More action needed on mining deforestation here – Norway funding agency

-confirms Guyana will lose US$20M

Systems are in place for measuring forest protection but insufficient action has been taken to reduce the mining operations that are the main cause of deforestation, the Norwegian government agency through which funds are channelled to pay Guyana for protecting its forests, has said.

The Norwegian Agency for Development Cooperation (NORAD) in its latest report released on Monday, confirmed that Guyana will lose US$20 million as a result of increased deforestation in Year 3 (2012) of the Guyana-Norway forest protection partnership. NORAD is a directorate under the Norwegian Ministry of Foreign Affairs and since 2010, it has been monitoring Norway’s International Climate and Forest Initiative (NICFI) the programme under which Guyana is paid to protect its forest.

Guyana has established the necessary systems for measuring forest protection but insufficient action has been taken to reduce the mining operations that are the main cause of deforestation in the country, NORAD said. The agency confirmed that payments from Norway for 2012 were reduced by approximately US$20 million. Guyana’s deforestation rate rose to 0.079% in 2012, an increase over the previous year, and while assessments for Year 4 (2013) have not yet been completed, it is believed that deforestation has again increased.

Further, following a steep drop in gold declarations, the government has begun to open thousands of hectares of new mining lands and this would increase deforestation.

“The Guyana-Norway partnership may have helped to reduce emissions, but the recent increase in the deforestation rate indicates that more needs to be done,” NORAD said in its latest report. “The technical and institutional pre-requisites for verifying deforestation rates relative to a reference level have been achieved, but much more action is required to mitigate the impacts of mining as the main driver of deforestation,” it noted.

Guyana and Norway in 2009 inked a REDD+ partnership under which Oslo will pay for Guyana’s performance on limiting greenhouse gas emissions from deforestation and forest degradation, and for progress made against governance-related indicators. REDD+ is a global initiative that aims to reduce greenhouse gas emissions from deforestation and forest degradation. Norway’s payments to Guyana may amount to approximately US$250 million over the period to 2015, depending on Guyana’s performance.

 Fragility

In its report, NORAD noted that the increase in deforestation has been mainly due to gold mining. As a result, REDD+ payments from Norway were reduced by approximately US$20 million for 2012. “This indicates the fragility of Guyana’s low deforestation rate, and the lack of resilience to the drivers of deforestation. It also raises the question whether there should be reduction or mitigation projects/activities directly relating to (gold) mining added to the Low Carbon Development Strategy,” NORAD said.

It had noted the creation of the Ministry of Natural Resources and the Environment with overarching responsibility for both mining and forest/environmental protection and said that questions have been raised about a possible conflict between these opposing remits for the new, relatively inexperienced ministry.

According to NORAD, several stakeholders have identified actions that could reduce the deforestation impact of mining without limiting mining activities to any significant extent. These include undertaking a national survey of gold deposits so that concessions are only granted for economically viable mines – and land is not cleared unnecessarily for non-viable mines – as well as improved technology should be introduced to increase the extraction rate from existing mines. This would address the practice of returning to mined land which restricts land reclamation, the agency noted.

Systems are in place for measuring forest protection but insufficient action has been taken to reduce the mining operations that are the main cause of deforestation, the Norwegian government agency through which funds are channelled to pay Guyana for protecting its forests, has said.

The Norwegian Agency for Development Cooperation (NORAD) in its latest report released on Monday, confirmed that Guyana will lose US$20 million as a result of increased deforestation in Year 3 (2012) of the Guyana-Norway forest protection partnership. NORAD is a directorate under the Norwegian Ministry of Foreign Affairs and since 2010, it has been monitoring Norway’s International Climate and Forest Initiative (NICFI) the programme under which Guyana is paid to protect its forest.

Guyana has established the necessary systems for measuring forest protection but insufficient action has been taken to reduce the mining operations that are the main cause of deforestation in the country, NORAD said. The agency confirmed that payments from Norway for 2012 were reduced by approximately US$20 million. Guyana’s deforestation rate rose to 0.079% in 2012, an increase over the previous year, and while assessments for Year 4 (2013) have not yet been completed, it is believed that deforestation has again increased.

Further, following a steep drop in gold declarations, the government has begun to open thousands of hectares of new mining lands and this would increase deforestation.

“The Guyana-Norway partnership may have helped to reduce emissions, but the recent increase in the deforestation rate indicates that more needs to be done,” NORAD said in its latest report. “The technical and institutional pre-requisites for verifying deforestation rates relative to a reference level have been achieved, but much more action is required to mitigate the impacts of mining as the main driver of deforestation,” it noted.

Guyana and Norway in 2009 inked a REDD+ partnership under which Oslo will pay for Guyana’s performance on limiting greenhouse gas emissions from deforestation and forest degradation, and for progress made against governance-related indicators. REDD+ is a global initiative that aims to reduce greenhouse gas emissions from deforestation and forest degradation. Norway’s payments to Guyana may amount to approximately US$250 million over the period to 2015, depending on Guyana’s performance.

 Fragility

In its report, NORAD noted that the increase in deforestation has been mainly due to gold mining. As a result, REDD+ payments from Norway were reduced by approximately US$20 million for 2012. “This indicates the fragility of Guyana’s low deforestation rate, and the lack of resilience to the drivers of deforestation. It also raises the question whether there should be reduction or mitigation projects/activities directly relating to (gold) mining added to the Low Carbon Development Strategy,” NORAD said.

It had noted the creation of the Ministry of Natural Resources and the Environment with overarching responsibility for both mining and forest/environmental protection and said that questions have been raised about a possible conflict between these opposing remits for the new, relatively inexperienced ministry.

According to NORAD, several stakeholders have identified actions that could reduce the deforestation impact of mining without limiting mining activities to any significant extent. These include undertaking a national survey of gold deposits so that concessions are only granted for economically viable mines – and land is not cleared unnecessarily for non-viable mines – as well as improved technology should be introduced to increase the extraction rate from existing mines. This would address the practice of returning to mined land which restricts land reclamation, the agency noted.

 Rolled out

Other actions include that the Guyana Geology and Mines Commission’s (GGMC) current trial land reclamation projects should be rolled out nationally, the report said citing an effective example of such a policy in French Guiana – “including no new claim/licence approvals to be granted to an individual/entity until their previous claim areas are environmentally reclaimed.” It was also stated that all mining operations should have trained staff in low-impact practices and it was suggested that this could be done via the newly established mining school.

NORAD said that the objective of taking early action to achieve cost-effective and verifiable reductions in greenhouse gas emissions has been successful. “One of the clear successes of the Guyana-Norway partnership has been the development of a fully functioning national monitoring, reporting and verification system. This achievement is in large part due to the timely development of a road-map for developing the system, and also the quality of the staff at the Guyana Forestry Commission (GFC). The system has now successfully completed three rounds of reporting and independent verification, and three rounds of payments have been made to the Guyana REDD+ Investment Fund (GRIF),” the report said.

The agency said that the disbursement of funds from the GRIF for low carbon development projects has been slow, which means that tangible measures for reducing deforestation have been limited. “In addition, relatively few of the proposed projects in the Low Carbon Development Strategy pipeline directly mitigate or control the impact of mining, which is the main driver of deforestation in Guyana. The lack of tangible interventions that directly address the expansion of mining is also evidenced by the recent increase in deforestation, caused by an increase in gold prices,” NORAD declared.

Catalyst

Despite these issues, many stakeholders believe that the Guyana-Norway agreement has been a catalyst for some low carbon development, and that it has therefore helped to reduce emissions to some extent, it said even as it noted that there are a number of actions that could be introduced or scaled up to limit the impact of mining, without greatly restricting the mining sector’s contribution to the economy.

A number of stakeholders commented that the level of REDD+ payments is insufficient to restrict mining activities, as mining is a key part of the national economy – revenue from mining is in the region of US$700 million per year, while REDD+ payments are up to US$50 million per year, the report noted.

It also noted that there is a highly effective working relationship between the GFC and the NICFI secretariat staff on technical monitoring, reporting and verification issues. Guyana’s capacity for monitoring, reporting, and verification system has developed exceptionally quickly, it observed.

According to NORAD, while there is regular communication between the Government of Guyana and the NICFI secretariat, a Norway bilateral support focal point/interlocutor based in Guyana, at least on a part-time basis, would be welcomed by almost all respondents. “One potential advantage of having a representative in the country would be a greater awareness of any issues or miscommunications that arise, and having the ability to address and correct them. The presence of a representative may also help to mitigate some of the more partisan and non-transparent activities related to the Low Carbon Development Fund,” the report said.

It noted that Guyana-Norway partnership has demonstrated all the components of a results based payment system, and there has been active communication with international REDD+ stakeholders, though some questions remain about the representativeness of Guyana as a REDD+ country. As noted in previous evaluations, Guyana is not perceived as being representative of other REDD+ countries, and this may limit the influence of the lessons learned from the Guyana-Norway partnership, the report said.

In terms of maintaining momentum for REDD+ between 2015 and 2020, the report noted that the monitoring, reporting and verification system in Guyana has wider benefits which should aid its sustainability between 2015 and 2020. For instance, the system is also useful for monitoring mining and logging concessions, and for FLEGT. However, the GFC has expended significant resources to develop the system, and support is needed to sustain what has been developed, and to retain staff, it said.

 

Other actions include that the Guyana Geology and Mines Commission’s (GGMC) current trial land reclamation projects should be rolled out nationally, the report said citing an effective example of such a policy in French Guiana – “including no new claim/licence approvals to be granted to an individual/entity until their previous claim areas are environmentally reclaimed.” It was also stated that all mining operations should have trained staff in low-impact practices and it was suggested that this could be done via the newly established mining school.

NORAD said that the objective of taking early action to achieve cost-effective and verifiable reductions in greenhouse gas emissions has been successful. “One of the clear successes of the Guyana-Norway partnership has been the development of a fully functioning national monitoring, reporting and verification system. This achievement is in large part due to the timely development of a road-map for developing the system, and also the quality of the staff at the Guyana Forestry Commission (GFC). The system has now successfully completed three rounds of reporting and independent verification, and three rounds of payments have been made to the Guyana REDD+ Investment Fund (GRIF),” the report said.

The agency said that the disbursement of funds from the GRIF for low carbon development projects has been slow, which means that tangible measures for reducing deforestation have been limited. “In addition, relatively few of the proposed projects in the Low Carbon Development Strategy pipeline directly mitigate or control the impact of mining, which is the main driver of deforestation in Guyana. The lack of tangible interventions that directly address the expansion of mining is also evidenced by the recent increase in deforestation, caused by an increase in gold prices,” NORAD declared.

 Catalyst

Despite these issues, many stakeholders believe that the Guyana-Norway agreement has been a catalyst for some low carbon development, and that it has therefore helped to reduce emissions to some extent, it said even as it noted that there are a number of actions that could be introduced or scaled up to limit the impact of mining, without greatly restricting the mining sector’s contribution to the economy.

A number of stakeholders commented that the level of REDD+ payments is insufficient to restrict mining activities, as mining is a key part of the national economy – revenue from mining is in the region of US$700 million per year, while REDD+ payments are up to US$50 million per year, the report noted.

It also noted that there is a highly effective working relationship between the GFC and the NICFI secretariat staff on technical monitoring, reporting and verification issues. Guyana’s capacity for monitoring, reporting, and verification system has developed exceptionally quickly, it observed.

According to NORAD, while there is regular communication between the Government of Guyana and the NICFI secretariat, a Norway bilateral support focal point/interlocutor based in Guyana, at least on a part-time basis, would be welcomed by almost all respondents. “One potential advantage of having a representative in the country would be a greater awareness of any issues or miscommunications that arise, and having the ability to address and correct them. The presence of a representative may also help to mitigate some of the more partisan and non-transparent activities related to the Low Carbon Development Fund,” the report said.

It noted that Guyana-Norway partnership has demonstrated all the components of a results based payment system, and there has been active communication with international REDD+ stakeholders, though some questions remain about the representativeness of Guyana as a REDD+ country. As noted in previous evaluations, Guyana is not perceived as being representative of other REDD+ countries, and this may limit the influence of the lessons learned from the Guyana-Norway partnership, the report said.

In terms of maintaining momentum for REDD+ between 2015 and 2020, the report noted that the monitoring, reporting and verification system in Guyana has wider benefits which should aid its sustainability between 2015 and 2020. For instance, the system is also useful for monitoring mining and logging concessions, and for FLEGT. However, the GFC has expended significant resources to develop the system, and support is needed to sustain what has been developed, and to retain staff, it said.

 

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