value chain governance and national forest conservation policies: scope and limitations jan börner...

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Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2 , and Sven Wunder 2 1 Center for Development Research, University of Bonn 2 Center for International Forestry Research (CIFOR) [email protected], [email protected] Foto Palm

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Page 1: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Value chain governance and national forest conservation policies: Scope and limitations

Jan Börner1,2 , and Sven Wunder2

1Center for Development Research, University of Bonn 2Center for International Forestry Research (CIFOR) [email protected], [email protected] Foto: Neil Palmer

Page 2: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Good and bad news on forests

Fig. 3 Annual forest loss totals for Brazil and Indonesia from 2000 to 2012.The forest loss annual increment is the slope of the estimated trend line of change in annual forest loss.

M C Hansen et al. 2013

Page 3: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

New drivers, new solutions?

• Deforestation is on the rise in most tropical forest countries

• Drivers of tropical deforestation are becoming increasingly global (e.g. Wheeler et al. 2013)

• Proliferation of value chain governance initiatives

M. Lenzen et al. (2012)

Page 4: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

What brought deforestation down in Brazil (Amazon)?

• Investments in monitoring technology

• Forest governance reform in 2004

• Reliance predominantly on command-and-control

Arima et al. 2014

Page 5: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Did value chain governance work?

• Yes, before the Soy Moratorium, 30% of soy expansion occurred through forest conversion. Afterwards most expansion occurred on cleared land (e.g. old pastures), only 1% through deforestation.

• No, because a 10% expansion of soy on old pastures was associated with a 40% increase in deforestation, mainly for cattle, at agricultural frontiers in the Amazon.

Soy MoratoriumGibbs et al. 2015

Arima et al. 2011

Page 6: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Why should we worry that iLUC threatens zero deforestation commitments?

Ag. rent$/ha

Forest area100% 0%

Page 7: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Why should we worry that iLUC threatens zero deforestation commitments?

Ag. rent$/ha

Forest area100% 0%

Infrastructure expansion

Commodity price increasesTechnological change (if producers are price takers)

Page 8: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Why should we worry that iLUC threatens zero deforestation commitments?

Ag. rent$/ha

Forest area100% 0%

Soy

Cattle

Soy dominated landscape

Pasture dominated landscape

Page 9: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Why should we worry that iLUC threatens zero deforestation commitments?

Ag. rent$/ha

Forest area100% 0%

Soy

Cattle

Soy Moratorium controls only one commodity

Expansion cost (land price) for cattle farms decreasesat the frontier

Capitalization of cattle producers through land market?

Page 10: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Why should we worry that iLUC threatens zero deforestation commitments?

Ag. rent$/ha

Forest area100% 0%

Soy

Cattle

Soy Moratorium controls only one commodity

Expansion costs (land price) for cattle farms decreasesat the frontier

Controlling soy, but not cattle producers increases access to profitable land for the latter

Page 11: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Why should we worry that iLUC threatens zero deforestation commitments?

Ag. rent$/ha

Forest area100% 0%

Soy

Cattle

Soy Moratorium + National forest law enforcement

Enforcement (access) cost

Page 12: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Field-based law enforcement in the Brazilian Amazon

Börner et al. 2015

Börner, Wunder et al. 2015

• Field inspections along with confiscation and embargos statistically significant deterrent

• Costs of enforcement increase with remoteness and poor property rights definition

• Probability of enforcement varies in space

Page 13: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Why should we worry that iLUC threatens zero deforestation commitments?

Ag. rent$/ha

Forest area100% 0%

Soy

Cattle

Soy Moratorium + National forest law enforcement

Enforcement (access) cost

Page 14: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Why should we worry that iLUC threatens zero deforestation commitments?

Ag. rent$/ha

Forest area100% 0%

Soy

Cattle

Soy Moratorium + National forest law enforcement

Enforcement (access) cost

Rebound effect of value chain-based initiative (iLUC) depends

on investment in national forest law enforcement

Page 15: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Summary

• Proliferation of value chain governance initiatives (e.g., zero deforestation commitments) for bio-based commodities

• Evidence confirms direct conservation effects, but also points to large indirect rebound effects through iLUC

• Few theoretical frameworks explain iLUC at agricultural frontiers and causality is hard to establish empirically

• Contextual factors that increase risk of iLUC-induced deforestation:– abundance of forest land at agricultural frontiers (Amazon)– competing internationally traded commodities with varying degrees of

productivity and value chain governance (soy vs. beef)– Weak forest law and/or forest law enforcement (SE Asia, Africa)– “Legal” access to forest land

Page 16: Value chain governance and national forest conservation policies: Scope and limitations Jan Börner 1,2, and Sven Wunder 2 1 Center for Development Research,

Implications

• Value-chain governance can complement, but not substitute national forest law & enforcement

• Lessons for targeting national forest law enforcement in the presence of value chain governance initiatives and vice versa

• Multi rather than single value chain governance?• Role to play for international forest conservation

mechanisms, such as REDD+