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The Green Economy and the Forestry Sector: Future Direction

Dr Young-Woo ParkRegional Director

Regional Office for Asia and the Pacific (ROAP)

05 June 2012 (World Environment Day)

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“If you do not change direction, you may end up where you are heading.”

Lao-tzu, Chinese philosopher (604-531 B.C.)

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• Recent attention on the green economy concept has been aided by widespread disillusionment with our prevailing economic paradigm where material wealth is delivered at the expense of growing environmental risks, ecological scarcities and social disparities.

• There is an urgent need to transition to a new paradigm.

• As a result, the last three years have seen the idea of a “green economy” float from debates by environmental economics specialist into the mainstream of policy discourse.

• The “Rio+20” agenda has adopted “green economy” as a key theme in the context of sustainable development and poverty eradication.

Why Green Economy?

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What is the GREEN Economy• UNEP defines a green economy as one that results in improved

human well-being and social equity, while significantly reducing environmental risks and ecological scarcities.

• It recognizes that is not either the environment or economic growth and development, but that they go hand in hand to the benefit of both.

• A green economy can be thought of as one which is low carbon, resource efficient and socially inclusive.

• Growth in income and employment is driven by public and private investments that reduce carbon emissions and pollution, enhance energy and resource efficiency, and prevent the loss of biodiversity and ecosystem services.

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Forests in a Green Economy

• The Green Economy has also entered the broader discussion on forests and forestry.

• Forests perform vital functions. Without them we would struggle to survive. Forest products and services are essential to every aspect of life. Around 1.6 billion people rely to some extent on forests for their livelihoods.

• The value of ecosystem services from tropical forests vastly exceeds figures showing up in national accounts. An estimated investment of US$30 billion in fighting deforestation and degradation could provide a return of up to US$4.5 trillion in products and services.

• It has become very clear that sustainable use pays off and business-as-usual (BAU) costs us dearly.

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Biodiversity pays

Source: TEEB, 2009

Net present value of benefits from conservation and conversionValue of US$ in 2007

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• Use of degraded lands for sustainable palm oil production

• Ecologically-friendly agricultural and forestry practices for smallholders

• Improved forest management such as reduced impact logging

• Better land-use and spatial planning that recognizes the importance of ecosystem services and biodiversity conservation

Where to invest in?

• Watershed management to reduce sedimentation and enhance navigability

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Forests in 2050

Key Forest Sector Indicators

Business As Usual (G2)

Natural Forest Area (Billion ha)

3.36 3.64

Deforestation rate (million ha/year)

14.9 6.66

Planted forest area (Million ha)

347 850

Total forest area (Billion ha)

3.71 4.49

Carbon storage in forests (Billion tonnes)

431 502

Gross Value Added (US$, Trillion)

0.9 1.04

Employment (Million) 25 30

Comparison of BAU with Green Investment Scenario (G2)

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• REDD+, which can be seen as an investment focusing on retaining or enhancing natural capital, and provides an opportunity to enable countries to shift from “brown” to green development by making investments in natural capital with a focus on forests, as well as human capital.

• Global Environment Facility

• Capital markets that connect long-term institutional investors with the delivery of sustainable forest and land management worldwide. Pension funds, for example, are considering forest funds that would invest in rain forests.

Main investment sources?

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• Reduction of excessive regulatory procedures and bureaucracy • Strengthening of governance, especially accountability and transparency• Raising awareness among decision makers regarding the negative

impacts of complex regulations and procedures on investment decisions• Application of best practices in forest law enforcement and reducing

illegal activities• Clarification and strengthening rights to land and forests, including the

potential for increasing the size and duration of forest land ownership and/or use rights

• Avoiding arbitrary changes and providing stable investment, land-use, land management and forestry policies, laws, procedures and approval systems to give investors in forestry the confidence to make long-term investments

What does it take?

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• While the needs of small-scale (including communities) and large-scale investors are clearly not the same, most of the previous recommendations would also provide for an enabling environment for community forestry. Above all, all actors would benefit from clear forest tenure arrangements and strong governance.

• Examples of initiatives indicate that a green economy in forestry is not necessarily something new. Sustainable management of forests, forest restoration, forest conservation, watershed management are all part of a green economy and the role communities have played in wise forest management and use is widely acknowledged.

• The biggest contribution that community forestry can make is probably to social equity and poverty reduction.

Role of community forestry

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UNEP’s main role is in providing advisory services, raising awareness, research and forming partnerships to help achieve a green economy through the collective vision, creativity, action and support from a broad cross-section of society, including governments, the private sector and consumers.

For Green Economy success stories: http://www.unep.org/greeneconomy/SuccessStories/ForestManagementinNepal/tabid/29869/Default.aspx

UNEP’s role?

Thank you

For more: http://www.unep.org/greeneconomy/