Is Guyana’s forest really worth US$580 million annually?

Nov 19, 2009 News

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…Independent reviews cites serious concerns about value of Guyana’s forests

 

An independent review of the consultation process of the Low Carbon Development Strategy (LCDS) has cited serious concerns about whether Guyana’s forest is really worth US$580 million annually.

This was the figure that was cited by the world renowned McKinsey and Company in the LCDS and which President Bharrat Jagdeo presented to the country when he launched a national consultation process in December, 2008.

“While the central premise of payments to Guyana for the environmental services it contributes to the world community was accepted by most, there were serious concerns over the veracity of the US$ 580 million figure that had been calculated by McKinsey and Company…,” an independent review commissioned by the governments of Guyana and Norway found.

The review was carried out by the International Institute for Environment and Development (IIED) through an independent monitoring team comprising Guyanese activists Vanda Radzik and Jocelyn Dow, and the IIED’s Duncan Macqueen.

The LCDS is Guyana’s position leading up to the United Nations Climate Change talks in Copenhagen. The LCDS argues that Guyana should be paid for keeping its forest standing and this would contribute to global efforts to prevent further global warming. The payment could come from rich countries under a mechanism that provides incentives for reducing deforestation and degradation (REDD).

According to the LCDS, Guyana could earn as much as US$580 million if it were to cut down the forests to engage in economic activities such as logging, mining and agriculture.

It was felt that the reports on which such figures rested (e.g. from Guyana Lands and Surveys Commission) should be made publically available and reviewed,” the report states.

According to the report, the point was made that should these Guyanese projections about the value of the forests, based on 0.4 per cent of the world’s forests, be extrapolated globally, the challenge to their materialising becomes apparent.

The report noted that some Amerindian communities had made calculations based on their percentage of national forests and were consequently questioning (perhaps tongue in cheek) when their annual US$ 800,000 would appear.

“To avoid unrealistic expectations, contributors called for information on what it would actually cost for performance based measures to conserve the forest in the face of real development threats,” the report stated.

This would avoid any tendency of the LCDS to undermine young Guyanese sense of responsibility, for example which one contributor called a ‘sit back and relax and watch the money roll in’ plan, the report stated.

Another commentator noted that this was already contemplated within the LCDS through performance base Monitoring, Reporting and Verification.

The report notes that some contributors cautioned that the evolving negotiations in Copenhagen were unlikely to see the release of funds to Guyana on the scale anticipated by the McKinsey report. Others took issue with the way in which carbon markets might be perceived to undermine sovereignty and privatise environmental services.

Some contributors noted another specific area where a small change in language could greatly enhance the ‘feel’ of the document was the removal of the term ‘economically rational’ deforestation – several contributors felt this language was counterproductive to national interests.

In particular the point was made that Amerindian communities had been conserving their environment for generations, and should be recognised as such – not associated with any ‘economically rational deforestation.

Questions were raised about exactly what conditions might be imposed on Guyana that would have to be fulfilled for money to flow, and the report noted that greater clarity on the conditions against which payments would be made is needed.

Early this year, President Jagdeo, and the Prime Minister of Norway, Mr. Jens

Stoltenberg issued a Joint Statement on cooperation on climate and forest issues.

The two countries agreed to work to ensure the establishment of a REDD mechanism under the United Nations Framework Convention on Climate Change.

The Government of Guyana has proposed to reduce emissions from deforestation and forest degradation (REDD) globally as an essential component of a new development path for Guyana.

As part of the partnership between Norway and Guyana on REDD, President Jagdeo suggested that a small team of experts consisting of two national (Guyanese) experts and one international expert (team leader) be engaged to advise the Governments of Guyana and Norway on Guyana’s multistakeholder consultation processes.

It was the national and local dissemination and preliminary stakeholder consultations to review the LCDS draft document that IIED tracked and monitored over the June – September 2009 period.

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