches a week. Loss of trees is one of the biggest sources of the carbon dioxide warming the atmosphere, accounting for 18% of annual emissions.

Projects will be eligible for funds if they can demonstrate that they will curb the destruction of forest, by providing alternative sources of income or energy for example. Their effectiveness will be monitored from above by high definition cameras being made in the Rutherford Appleton laboratory in Oxfordshire, UK, due to be mounted on satellites and launched into orbit in the next two years.

"We are pledging to work together to secure the future of one of the world's last remaining ancient forests," Gordon Brown said at the scheme's launch.

Britain initiated the fund and is providing £58m. "Preserving our forests is vital if we are going to reduce global emissions and tackle climate change."

Jens Stoltenberg, the Norwegian prime minister, whose government is putting £50m in the scheme over three years said the money spent was the most immediate and cost-effective way to combat greenhouse gas emissions. Norway is spending £300m a year on its global forest initiatives.

"By doing something about deforestation we can achieve a big and rapid reduction in emissions," Stoltenberg told the Guardian. The estimated cost of reducing emissions by halting deforestation is £3 per metric tonne of CO2, compared to £50-100 a tonne for carbon capture schemes. Norway believes that their annual expenditure on combating deforestation could cut emissions equivalent to twice Norway's annual total.

British and Norwegian officials acknowledge that the biggest challenge will be ensuring that the money is effectively spent. The Congo rainforest sprawls across Cameroon, Central African Republic, the Democratic Republic of the Congo (DRC), Equatorial Guinea, Gabon, and the Republic of the Congo. Across large swaths, particularly in the DRC, corruption is rife while mining and logging companies are prepared to offer large rewards to communities and regional authorities to open up their forests.

"We know the technology. Everyone knows how not to cut down a tree," Stoltenberg said. "The big challenge is the institutions, the framework, the monitoring and the control. I don't believe that is easy but that cannot prevent us for trying. [Otherwise] we won't have any chance of reaching the reductions we need to avoid serious global warming."

The new Congo Basin Forest Fund will be co-chaired by Wangari Maathai, a Kenyan environmental activist and Nobel Peace laureate, and Paul Martin, a former Canadian prime minister.

Maathai said the scheme was an example of "carbon justice" by which industrialised countries responsible for global warming entered into partnerships with those suffering its effects or those being asked to sacrifice their own economic development in the interests of the planet.

"Africa has to make very tough choices and she has to feed herself. But it's very important we do not sacrifice indigenous forests for biofuels or any other alternatives," Maathai said.