The World Bank Forest Carbon Partnership Facility: REDDy or not, here it comes!
At the October 20-22, 2008 meeting of the World Bank’s Forest Carbon Partnership Facility (FCPF) in Washington DC, the facility’s board approved funding for an additional ten countries to develop plans for reducing emissions from deforestation and degradation (REDD). This newest round of approvals, which included Cameroon and the Republic of Congo among others from Africa, Latin America and the Asia-Pacific region, brings the total number of countries that have access to the Bank’s fund to 25 – ten of them in Africa. But while the governments of forested countries scramble to get at this fresh pot of REDD funds, many outstanding questions remain about who decides who gets the money, how the decisions are made, what the funds will pay for, and who stands to gain.
Few object to the notion of public funding for “REDD-readiness” activities; indeed, most agree that focusing on improving forest governance, strengthening the land tenure regimes, legal, technical and regulatory frameworks that need to be in place in order for lasting forest protection to be possible, is precisely what must be done first, before any financial mechanism for REDD can operate effectively. However, many are concerned about the World Bank’s control of the FCPF, given the institution’s poor track record in the forest sector, its catalytic role in the expansion of the carbon market, and the extent to which the fund is dominated by narrow government, logging industry and conservationist interests.
What is the FCPF?
The World Bank’s Forest Carbon Partnership Facility (FCPF) is a two-tiered fund, comprised of a “Readiness Mechanism”, which provides eligible governments with public grants to support policy and institutional reforms aimed at preparing the country to implement REDD, and a “Carbon Finance Fund”, which will link “REDDy” countries with payments for the purchase of their avoided greenhouse gas emissions. Formally launched in Bali last year at the 13th Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change (UNFCCC), the FCPF aims to kick-start countries’ efforts to “combat tropical deforestation and climate change” by helping them to acquire the technical, regulatory and policy tools necessary to keep forests standing and to document and eventually sell the emissions savings from doing so.
The FCPF’s orientation toward the carbon market leaves little doubt about the fund’s origins; despite being about forest protection, the FCPF is clearly a product of the Bank’s carbon finance unit, not its forestry or environment departments.
Even before its formal launch, the FCPF came under criticism from civil society organizations concerned about its design and objectives, as well as the lack of transparency or accountability in operation and governance structures. Many of the concerns raised by NGOs and indigenous peoples last year have been borne out in recent months. In particular, the lack of transparency and limited participation of forest-dependent communities, either in the preparation of countries’ applications for funds or in their review and approval, has meant that outsiders have heavily influenced country proposals, and that local communities’ rights and interests have been prejudiced.
Since it began operating in June of this year, the facility has attracted applications from more than 40 countries, although it originally set out only to accommodate 20. However, on the basis of new financial commitments from several donor countries at the October meeting, the size of the FCPF “Readiness Mechanism” was increased from $100m to $150m. Japan doubled its contribution from $5m to $10m, Norway increased its participation by an additional $1 million, and Switzerland committed approximately $800,000. It is not yet known who will cover the remainder of the Fund’s projected $50m growth. The expanded Readiness Mechanism will enable the FCPF to accommodate 30 participant countries, and will increase the average size of the so-called “readiness grant” from $2m to $3.6m.
Another key decision taken at the October meeting in Washington was the creation of a $1m “Capacity Building Program” for forest-dependent indigenous peoples and other forest dwellers. The ‘small grants’ program, which will provide up to $200,000 each year for five years, is supposed to support indigenous peoples’ engagement in the facility. While the dedicated support for indigenous peoples’ participation in the readiness process is welcome, it is not known precisely how the money will be distributed or whether it guarantees that indigenous peoples will have any greater decision-making role in the operations and oversight of the facility.
Empty evaluation: What good are criteria if they are not applied?
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