Should you be concerned about Mekong countries’ REDD proposals to the World Bank?

Jelson Garcia, Asia Program Manager, Bank Information Center

Trading forests for carbon

Overview

I. Assumptions: Why REDD and how come the World Bank plays a role in it?

II. Governance: The FCPF and how is it structured? How are REDD proposals developed and decided in the Bank?

III. Trends and issues: What are the key issues with REDD?• The case of Indonesia and Guyana REDD proposals• Implications of REDD proposals to Mekong forests

Spirit ceremony. Pursat, Cambodia. January 2005. World Rainforest Movement

Assumptions: Why REDD?

• Proponents: Keep your forests intact and you’ll be rewarded! Forest s have a role in mitigating climate change; they capture & store carbon

• 2007 Stern Review: deforestation measures be included in the post-2012 commitments under UNFCCC

• A proposal to discourage deforestation and forest degradation taken up at the CoP to the UNFCC in Bali (CoP-13)

• Only the Bali Action Plan has so far the agreed text on REDD: “Policy approaches and positive incentives on issues relating to reducing emissions from deforestation and forest degradation in developing countries; and the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries”.

• An Agreement on REDD planned at CoP-15 in Copenhagen

How is REDD being funded?• Carbon trading, financing and mixing the two

• Market-based approach: because market forces drive forest destruction for crop, plantation and industrial expansion, cattle ranching , we need to create market signals that keeping forests is more profitable than cutting them. Markets (developed countries) give (nations with large forests) financial incentives by conserving their forests in exchange of REDD credits.

• Critique: it doesn’t stop polluting countries and companies from burning fossils! REDD used as an excuse not to reduce emissions. They pass the burden of mitigating climate change to developing countries in exchange of money incentives

How is REDD being funded?

Why is the World Bank involved?• Trustee/Administrator/Implementing Agency

• Carbon Market Facilitator (It’s been driving carbon trading for years through its Carbon Finance Unit – to reduce the risks for private investors)• Carbon Market Innovator (PCF/FCPC)• Carbon Market Broker (Donor funds with developing

country projects for JI/CDM)• Carbon Market Aggregator• Carbon Market Stabilizer (CIF)

• Vehicle for large Climate $ outside of UNFCCC• Playing off US v. Japan v EU v G-77

• Financial Bridge to post-Kyoto Regime

• Knowledge Bank• Selling the market mechanisms• Expert on climate finance architecture• Expert on climate-development relationship• Building borrower capacity on how to get carbon revenue

stream• Political Player in the UNFCCC negotiations• Not just carbon finance, but Adaptation• Alliance with South to get more $ (additional resources)• Deforestation Rules: REDD/FCPC

Why is the World Bank involved?

• They’ve been very nimble and very smart• CIF governance structure

• They’re perfectly positioned to dominate discussion and implementation of future climate financial architecture

• Their behavior/approach/ideology in climate change-related projects and funding is no better than in any other area

Why is the World Bank involved?

How is REDD proposal developed and how is it decided in the Bank?

• The Forest Carbon Partnership Facility: assist developing countries to prepare in bringing forest carbon stocks into an international carbon market. Run by Management Team (FMT); Technical Advisory Panel (TAP) reviews R-Plan; REDD decided by the Program Committee (PC);. How?

• Develop a Readiness Plan (R-Plan), a document that outlines steps and ‘minimum requirements’ for a country to achieve ‘Readiness’. The R-Plan must contain a completed:• ‘consultation and outreach plan’• a ‘Land use, Forest Policy and Governance Quick Assessment.’• detailed or outline terms of reference (TORS) for, inter alia, the

establishment of a ‘National REDD working Group’, a risk assessment, a national REDD Strategy, a REDD Implementation Framework and also TORs for social and environmental impact assessment of the REDD strategy.

How is REDD proposal developed and how is it decided in the Bank?

• R-Plan Implementation: Once approved, an R-Plan is expected to be executed over two or three years to provide a “Readiness Package” that includes a:

• National REDD Strategy and REDD implementation framework that has been prepared and vetted through a multi-stakeholder consultation process;

• Completed design for a national REDD monitoring, reporting and verification system

• A national baseline (or reference scenario) for deforestation rates – that has been adopted and published

What can a country access if its R-PP is approved?

Timeline for Mekong country R-PPs

Trends and Issues

• 25 R-PINs submitted; Panama and Guyana R-Plan approved; Indonesia temporarily disapproved

• In Mekong countries submitted their R-PIN: • Thailand• Lao PDR• Cambodia• Vietnam• Lower Mekong REDD

Trends and Issues

• 25 R-PINs submitted; Panama and Guyana R-Plan approved; Indonesia temporarily disapproved

• In Mekong countries submitted their R-PIN: • Thailand• Lao PDR• Cambodia• Vietnam• Lower Mekong REDD

Key issues emerging: the Indonesia and Guyana R-Plan

• Tenure security: Overlooks critical land tenure issues: unresolved territorial rights claims of indigenous peoples, land tenure insecurity of forest-dependent people, resource conflicts

• Rights: Fails to comply with international obligations in relation to human rights, inc. UNDRIP, FPIC

• Governance: Design and implementation strategy highly non-transparent and exclusive; lack of proper assessment of forest governance and alignment with national forest/land policies

• Equity: who owns carbon, who gets the benefits, who gets marginalized?

• Accounting: how much carbon is stored and captured?• Accountability: Compliance with safeguard policies• No clear plans to address deforestation and degradation caused

by mining and industrial logging concessions• others

Some strategic points to consider in REDD advocacy

• Collectively analyze the content, governance, scope and spirit of the REDD proposal to develop shared and people-based position, strong set of arguments and proposition

• Engage with the key government ministry (and other input providers) that leads the design of the R-PP

• Link with the FCPF decision-making body, i.e. the Participant Committee, to influence their ‘country’ position.

• Link with the NGO Observer to get the latest intelligence on the state-of-play, possible allies, as well as the decision-making timeline…for timely and informed action.

• Media, others…?

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