Forest restoration could ringfence $6.3 trillion in ecosystem services

Q+A with Robert Nasi, CIFOR director general, CIFOR-ICRAF managing director
Robert Nasi

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The price of deforestation and degradation is enormous, said Robert Nasi, director general of CIFOR and managing director of CIFOR-ICRAF, speaking at the Global Forest Summit.

Each year, deforestation or agriculture-related land degradation activities release about a quarter of greenhouse gas (GHG) emissions. Their vast carbon storage capacity means that conserving and restoring them is considered a key nature-based solution for keeping global warming in check – and one which has the potential to offer substantial returns.

Under the Bonn Challenge, countries have committed voluntarily to restore 350 million hectares by 2030, but massive investments are needed. Nasi argues that a business model should be developed to meet restoration targets.

He spoke with Forests News after the event.

Q: What is the overall cost to society of forest degradation?

A: Estimates pin the value of lost ecosystem services due to land and forest degradation at $6.3 trillion a year.

“This is a mindboggling amount, while it’s only a rough estimate, what matters is the order of magnitude – the amount is more than the value of the nominal gross domestic product of France, Italy and Canada put together per annum.”

To achieve the Bonn Challenge, we need an estimated $350 billion, but 300 of these $350 billion are currently not available and need to be found to address the problem. So, to finance restoration at the scale needed it must become an economic activity creating jobs, improving livelihoods, and of course restoring forests.

Achieving restoration at scale – for example, as intended by the Bonn Challenge – also brings unprecedented opportunities: if targeted investments in restoration are made, they could result in trillions in net benefits and a significant return on investment. Research shows that for every dollar invested in restoring degraded forests, a return of $7 to $30 in economic benefits can be expected.

So, the cost to society is huge if the degradation continues and at the same time prospects of attractive returns of restoration, but we still do not do it. Why not?

Q: What are the biggest challenges the planet is facing?

A: I can think of quite a list, but overall, we must change our paradigm about how, at what cost, for what ultimate goal and by whom restoration should be done. Our economic system is rife with perverse incentives, which must be suppressed.

For example, take agricultural subsidies. A report produced by the Organization for Economic Cooperation and Development (OECD) found that 54 countries studied – all were OECD and European Union countries, plus 12 key emerging economies – provide over $700 billion a year in total support to the agricultural sector. Creating a loss revenue of $50 billion a year for developing countries and making unsustainable cropping systems artificially viable.

Don´t misunderstand me, not all subsidies are bad, especially if they’re well designed to support the poorest citizen and helping to lift them out of poverty. But in a lot of cases subsidies are counterproductive, and the removal of subsidies for fossil fuels, bioenergy and agriculture would be an immense boon for forests and the environment if well thought through and instead invested into a circular bioeconomy.

Q: There was a lot of discussion around carbon offsets. What are your views on this strategy?

A: Carbon offsetting is often presented as a panacea or as a dangerous distraction in relation to mitigating GHG emissions. It is neither one nor the other.

We must reduce emissions by 45 percent by 2030. Carbon offset projects will never be able to curb the emissions growth if fuel-fed power stations continue to be built or petrol cars continue to be bought. Trees planted today can’t grow fast enough. We are like the Red Queen in Alice in Wonderland who needs to run endlessly to stay in the same place.

This is not to say that carbon offset projects should stop, quite the opposite. We must continue to restore forests and peatlands or scale up renewable energy and energy efficiency projects via offset schemes. But it cannot simply be a one-for-one model. Like the Red Queen we must run faster if we want to go somewhere.

If one ton of sequestered CO2 is the price of one carbon credit, we still need to deliver the missing 45 per cent emissions’ reduction, as well as their future projected increase. This is exactly why the global climate challenges must be addressed in a coherent and holistic manner – something that we take into account in our research approach.

Morally speaking, the main issue I have with the carbon offset is the basic assumption that a ton of carbon dioxide (CO2) is the same wherever it is emitted. This is fundamental for the carbon offset business: a CO2 emitter the United States buys CO2 storage in India. But then the U.S. emission per capita  is 16.5t, whereas the one for India is 1.7t. Clearly, these do not have the same social and ethical value even if they have the same effect in CO2 concentration in the atmosphere. Carbon offset mechanisms must take all of these factors into consideration: environmental ones, economic ones – ensuring additionality and permanence while at the same time also reflecting ethical considerations.

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This research forms part of the CGIAR Research Program on Forests, Trees and Agroforestry, which is supported by CGIAR Fund Donors.
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