The urgent need for action

The importance of rainforests

The world's rainforests are being lost at an alarming rate. This is largely due to destructive logging activity and the clearing of land for large-scale farming - both of which offer attractive financial returns. But deforestation threatens the many vital ecosystem benefits that these forests provide.

Rainforests benefit everyone, everywhere - not just people in the nations in which they are found. They store water, regulate rainfall and are home to over half of the planet's biodiversity. But most importantly, they absorb and store carbon dioxide (CO2). So they play a critical role in helping to limit the amount of fossil fuel emissions (greenhouse gases) that build up in our atmosphere every year. To make matters worse, when they are cut down and burned they release more emissions than the global transport sector

It is these emissions that are causing global warming. In simple terms, if we didn't have any rainforests to absorb CO2, the temperature of the earth would rise. And so would sea levels. And that is very bad news for all of us.

Climate change is already happening. We can all see it all around us - the unexpected weather patterns, the flooding, even plants flowering earlier than usual. We can't reverse it, but we might be able to stop it or maybe even just slow it down...

It is clear that there is an urgent need for action to stop tropical deforestation.

The world's rainforests are vitally important to all of us. It we don't take emergency action to protect them, it may be impossible for us to stabilise the effects of climate change.

Existing initiatives to tackle tropical deforestation

There has long been support for the idea that the international community should work with the governments of rainforest nations to slow or stop the destruction of tropical rainforests.

However, previous initiatives have lacked appropriate funding and have been unable to generate the necessary political desire to tackle the issues involved. This lack of progress is clearly demonstrated by the huge areas of the world's rainforests that have been cleared over the past 30 years.

The growing importance of climate change has made everyone realise that a new approach is needed.

A number of funds and ideas about how those pots of money could be best put to work have been proposed by the World Bank, Norway, Japan, Germany, the United Kingdom, Australia, the European Commission, Brazil and Guyana. These initiatives are either focused on, or include, substantial programmes for tropical rainforests - and they represent real progress. Nonetheless, even together, they will not provide enough funding to fully address all the drivers of deforestation.

Future UNFCCC plans around REDD

Countries are currently negotiating a replacement agreement for the Kyoto Protocol - which covers commitments up to 2012 - under the United Nations Framework Convention on Climate Change (UNFCCC).

It is widely expected that the next agreement will include initiatives that promote action to reduce carbon emissions from deforestation - this activity is known as Reducing Emissions from Deforestation and Degradation (REDD).

Linking carbon emissions from deforestation to global compliance agreements is likely to help to generate large-scale financing for the protection of rainforests. However, there is great uncertainty about how REDD would be funded - and how much of this funding rainforest nations might receive. This will be worked out through negotiation over the next two years.

Even if REDD is included within a 2012 agreement, it will probably take many years to roll out fully. Most experts believe that it could be 5-10 years before significant funds start to flow into rainforest nations under a REDD initiative.

Therefore, some sort of temporary or emergency activity is required to rapidly reduce deforestation in the short term.

If we don't take this action, we could lose another 100 million hectares of tropical forests over the next 10 years - that's an area the size of Egypt.

The economic rationale for reducing deforestation

The rewards for protecting the world's rainforests are potentially huge. If we were to lose those rainforests and all the ecosystem benefits that they bring us, a study by TEEB puts the annual cost to the world (at current rates of deforestation) at between US$2 trillion and US$5 trillion per year [1]. Another influential publication, The Eliasch Review, estimates that the benefits of halving deforestation - and thereby lessening global warming - could amount to US$3.7 trillion (in net present value terms) [2].

Certainly, tackling deforestation represents one of the most affordable ways to reduce carbon emissions currently available. In the Stern Review, it is estimated that the costs of reducing greenhouse gas emissions to achieve climate stability would be around 1% of global GDP - or US$650 billion per year [3]. Considering that tropical deforestation accounts for about 17% of all annual global greenhouse gas emissions, this would imply that over US$100 billion could be channelled into this sector each year. But in practice, the funding needs of an initiative that significantly reduces tropical deforestation could be much lower - perhaps only US$10-15 billion per year. Put like that, it represents very good value.

These are obviously very big figures. But this is a very big problem. And one that the whole world needs to address - urgently.

Rainforests cool the planet, provide oxygen, regulate the water cycle, absorb a significant proportion of the carbon emissions we produce, provide a home to countless species, and provide complex and invaluable ecosystem benefits for all of us. It is right and essential that the world pays for these services.

For more details, and to download the PRP report on the economic rationale for reducing deforestation, click here [PDF 2.3MB]

Sources

1 TEEB, ‘The economics of ecosystems and biodiversity' (2008)
2 Eliasch Review (2008), Ch. 5
3 Stern, N., ‘The Stern review on the economics of climate change', CUP (2006)