Bridging the Divide between the Forestry and Financial Worlds


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A community-run, state-of-the art lumber mill at Ixtlán de Juárez, Oaxaca.

While it is true that trees do not grow just on money but under carefully crafted governance conditions, REDD+ funding does represent an important opportunity to promote sustainable forest management. So, it is critical to know which arrangements are most conducive to effective use of funds for this purpose.

Emphasizing the need to broaden the financial base for sustainable forest management, three researchers presented analyses of “forest finance and finance for REDD+,” the third theme of the Oaxaca workshop, which was also treated in round-table discussions. The idea was to derive lessons from recent experiences with forestry finance that might usefully inform the development of REDD+ schemes.

Echoing the “one size does not fit all” message of previous speakers who had underlined the importance of varied patterns and actors in landscape transformation, the experts on forest finance also cautioned against ignoring local diversity in the design of financing strategies. Commonly used terms like “forest communities” and “indigenous groups,” said the first speaker, mask “profound differences” between different contexts and dynamics, requiring diverse financial instruments and ways to access them.

He also stressed, as did presentations in previous sessions, the importance of secure forest tenure and of strong governance and institutions, which must be competent, credible and accountable, as they seek to widen rural people’s access to forest finance. In addition, he urged experts to communicate and share knowledge, with the aim of bridging the divide between the forestry and financial worlds.

In a similar vein, the second presenter shared an assessment of the current emissions and environmental standards applied to land-use projects. He judged the standards on the basis of criteria being used now to define safeguards for new REDD+ schemes. These criteria include not just carbon emissions reduction but also biodiversity conservation, poverty reduction and sustainable forestry management. This speaker underlined the need to strike a careful balance in the standards applied to REDD+ schemes. They must be sufficiently rigorous to ensure that funds are properly used, but the transaction costs of meeting these standards must not be so high as to strangle the initiative from the start, a point that was emphatically reinforced in the round-table discussions.

Speaking from a Mexican perspective, the final presenter also stressed the importance of laying a firm foundation for new REDD+ mechanisms based on sound practices from previous experiences that have brought together the separate worlds of forestry and finance.

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