The context for discussions on these three aspects of the negotiations is the increasing urgency of creating global political will to address climate change and to agree an international course of action at Copenhagen in 2009. The US has been seen as the major block to negotiations, by refusing to commit to greenhouse gas (GHG) emissions reduction targets, before major GHG emitters of the developing world such as China and India make their own commitments. The international sense of frustration evident at Bali, has been lightened by the hope that whoever replaces George Bush in the White House later this year will adopt a less recalcitrant position. All are agreed that the task of agreeing an effective post-Kyoto agreement is a huge one.
While drastic reductions in deforestation rates are desperately needed in countries like Indonesia, there is concern that REDD1 schemes could prioritise conservation over poverty reduction, strengthen state control over forests and further marginalise forest dependent communities, including indigenous peoples.
There is further concern that where REDD schemes are financed by institutions controlled by developed countries (such as the World Bank), or the private sector (through carbon markets) they will serve the interests of those countries and companies, rather than the people who live in and rely on the forests for their livelihoods.
Following the Bali summit, a spokesperson for a UK carbon trading investment bank, Climate Change Capital, predicted that setting binding emissions targets would create 'a very substantial market opportunity.' He said we would then see "the power of private money working for a moral purpose".2 But how far can the private sector be trusted? Past experience shows that mixing profits and morality is not so easy in practice, especially where people's land, resources and livelihoods are at stake. Companies are generally more interested in short-term profits than long-term climate change.
Such schemes could worsen poverty and violate rights to land and resources where local communities and indigenous peoples' rights have weak or non-existent status under national laws, as in Indonesia. A Bali statement signed by civil society organisations from North and South highlighted the potential social impacts for the 1.6 billion people who depend on forests for their home and living. Carbon financing means that "wealthy companies and countries are able to buy the right to continue to pollute", said the statement, "whilst poor communities often find themselves locked into unfavourable, long-term commercial contracts".3
Yet another concern with REDD is that focusing on avoided deforestation may distract attention away from the equally or even more urgent priorities of making deep cuts in developed countries' per capita energy consumption levels (the US is top of the table here), and cuts in overall emissions levels by populous countries such as China and India where recent economic growth combined with sheer size have led to skyrocketing levels of greenhouse gas emissions. The Bali civil society statement warned that carbon trading was 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."4
Moreover, there is nothing to say that carbon trading will actually do the job of reducing emissions. The Kyoto Protocol's Clean Development Mechanism (CDM) has not worked, according to a recent investigation by the US-based Institute for Policy Studies.5
At the Bali summit, indigenous delegates protested against their exclusion from a meeting between UNFCCC Executive Secretary Yvo de Boer and civil society. Protesters wore gags with 'UNFCCC' written on them at a demonstration outside the official negotiations on December 7th.
Indigenous representatives highlighted the lack of scope for participation in the negotiations (in contrast to the Convention on Biodiversity, CBD, for example) and the almost total lack of language on indigenous peoples in UNFCCC documents. "There is no seat or name plate for indigenous peoples in the plenary, nor for the United Nations Permanent Forum on Indigenous Issues, the highest level body in the United Nations that addresses indigenous peoples rights," said Hubertus Samangun, an Indonesian spokesperson for the indigenous delegation at the Bali summit.6
In a statement, which representatives were not permitted to present at COP13's opening session, the International Forum of Indigenous Peoples and Climate Change (IFIPCC) asserted that indigenous peoples had suffered the worst impacts of climate change without having contributed to its creation. It said that they "must not be placed in the position of suffering from mitigation strategies so that over-consumption of industrialised countries can continue."
The statement called for cooperation in a manner that recognises social justice, environmental integrity, indigenous and other human rights and that "creates a climate where greed does not dominate the needs of humanity"
IFIPCC also demanded:
The resources include:
More resources are listed on the Permanent Forum's web-page on climate change: www.un.org/esa/socdev/unpfii/en/climate_change.html
So, while the UNFCCC has been criticised for its slow, non-inclusive decision-making processes, many groups - especially those tracking international financial institutions - would prefer to see it, rather than the World Bank, in charge of climate change funding.
A recent update on this by Third World Network,8 explains how the Bank initially proposed three funds - a Clean Technology Fund (CTF, target size US$5-10 billion); a Forest Investment Fund (US$300-500 million, aimed at REDD programmes) and an Adaptation Pilot Fund (US$300-500 million), along with an umbrella Strategic Climate Fund (SCF) which would act as a vehicle to receive and disburse donor funding towards specific funds and programmes.
Currently, says TWN, the emphasis is on getting the CTF and SCF set up immediately, and the Forest Investment Fund in late 2008 or early 2009. The Adaptation Pilot Fund, renamed the 'Climate Resilience Pilot Programme' will be established as a programme under the SCF. These climate investment funds, which are expected to attract large contributions from developed countries, will channel financing via the various multilateral development banks, including the World Bank Group itself.
Another World Bank creation, the Forest Carbon Partnership Facility (FCPF), which will link to the proposed Forest Investment Fund was launched at the Bali summit (see box, below).
These actions have caused a huge amount of concern among civil society groups who question the Bank's capacity to manage billions of dollars of climate change funding effectively. TWN is concerned that the Bank is setting itself up to be 'a key, if not the key, player in the governance of climate change.' The concerns include the following:
According to TWN, the Bank has responded to some of these criticisms by stressing consistency with the Bali Action Plan Bali article) and by making some revisions to the funds' governance structure to incorporate some developing country participation. Nevertheless, the changes do not resolve the "fundamental contradictions and inherent problems" associated with the design and proposed implementation of the funds. For example, the Bank's Adaptation Fund competes directly with the Adaptation Fund agreed in Bali which has a majority of developing country members (see also previous article).
TWN is calling for efforts to develop a genuinely multilateral fund for climate change financing under the UNFCCC which would give developing countries due representation within the governance structure, ensure that funds are used in accordance with internationally agreed principles and meet the objectives of the multilateral climate change regime.
The controversy surrounding this new World Bank body, launched at Bali in December last year, is where all three strands of the climate change debate discussed above - REDD, indigenous rights and funding - cross over. The FCPF has drawn out arguments over the principles of REDD and carbon financing outlined above, some of the same criticisms directed at Bank involvement in designing and managing climate change funds, and has drawn particular attention from indigenous peoples whose lives may well be negatively affected by projects implemented under its auspices (see also DTE 74).
World Bank's Forest Carbon Partnership Facility under fire
According to the World Bank, the FCPF is designed to 'set the stage for a large-scale system of incentives for reducing emissions from deforestation and forest degradation, providing a fresh sources of financing for the sustainable use of forest resources and biodiversity conservation, for the more than 1.2 billion people who depend to varying degrees on forests for their livelihoods'.10
The facility consists of two schemes - the Readiness Mechanism, to help around 20 developing countries prepare to participate in REDD incentive programmes, and the Carbon Finance Mechanism, which will pilot carbon payments for around five of the successful Readiness Mechanism participants. Each mechanism has its own trust fund, with the Bank acting as trustee for both.
The main priority of the Facility is climate change mitigation, which implies that poverty reduction and human rights protection, including indigenous rights, are secondary. FCPF REDD programmes, says the FCPF brochure, should be designed to "avoid any harm to local people and the environment" and improve livelihoods "where feasible". The Bank says that REDD activities can improve livelihoods for local communities by securing customary property or user rights to their forest land and forest products. However, it makes no mention of upholding indigenous rights or of securing indigenous peoples' free, prior and informed consent (FPIC) as basic requirements.
Indigenous peoples' concerns over the FCPF were voiced at the Bali launch, by UNPFII Chair, Victoria Tauli-Corpuz. She pointed to the negative historical experiences with similar initiatives, the vulnerable position of indigenous peoples despite the adoption of the UN Indigenous Peoples' Declaration, and the poor record of REDD target states like Brazil, Democratic Republic of Congo and Indonesia in preserving forests. "It is, therefore, a moral and legal imperative that indigenous peoples be fully involved in designing, implementing and evaluating initiatives related to REDD."11
Corpuz argued that the success of avoided deforestation efforts hinges primarily on whether indigenous peoples support mechanisms like the FCPF. To get indigenous support, she said, the FCPF and other actors would, among other things, need to:
The UK-based Forest Peoples Programme has published a survey of indigenous views on the FCPF and a briefing on the Facility, which highlight its main shortcomings as well as outlining its development and structure. Both documents point to the abject failure of the World Bank to consult indigenous peoples on the Facility - instead opting for a rushed retroactive consultation this year, prompted by criticisms. These documents can be downloaded from FPP's website at: www.forestpeoples.org/documents/forest_issues/bases/forest_issues.shtml
NGOs NGOs attending the Bali summit called for the FCPF not to be launched, due to serious shortcomings with the Facility, including its flawed governance structure, lack of transparency, the lack of attention to the Bank's poverty mandate and over-reliance on market-based mechanisms to pay for REDD.14
The climate change campaigner for WALHI (Friends of the Earth Indonesia) has since called the FCPF launch 'a little bit absurd'. "People would think that the Bank had a very good proposal both for people and, of course, business. In fact, nobody noticed that the Bank, through its lending and development policies, has been promoting deforestation in tropical countries like Indonesia," wrote Torry Kuswardono, in an article for Bretton Woods Project, entitled 'Whoever loses, the Bank always wins'. He calls the FCPF the Bank's 'new initiative for forest carbon brokerage'.15
A recent report by the Rainforest Foundation UK concludes that "The FCPF could prove to be an extremely expensive and ineffective diversion from the urgent task of stopping tropical deforestation in the short term through known mechanisms". Moreover, its enquiries have revealed the Bank has not conducted any analysis of the likely impacts of 'avoided deforestation' credits on existing carbon markets. Carbon Sunk is available at www.rainforestfoundationuk.org/. See also updates from the Bretton Woods Project, eg www.brettonwoodsproject.org/art-561066.
1 See DTE 74 or DTE's Bali Briefing http://dte.gn.apc.org/BB07.pdf for further background on avoided deforestation.
2 US Pours Cold Water on Bali Optimism, The Guardian 17/Dec/07.
3 Bali Declaration: Protecting the world's forests needs more than just money, 10/Dec/07
4 Bali Declaration: Protecting the world's forests needs more than just money, 10/Dec/07
5 World Bank Climate Profiteer by Jane Redman, Sustainable Energy and Economy Network, IPS, www.ips-dc.org/reports/#292
6 IFIPCC Press statement, 7/Dec/08, www.globaljusticeecology.org/connections.php?ID=81
7 Statement from the Indigenous Peoples Forum in Alter Eco newsletter, December 2008.
8 Celine Tan, Third World Network: 'World Bank's Climate Funds Will Undermine Global Climate Action' 10/Apr/08. See www.twnside.org.sg
9 See DTE's 2004 factsheet on the EIR and web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTOGMC/0,,contentMDK:20605112~menuPK:592071~pagePK:148956~piPK:216618~theSitePK:336930,00.html
10 Forest Carbon Partnership Facility Booklet.
11 Statement on the Announcement of the World Bank Forest Carbon Partnership Facility, by Victoria Tauli-Corpuz, Chair UN Permanent Forum on Indigenous Issues, 11/Dec/07.
12 The United Nations Forum on Forests. www.un.org/esa/forests/index.html
13 Statement by IFIPCC on REDD agenda item at the UNFCCC climate negotiations, Nov 2007
14 NGO Statement on the World Bank's Proposed Forest Carbon Partnership Facility (FCPF) 30 November. Signatories include Down to Earth.
15 Torry Kuswardono, Whoever loses, the Bank always wins, Profits from Indonesia's forests next, Bretton Woods Project, 1/Feb/08 at www.brettonwoodsproject.org/art-560001