REDD+ and the global economy; Competing forces and policy options

Abstract

The challenges of reducing greenhouse gas (GHG) emissions, while feeding a growing population and meeting global demand for fibre and energy, are attracting increasing attention (Kissinger 2011; Wollenberg et al. 2011). This chapter presents an overview of current trade and investment-related drivers of deforestation and forest degradation in the tropics and the ways in which they serve as obstacles to REDD+ implementation, with a closer look at three regions. In addition, we suggest policy options that could help tackle these global drivers by making economic growth more compatible with forest conservation. The discussion is organised around three questions: 1. What are the main economic drivers and trends shaping deforestation and forest degradation in the tropics that represent major obstacles to REDD+? 2. Which aspects of these economic drivers represent the greatest challenges to reducing deforestation and forest degradation in Indonesia, the Brazilian Amazon and East Africa? 3. What policy approaches would be most effective for reducing the effects of these forces on forests and what are the implications for REDD+? Deforestation has historically been linked to economic development, population growth and the associated demands for food, fibre and energy. We argue that there are a number of contemporary drivers, strongly related to global markets and investment, that lead to increased competition for land, including forestland in the tropics. These drivers include the increased integration of food, fibre, energy and financial markets; high price volatility and higher commodity prices; and a transnational land rush. They make attempts to reduce carbon emissions through REDD+ more challenging since, directly and indirectly, these drivers stimulate the conversion of forestland to agricultural use and increase logging activities that often lead to forest degradation. Nonetheless, there are important regional variations in how these drivers affect forests, as our assessments from Indonesia, the Brazilian Amazon and East Africa show. We adopt a broad definition of REDD+ to mean the array of policies that primarily aim to reduce carbon emissions from deforestation and forest degradation and may also include result-based incentives and compensation (see Chapter 1). Many factors affect the implementation of REDD+. In this chapter, we focus on the global economic drivers and trends shaped by markets and public policies – in consumer and producer countries – that bring about changes in land use, thus affecting forest cover and quality. In order to make REDD+ policies more effective, we must consider global economic dynamics and their interactions with political and institutional conditions at the national level. On the supply side, a realignment of market incentives and regulations is needed to reorient economic development in tropical developing countries in order to reconcile food and energy provision with forest conservation, along with policy actions on the demand side.