REDD in the Congo – new report from World Rainforest Movement

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REDD in the Congo - new report from World Rainforest Movement

The forests in the Congo Basin, the second largest area of tropical forest in the world, are receiving increasing interest. Enormous amounts of carbon are stored in these forests, meaning that REDD proponents are increasingly looking at these forests to “offset” continued pollution in the rich countries.

This new short report from World Rainforest Movement calls into question some of the assumptions behind this enthusiasm for REDD in the Congo. The report, “REDD in the Congo” can be downloaded here (pdf file 1.4 MB) and is posted in full below.

REDD in the Congo Basin

WRM, December 2010

The forest of the Congo Basin expands over an area of continuous tropical rainforest cover only second to that of the Amazon forest. The region’s forests are found in Republic of Congo, Democratic Republic of Congo, Cameroon, Gabon, Equatorial Guinea and the Central African Republic.

Those forests are currently receiving a lot of attention within the Climate Change negotiations, because they store enormous amounts of carbon, that might be released to the atmosphere if they were to disappear, thus further contributing to climate change. As a result, they are being geared towards their inclusion in a scheme called “Reducing Emissions from Deforestation and Forest Degradation (REDD)”, which would imply payments for “carbon credits” resulting from having reduced carbon emissions.[1]

Though extremely difficult to prove and quantify, the idea is that countries should be financially compensated for avoiding a certain level of deforestation or forest degradation that would have occurred in a business as usual scenario. Compensation would be based in the avoided carbon emissions resulting from forest conservation. Those “avoided emissions” would be traded in the international market and paid for by governments or companies as “offsets” for their own carbon emissions.[2]

Low deforestation rates

However, in spite of what many might think, deforestation in the Congo Basin is relatively low -particularly when compared to the Amazonian and Indonesian forests- ranging from as low as 0.1 percent forest loss per year in the Republic of the Congo and Central African Republic to 1 percent deforestation in Cameroon.[3]

This good news is, however, very bad news for those who seek to profit from a carbon market-based REDD system, because such type of REDD is based on the sale of carbon credits generated by the reduction of emissions from deforestation. This means that countries that do not destroy significant areas of forests are not particularly interesting for market-based REDD projects.

There are however some “opportunities”, that large organizations – ranging from the World Bank to the World Resources Institute[4], WWF[5] and Conservation International[6] – are trying to benefit from, focused on the second part of the acronym REDD: reduction of carbon emissions from “forest degradation”.

Emissions from forest degradation

While some organizations blame forest degradation on either shifting agriculture or fuelwood collection for local consumption, most of it is in fact the result of large-scale industrial logging within forest concessions granted by governments to logging companies. Most of the Congo Basin countries already have enormous logging concession areas, largely in the hands of foreign corporations.

Although industrial logging does in fact degrade forests, it is very difficult to calculate with any level of certainty the amount of net carbon emissions resulting from the process. Among other issues, the following serve to clarify the problem: 1) the huge logs extracted are exported for the production of high quality wood products; as a result, the carbon stored therein may not be released for many decades; 2) many trees are destroyed during the logging operation and left to rot at the site, which means that the carbon contained in them will be slowly released over a number of years; 3) natural re-growth of the logged forest starts immediately; this means that part of the total amount of carbon released as a result of logging will be absorbed by the growing vegetation acting as a carbon sink.

Given the above, it is extremely difficult to estimate net emissions resulting from the logging operations and therefore to establish a figure for the “emission reductions” that would result from halting industrial logging, thereby making carbon credits an almost worthless “guesstimate”. This does not mean that industrial logging should not be stopped: it certainly must, but not only because of the resulting carbon emissions but because of all the social and environmental impacts it entails, ranging from biodiversity loss to human rights abuses.

Where would REDD money go?

But even if “reduced emissions” could be calculated, a second important question is: where would the REDD money go? The answer is simple: to the actors that are responsible for deforestation or forest degradation that are willing to collect REDD money instead of that obtained through logging. This means either governments or logging companies or both.

In the case of governments, they would need to demonstrate that their development plans include the logging of large areas of forest – which in the Congo basin mostly “belongs” to the state – and that the only way of preventing this would be for them to receive a similar amount of money to the one they would “lose” if they were to conserve the forest.

As respects to logging companies, they would need to be paid for the profits they would have gained through logging. As has been documented elsewhere,[7] the money received could be used for simply carrying out the same logging operations but in another country. Which for the climate of course means that global emissions from their activity would not have been reduced at all. Another important actor has appeared in the REDD scenario: large conservation businesses. Smelling the possibility of raising money for conservation projects through the REDD mechanism, organizations such as Conservation International are quickly investing time for finding out ways through which to convince the carbon market that their projects may be eligible for REDD-related carbon credits. This is not an easy task, because conservation projects will only work in areas with little economic pressure and hence with little risk of carbon emissions from deforestation or forest degradation. However, the fact that these kind of projects will contribute little in reducing emissions will probably not be a major hurdle for their approval. The reason is that their role as showcase projects will serve for paving the way for the approval of much more ugly REDD dealings in forest areas, including the payment of large amounts of money to logging companies with a long history of social and environmental destruction in the region.

And what about communities living in forests? Given that Congo Basin forest communities are not usually destroying or degrading forests in a significant manner, they would not be entitled to REDD carbon market money, nor would those living in logging concession areas, because the money would be received by the logging company responsible for “reducing” emissions.

The market works … when pushed by those keen to create it

While the United Nations Convention on Climate Change (UNFCCC) has not yet taken any decision about REDD, a number of actors have been pushing it through as if it had already been approved. Such is particularly the case of the World Bank, that has been putting pressure on UNFCCC for the acceptance of the carbon market in general and REDD in particular before any decisions on this issue had been taken by the Conference of the Parties to the Convention.

For the achievement of those aims, the Bank created its “ Carbon Finance Unit”, which in turn established the Forest Carbon Partnership Facility (FCPF) in 2007.

At the same time, three UN agencies (FAO, UNEP and UNDP) got together and created the UN-REDD Programme (United Nations Collaborative Programme on Reducing Emissions from Deforestation and Forest Degradation in Developing Countries).

Later on, the FCPF and the UN-REDD Programme decided to “work together both at the international level, harmonizing normative frameworks and organizing joint events, and at the national level, where joint missions and sharing of information are producing coordinated support interventions.”[8]

As a result, a number of governments are receiving financial and technical support for preparing conditions for future REDD projects, defined as “REDD-readiness plans”. Such plans are largely dependent on how much funding and support a country receives to create them.[9]

The Democratic Republic of Congo (DRC) currently stands as the regional leader in attracting REDD money. The World Bank’s Forest Carbon Partnership Facility (FCPF), allocated US$3.4 million for this country’s REDD strategy. The DRC also received substantial financial support from UN-REDD and the Congo Basin Forest Fund. According to a media article “Thanks to this funding, the Democratic Republic of Congo is now awash with pilot projects.”[10]

The Republic of Congo (holding the second largest area of forest within the Congo Basin) will be also receiving US$3.4 million from the FCPF after its readiness plan was approved in 2010. The UN-REDD will be also providing financial support to address the shortcomings of the plan as regards to lack of participation.[11]

Unlike the two Congos, other nations in the region have received limited funds to prepare their readiness strategies. As a result, Cameroon, the Central African Republic and Equatorial Guinea are making slow progress, while Gabon is confronting political in-fighting over who is responsible for implementing REDD.[12]

Will REDD money subsidize plantations?

Many forest areas in the Congo Basin have been converted to monoculture oil palm and rubber tree plantations[13] and–to a lesser extent- eucalyptus trees[14]. At present there is a very strong push for the establishment of even larger plantations, mostly oil palm[15] (aimed at the production of agrofuels) and rubber tree plantations.

A few examples serve to illustrate the issue: 1) In the Republic of Congo, Spanish company Aurantia, Italian energy companies ENI and Fri-El Green plan to plant a total of more that 100,000 hectares of oil palm;[16] 2) In the Democratic Republic of Congo, Canadian company TriNorth Capital would plant some 70,000 hectares of oil palm while Chinese company ZTE Agribusiness announced its intention of establishing oil palm plantations over 1 million hectares of land;[17] 3) In Gabon, Singapore-based Olam International would plant some 140,000 hectares with oil palms.[18]

In relation to REDD, the question is: will these plantations receive carbon credits? Will the area covered by them be considered as “forests” and therefore not included as deforestation? In this respects, it is important to note that according to the FAO definition – adopted by the UNFCCC- rubber plantations are “forests”, while oil palm plantations are not. One can expect strong lobbying from the oil palm industry – as well as from governments in countries with extensive plantations such as Indonesia and Malaysia – to have these plantations defined as forests too. The end result could be that such plantations might be entitled to REDD money.

A different approach

The forests of the Congo Basin are crucially important, but not only as mere carbon reservoirs. These forests provide habitats for countless species of animals and plants; they act as local and regional climate regulators; protect soils and the water cycle and provide for the livelihoods of tens of millions of people that have inhabited and protected them since time immemorial. The need for their conservation therefore goes far beyond carbon-focused schemes that could impact negatively on local peoples’ livelihoods and rights over these forests.

Northern governments – past and present – have played a key role in forest destruction and in the disempowerment of those peoples over their forests, either directly –through colonialism – and/or indirectly – via consumption of products extracted from them.[19]

As a result, Northern governments need to acknowledge their past and present role in deforestation and forest degradation in the region – as well as in global climate change – and commit themselves to supporting forest conservation in the Congo Basin. Contrary to the prevailing market-based REDD approach, financial support should be provided – not exchanged for carbon “offsets – to countries that put in place and implement policies that ensure both the conservation of forests – not plantations – and the rights of forest and forest-dependent peoples. Mechanisms should be established to ensure that the money will be fairly shared between relevant government agencies and the communities involved in forest conservation. At the same time, Northern countries should identify and adequately address the role that their own policies and corporations play in deforestation and forest degradation in the region. Corporations involved in forest destruction should not be “compensated”.

WRM, December 2010


References:

[1] ^^ Unless Bolivia’s suggestions are adopted at the UN-level and carbon trading is excluded from REDD. Currently Bolivia’s suggestions are in square brackets.

[2] ^^ Unless Bolivia’s suggestions are adopted

[3] ^^ http://www.forestcarbonindex.org/congo-basin-and-west-africa.html

[4] ^^ http://www.wri.org/stories/2010/08/preparing-redd-republic-congo

[5] ^^ http://wwf.panda.org/who_we_are/jobs/?uNewsID=194703

[6] ^^ http://www.conservation.org/sites/celb/Documents/2010.03.05_Disney_Factsheet_LR.pdf

[7] ^^ http://www.guardian.co.uk/environment/2010/mar/11/greenwash-noel-kempff-forests

[8] ^^ http://www.un-redd.org/NewsCentre/Newsletterhome/1Feature2/tabid/1588/language/en-
US/Default.aspx

[9] ^^ http://www.ecosystemmarketplace.com/pages/dynamic/article.page.php?page_id
=7846&section=news_articles&eod=1

[10] ^^ http://www.ecosystemmarketplace.com/pages/dynamic/article.page.php?page_id=7846&section=news_articles&eod=1

[11] ^^ http://www.bicusa.org/en/Article.12053.aspx

[12] ^^ http://www.ecosystemmarketplace.com/pages/dynamic/article.page.php?page_id
=7846&section=news_articles&eod=1

[13] ^^ Mostly in the Democratic Republic of Congo and Cameroon

[14] ^^ In the Republic of Congo

[15] ^^ See at http://oilpalminafrica.wordpress.com/

[16] ^^ http://oilpalminafrica.wordpress.com/2010/08/19/congo-r/

[17] ^^ http://oilpalminafrica.wordpress.com/2010/08/19/congo-r-d/

[18] ^^ http://oilpalminafrica.wordpress.com/2010/08/19/gabon/

[19] ^^ Some economically powerful Southern countries – such as Brazil, China, Malaysia, Singapore – are now also starting to play a similar destructive role in the Congo Basin.

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2 Comments

  1. Q1 How much would governments receive if ‘the only way of preventing this would be for them to receive a similar amount of money to the one they would “lose” if they were to conserve the forest’?

    The answer is not much, perhaps in the same order of magnitude as that which is allocated under FLEG budgets already.

    This is because little tax is properly received by host governments from logging in the Congo Basin – which, in Cameroon and DR Congo particularly, should include taxes due from artisanal loggers (who account for much of those countries’ industrial roundwood production and forest damage).

    Q2 How much would loggers receive?

    Answer: No more than they declare in profit – after tax has been deducted – minus the amounts which they owe their host governments (as fines, tax arrears, concession fees etc). Further, several logging groups, particularly those whose primary market has tended to be China, would not be eligble anyway – because the logs which they export warrant the description Illegal Timber.

    It remains to be seen whether such exports would cease if and when Voluntary Partnership Agreements (being negotiated or discussed by the European Union and the governments of the six countries of the Congo Basin) are implemented.

    A focus on “Northern” countries would be misplaced – although a number of EU member states have accounted for the great majority of those countries’ imports from the Congo Basin. For more than a decade, China has dominated the Congo Basin’s exports of logs. This is long enough to become culpable.

    Would China be willing to make REDD reparations to the countries whose logs it imports? If China were to do so and this causes the price of tropical hardwood flooring, furniture and plywood to rise in the EU, Japan (if this is in the “North”..) and the USA, then this would add to the amount the “North” should pay.

  2. @James Hewitt

    Very well put. This article illustrates (though does not make totally clear), two key points:

    1. There is a major problem with any ‘opportunity cost’ approach:

    a/ Because this only tells you what the PRIVATE interest (ie loggers) would need to receive as ‘compensation’ for not logging – whereas the forest is actually a PUBLIC asset (all forest in DR Congo is ‘owned’ by the state) and therefore the ‘opportunity cost’ should properly be calculated on the basis of the lost income to the state – which in the case of DRC, officially, is almost zero, because the forest taxes (thanks to the World Bank) are very low, and most companies do not pay them anyway. Therefore, in theory, the amount of REDD that should be paid to the DRC government for, say, stopping logging, is the amount of logging taxes they receive, plus an amount for doing things like re-deploying logging workers. There would be a certain cost in ‘cancelling’ logging operations (though see below: in DRC’s case, probably not much, because most of them are illegal anyway) but this is definitely not the same as paying someone or other the total amount of revenue foregone that the logging companies are currently earning.

    b/ However, what is *really* important to the ‘government’ in terms of ‘opportunity cost’ is what it receives in terms of ‘private rent capture’, ie the amount of money that can be siphoned off from logging deals, either as bribes to allocate concessions and for companies to continue to not pay taxes or follow the law etc, or as embezzlement of any taxes that are actually paid etc. Anything less than this that can similarly be privately captured through REDD funding will therefore not be successful in stopping decision-makers and officials from handing out logging concessions.

    c/ Even more difficult to quantify in opportuntiy cost terms is the role of logging concessions as extremely important currency for ‘state security’ and political/patronage systems. According to one estimate, some 50 million hectares of DR Congo’s rainforests (around half of the total) have been handed out to third parties for essentially political purposes, including 33 million hectares assigned to President Mugabe’s COSLEG military/industrial machinery for Zimbabwe’s military support to the Kabila(s) regime during the conflicts earlier this decade.

    What exactly would be the price for returning this area of forest back to the full control of the DRC state, and for it thereafter to ‘protect’ it? Another 15 million hectares or so was (illegally) handed out by opposition political elements in order to fund the election campaigns of various (ex-rebel) political factions up to 2006, or thereabouts.

    2. There would be a major problem in DRC with knowing who or which loggers could even be considered as ‘legally eligible’ for any kind of payment, including for REDD.

    In addition to the 15+ million hectares which were allocated in contravention of the 2002 Forest Code, there were already some 6 or 7 million hectares of logging ‘titles’, all of which were supposed to have been reviewed and mostly cancelled under a World Bank-backed process a few years ago. Predictably, of course, the Bank made a mess of this process (specifically, one Laurent Debroux, now World Bank Task Manager for the Guyana Forest Carbon Partnership Facility, made a mess of it or, possibly more likely, deliberately failed to ensure that the process was rigorous), and allowed the Congolese government not to deem illegal many operations which were clearly in breach of the legal requirements – and it is not clear that even any of those operations which were ruled ‘illegal’ have actually stopped logging.

    Where WRM is right in saying that “Northern governments need to acknowledge their past and present role in deforestation and forest degradation in the region – as well as in global climate change”, probably the most important thing they could do would be to hold the World Bank to account for the unbelievable mess it has left behind in DRC’s forest sector. Not a single cent of new (REDD) money (including from the World Bank) should go to DRC until the results of the Legality Review are properly implemented, and all the logging operations which were clearly issued in breach of the 2002 Forest Code are actually cancelled and halted on the ground.

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