92001E2333

WRITTEN QUESTION E-2333/01

by Margrietus van den Berg (PSE) to the Commission

(31 July 2001)

Subject: Implementation of the Clean Development Mechanism and deforestation in the Amazon

The Clean Development Mechanism (CDM) under the Kyoto Protocol offers scope for forest management projects because of forests' carbon sink potential. The scope of application of the CDM is currently still under discussion. The prevention of deforestation by means of sustainable forest management can be seen as a method of tackling the greenhouse effect in that the protection of existing forests conserves their potential to absorb carbon dioxide. The Amazon area is of particular relevance in this context as the Amazon rainforest is the world's largest remaining tropical rainforest.

The success of sustainable forest management projects, and hence the prevention of deforestation, largely depends on the involvement and motivation of the local and indigenous population. Clear economic and social advantages for and active participation by the local and indigenous population are the preconditions for this. However, there is a huge divide between the international negotiations on the detailed implementation of the Clean Development Mechanism by national governments and the opportunities for involvement of the local and indigenous forest dwellers who have a direct interest in these negotiations.

1. Does the Commission consider that sustainable forest management projects aimed at preventing deforestation should be eligible for the CDM and, if not, why not?

2. Is the Commission prepared to play an active role in ensuring that local and indigenous population groups are able to participate in defining the conditions for sink projects within the CDM, and, if so, what form does the Commission think that this participation should take?

Answer given by Mr Wallström on behalf of the Commission

(30 October 2001)

1. In accordance with all Member States and many other Parties, the Commission opposed including prevention of deforestation as a specific project activity under the Clean Development Mechanism during negotiations at the Sixth Session of the United Nations Framework Convention on Climate Change (UNFCCC) Conference of the Parties (COP6). As a consequence, this activity is presently excluded from crediting under the Clean Development Mechanism (CDM) during the first Commitment Period.

This does of course not indicate that the Commission condones deforestation or is oblivious to its disastrous environmental and social consequences. To the contrary, the Commission and the Community undertake major political, financial and specific project efforts to stem worldwide deforestation, which currently amounts to about 13 million hectares annually.

However, project activities to prevent deforestation do not fit the Clean Development Mechanism very well. The principal reason is leakage: Individual tracts of forest may be preserved successfully; however, the displaced demand for timber or land tends to re-emerge in other locations outside the project boundaries, perhaps even in other countries and lead to carbon emissions there. Moreover, giving credit to and compensating prevented deforestation on a project-by-project basis could provide a perverse incentive not to act against deforestation in a country through other policy means and law enforcement.

Therefore, the Parties chose to consider deforestation prevention under the Special Climate Change Fund and the adaptation fund under the Kyoto Protocol, both of which will be established in the near future, but to exclude it from crediting under CDM.

2. The Protocol defines a dual purpose for the CDM, namely helping Annex I Parties to fulfil commitments and contributing to sustainable development. For the Commission, it is not conceivable how sustainable development can be promoted via forestry projects without full participation of local and indigenous groups. Therefore, the Commission played a pro-active role in past negotiations about the modalities for sinks in the CDM to ensure a prominent role for these groups.

According to the results of COP6, details about socio-economic impacts of sink projects in CDM remain to be agreed by 2003 at the latest. Preliminary proposals for the process of certifying emission reductions, as required by Article 12 of the Protocol cover stakeholder participation quite extensively.

One practical instrument for ensuring stakeholder participation in forest management could be forest certification, an independent third-party assessment whether management meets certain sustainability criteria. These criteria include the rights of indigenous people and adequate stakeholder participation. Forest certification has already been applied to almost 100 million hectares of forests all over the world. To further possible use of this instrument in ensuring environmental and social compatibility of carbon sinks, the Commission has organized a special workshop on this topic recently.