Ecuador: Threats From Carbon Market

Ecuador’s participation in the global carbon market has generated complications in indigenous peoples and Afro-Ecuadorian communities, which have not only seen cutbacks in their rights to use land for ancestral activities, but whose organizations have also undergone fracturing due to the government’s offer to establish annual cash bonuses to communities that participate in its flagship program, Socio Bosque, or Forest Partner, driven by the Ministry of Environment since mid-2008.

On President Rafael Correa’s Saturday radio program May 23, 2009, he announced he was looking at how to enter into the carbon credits market to protect the country’s environment, especially the Amazon.

Ecuador produces “a large amount of pure air because of the Amazonian jungle, and other countries consume that; those countries should compensate us,” Correa said during the broadcast.

By including virgin forest conservation in the framework of the carbon credit market and presenting it as his administration’s environmental strategy, Correa took up the discourse of the countries that pollute most, but that make no effort to reduce the carbon emissions generated by their industries. Yet these countries still push for communities in poor countries not to use their forests as resources as they have done since ancient times, using the wood for their hearths and homes.

In exchange, wealthy countries, through multilateral agencies and large non-governmental organizations, offer compensation to the governments who fulfill these requests, which is a laughable amount when compared to the costs that would be undertaken to reduce their own carbon dioxide, or CO2, emissions. Ecuador seeks to access US$4 million committed by the United Nations in exchange for providing ecosystem services to the international market.

Part of this compensation is passed on, through Socio Bosque program, to the communities that agree to this proposal and that, moreover, demonstrate sympathy for the government — all of which makes this program a clientelistic instrument, because once the agreement is signed, communities are forced to support the president.

“The last time the president came to [the Amazon city of] Lago Agrio [on Sept. 16], the Provincial Directorate for the Environment mobilized the Kichwa and Cofan communities, which have agreements with Socio Bosque,” said Paco Chuji, president of the Federation of Organizations of Kichwa Nationality of Sucumbíos-Ecuador, or FONAKISE.

The carbon offset bonds or credits form part of the clean development mechanisms included in the Kyoto Protocol on climate change (in force since 2004), which allows countries or companies from industrialized countries that have surpassed their caps on the greenhouse gas emissions that cause climate change, and that haven’t fulfilled their reduction measures, to have the possibility of purchasing carbon credits.

One carbon offset bond allows for the right to release into the atmosphere one metric ton of CO2. That is to say, for example, a company that has an emissions limit of 100,000 metric tons of CO2 annually reaches that cap and emits 10,000 metric tons more must acquire carbon credits equivalent to that excess. At the same time, companies that stop emitting greenhouse gases can receive Certified Emission Reduction or CER; each CER represents one metric ton of CO2 that is no longer entering the atmosphere and the certificate can be sold in the carbon credit market.
Splintered organizations

Even though the announcement was made in 2009, Correa’s government had already taken steps in designing the proposal, using Socio Bosque and inviting communities and individuals who owned the native woodlands to participate in the program and receive a bonus of $30 annually for every hectare (2.5 acres) of land that is preserved.

According to the Ministry of Environment, the goal of this program is to conserve about 4 million hectares (10 million acres) of virgin forests and protect ecosystem services, like oxygen production, that those woodlands provide. The ministry also highlights that the program will improve the incomes of communities that own forests.

The proposal was well-received by leaders of various indigenous communities, like the Cofan in the northern Amazon, along the border with Colombia, who signed — without consulting their constituency — an agreement with the ministry that proposes the conservation of 7,100 hectares (17,000 acres) of forest in the Dureno community, and 80,000 hectares (200,000 acres) in the Zabalo community. It provides for the installation of park rangers at the outskirts of these communities who monitor that no poaching, illegal logging, or “invasions” by other communities is happening.

“The government pays the park rangers, it pays the community to conserve the forest, and we’re happy with that, because we have an income and they have told us we can keep hunting, that we can use the wood we need. We don’t know anything more than that,” said José Quenamá, a Cofan leader.

The agreements establish that in the case of breaching the agreement or of wanting to terminate it early, there may be a series of “administrative, civil, and criminal sanctions” that are not clearly defined either in the accord, or in the Socio Bosque operating manual.

“At some point when communities are critical of the government or do not go along with its actions, the felling of trees to build houses in the community may be interpreted as a breach of the agreement, and they will receive sanctions that nobody knows precisely the nature of,” Chuji said.

As with the Cofan people, other Amazon Kichwa and Shuar communities have signed similar agreements, even against the stance of regional organizations, like in the case of the communities that belong to FONAKISE.

“The problems that are dividing [communities] come from Socio Bosque, because some communities say they need the money, while we think that for that money, we would have to give up the land,” said Mery Salazar, president of the FONAKISE women’s association. Salazar refers to the possible sanctions that involve paying back the money to the Ministry of Environment, which would be difficult to do. Even though the Constitution establishes that indigenous territories cannot be garnished for debt, the government has shown a lot of creativity in economically mollifying the indigenous communities, as seen with the Secoya nation.
A mortgaged life

In mid-2010, several members of the Secoya nation, located in Ecuador’s northern Amazon, cut down 174 hectares (435 acres) of virgin forest and planted palm trees, in agreement with a private company that would buy the crop.

The Ministry of Environment took administrative action against the Secoyas and in early September fined them $375,000 for having ignored the constitutional provision that prohibits the clearing of native vegetation and changes in land use without first having submitted a plan for forest management and obtained a license from the ministry.

The Secoya communities has avoided entering into the Socio Bosque program, but now it seems they are being obligated to participate; given the impossibility of paying that fine, the government has proposed to Secoya leaders that they include in the Socio Bosque program the hectares of ancestral lands the community has to pay off the fine for the felled trees with carbon credits over a period of 10 years. The Secoya nation possesses 25,000 hectares (62,500 acres) of virgin forest in which they grow cacao, bananas, and yucca, as well as palm trees.

The governor of the province of Sucumbíos, Nancy Morocho, proposed to the Secoyas alternative payment options: the first was to pay it with any revenue generated from oil drilling on its land done by the state-run firm Petroamazonas, and the second was to allocate the income from the palm tree crops. Either of these payment methods would mean that the Secoyas must mortgage their way of life.

What is surprising in this case is that, adjacent to Secoya territories, large companies that grow palm tree crops use amounts of land much greater than that used by the Secoyas. Yet it seems that these companies have not been fined like the indigenous communities were.

The General Assembly of the Indigenous Secoya Organization of Ecuador decided to ignore the sanction and not accept the payment alternatives, and asked the Confederation of Indigenous Nationalities of Ecuador, or CONAIE, to back its decision. CONAIE has included this issue on its agenda of pending struggles.