Fears of corruption as REDD forest-protection schemes begin

| 13th October 2010
Tropical deforestation

Under REDD-type forest protection schemes billions of dollars will flow into some of the most corrupt countries in the world

Misunderstandings and scepticism around schemes that pay countries to protect their forests are rife, with fears that without proper policing it will be a magnet for organised crime and corruption
People believed they needed to bottle the carbon dioxide before they could sell it

Over the next decade developing countries could collect $35 billion every year to reduce deforestation. Indonesia received $30 million from Norway, the first slice of a Reducing Emissions from Deforestation and Degradation-type deal (REDD+) worth $100 million. And Guyana is in line for the same amount soon.

Halting deforestation, which contributes almost 20 per cent of the world’s annual carbon dioxide emissions, would be a boon for the fight against climate change. But poorly executed, REDD+ and similar deals could lead to corruption, exploitation of indigenous people and no overall emissions reduction.

Only the general principle has been agreed internationally, but at the last count there were 144 REDD+ type initiatives being pursued by a variety of organisations. Despite difficulties of sourcing money, wording contracts, setting baselines and identifying beneficiaries, and whether the world is ready or not, REDD+ is happening.

One of those countries where it is happening is Guyana, where president Bharrat Jagdeo, who earlier this year was given the UN’s Champion of the Earth award, says ‘climate change is good business for us. It is probably the best thing that could have happened to forested countries’.

Guyana and Norway signed a Memorandum of Understanding last November, in which Guyana could receive $250 million for conserving its forest; but wranglings continue and Norway’s millions have not yet arrived. Meanwhile, miners vociferously complain about being forced out of business by accompanying stricter regulations. Longer term, protecting forests could bring economic benefits but short term there are sacrifices for developing countries.

Dane Gobin, chief executive of Iwokrama - a forest reserve in Guyana - sums up the matter: ‘We have a resource we would like to get money for. Either you pay us for biodiversity services or we will sell the forest to Malaysian logging companies.’

Corruption fears

Paying developing countries to protect forests sounds like a win-win situation but it is risky.

Shyam Nokta, head of the Guyana’s office of climate change, said: ‘We need assurance finance will be predictable, secure over time and that it will be new. Developed countries need assurances of openness, transparency and that the money will be used in development.’

Under REDD+, billions of dollars will flow into some of the most corrupt countries in the world. Forest campaigner for Global Witness, Mattia Fosci, said: ‘Every organised criminal and corrupt official worth their salt will be planning how to take a slice; that is why good governance of REDD revenues is essential.’

In Papua New Guinea, the director of the Office of Climate Change, Theo Yasause, was investigated over illegal carbon credits, although cleared of corruption. Some of these ‘credits’ were given to Nupan Trading run by Kirk Roberts. So-called ‘carbon cowboy’ Roberts is being investigated for allegedly misleading villagers over carbon-trading schemes.

Corruption is not the only risk, Fosci added: ‘The real danger is that REDD revenues are captured by the elites, the forest-dependent people remain just as disenfranchised as they are now under logging regimes.’

However, REDD+ could be an opportunity for indigenous people to benefit financially and otherwise from their role as stewards of the forest. Ecuador’s UN deal to prevent oil exploitation in Yasuni National Park was heralded as a victory for the local forest people. But under REDD+, communities without formal land rights miss out. Guyana is using some money for titling Amerindian lands, but it is debatable whether the country can enforce titles effectively. At one point the Mines Commission, which investigates miners’ violations of the Amerindian Act, had a 19,000-case backlog.

Reaping REDD+ benefits depends on indigenous people fully participating in the process. In Papua New Guinea there were serious misunderstandings, with people believing they needed to bottle the carbon dioxide before they could sell it - or worse - burn the forest and bag the carbon to get rich from ‘sky money’. In Ecuador a consortium of indigenous people rejected REDD+ saying it removes their control of resources.

Forests and climate campaigner for FERN, Kate Dooley said: ‘The increase in market value of large, remote tracts of forest is already leading to "the last great land grab" as multinationals, carbon traders and governments rush to secure ownership of forests.’

Indigenous people with only customary rights to land are vulnerable. Dooley said: ‘In every country where REDD processes are starting the principle of fair prior informed consent is not being upheld, leading to serious breaches of human rights.’

Making REDD work

Without the support of forest people to monitor and police the forest, REDD+ is unlikely to succeed. Studies show deforestation rates are lower in areas of the Brazilian Amazon managed by indigenous groups. Even with local communities’ support, monitoring is tricky and expensive.

Peter Minang from the World Agroforestry Centre thinks developing countries need substantial capacity-building.

He said: ‘We still know very little about how much it will really cost a country to set up and implement REDD+.’ A total of $1.5million of Norway’s money is allotted to monitoring in Guyana, but keeping an eye on 13 million hectares of forest, some of which can only be accessed by air, is no mean feat. Policing is also crucial: in Indonesia 40 to 55 per cent of the country’s timber is harvested illegally. If this is not controlled, payment to protect forests is pointless. Leakage of deforestation from protected areas to others is difficult to eradicate unless the causes of deforestation are tackled. 

Payments to preserve forests could represent a paradigm shift to a different valuation of ecosystems.

Rebecca Chacko, director of climate policy for Conservation International, said: ‘REDD+ is the first time we are seeing significant potential for payment for ecosystem services at the global level.’

Dooley agrees but only if the financial transfers force polluters to pay for conservation. ‘This would be dependent on this money being truly financial transfers based on polluter pays rather than trading and selling, which is merely an extension of the same capitalist paradigm which got us into the climate mess in the first place,’ she said.

Non-market mechanisms often struggle to raise money; Ecuador’s Yasuni scheme requires $3.6 billion but not all has been pledged yet. But the alternative, a carbon-credit scheme, allows developed countries to avoid unpopular policy decisions by offsetting carbon elsewhere, and if forest carbon credits are cheap enough they could even delay introduction of cleaner technologies.

REDD+ type schemes have not been around long enough to know for certain whether they can work effectively, but reducing production of carbon dioxide is urgent.
Chacko said: ‘REDD+ is a relatively low-cost way to reduce greenhouse gas emissions, but the opportunity it provides will [soon] no longer be available to us.’

REDD+ will only be more than greenwash if deforestation is actually reduced globally. For that, its causes need to be addressed and these must include the West’s demand for agricultural products from forest nations, as 80 per cent of new farmland in the tropics comes from felling forests.

However, paying countries to preserve forests does nothing to address manmade climate change caused by reliance on fossil fuels. While dangerous climate change cannot be avoided without tackling deforestation, there have to be major emissions cuts too.

People believed they needed to bottle the carbon dioxide before they could sell it
Shell funding of forest protection scheme could result in 'largest land grab of all time'
Oil giant's investment in Indonesian REDD conservation project is a crude attempt to increase profit and gloss over its expanding oil drilling operations, say campaigners
Growing conflicts over Tanzania's 'charismatic carbon'
The country's forests are at the centre of a new global scramble to 'buy up' carbon, but as Thembi Mutch reports, is the process really going to benefit the environment or people?
Atlantic Rising: Liberia faces choice between deforestation and REDD
If alternatives to deforestation like REDD do not arrive soon Liberia's remaining rainforest cover is likely to go the same way as its neighbours in Cote d'Ivoire
I applaud Norway's $1bn funding offer to Indonesia. But where will that money go?
Norway's $1 billion of anti-deforestation funding to Indonesia is nothing short of amazing. But we should watch very carefully to see whether the money reaches the right pockets...
Protecting forests AND the rights of forest peoples
The plans currently under consideration for saving forests might help the trees, but they could ride roughshod over indigenous communities. Here are some ways to change that


The Ecologist has a formidable reputation built on fifty years of investigative journalism and compelling commentary from writers across the world. Now, as we face the compound crises of climate breakdown, biodiversity collapse and social injustice, the need for rigorous, trusted and ethical journalism has never been greater. This is the moment to consolidate, connect and rise to meet the challenges of our changing world. The Ecologist is owned and published by the Resurgence Trust. Support The Resurgence Trust from as little as £1. Thank you. Donate here