A market in forests?

May 13, 2009

Fighters for “No Climate Protection without Forest Protection – last exit Copenhagen ” were in Frankfurt to promote forest conservation ahead of the global climate meeting in Copenhagen at the end of 2009.

Their appeal to investment circles and government institutions in Germany’s business capital was fresh and vigorous. Each year, forests the size of Bavaria disappear, they said. Logging for profit and to open land for arable crops contributes to about 20 percent of worldwide greenhouse gas emissions, and substantial parts are not legal.

Avoid it now to save the planet, they said — is it not weird to be able to look at the world via Google Earth but to be totally powerless when it comes to watching its biodiversity being destroyed?

The event was supported by the David & Lucile Packard foundation and the Global Canopy Programme. They are among supporters of an initiative called Reducing Emissions from Deforestation and Degradation (REDD).

It is little known that the EU is in policy discussions to decide whether its members should be allowed to offset their emissions through REDD, and how this could be technically done.

And much more is unclear. Who monitors and polices the avoidance of trees being cut and who pays for it — new asset classes such as forest gilts may make sense. Or there could be market-based forest funds, financed via auction revenues. But nobody knows yet who should get the cash thus generated.  And how would one deal with land rights, and with corruption in some of the countries housing forests?

There is even criticism from Greenpeace which has said including forests in established CO2 markets such as Europe’s would flood them and torpedo pricing mechanisms.

Bernd Hansjuergens, co-author of the TEEB report that aims to prove the business case of biodiversity said, “The function of forests is relevant in markets. Consequently they must appear in markets and present a market.”

Is it a market worth having?

(Photos: top left – A truck transports logs cut from Amazon rain forest by workers employed in the Jari Managed Forest Project, February 11, 2008. REUTERS/Jamil Bittar (BRAZIL). Right – A pair of scarlet macaws perch on a tree in Bolivia’s Machia Park in Villa Tunari in the Bolivian Amazon jungle 520 km (323 miles) southeast of La Paz August 17, 2005. REUTERS/David Mercado


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Saving the forests will be an almost impossible task, look at China’s growing appetite for Brazillian soybeans and beef, this triggers a growing demand for agricultural land and will lead to more deforestation of the Amazon rainforest.

Posted by Nikkei 225 | Report as abusive

Another source of deforestation is our misplaced faith in corn-based ethanol fuel. There are other, more sustainable sources of alternate fuel (plant waste, algae, etc.) that don’t obliterate the last wild places on earth.

Posted by Eric | Report as abusive

This idea is just too sensible. In Australia we subsidise the logging of our native forests, but pay our neighbours, Indonesia and Papua New Guinea to protect theirs.

Posted by Harriett Swift | Report as abusive

Australia continues to log her last remaining native forests ncluding 500-600 year old trees and despite a glut of tax payer subsidized plantation timber.Less than 2% of logs are feature grade; the rest is low grade with 80-90% classed as waste and exported as woodchips. Now this so called ‘waste’ will be burnt for electricity as ‘renewable’ and will undercut wind and solar energy prices.Native forest logging emissions are 7% and not counted under UNFCC rules; our southern regions are drying out and our unique species such as koalas are dying out.Yes, protect our climate means protect forests.

Posted by Prue Acton | Report as abusive

Protecting remaining (tropical) forests can’t be done by the owner country alone.International community should participate based on the fairness principles. Let the markets emerge, but don’t let everything charge to the markets.

Posted by Iip Albanjary | Report as abusive

It has been said that the tropical rainforests are “The Lungs of the Earth.” If this is true would they not be among the most valuable parts of the planet?Greenpeace and other skeptics of carbon credits generated through avoided deforestation always seen to overlook a simple solution to the fear of “under-priced carbon credits flooding the market.” Place a floor on the price of all carbon credits. Instead of limiting the percentage of forestry credits in the marketplace (as in the current EU ETS), require that a certain percentage of credits come from forestry projects.The Trillion $$$ carbon market is the rainforests’ best hope of survival, and the planet’s.Dan T@TreeBanker

Posted by @TreeBanker | Report as abusive

[…] A market in forests? By Vera Eckert, Reuters Blogs. A report about a meeting held in Frankfurt which was supported by the David & Lucile Packard Foundation and the Global Canopy Programme. Fighters for “No Climate Protection without Forest Protection – last exit Copenhagen” were in Frankfurt to promote forest conservation ahead of the global climate meeting in Copenhagen at the end of 2009. […]

Posted by REDD in the news: 11-17 May 2009 | redd-monitor.org | Report as abusive