Enhancing Capacity for Livelihoods Development in the Tonlé Sap and Cardamom Mountains Landscape in Cambodia

CHALLENGE

Over the last two decades, Cambodia achieved remarkable economic growth and graduated from a low- to a lower middle-income country. This growth has largely been driven by the country’s rich and diverse natural capital, which supports the livelihoods of millions of Cambodians but is rapidly being degraded from unsustainable use. For instance, agriculture - which is heavily dependent on natural resources and ecosystem services - contributed to 30 percent of GDP in 2015, and the livelihoods of more than five million people. However, according to official estimates, forest cover declined by 21 percent between 2006 and 2014, mainly due to the conversion of forests to agriculture or rubber plantations within economic land concessions.

To counter the rapid decline in forest area, the Royal Government of Cambodia has adopted several policies, strategies and plans to encourage improved forest use and protection. While these changes are positive, many institutional, information and investment challenges remain. In particular, more comprehensive cost-benefit analyses are needed to assess potential investments in sustainable livelihoods and ecosystem services. In addition, implementation of an integrated landscapes approach to forest programming requires strengthening institutional capacities at the national and subnational levels, as well as improving information and decision-support systems.

APPROACH

The key components of this activity will be:

1. The development a national forest monitoring system. Efforts will be made to coordinate with complementary efforts by other development partners and NGOs, to bring together maps and data on forestry, land use, biodiversity, ecosystems, water resources, and soil conditions, to effectively inform decision-making at the local levels. Spatial mapping platforms and GIS resources will be used to compile an interface for informing suitable and sustainable livelihoods and projecting impacts from climate change and economic development. 
2. Carrying out an institutional development needs assessment, at the national and sub-national levels. It will include the identification of implementation needs for operationalizing the government’s new “corridors approach” for the integrated management of forest landscapes, as well as for anticipated reforms to the environmental code and the framework on the co-management of forests and natural resources.
3. Undertake an options assessment of investments in sustainable livelihoods and natural assets. This will help determine the various livelihoods options that could be implemented to build community resilience, protect natural resource assets, and promote a sustained and green growth pathway in the Tonle Sap watersheds and Cardamom Mountains landscapes. The PROFOR Forest Poverty Toolkit will be applied, building additional layers of detail specific to Cambodia, including through by using key informant interviews and focus group discussions. Based on these findings, policy recommendations will be generated on the way forward for landscape-level planning, programming, and investment typologies.

RESULTS

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Last Updated : 06-15-2024

Economic Growth and Drivers of Deforestation in the Congo Basin

CHALLENGE
Though the deforestation rates in the Congo Basin countries have historically been low, the trend is likely to change dramatically due to the combination of many different factors: population increases (and associated expansion of subsistence agriculture and fuelwood collection); local and regional development; and the rise in global demand for commodities.

The countries of the Congo Basin face the dual challenge of developing local economies and reducing poverty, while limiting the negative impact of growth on the region's natural capital.

APPROACH
PROFOR supported an in-depth, multi-sectoral analysis of the major drivers of deforestation and forest degradation for the next decades in all six of the Congo Basin countries (Cameroon, Central African Republic, Gabon, Democratic Republic of Congo, Equatorial Guinea and Republic of Congo). The overall study was led by the World Bank Africa Region. A team from the International Institute for Applies Systems Analysis (IASA) led a modeling exercise, based on the GLOBIOM model but tailored to the Congo region, to investigate drivers of deforestation by 2030 and assess the impacts of various "policy shocks" (such as: increased international demand for biofuel; improved transportation infrastructure; improved agricultural technologies; etc). The approach also relied heavily on the inputs from multi-stakeholder regional workshops and in-depth sectoral reports (available on this page).

MAIN FINDINGS

• ƒDeforestation rates are likely to increase in the future to sustain development and poverty reduction.
• ƒƒIncreasing agricultural productivity is not sufficient to limit pressure on forests.
• ƒƒWood extraction for domestic fuelwood or charcoal production will continue to grow for the next few decades and could create a massive threat to forests in densely populated areas.
• ƒƒThe development of much-needed transportation infrastructure could lead to major deforestation, mainly by changing economic dynamics in newly accessible rural areas.
• ƒƒThe pressure from formal logging is limited, but informal chainsaw logging is expected to progressively degrade forests.
• ƒƒMining—a largely untapped source of income and growth—could also lead to significant impacts when the sector develops.

MAIN RECOMMENDATIONS
The study highlights options to limit deforestation while pursuing inclusive, green growth. Emerging environmental finance mechanisms, such as reducing emissions from deforestation and forest degradation (REDD+), may provide additional resources to help countries protect their forests. But there are already a number of “no-regrets” actions that countries can take to grow along a sustainable development path:

• Participatory land use planning could help clarify tradeoffs among different sectors, encourage the development of growth poles and corridors, and direct destructive activities away from forests of great ecological value.
• ƒƒUnlocking the potential of the Congo Basin for agriculture will not necessarily take a toll on forests: the Congo Basin could almost double its cultivated area without converting any forested areas. Policy makers should seek to target agricultural activities primarily towards degraded and nonforested land.
• ƒƒIn the energy sector, putting the woodfuel supply chain on a more sustainable and formal basis should stand as a priority. More attention should be paid to responding to growing urban needs for both food and energy through intensified multi-use systems (agroforestry).
• ƒƒBetter planning at the regional and national levels could help contain the adverse effects of transportation development, through a multi-modal and more spatially efficient network.
• ƒƒExpanding sustainable forest management principles to the booming and unregulated informal logging sector would help preserve forest biomass and carbon stocks.
• ƒƒSetting “high standard” goals for environmental management of the mining sector could help mitigate adverse effects as the sector develops in the Congo Basin.

See also: Main recommendations by sector (English) - Recommandations principales par secteur (français)

RESULTS
The results from the modeling exercise were shared over the years: at the UNFCCC Conference of Parties 15 in Copehagen, at the World Bank in January 2010 and February 2013( "SDN week" ) and at multiple regional conferences and workshops (Kinshasa, Douala, Brazzaville 2009-2012; final regional conference in Kinshasa, May 2013 - see conference presentations here).

The findings have helped Congo Basin countries better understand the diversity of factors of deforestation --beyond logging -- and the impact of indirect external factors such as global commodity demand.

The knowledge generated from this activity is critically important as Congo Basin countries prepare their REDD+ and broader development strategies. If countries are able to minimize forest loss as their economies develop, they could "leapfrog" the steep drop in forest cover that has historically accompanied development in many countries, and make an important global contribution to climate change mitigation.

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Author : World Bank Africa Region, COMIFAC, International Institute for Applied Systems Analysis, PROFOR, Norwegian Trust Fund for Private Sector and Infrastructure, UK Government, Trust Fund for Environmentally and Socially Sustainable Development, Forest Carbon Partnership Facility.Author: Carole Megevand, with Aline Mosnier, Joël Hourticq, Klas Sanders, Nina Doetinchem, and Charlotte Streck.
Last Updated : 06-15-2024

Brazil: Scaling up Renewable Charcoal Production

CHALLENGE
Charcoal is one of the main sources of energy used in the production of pig iron for steel in Brazil. The vast majority of the current charcoal production is from unsustainable and often illegal harvest of native forests, leading to severe environmental degradation and deforestation. However, there have been successful business cases of forest plantation for charcoal production in Brazil, including one Clean Development Mechanism (CDM) project financed by the Prototype Carbon Fund in Minas Gerais. Expanding the area of forest plantations for charcoal on idle or degraded pasture land would reduce the pressure on native forests in Brazil.

However, barriers have prevented wide adoption of forest plantations for charcoal. Some of the barriers include:

• lack of credit to finance the initial production costs (first income revenue usually is generated after 7 years of plantation),
• difficult access to credit (forest plantations are often not accepted as collateral for loans),
• higher transaction costs relative to deforestation and coal production (planted forest activity has a cycle of 14-21 years of production, is labor intensive, and results in high costs of land management and environmental licensing),
• inefficient technologies for carbonization process (contributing to the emission of greenhouse gases (GHG), including methane),
• unclear agricultural and environmental regulatory framework to forest production,
• weak institutional arrangements, etc. 

With 62 pig iron mills, the state of Minais Gerais is Brazil's largest producer of steel and iron, responsible for 60% of the national production.  Minas Gerais approved a law which virtually bans the use of charcoal from deforestation by 2018. In order to supply the industry with charcoal from plantations Minais Gerais would need about 1.5 million ha under new plantations.

APPROACH
PROFOR and the BioCarbon Fund co-financed a study designed to identify institutional and financial arrangements required to mainstream forest plantation business models and promote the potential development of CDM projects aimed at reducing GHG emissions in the forestry and iron supply chains in the state of Minas Gerais.

The displacement of non-renewable charcoal by renewable charcoal by 2017 and the use of charcoal to produce up to 46% of the pig iron and steel by 2030, would potentially mitigate 62 Mt of CO2 between 2010 and 2030. This would represent 31% of all emissions reductions expected from the steel industry and contribute to Brazil's overall effort to reduce its GHG emissions by 39% by 2020.

RESULTS
The study's methodology and preliminary results were presented during a workshop "Identifying Financial and Institutional Arrangements for Scaling Up Renewable Charcoal Production" in Belo Horinzonte, Minas Gerais, in December 5, 2011. (A presentation from that workshop is available in Portuguese on this page). At completion, final reports with the technical work, datasets, and related links were shared with key counterparts within the government, private sector, and financial institutions.

The analytical work supported by this project was a key building block in the World Bank’s strategy for supporting Brazil’s move toward a low carbon economy as stated in the Brazil Country Partnership Strategy for 2012-2015, under Objective 4: Improving sustainable natural resource management and climate resilience. ("Helping the Federal government and the private sector to implement Brazil’s National Climate Change Plan, including through developing programs and financial mechanisms to promote sustainable land use, decrease deforestation, and increase energy efficiency and renewable energy.")

The Minas Gerais Development Policy Loan III ( P121590), to which this study contributed, is one of the deliverables of the new country strategy. The State has adopted measures to encourage forest plantation within its territory to supply raw input to industries within its territory.

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Author : World Bank in Brazil, BioCarbon Fund
Last Updated : 06-15-2024

An economic cost-benefit analysis of forest conservation and restoration in Nicaragua

Program Summary

This PROFOR activity aimed to provide evidence to the Government of Nicaragua on the economic benefits of forest landscape restoration activities. The knowledge generated from this activity was intended to improve policy makers’ ability to made decisions on investments going towards rural livelihoods and incomes, reduced GHG emissions, and greater climate risk resilience.

Challenge

Based on climate change projections, water availability is likely to decline in most of Nicaragua's watersheds. A three-year drought, coupled with massive deforestation in the past few decades, has depleted most of Nicaragua’s water sources which is threatening the country’s future water supply. In fact, the country has lost up to 60 percent of its surface water sources and up to 50 percent of its underground sources, which have either dried up or have been polluted. Such diminished water availability will severely impact human health, agricultural productivity, hydropower generation, and a suite of other economic activities.

The government of Nicaragua recognizes that restoring forest cover is indispensable to safeguarding agricultural production and minimizing the impacts of climate variability on economic and human well-being. Under the National Reforestation Plan, the government is not only addressing the reduction of carbon emissions, but also aiming to increase awareness of the importance of reversing deforestation, increasing forest coverage, and improving the production of environmental services provided by forests.

To assist the government’s efforts, PROFOR proposed to provide analysis on the ecosystem service and economic benefits of forest landscape restoration activities, including disseminating information to decision makers on the trade-offs of different restoration scenarios. The results would guide the Nicaraguan government on implementing potential forest landscape restoration programs by providing potential prices for payment for ecosystem services and identifying the low-cost/high-benefit alternatives in watershed conservation, forest protection, and carbon sequestration. PROFOR would generate various restoration and investment scenarios that could open restoration and reforestation opportunities for farmers, local communities, and the private sector, including agribusiness and ecotourism.  

Approach

This PROFOR activity consisted of the following tasks:

• Output 1: Analysis of the costs of environmental degradation. This task aimed to provide the analytical underpinnings to target interventions for climate change adaptation and mitigation. This task was to estimate the costs of environmental degradation resulting from land degradation and deforestation, droughts, soil degradation, fire, flooding, and other natural disasters. In addition, the analysis was to estimate the costs to Nicaragua associated with climate change.
• Output 2: Benefit analysis of a potential program for watershed conservation and landscape restoration in Nicaragua. This analysis aimed to estimate the benefits of forest and landscape restoration on the value of multiple ecosystem services across the country by estimating the net value of ecosystem service benefits (such as ecotourism, carbon sequestration, water quality, agriculture, soil protection, etc.) under different reforestation scenarios. It would also explore the economic potential of changing land use (such as degraded agricultural land) to restore native forest, or for agroforestry.

By accomplishing these tasks, the program aimed to inform and improve the Nicaraguan Government’s knowledge on how to promote policies and regulations that increase forest conservation, support a nature-based economy, and increase watershed conservation and landscape restoration in the country.   

Results

Due to civil unrest in the country, work for this activity was frozen, delayed, and although eventually reopened, many limitations to activities were put in place due to continual political tensions. The team had initiated the diagnostics and analysis but was not able to collect all the information needed for the studies. Nevertheless, the team was able to put together a draft/preliminary report for Output 1: Analysis of the costs of environmental degradation. The government was very interested in this activity because of their interest in headwater conservation and landscape restoration. Analysis for Output 2 was partially included in this report as the needed data that was difficult to obtain due to the country’s political crisis.

Findings

The preliminary cost of environmental degradation (COED) to Nicaraguan society is estimated at about US$0.9 billion, or 6.7 percent of the country’s GDP in 2016. Among the costs, it is important to note the following:

• Air pollution stands out as the most important driver of degradation (3.8 percent of GDP). This primarily is due to the impacts caused by household air pollution (about 1,060 premature deaths).
• Unsafe water supply, sanitation, and hygiene cause significant damage (1 percent of GDP) largely as a result of the effects of inadequate water supply, sanitation, and hygiene on health (about 260 deaths).
• Agricultural land degradation, deforestation, and natural disasters are also noteworthy because of their negative effects on resource productivity and ecosystem services.
• In case of devastating natural disaster scenario, cost of natural disasters will be comparable to the average annual total national cost.
• All zones in Nicaragua appear to have similar COED, but environmental health costs dominate in the Pacific and Central zones, while natural resource degradation dominates in the Atlantic zone.

The findings of the COED in Nicaragua can be useful for future project GEF preparations, SCD, CPF, and DPLs, among others.

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Last Updated : 06-15-2024