Rawle Lucas is a Guyanese-born Certified Public Accountant and Assistant Vice President of the Lending Services Division.
Mr. Lucas has agreed to serve as a columnist with the Stabroek Business and will be contributing articles on economic, financial and development matters.
By Rawle Lucas
Concept of Acute Interest
Quite recently, the administration in Guyana has been showing abundant interest in the concept of REDD and its likely outcome. REDD is not a new communist identity that the People’s Progressive Party (PPP) and its government is trying to pursue, even though the frequent undemocratic behaviour of the administration often leaves many Guyanese wondering. Though unrelated, REDD is just as serious for what it intends to do and many Guyanese may be totally unaware of how its implementation could affect their immediate economic circumstances and that of future generations of Guyanese. This likelihood makes REDD a concept of acute interest to Guyanese and one to which they should all pay close attention.
REDD is the acronym for Reducing Emissions from Deforestation and Forest Degradation, and it has emerged as a prominent issue in the dialogue on climate change and a focus of the after-life of the Kyoto Protocol, a treaty on global climate control ostensibly designed to save us from ourselves. Like the Kyoto Protocol, which expires in 2012, REDD is also designed to save the world from its proclivity for reckless environmental behaviour that involves the use of forests in the name of human survival and economic progress.
Low-cost tool
Though absent from the Kyoto Protocol, REDD is now viewed by many countries and experts as the most valuable low-cost tool to fight global warming and to help meet some of the important environmental aspirations contained in the Kyoto Protocol. Apart from seeking to correct a deficiency in the Kyoto Protocol, the primary purpose of the REDD regime is to cut the emission of carbon dioxide into the atmosphere by preserving forests or managing forests in a way that helps to contain carbon dioxide emissions.
The rationale for the REDD regime is based on the now widely accepted scientific conclusion that deforestation and forest degradation are the largest sources of greenhouse gas emissions. According to existing data, deforestation and forest degradation account for 20 percent of greenhouse gas emissions. This shift relegates hydrocarbons and the industrial and transport activities that it supports to a subordinate role in the destruction of our planet for greenhouse gas emissions from this source is placed at about 18 percent.
Focus on developing countries
While all forests are of value in the fight against global warming, the focus of REDD is on forests in developing countries. This is in part because developing countries want to support responsible action to save the planet and in part because tropical forests hold 50 percent more carbon stock than forests found in temperate climates. The prevailing belief is that, if deforestation and forest degradation from tropical forests could be stopped or slowed, then the risk of global warming and the cost of stopping or slowing it could be reduced considerably. Since every country was likely to be affected adversely in some form by the precipitous warming of the earth, taking action to stop global warming has intrinsic value to Guyana as well.
Responsible behaviour
The excitement in Guyana about REDD stems from the country’s international commitment to help save the earth’s atmosphere from the ravages of greenhouse gases and the money that it believes it could earn from fulfilling those commitments. Current optimism might be misplaced since the FCPF only aims at this stage to help Guyana assess the amount of its carbon stock.
Guyana has always been aware of the value and importance of its forests to the stability of the earth’s climate. This awareness led it to become an active member of the Treaty of Amazonian Cooperation. The Parties to that treaty understood the link between preserving the forests for climate value and using it responsibly for the development of the people who own the forests.
Guyana’s understanding of the shared risks from climate change also led it to unilaterally give up a sizable portion of its virgin forest, about 317,000 hectares, to create the Iwokrama project for the benefit of all mankind. Now that there is a global willingness to make REDD an integral part of any post-Kyoto regime, Guyana’s acquiescence to REDD is a further demonstration of its commitment to play its part in the preservation of the planet. As far as Guyana is concerned, REDD is a logical follow-up to its own series of progressive steps already taken to thwart global warming.
Global consensus
The potential value that REDD brings to this effort is the opportunity for countries like Guyana that have tropical forests to match responsible management of its ecosystem with its economic vision and development ambitions.
The path to this point could be traced from Canada in 2005 to Indonesia in 2007, even though the issue was part of the international debate for much longer. REDD emerged with a greater global consensus for action in 2005 at the 11th Conference of the Parties (COP) to the United Nations Framework Conference on Climate Change (UNFCCC). Ever since that session of the COP which was held in Montreal Canada and the first workshop on REDD held in Italy in 2006, there has been renewed efforts to incorporate a REDD regime as a central mechanism in the management of climate change.
The persistent efforts of the global community ultimately bore fruit at the 13th meeting of the COP which was held in Bali, Indonesia in 2007. The decision in Bali was significant not only because it broke a logjam in the debate on the issue of emissions control but because it also renewed hope for a more robust and broad-based post-Kyoto consensus on managing climate change. An important element of the Bali decision was the willingness of the international community to assign economic value to the carbon dioxide trapped by tropical forests in developing countries in exchange for the preservation or controlled use of those forest resources.
Funding facility
This outcome prompted a decision by the World Bank to create a new funding facility called the Forest Carbon Partnership Facility (FCPF) to help consummate the exchange of carbon retention for money. This is not the only such facility around but it is the one with much more global reach. The funding facility which became operational in June 2008 is a means of giving financial value to REDD and the inclusion of Guyana in this facility brings it within the ambit of a strategic alliance for the survival of the planet.
This shift in accountability makes it necessary for countries like Guyana to be careful that it is not arbitrarily held in check as it tries to take advantage of its natural resources. There is no evidence in available reports that funding would go beyond establishing baselines to hold the country accountable for the carbon dioxide under its control. It would be regrettable if the current efforts of the administration amount to nothing more than the undertaking of another obligation to be paid for with the economic sacrifice of Guyanese.
Risk of Losing Control
This risk of losing control over its resources is real since the administration has already begun engaging the resources of Guyana without a full conceptualization of the impact of REDD on the economic development of Guyana and future Guyanese populations. Guyanese need to be aware that their forest is valuable both as a source of economic wealth and a means of staving off global warming. It is one of four tropical forests that possess a vast and desired capacity to provide stability to the global ecosystem. The forest of Guyana fulfils this role by providing measurable services such as rainfall, cooling of the atmosphere, moderating weather conditions, storing carbon and sustaining biodiversity.
Currently, Guyanese could clear the land for farming, housing construction, mineral exploration, logging or any other legitimate use as guaranteed by the constitution. That freedom of choice could disappear or be severely restricted if a broader national consensus is not reached on the issue of REDD. While the administration acknowledges this risk in a Readiness Plan Information Note (R-PIN) prepared as a condition for participating in the FCPF, far too much emphasis is placed on the technical issues and not enough on the social, economic and political consequences of REDD.
There is no way of telling where these environmental agreements would lead Guyanese who may have to rethink their current choices of land use and come up with new economic activities or industries with a favourable outcome for climate change. This could involve introducing more complex production systems for which they may not have the skills or technology and which could put them at a significant economic or employment disadvantage
Too Narrow
While the concerns about climate change present opportunities, the focus of consultations by the administration has been too narrow and is proceeding as if Guyana is not for all Guyanese. The interest groups that have been consulted so far cannot be deemed representative of the entire population by any stretch of the imagination. The issues may be technical but it is the responsibility of the administration to make sure that Guyanese understand the impact of REDD on them and their ability to use the land. This is particularly true for the younger generation since they will have to live with the consequences of the decisions of today. Their ability to pursue many of the traditional economic endeavours of housing construction, agriculture and mining could clash with the international commitments that the administration is making in their name.
This is not a matter that should be taken lightly and the administration should not be too casual about it. For example, in a meeting in Bonn, Germany last month, experts contended that agriculture accounts for as much as 15 percent of greenhouse gases. Over one-third of the Guyana economy is based on agriculture and nearly 30 percent of its labour force is engaged in the agricultural sector in one way or another. Even though the expert meeting offered no alternatives, there is the real possibility that powerful countries could push for radical changes in agricultural production for which a country like Guyana may not be fully prepared.
While protecting the earth’s atmosphere is commendable, Guyanese should not be expected to do more than other nations, even if paid to do so. The actions of Guyana would only be meaningful if the actions of other nations did not undermine the global benefits that could accrue from the sacrifice of Guyanese that are made under the REDD regime.
