By Edward Glover
     Chair, IIC Board of Trustees and former
     British High Commissioner to Guyana

We hear every day about climate change and what to do about it - turning off the lights, turning down the heating and not flying off on holiday. Unfortunately, the importance of the world’s rainforests seldom makes the front page. This is why another 600 acres (240 hectares) will disappear in the time it takes to read this article.

The challenge

The overall challenge is to communicate a new approach to rainforest sustainability and promote the ground-breaking concept of investment in rainforest eco-system services as a key part of the solution to climate change. We have to show the inherent value of rainforests to humanity, thus establishing that they are worth more alive than dead. Effective and imaginative communication has a central role to play in this process.

At its simplest, it is a battle of short-term gain versus long-term thinking.

Rainforest destruction is driven by increasing demands for immediate profit – for valuable ‘cash crops’ such as timber, soya, bio-fuels and beef. ‘Hard’ financial values too often overshadow the ‘softer’ and less quantified ecological values. Yet the financial value of a standing forest is real and can be quantified.

The facts

• The world’s remaining forests account for a huge amount of the world’s natural carbon capture and storage (CCS) - an estimated 1.2 billion tonnes per year. Based on best estimates of technology based CCS being US$50 per ton, this gives an annual value of some US$60 billion.
• However, the rainforest is being destroyed at a rate of 13 million hectares per year - equivalent to 1800 times the size of the Beijing Olympic Stadium every hour. This not only reduces Earth’s natural CCS capacity but, because all but the prime timber is burnt, some 13 million tonnes of carbon is released, directly accounting for around 20% of total annual C02 emissions.
• This in turn equates to a financial cost of US$234 billion per annum, at current market values, to industrially offset these emissions.

An area of rainforest 1800 times that of the Bird’s Nest is lost every hour

The wood versus the trees

With the current global carbon emission level at 387 ppm (parts per million) and the upper threshold of tolerance believed to be 450 ppm, there may be only a decade or two left before our planet reaches the point of no return. Rainforest destruction is accelerating this process.

A vital part of the global solution to reducing emissions dramatically is therefore to save the remaining rainforests: by understanding the critical eco-system services they deliver by placing a greater financial value on them through innovative financial mechanisms.

We pay for electricity, gas, oil, water and waste services but nothing for rainforest services on which we all depend. How can we capture and quantify this value? How do we turn these rich forests into long-term capital assets, not short-term expendable commodities?

The Iwokrama rainforest reserve covers one million acres in Guyana

The Iwokrama Model

The Iwokrama International Centre (IIC) was established in 1996 to manage a reserve of 371,000 hectares (a million acres) of rainforest in Guyana, a country the size of the United Kingdom on the north eastern shoulder of South America. It is part of the Guyana Shield rainforest which borders the Amazon and dedicated by an enlightened Guyanese Government to its people, to the Commonwealth and to the wider international community for international research into global warming. The Iwokrama forest and its Research Centre are therefore unique, providing a dedicated environment to trial the concept of a truly sustainable forest, where conservation, environmental balance and economic use are mutually reinforcing.

The IIC, along with the Government of Guyana, the Commonwealth Secretariat and other partners is developing a new model to enable countries with rainforests to earn significant income from eco-system services and creative conservation practice.

Iwokrama aims to become fully self funding via four distinct revenue streams:

• Selective timber harvesting – Iwokrama is fully certified by the Forest Stewardship Council (FSC). This means that, typically, just two to three mature trees per hectare are taken every 60 years - and taken only from a small part of the reserve. Hard wood timber bearing the Iwokrama mark can be used by even the most eco-friendly consumers. This year almost the entire Iwokrama output of certified timber is being bought by companies in Europe and the US.
• Eco-tourism – rainforest bird watching is very popular and Iwokrama continues to develop facilities for group tours; currently it has 20 kms of forest trails.
• Forest management services – the IIC provides training for others involved in rainforest management elsewhere in South America and beyond.
• Financial ‘utility bonds’ – the IIC is working with Canopy Capital, a private UK company established to help drive capital to the rainforest canopy. The aim is to pioneer financial instruments based on the utility value of the eco-system services of the forest - rain generation, biodiversity, and soil and carbon conservation. It is intended to go beyond simple eco-philanthropy. The bonds will provide competitive rates of return and be tradable. UK Government support for this initiative is being actively sought.

Iwokrama provides an exceptional environment for scientific research and is a source of support for 16 local communities, all of whom have an ownership stake in the commercial activities of the IIC, as well as other benefits, including capacity building and the employment it offers.

Use it or lose it

Rainforests are located primarily in some of the world’s poorest countries so the forest capital must generate income, which benefits their economies more than the temptation to allow other development instead.

If the global community, increasingly aware of the impact of climate change, wants tropical forests to survive, the services of the rainforest canopy can no longer go unrecognised or unpaid. The IIC’s pioneering solution could pave the way for sustainable and innovative sources of finance on a wider scale to match a new global priority of national ownership and local stewardship.

Applied widely, this new model for rainforest management could help bring an end to the destruction of rainforests and create momentum for a new international market for eco-system payments. These would be based on a professional evaluation of the national eco-system assets of countries, thus encouraging the introduction of effective local and national governance, monitoring and surveillance regimes.

Iwokrama, meaning ‘place of refuge’, supports 16 local communities

Next Steps

We have to encourage those that can and do think strategically to eschew the lure of the short term option and take the long view.

The immediate dilemma is how to persuade investors and international policy makers to invest in forest eco-system services and design frameworks to regulate their trade. Against the present background of successive financial shocks and lack of liquidity, the inclination of policy and money makers is to think short term and in terms of unproven technology-based CCS solutions.

But climate change waits for no man - the Arctic ice cap continues to shrink and the degradation of rainforest assets and the communities that depend on them continues apace. How to inspire investors and decision makers to overcome their hesitation is an urgent task for the IIC and its partners.

We need to encourage those that can make a difference to conclude that they must be involved in supporting initiatives like Iwokrama; that they too can be pathfinders, showing others that by investing a little now we can avoid a bigger bill for everyone later. To succeed, we have to communicate the real value of an asset that is as yet unrealised. There is much hard work ahead.

Hill & Knowlton is a pro bono advisor to the Iwokrama International Institute. Read more about the Iwokrama reserve at http://www.iwokrama.org/home.htm