In this post, I interviewed prof. Ole Hofstad from Norwegian University of Life Sciences (NMBU). We discuss issues such as degradation of REDD Program, hopes for its future or illegal logging issues. The interview will be published in three parts. The I Part of the interview is focusing on REDD in general, PES and Norwegian experience with REDD. Enjoy!  

The idea behind REDD Programme

Rafal Chudy:
– First, thank you, professor, for accepting the invitation. On behalf of Forest Monitor readers’ many thanks for sharing your knowledge and experience.
– What was the original idea of REDD, and how it works in practice?

Prof. Ole Hofstad:
    – Well, I think that the original idea behind REDD policy was to establish a marketplace for reduced GHG emissions where poor people could act as producers and sellers rather than recipients of development aid. Unfortunately, these good intentions have not materialized. As one says the road to hell is paved with good intentions. REDD was also paved with good intentions. Now, REDD seems to have degraded to a system of national bi-lateral negotiations between bureaucrats and (corrupt) politicians at the higher level, and traditional development assistance plantation projects at the local level.

– What was your first reaction when you heard about REDD Programme?

    – When the concept of payment for environmental services was introduced more than 10 years ago, my first reaction was enthusiastically optimistic. I realized that finally, someone had come up with a way in which rich people could pay poor ones for highly valued services instead of distributing donations and development assistance. I was inspired that the poor would have a chance to produce and sell instead of acting like beggars.

Mission of REDD in Norway

– Norway is a significant contributor in the REDD Programme. Was the mission of REDD clear from the beginning in Norway and what was the approach concerning REDD payments?

    – In my first interactions with the Norwegian Ministry of Foreign Affairs right after the Bali Conference in 2007, bureaucrats were very clear on limiting REDD payments to reduced deforestation and degradation , and that reforestation or afforestation would not be considered. Already at that time, the Ministry put much emphasis on the co-benefits of REDD, e.g. protection of biodiversity and poverty reduction. Later REDD initiatives have been criticized for weakening the rights of indigenous people.

– What can be the consequences behind tree planting in developing countries, in terms of people’s livelihood conditions?

    – Seen in the market context, it is not likely that tree planting as part of REDD+ projects will improve rural livelihoods considerably. Moreover, financing institutions and project organizers are not likely to pay CO2 prices that will make tree planting immensely profitable.

Norwegian experience on REDD

– Could you tell more about Norwegian experience on REDD?

    – When Arild Angelsen and others prepared a report on REDD to the Norwegian government in 2009, they realized that implementing a functioning payments for ecosystem services (PES) system based on conditionality in the major deforesting regions of the South would not be possible. They came up with the idea of a three-phase approach to REDD.

Phase 1 would include initial support allowing countries to develop strategy, strengthening institutions, and start demonstration activities.

Phase 2 would be financed by funds, and payments would be output-based, but performance would not necessarily be monitored only based on emissions against reference levels.

Phase 3 would be financed by rewarding performance on the basis of quantified forest emissions and removals against agreed reference levels.

The authors envisaged Phase 1 to start in 2010, Phase 2 the year after in some countries, and Phase 3 from 2016 onwards. They assumed also that there would be a COP commitment to Phase 2 in Copenhagen December 2009.

We now know that this did not happen, and that the Amazon Fund is the only funding mechanism that works according to the ideas of Phase 3. Most REDD+ activities can still be characterized as part of Phase 1.

– Why has the process collapsed? What were the main reasons?

    – Establishing a payment mechanism is a major challenge for the REDD strategies of states with less sophisticated monitoring capacity than Brazil. It requires detailed information about changes in the carbon stock of forests, appropriate incentives given to decision makers to undertake activities that reduce deforestation and degradation , and that the flow of information and incentives are embedded within a set of effective institutions to ensure good governance.

Amazon Fund

– What was the approach of Norway concerning Amazon Fund and its practical operation?

    – Norwegian politicians, from Erik Solheim (Socialist Left Party) in 2008 to Vidar Helgesen (Conservative Party) in 2015, have persistently argued that since Norwegian financing of the Amazon Fund is strictly conditional, it has also been a causal factor of reduced deforestation in the Brazilian Amazon. Norwegian insistence on conditionality has been a driver behind the success of reduced deforestation in Brazil – they say.

– Do you agree that this was an important reason behind reduction of deforestation and degradation in Amazon?

    – I have argued that reduced deforestation in the Amazon started already around 2005 during Marina Silva’s period as minister of environment in Brazil. Furthermore, transfer of Norwegian funds was very limited until 2012 because the Brazilian Development Bank (BNDES) did not find good projects of forest protection ready for implementation. My thinking is that deforestation in the Amazon would have been reduced irrespective of Norwegian financing. Norwegian contributions are not a cause of reduced deforestation in the Amazon, but a remuneration for something that happened due to internal political developments in Brazil. Seymour and Birdsall in 2014 argued in their article entitled “Do trees grow on money. The problem of attribution” that the promise of Norwegian contributions had a significant impact on that process. I doubt it.

Optimal level of deforestation

– While I was at one of your lectures, you were telling students about “optimal level of deforestation”. In addition, you mentioned that “even illegal products provide significant value for economy”. Could you tell us more, what do you mean by these two statements?

    – If you carry out a cost-benefit analysis of land use in a country, you will find that there are both costs and benefits of natural forests as well as cropland, grazing areas, and plantations (oil palms, rubber, eucalyptus, etc.). At one point, the marginal benefits of different land uses become equal. This equilibrium is dynamic, so the government should be wise and forward looking, but I think some countries will find that it is still reasonable to deforest further even if you include the cost of greenhouse gas emission.

Illegal logging is not synonymous to environmentally harmful logging. It depends on the law of each state. Illegal logging brings products to the market that many consumers value. They are produced with a number of additional avoidance costs (bribes included). There may be serious external costs also, of course, but not always. Many weak states in the South have silently decided that strict control of illegal harvest of low value products like firewood and charcoal from state owned woodlands costs more than it tastes.

Payments for environmental services

– Could you tell us more about payments for environmental services (PES)? How does it work?

    – Payments for environmental services are incentives offered to farmers or landowners in exchange for managing their land to provide some sort of ecological service. A PES scheme is a voluntary, conditional agreement between a “seller” and a “buyer” over a well-defined environmental service. These programmes, or schemes, promote the conservation of natural resources in the marketplace. I think this definition captures the essence of PES as it was originally understood.

– What is the meaning of conditional agreement? Is it so important?

    – To me the phrase conditional payment is pivotal. Additional services such as carbon sequestration or storage should be paid for when delivered just as we pay for coffee when we leave the store or load it on to the truck at farm gate. One may discuss practical ways of measuring carbon sequestration, e.g. number of hectares planted, number of tonnes biomass accumulated, or net change of carbon stock during a certain period, but payment should be conditional on some quantified service delivery. Unfortunately, the way many REDD+ projects are implemented in East-Africa these days seems to involve little conditionality.

Degradation of projects in East Africa

– Do you mean that projects in East Africa are big failures?

– My impression is that most REDD+ projects in East Africa are designed as interventions in rural communities with tree planting as a major activity. Improving people’s livelihoods is an important objective. I am tempted to put forward two critical questions:

• Why is the focus on rural communities, while urban people consume most charcoal and timber, and
• Why are most projects engaged in tree planting, while the major problem is GHG emissions from deforestation and forest degradation ?

END OF PART I

Ole Hofstad.

Professor Ole Hofstad was born 19.03.1949 in Trondheim, Norway. In 1973 he finished his Msc. studies in Forest Economics at the Agricultural University of Norway (AUN). The same year he was employed as research assistant at the Department of Forest Economics at AUN. He successfully defended his Dr. scient thesis in Forest Economics at the same department in 1977. The title of his thesis was “Conflicts in multiple-use forestry”.

Subsequently Hofstad spent two years in Morogoro, Tanzania as lecturer at the University of Dar es Salaam (later Sokoine University of Agriculture) and one year as lecturer at the Department of Forest Mensuration and Management, AUN. From 1980 he was employed for two years as director of planning for MADEMO (Post-independence state forest enterprise) in Mozambique. In the period 1982- 989 he was lecturer and associate professor (from 1985) at the Department of Forest Mensuration and Management, AUN. He was elected as Head of Department for 1988 and 1989.

After the merger of all forestry departments at AUN in 1990 he was elected as the first Head at the Department of Forest Sciences, AUN. From 1991 to 1993 he was on leave from the department and spent two years as Woodland Management Advisor to Zimbabwe Forestry Commission on contract with the Danish Ministry of Foreign Affairs. Hofstad was appointed as professor at the Department of Forest Sciences in 1993, and was later elected as Head of Department for two three-year periods (1996-1998 and 2000-2002). In 2002-2003 he spent his sabbatical at College of Natural Resources, University of California at Berkeley. Since 2003 he has been professor at the Department of Ecology and Natural Resource Management, Norwegian University of Life Sciences.

Photos credit: Ole Hofstad