Forest deals push forward as climate talks lag

LONDON (AlertNet) - With progress towards a U.N. climate deal lagging, financial institutions, donors and tropical forest countries are moving rapidly to set up their own systems to pay forest nations to preserve their trees as a means of curbing carbon emissions.

Norway has approached the World Bank to act as an intermediary in a deal that would transfer $250 million to Guyana over six or seven years in exchange for stepped up protection of that South American nation's stands of forest. The Scandinavian country was also scheduled Wednesday to sign a final binding agreement to provide Indonesia with $1 billion in exchange for boosting its forest protection, though the partners were struggling to agree on a bank to manage the effort. Tropical forest experts, including officials at the U.S.-based Rainforest Alliance, say the moves to implement forest protection deals before a new U.N. climate deal is officially negotiated may help lay the groundwork for a faster and more effective rollout of programmes down the road.

"We really need this private work that's happening right now, to learn lessons from it and build mechanisms," said Julianne Baroody, coordinator of climate initiatives at the Rainforest Alliance, a non-profit organisation that works on facilitating forest carbon projects. "It's been helpful in advancing this issue and giving private sector investors confidence." Deforestation and forest degradation account for as much as 17 percent of global carbon emissions, and nearly 42 percent of total carbon emitted in Latin America, home of the world's largest rainforest and of abundant hydropower, according to the U.N. Intergovernmental Panel on Climate Change (IPCC).

REDD, a U.N.-backed effort aimed at Reducing Emissions from Deforestation and Forest Degradation through payments to developing nations for protecting trees, is one of the areas where international climate negotiators have come closest to reaching agreement. But the slow pace of climate negotiations, which REDD supporters had hoped would lead to a deal in Copenhagen last December, have led backers to look for ways to set deals in motion anyway, in accordance with the rules now being hammered out at the climate talks.

"There's an urgency to address the challenge of climate change, particularly in the forest sector. But it's taken more time than anticipated to agree on the international architecture and methodologies," said Laurent Debroux, a senior natural resources economist who focuses on Latin America and the Caribbean for the World Bank. "Countries are really keen on moving forward, both on the donor side, like Norway, and on the forest country side, like Guyana. We're trying not to push and rush but to learn by doing and accompany countries that feel they can make progress by finding a balance between quality and learning from the experience."

GETTING READY FOR REDD

The bank has seen surging interest in REDD and other climate efforts from its client nations in Latin America, with 63 percent now seeking its help to set up climate programmes, compared with 35 percent in 2007, bank officials said. Since 2008, it has operated the Forest Carbon Partnership Facility, which brings together donors and recipient nations, particularly in Latin America, to set up REDD "readiness" plans and put in place baseline monitoring. The scheme now has about $120 million of funding in place, Debroux said, and 37 nations, led by Guyana, Mexico, Argentina, Panama and Costa Rica, are moving to access the funds.

The bank, through its Forest Investment Programme, is also positioning itself to be an intermediary between REDD donor and recipient nations in managing active REDD projects and passing on funding, essentially filling the gap left by the absence - so far - of any formal international mechanism for REDD. The work may involve helping sort out some of the potentially most vexing aspects of REDD, including trying to head off associated corruption problems many experts believe will dog REDD efforts, and finding ways to quickly scale up pilot projects that work.

Whether recipient nations will accept the involvement of the World Bank or other institutions as intermediaries in REDD deals, however, remains to be seen. Some, like Indonesia, have so far flatly rejected the idea, calling for simple bilateral agreements instead that use local banks. Efforts to put in place early REDD agreements have come in for criticism on various grounds, including that they have not adequately consulted rainforest dwellers and may not ensure they - and not just national governments - receive a share of the funds. Trying to move quickly to set up REDD programmes, without tackling threats like corruption and lack of consultation, could doom the effort, activist groups warn.

"A bad REDD system is worse than no system at all for the world's climate, its forests and its people," warned a network of 40 environmental and human rights organisations in April. Unless programmes are designed with a focus on transparency and human rights, REDD "sets itself up for failure and could easily do more harm than good," said the group, led by non-profit organisations such as Global Witness and the Rainforest Foundation UK. But Baroody, of the Rainforest Alliance, called the early REDD initiatives important and said involvement by big financial institutions like the World Bank was more helpful than detrimental. "Whether they have been as successful as some people would have liked, they are in place and the stakeholder engagement forums they have created, while not perfect, do allow for some legitimate involvement," she said. "It's good that organisations are collaborating in lieu of a formal (U.N.) mechanism."