Reversing global forest decline will require private sector engagement and finance, argues a new report published by the United Nations and a coalition of more than 200 financial institutions.
The report, “REDDy-Set-Grow Part II: Recommendations for international climate change negotiators,” [PDF] urges negotiators meeting at this December’s UN Framework Convention on Climate Change (UNFCCC) in Duban South Africa to lay out a policy framework that “clarifies the fundamental role of private engagement and investment in funding REDD+.” Under REDD+, industrialized nations would pay developing countries to reduce greenhouse gas emissions from deforestation and forest degradation.
“There is a price for soybeans, palm oil, beef and other products grown on deforested lands, but not for the many critically important services provided by healthy forests, including the sequestration and storing of carbon,” said Christian del Valle, the Director of Environmental Markets & Forestry at BNP Paribas and a contributor to the report, in a statement. “With the possibility of a global funding mechanism for REDD+ we now have, at the global level, the unprecedented opportunity to address this imbalance. I hope we do not miss it so that natural forests are given the value they deserve.”
The report warns that without an effective means to compensate forest conservation, continued destruction of forests could take a heavy economic toll in coming decades—up to $1 trillion per year by 2100, according to published research.
The report says that “a healthy forestry-based carbon market could mobilize investment for the protection and rehabilitation of natural forests to the tune of more than $10 billion by 2020.”
While the concept of compensating poor countries for preserving their forests enjoys broad support, the report’s call for a market-based REDD mechanism is more contentious. Opponents of carbon trading fear REDD could provide a loophole for industrialized countries to continue polluting, while the market itself could be vulnerable to manipulation. Others worry that without addressing complex issues like land rights in developing nations, REDD could disadvantage poor forest users, with most of the benefits accruing to the powerful and well-connected.
These concerns, coupled with technical complications and the financial strains caused by the global financial crisis, have contributed to slow progress on REDD+ in recent months.