COP27 leaders aim to slow global deforestation through sovereign carbon credits

A gloomy forecast hung over rainforest lands in the waning days of the COP27 climate conference. But sunshine came out when the Democratic Republic of Congo’s Deputy Prime Minister Eve Bazaiba arrived – a real “badass” who brought together African and South American countries to raise awareness of forests and peatlands.

Her hard work helped put rainforest countries on a de facto fast track to attracting private finance, making it easier for companies to support national efforts to slow deforestation through “sovereign” carbon credits. Because those credits are issued by federal governments under the Paris Agreement, they will drive up the price and raise more money for forest conservation and infrastructure improvements.

“The scientists have clearly told us that the solution to climate change is to preserve the rainforests and the peatlands,” Ms. Bazaiba said at a roundtable with rainforest representatives three days before the end of the conference. “Those elements are essential to save the planet – to save the island nations and a country like ours, Congo. It is important for us to have a common voice and speak loudly. We are the owner and custodian of these forests.”

The Congo Basin is the lungs of the earth – nature’s way of cleaning the atmosphere. If the rainforests are not maintained, the tipping point will come soon and there will be huge consequences. Corporate finance is critical to raising funds to stop illegal logging and create jobs.

But the Democratic Republic of Congo is also part of the Coalition for Rainforest Nations – an intergovernmental organization with more than 50 other rainforest countries. So the Deputy Prime Minister cares deeply about the Global South. To this end, developing countries have fought to include the REDD+ mechanism in the final agreement. Under that plan, governments are held accountable for their forest lands and set targets to halt deforestation. The United Nations Framework Convention on Climate Change reviews those progress before approving their performance and emission reductions.

During the roundtable, Ms. Bazaiba wanted to know where each delegate was coming from – the interpersonal touch needed to win over decision makers. She also persuaded Brazil and Indonesia to support her efforts.

“The plan finally ends years of misinformation that UNFCCC REDD+ was not for businesses or carbon markets. The private sector has always been welcome to support the efforts of rainforest countries. REDD+ sovereign carbon credits are of the highest environmental integrity and include some of the most incredible biodiversity in the world,” said Kevin Conrad, executive director of the Coalition for Rainforest Nations.

Sun Shines On Rainforests

The goal is to halve greenhouse gas emissions by 2030 to limit temperature rise to 1.5 degrees Celsius
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. Failure to do so will mean more extreme weather events and costly economic consequences. The temperature rise is now almost 1.2 degrees. If we do nothing to reduce emissions, it will take less than a decade to reach the 1.5 degree mark, says the Global Carbon Budget report.

In November, the UNFCCC approved the West African country of Gabon for 90 million tonnes of emissions reductions to slow deforestation between 2010 and 2018. up to 90,000.

Honduras and Belize follow Gabon. They will soon issue 5.6 million and 7.7 million tonnes in loans respectively. Papua New Guinea will do the same in 2023 by issuing 90 million tonnes of sovereign carbon credits.

Lee White, Gabon’s Minister of Water, Forests, Marine and Environment, shared his experience going through the UNFCCC REDD+ audit process, which he characterized as exhaustive and required multiple reviews and changes. He compared it to that of Norway – one of the few countries that invests directly in the rainforests. Norway paid Gabon $70 million to preserve its forests.

“I would say Norway’s was five times less intense, five times less thorough than the UNFCCC audit,” says White.

And it’s an important shift to get Brazil to support the rainforest. Lula da Silva takes over the presidency in January after ousting the incumbent, Jair Bolsanaro, who took office in 2019. Between 2010 and 2018, deforestation escalated, releasing 1 billion tons more CO2 into the atmosphere than the trees absorbed. Much of that can be attributed to wildfires and deforestation to make agriculture possible, according to Brazil’s National Institute for Space Research.

A star is reborn

But Lula will prioritize the environment. He came to COP27 with all the fanfare of a modern rock staremphasizing the need to preserve the Amazon
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rainforests and setting a goal of zero deforestation by 2030. “Brazil is back,” he told a packed room to a packed room.

“The threat to the Amazon rainforest is a combination of climate change and human impact, slash and burn and agriculture. The more you shred the forest, the more vulnerable it becomes to climate change and efficient controls. If it is not stopped, we can expect more warming,” said Richard Betts, a scientist at Britain’s Met Office Hadley Centre, in a conversation with this writer.

“Can Amazon deforestation be curbed? We are not yet past the point of no return. The forest helps maintain the local climate. The forest creates a wet climate,” says Betts. “The countries that emit the least are already the hottest and suffering the worst droughts. They have more extreme climates, which endanger human health.”

Alphabet, Disney, General Motors
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Honeywell and Unilever
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are among the top buyers of carbon credits.

Economic justice is urgently needed – to give rainforest nations the funding they need to protect their trees and switch to greener fuels. For Gabon, revenue from the sale of sovereign carbon credits will go towards forest conservation, paying down government debt and supporting the transition to a sustainable economy.

Belize will use the revenues from carbon credits for conservation, restoration and climate adaptation – or to adapt to economic and social changes due to warming. The proceeds are shared with traditional environmental managers and for national development. Honduras will allocate money for making furniture and floors. It will also build agroforestry businesses while also planting trees to restore the forest. Ecotourism will eventually become a business.

Of every ton of CO2 emitted, half remains in the atmosphere, while the forests or oceans store the other half. As dependence on oil continues, forest-based solutions are more valuable. The aim is therefore to manage the land and stop deforestation. As such, forests absorb 7.6 billion tons annually. But according to the UNFCCC, we need to reduce carbon emissions by 500 billion tons by 2050.

“The voice of the South has been heard,” said Simo Kilepa, Minister of Environment, Nature Conservation and Climate Change for Papua New Guinea.

The Deputy Prime Minister of the Democratic Republic of Congo, Eve Bazaiba, deserves many thanks. More than anyone else, she outlined the importation of forests and peatlands, paving the way for rainforest countries to get the private funding they need to slow deforestation. Gabon, Belize and Honduras are the first to sell sovereign credits, which could have a cascading effect if they are fruitful. Nature now indeed has value and offers developing countries a potential economic blow.

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