Carbon trading not a viable option for climate financing – GFC Rep
─ Guyana/Norway Agreement pays for avoided deforestation
─ Private trading markets only pay for reduced emissions
─ Guyana is a unique country possessing high forest cover, low deforestation rate
DPI Guyana, Friday, August 3, 2018
An outstanding feature of the Guyana/Norway Forest Agreement is the fact that it is not built on emissions reductions but on avoided deforestation says Head of Planning and Development at the Guyana Forestry Commission (GFC), Pradeepa Bholanath.
Bholanath was today addressing the Parliamentary Sectoral Committee on Foreign Relations. In response to a question posed by Committee Chair, Gail Teixeira, Bholanath intimated that Guyana is unlikely to benefit from carbon trading.
Teixeira was referring to the country’s National Determined Contribution (NDC), which states that “Guyana does not see viable opportunity in carbon trading markets.”
Carbon trading refers to the exchange of credits between nations designed to reduce emissions of carbon dioxide. It originated with the 1997 Kyoto Protocol, with the objective of reducing carbon emissions and mitigating climate change and future global warming.
She explained that in 2009, when negotiations began with Norway, the main advantage presented was payment for avoided deforestation.
The existing regional and international carbon markets, the Planning and Development Head, noted are paying for emission reductions.
“For a country with high forest cover and low deforestation rate, it really meant that unless we began to rapidly deforest…it really would be a non-starter for us to target those markets when we do not have a substantial amount to reduce,” she pointed out.
In the Guyana/Norway Agreement, that country only pays Guyana 80 percent of what is earned, Bholanath said this was intended to encourage other countries to sign onto the agreement.
The GFC representative said over the past seven years, following the signing of the agreement, there have not been a lot of markets willing to buy avoided deforestation credits.
It was emphasised that “unless we really change our policy dynamics and actually tremendously ramp up deforestation rates we will never really be able to actively and in a substantive way participate in those markets.”
Reference was made to efforts by the International platform to provide incentives for countries such as Guyana, which has a high forest cover with a low deforestation rate, such as the creation of the Green Climate Fund (GCF), “because the private markets were really not interested.”
The GFC representative, further noted that unless our forest landscape changes dramatically to being a high deforestation rate country or the private trading market changes, carbon trading cannot be counted on as a source of climate financing.
Image: Karime Peters