Financial tools like carbon credits do not keep their promises

Financial tools like carbon credits do not keep their promises
Financial tools like carbon credits do not keep their promises

Carbon credits, anti-deforestation certificates… The financial instruments created to protect forests so that they absorb more CO2 have not really helped preserve these ecosystems and the populations who live there, according to a study published Monday .

This report, coordinated by the International Union of Forestry Research Organizations (IUFRO) which synthesizes more than 10 years of research, is presented at the 19th UN Forum for Forests which opened on Monday.

Forest protection projects based on market mechanisms have only made “limited” progress in stopping deforestation and have sometimes reinforced economic inequalities, says IUFRO, which brings together 15,000 scientists from 120 countries.

The authors of the report recommend “radically rethinking” these instruments which are nevertheless multiplying, presented as effective means of combating deforestation, limiting global warming and improving the living conditions of local populations.

Projects to protect forests from deforestation or improve their management so that they absorb more CO2 are often carried out in developing countries, with the risk that local populations will be exploited or driven from their land while part of the income thus generated is supposed to return to them.
For each additional ton of CO2 absorbed by a forest thanks to a project, a company can purchase a carbon credit allowing it to offset its emissions.

“The win-win scenario, or even triple win with benefits for the environment, the economy and populations, is not found on the ground,” explains Maria Brockhaus, researcher at the University of Helsinki who contributed to the report .

“On the contrary, in certain cases, poverty and deforestation persist (…) where financial instruments are sometimes the only measures put in place for decades,” she told AFP.
Since the last IUFRO evaluation in 2010, the organization has noted a multiplication of these financial tools, “with actors often more interested in short-term profits than in fair and sustainable management of forests”.

According to lead author Constance McDermott, a researcher at the University of Oxford, not all projects are bad “but overall it’s hard to say it’s a resounding success.”

A $120 million project intended to prevent deforestation in the Democratic Republic of Congo, for example, “reinforced already established interests” by restricting people’s access to the forest without worrying about logging by powerful local companies.

In Malaysia, a foreign-funded plantation company promised indigenous communities better living conditions in exchange for rights to their land, but these communities ultimately received no benefits, according to the report.
“The winnings are often cashed elsewhere,” adds Maria Brockhaus.

In Ghana, deforestation rates have increased despite the establishment of rules on sustainable cocoa production and carbon credit projects, while local producers earn less than a few decades ago, says Constance McDermott.

Despite repeated scandals revealing the ineffectiveness of carbon credits linked to forest protection, these tools are still considered a market of the future, which could increase from two billion dollars per year to several hundred by 2050.

Market players have proposed methodological improvements to try to measure the integrity of the credits they sell but, for many researchers, the guarantees of population protection are not sufficient.

The Paris agreement provides for the entry of States into this contested market but the rules of the mechanism which will allow them to exchange carbon credits have not yet been defined.

The UN body responsible for supervising this future mechanism, however, announced on Friday the establishment of a new procedure allowing populations living in territories affected by these future carbon credits to file appeals if they consider themselves wronged by them. .

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