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23 Oct 06
Carbon trade 'to save' rainforest
Yahoo News 23 Oct 06
Global forests disappearing for a pittance: World Bank
WASHINGTON (AFP) - Global warming caused by rapid deforestation could be curbed if developing countries were paid the proper rewards for maintaining their woodland, a World Bank study said.
The report noted that the world's forests are disappearing at a rate of five percent a decade as woodland is cleared for timber and production of in-demand commodities like beef, coffee and soybeans.
But the land would have far more value if the forests were preserved and developing countries were then rewarded on global carbon markets.
Such markets are an offshoot of the Kyoto agreement against global warming, letting countries that struggle to meet targets for industrial emissions of carbon dioxide (CO2) pay other countries that keep their own emissions down.
About a fifth of global CO2 emissions come from tropical deforestation but these have not been harnessed into carbon markets such as the European Union's Emissions Trading Scheme, the report said.
It said that in Latin America, dense jungle is often cleared to create pastures worth as little as 300 dollars a hectare while releasing 500 tonnes of CO2 per hectare. This implies a "CO2 abatement cost" of less than one dollar a tonne.
The report said it was believed that tackling climate change requires paying about three dollars a tonne for CO2 abatement, while EU members are currently paying up to 20 dollars a tonne.
"In other words, deforesters are destroying a carbon storage asset theoretically worth 1,500-10,000 dollars to create a pasture worth 200-500 dollars per hectare," the World Bank said.
"Yet carbon markets, such as those under the Kyoto Protocol and EU Emissions Trading Scheme, do not reward forestholders for reduced emissions from avoided deforestation."
But such rewards would require a "global commitment" against climate change, the report said, while the United States and Australia have refused to ratify the Kyoto pact in its current guise.
"Global carbon finance can be a powerful incentive to stop deforestation," said the World Bank's chief economist, Francois Bourguignon. "Compensation for avoiding deforestation could help developing countries to improve forest governance and boost rural incomes, while helping the world at large to mitigate climate change more vigorously," he said.
The report noted also that global concern about the loss of rare species should be harnessed to compensate countries for not chopping down their forests.
In the Kerinci-Seblat National Park, on the Indonesian island of Sumatra, "avarice and opportunity" threaten an area containing 4,000 plant species and three percent of the Earth's mammal species -- including threatened ones such as the clouded leopard and small Sumatran rhinoceros.
Properly regulated logging in such places would give locals a stake in keeping their forests managed, to ensure a long-term income from timber, the report said.
BBC 23 Oct 06
Carbon trade 'to save' rainforest
Carbon trading can be used to protect endangered rainforests by compensating nations that avoid deforestation, the World Bank has said. It has suggested that industrial states offset their carbon emissions by funding projects designed to reduce deforestation in developing countries.
The World Bank report said 5% of the world's rainforest is lost each decade. The forest was more valuable if left to store carbon dioxide emissions than if cleared for pasture, it argued.
Carbon markets According to the World Bank, deforestation contributes to 20% of global carbon dioxide emissions.
Deforested land that is worth $200-500 as pasture could be worth $1,500-$10,000 if left as forest and used to offset - or trade against - carbon emissions in the industrial world. Carbon trading is a market mechanism intended to tackle global warming.
The most important greenhouse gas contributing to global warming is carbon dioxide (CO2), which is mainly emitted by burning fossil fuels. The key idea behind carbon trading is that, from the planet's point of view, where carbon dioxide comes from is far less important than total amounts.
Its proponents argue that trading the right to emit CO2 allows firms and nations to decide whether they should spend money on cutting pollution or on buying the right to pollute by paying someone else to cut back.
"Global carbon finance can be a powerful incentive to stop deforestation," said World Bank economist Francois Bourguignon. "Compensation for avoiding deforestation could help developing countries to improve forest governance and boost rural incomes, while helping the world at large to mitigate climate change more vigorously."
At the moment, carbon trading markets like that run by European Union members offer no reward to forest owners for cutting emissions by simply leaving trees where they are.
But if developing nations could tap this income, they could use the money to preserve the environmental benefits of forests and stimulate more productive agriculture on poor quality land.
The World Bank is one of the main players in carbon financing, and estimates the value of carbon traded in 2005 to be about $10bn. It believes the carbon market has the potential to bring more than $25bn (£14bn) in new financing for sustainable development to the poorest countries and the developing world.
Related articles on Global issues: Climate change and Forests
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