Protecting the world's forests needs more than just money

December 10th, 2007

Governments meeting in Bali, Indonesia for the 13th Conference of the
Parties/3rd Meeting of the Parties to the United Nations' Framework
Convention on Climate Change (UNFCCC), 3-14 December 2007, need to
recognise that this may be our last opportunity to stop runaway
climate change and that with 18-20% of annual carbon emissions being
caused by deforestation, protecting our forests is a key part of this.

This problem is made even more important because forests are a key
part of the earth's carbon and hydrological cycles. Without forests
rainfall will fail in many regions. Yet forests themselves are being
impacted by climate change and may already be losing their ability to
regulate the planet's climate. Further increases in temperature
threaten to increase heat stress and drought, causing forests,
particularly tropical forests, to become net sources of emissions,
rather than stores. Furthermore, deforestation can also trigger
irreversible ecosystem die-back.

Governments and intergovernmental organisations, including the World
Bank, have responded by submitting a number of proposals
concerning `Reducing Emissions from Deforestation' (RED) and, in the
case of the Bank, a proposal to launch a Forest Carbon Partnership
Facility. However, these proposals, especially those that argue that
forests should be included in carbon markets as offsets, fall far
short of what is needed to combat climate change swiftly and
effectively.

Carbon trading and offsetting are being used as a smoke-screen to
ward off legislation and delay the urgent action needed to cut
emissions and develop alternative low-carbon solutions. At the same
time they encourage businesses, governments and people to continue
with or even increase unnecessary polluting activities - reducing
life to a commodity to be bought and sold.

Despite all these concerns, because carbon finance mechanisms hold
the prospect of spectacular commercial profit in what may become one
of the largest commodity markets in the world, they are at the top of
many governmental and commercial agendas here in Bali.

Yet the UNFCCC's project- and trading-based emissions reductions
schemes to date have been totally ineffective in terms of their
ability to significantly reduce emissions. The UNFCCC's Clean
Development Mechanism (CDM), which was launched in Kyoto in December
1997, was intended to allow countries with emissions reductions
targets under the Kyoto Protocol to invest in projects that lead to
developing countries being able to reduce their emissions more
cheaply.

The CDM has not worked. Projects have tended to lead to excessive
profits for business, whilst generating investment for many projects
that would have happened anyway. Several years of carbon trading have
not stopped increasing rates of greenhouse gas emissions. In fact,
studies show they may be resulting in an overall increase in
emissions. Many projects are not `clean' nor are they leading to
poverty alleviation or sustainable development, as intended.

The World Bank has an equally appalling track record in relation to
carbon funding, not least because it continues to fund oil, gas and
mining projects, despite recommendations from its own review which
suggested most of these projects be rapidly phased out; and as a
broker it has a vested interest in promoting carbon trading. Its
planned Forest Carbon Partnership Facility (FCPF) –intended to
channel carbon finance from donors to recipient countries - could
also have serious negative social and environmental impacts.

Carbon financing is proving intensely inequitable. Forests are the
home and source of livelihoods for over 1.6 billion people, including
Indigenous peoples, and forest-dependent communities. Wealthy
companies and countries are able to buy the right to continue to
pollute, whilst poor communities often find themselves locked into
unfavourable, long-term commercial contracts. Furthermore, forest-
dependent Indigenous Peoples and local communities have already found
that it is they who may have to bear the real cost of climate
mitigation projects based on carbon finance, while garnering none of
the benefits. Some carbon finance projects are subsidizing industrial
tree plantations at the expense of communities, ecosystems and food
production.

The proposed RED policies could trigger further displacement,
conflict and violence, as forests themselves increase in value they
are declared `off limits' to communities that live in them or depend
on them for their livelihoods. Women and Indigenous Peoples are the
least likely to profit from the destruction of forests and therefore
also the least likely to receive compensation. Carbon finance
mechanisms result in forests being transferred or sold off to large
companies who aim to acquire profitable `carbon credits' at some
point in the future.

Carbon markets, like other commodities, are also proving notoriously
volatile. Far from creating a predictable commercial environment and
financial flows, the European Union's Emissions Trading Scheme Phase
I, for example, has had "very questionable effects" on "the extent to
which emissions are reduced, and the extent to which it provides a
stable and effective carbon price" (UK Environmental Audit Committee,
28 February 2007). The protection of forests and our climate is
essential to all our futures and should not be subject to the
vagaries of the market.

Recommendations

We are calling for governments to:

+ address the direct and underlying `drivers' of deforestation and
the destruction of biodiversity in other ecosystems which are also
critical to climate stability by reducing demand for agricultural and
forest products and energy; removing trade and investment
liberalisation rules that fuel deforestation; and stopping
corruption.

+ ensure that all forest protection programs are based upon and
uphold the rights of Indigenous Peoples (as laid down in the UN
Declaration on the Rights of Indigenous Peoples), women and local
communities, by prohibiting any actions that seek to exclude
Indigenous peoples and forest dependent communities
from `conservation' areas. Outstanding land and tenure questions and
the free and prior informed consent of affected communities should be
addressed as a prerequisite, before the implementation of any such
programs.

+ give the highest priority to halting the development, production
and trade of agrofuels, and suspend all targets and other incentives,
including subsidies, carbon trading and public and private finance
related to the development and production of agrofuels.
keep forests out of carbon finance mechanisms, which are
unpredictable, inequitable and discourage the reduction of emissions
at source. This includes keeping forests out of the Clean Development
Mechanism and all carbon trading initiatives; and rejecting the World
Bank's Forest Carbon Partnership Facility (FCPF).

+ ensure that developing countries are assisted in their efforts to
protect their forests with well targeted, predictable and sufficient
financial and other support, in the form of an international fund
that rewards the complete rather than partial cessation of
deforestation; supports policies that promote community-based forest
management and reforestation, natural regeneration and ecosystem
restoration; and finances a global forest fire fighting fund and
expertise, to assist countries unable to prevent or stop out-of-
control forest fires.

+ redirect the very substantial amounts of public funds, tax
exemptions and other forms of subsidies currently provided to the
fossil fuel and agrofuels industries, into avoided deforestation
assistance funds, the effective promotion of public transport and the
development of solar, wind, geothermal, wave and energy efficiency
technologies, (Government spending on energy subsidies currently
totals US$250 billion per year.)

+ ensure that funds are not used to compensate logging and plantation
companies and others involved in large-scale deforestation.
strengthen weak forest conservation policies and institutions,
encouraging bans or moratoria on industrial logging and forest
conversion, and addressing corruption and lack of enforcement.
implement a moratorium on all public financing and subsidies of oil,
coal and gas exploration, and rapidly phase in subsidies for clean
energy alternatives with just transition programmes to phase out
existing fossil fuel activities, whilst protecting ecosystems,
communities and food production from agrofuels.

Signed by:

Amigos de la Tierra/Friends of the Earth Spain
Arbeitsgemeinschaft Regenwald und Artenschutz, Germany
Asamblea Patagonica contra el Saquco y la Contaminacion, Patagonia,
Argentina
Biofuelwatch
Carbon Trade Watch
Centro de Defeso dos Direitos Humanos, Brazil
COECOCEIBA/Friends of the Earth Costa Rica
Comisión Intereclesial de Justicia y Paz, Colombia
Down to Earth
Ecologistas en Acción, Spain
FERN
Focus on the Global South
Foundation for Ecological Security, India
Freunde der Naturvoelker e.V./ Friends of Peoples close to Nature,
Germany
Friends of the Earth Argentina
Friends of the Earth International
Friends of the Siberian Forests, Russia
Genethics Foundation, Netherlands
Global Forest Coalition
Global Justice Ecology Project, US
Grupo Reflexion Rural, Argentina
Madre Tierra/ Friends of the Earth Honduras
MONLAR, Movement for Land and Agriculture Reform, Sri Lanka
National Farmers Assembly, Sri Lanka
Nature Alert
NOAH/ Friends of the Earth Denmark
O le Siosiomaga Society, Samoa
Ökumenischer Arbeitskreis "Christen & Ökologie", Germany
Pacific Indigenous Peoples Environment Coalition
Quaker Concern for Animals, UK
Red de Alternativas a la Impunidad y la Globalización
Regional Advisory Information and Network (RAINS), Ghana
Rettet den Regenwald , Germany
Salva la Selva, Ecuador
Sobrevivencia/ Friends of the Earth Paraguay
Sociedad Ecologica Regional (A Ho Valle y Comarca Andina, Argentina
Sustainable Energy and Economy Network, US
Swiss Working Group on Colombia (Grupo de Trabajo Suiza Colombia)
Tamil Nadu Environment Council (TNEC), India
Terre des hommes-Arbeitsgruppe Schwäbisch Gmünd / Germany
Timberwatch Coalition, South Africa
Transnational Institute
Via Campesina
WALHI/ Friends of the Earth Indonesia
Watch Indonesia! Germany
World Rainforest Movement
Xàrxa de l'Observatori del Deute en la Globalització, Barcelona,
Spanish State