Pay the tropics to reverse deforestation

AMONG THE MANY NASTY things that humans are doing to the environment, few rank worse than destroying tropical forests. Rainforests sustain an astonishing diversity of species and keep our planet liveable by limiting soil erosion, reducing floods, maintaining natural water cycles, and stabilising the climate. Yet roughly 10 million hectares of tropical forest are destroyed every year – the equivalent of 50 football fields a minute.

If we hope to reign in global warming, the last thing we should be doing is razing tropical forests. Destroying them dumps vast quantities of greenhouse gases into the atmosphere – nearly 20 per cent of all human carbon emissions, which is more than the entire global transportation sector.

More than that, tropical forests, which emit water vapour into the atmosphere, are major drivers of cloud formation. Clouds cool the planet by reflecting solar heat back into space, and they also sustain regional rainfall, which limits destructive forest fires. Hence, saving a hectare of tropical forest does far more to reduce global warming than saving a hectare of other types of forest.

IN RECENT YEARS, MANY scientists have advocated carbon trading as a way to slow tropical deforestation. Known as ‘REDD’ (Reducing Emissions from Deforestation and Degradation), the idea is simple in concept. Under international agreements such as the Kyoto Protocol, participating nations agree to reduce their carbon emissions below a certain level.

Nations that struggle to meet their emissions target can buy carbon credits from other countries that either have no target (as is currently the case for developing nations under Kyoto) or that produce fewer emissions than allowed. Like any tradable commodity, the price of carbon credits is largely determined by supply and demand.
 
In theory, everyone should win with REDD. Wealthier nations, such as Australia, can pay to help slow deforestation as part of an overall effort to meet their emissions target. Protecting an imperilled forest in Madagascar, for instance, might lead to the same net reduction of carbon emissions – and be far cheaper – than retrofitting a coal-fired generating plant here or in the US.

In a transaction like this, dangerous carbon emissions are reduced, a biologically rich forest is protected and Madagascar gains direly needed foreign revenues. In any effort to slow global warming, tropical forests are the low-hanging fruit.

IF REDD IS SUCH A GREAT idea, why hasn’t it been implemented already?  The first effort to install it, as part of the Kyoto Protocol in 1997, met with surprisingly intense opposition. European green groups feared that wealthy nations like the US would simply buy their way out of their international obligations to permanently cut their burgeoning emissions.

Others argued that forest conservation was a risky and uncertain strategy for battling greenhouse gases. For example, even though you might try to slow deforestation by establishing a new national park in Malaysia, ‘leakage’ could occur if slash-and-burn farmers simply move to other areas and continue destroying the forest.

Finally, Brazil, which alone contains a third of the world’s tropical forest, adamantly opposed REDD and lobbied other developing nations to do likewise. Brazil feared that long-term commitments to protect forests could potentially limit their future development options.

Fortunately, the situation changed dramatically at the Bali climate conference in 2007, with REDD finally getting a green light. A coalition of small, forest-rich countries, led by Papua New Guinea and Costa Rica, made great strides, skilfully negotiating to avoid some of the biggest concerns about REDD. 

Those worried about the ‘leakage’ issue were mollified when the coalition proposed to tally deforestation at the national level. Thus, if a carbon-offset project slowed deforestation in one part of, say, Cameroon but simply allowed it to increase elsewhere in the country, Cameroon would receive no benefit. In addition, the fact that the coalition was led by developing nations helped to surmount fears that carbon trading would seriously limit their future development options.

Finally, European environmental groups have grown increasingly alarmed by the acceleration of greenhouse gas emissions, particularly with China and India now joining other leading industrial nations as major polluters. Simply from a climate change perspective, the green groups realised, failing to address tropical deforestation was dangerously irresponsible. 

REDD IS NOW MOVING forward, but technical hurdles remain. For a developing nation to qualify for carbon credits, it must first establish its baseline rate of carbon emissions from deforestation, and then show that is has reduced emissions below that. This requires good data on current and past rates of forest loss, as well as field inventories to estimate how much carbon is stored in its forests. Satellites are increasingly being used to generate these numbers, but much work remains to get reliable estimates for all developing nations.

While REDD could be a boon for forests, it also raises important policy questions. For instance, while rapidly deforesting nations such as Brazil and Indonesia could benefit greatly from carbon trading, how do you reward an environmental leader like Costa Rica, which is actually gaining forest cover? Under the current scheme, Costa Rica would gain nothing, because its baseline deforestation rate is zero.

Furthermore, will REDD effectively protect endangered biodiversity?  Purely from a global warming perspective, the most efficient way to reduce greenhouse gases is to focus on big countries such as Brazil and Indonesia, which account for the lion’s share of deforestation. But the most imperilled species persist in tiny forest remnants in nations such as Madagascar, the Philippines, and the Brazilian Atlantic forests.  Protecting these scraps of forest would do little to slow global warming, though some donors might be willing to pay a premium price for carbon credits in these hotspots of biodiversity. 

REDD is becoming a reality, with some US$6 billion now having been committed for various schemes globally. Many challenges remain, however, and care will be needed to ensure that initiatives are not swamped by technical obstacles or national self-interest.

In my view, perhaps the greatest challenge for REDD is the prospect of a massive expansion of biofuels. Be it sugarcane, oil palm, soy, or jatropha trees, the tropics is the best place to grow biofuel crops, and the escalating demand for biofuels is creating an enormous incentive for converting tropical forests to farmland.

This will drive up land prices and thereby reduce the attractiveness of REDD, and the massive carbon emissions from forest destruction could reverse any gains from REDD initiatives. As enlightened citizens, let us demand both sustainable energy and forest policies from our government.

William Laurance is Distinguished Research Professor in the School of Marine and Tropical Biology at James Cook University in Cairns, Queensland. He also holds the Prince Bernhard Chair in International Nature Conservation.