Wheeler hails UK/Guyana bio-diversity conservation cooperation

Guyana Chronicle top story, Monday 31 March 2008

http://www.guyanachronicle.com/topstory.html
Wheeler hails UK/Guyana bio-diversity conservation cooperation
By Sarada Singh
<http://www.guyanachronicle.com/Wheeler-presents.jpg>
Wheeler presents in digital folder conservation seminar at Pegasus. British
High Commissioner to Guyana, Fraser Wheeler presents a representative from
the Ministry of Education Sean Mendonca the Wetlands School Pack. (Photo by:
Quacy Sampson)

BRITISH High Commissioner to Guyana, Mr. Fraser Wheeler has hailed the
milestone of the productive partnership between the United Kingdom (UK) and
Guyana in achieving the promises embodied within in the Convention on
Biological Diversity.
He was speaking Wednesday last at the ceremony to mark eight years of
Guyanese and British cooperation within the Darwin Initiative Wetlands
Project on conservation and development of its convention on biological
diversity.
To commemorate the occasion, a ceremony was held in the Savannah Suite of Le
Meridien Pegasus hotel which saw the presentation of project highlights and
discussion on the future of the North Rupununi Wetlands by prominent
individuals in conservation here.
Noting that biological resources support such diverse industries as
agriculture, cosmetics, pharmaceuticals, pulp and paper, horticulture,
construction and waste treatment, the High Commissioner said: "The loss of
biodiversity threatens our food supplies, opportunities for recreation and
tourism, and sources of wood, medicines and energy. It also interferes with
essential ecological functions such as natural flood control, and weakens
the ability to deal with natural disasters such as floods, droughts, and
hurricanes, and with human impacts, such as pollution and climate change."
He observed that already, countries such as the UK and Guyana are spending
huge sums in response to flood and storm damage; and such damage is expected
to increase due to global warming.
According to Wheeler, the UK is active in the world of bio-diversity at home
and abroad, and has the expertise and resources to help other countries
achieve their 2010 targets to halt the loss of bio-diversity.
He said the principal mechanism through which the UK supports other
countries in their obligation to the Convention on Biological Diversity is
through the Darwin Initiative.
The key objective of the Darwin Initiative is for the UK to work with local
partners in countries rich in bio-diversity but poor in resources to achieve
the conservation of biological diversity and the sustainable use of its
components and the fair and equitable sharing of benefits. Since March 21,
2007, 458 projects have been supported, totalling an investment of around 60
million pounds, of which six of these are in Guyana.
At the ceremony the results of the North Rupununi Wetlands Project were
presented which include: teacher and student resources for primary schools,
community and environmental officer courses, and a postgraduate course on
wetland management for the University of Guyana, the 2008 edition of the
NRAMP, a study of the impact of NRAMP to date, the North Rupununi Tourist
Guide and maps, and the North Rupununi Community website.
Chairman of North Rupununi District Development Board during his
presentation advocated the development and sustainability of the North
Rupununi Wetlands.
"We need to ensure that our actions promote the continued ecosystem
stability, and that the uses that are undertaken are sustainable and the
benefits that are derived from such uses do not escape the people of the
North Rupununi Wetland area. We are cautious of mother nature's retribution
when her resources are exploited in an irresponsible way based on our and
the experiences of others," Andries posited.
He also pointed out the need for global understanding of the importance in
maintaining the appropriate balance in the way the North Rupununi Wetland
ecosystem works.
"We cannot do this alone, as we are not in isolation. As a country we need
to make the right decisions that will ensure that this rich place that is
the North Rupununi Wetlands continues to provide the services not just to
the people who live there, but also the wider Guyanese and global
population," he explained.
The key objective of the Darwin Initiative is to draw on expertise relevant
to bio-diversity from within the United Kingdom, to work with local partners
in countries rich in bio-diversity but poor in resources, to achieve the
conservation of biological diversity; the sustainable use of its components
and the fair and equitable sharing of benefits. Among the contributions of
the Wetlands Project was during the year 2003 the Darwin Initiative approved
funding for the North Rupununi project.
The project also allowed the UK's leading institutions for biodiversity
conservation and education which includes the Royal Holloway University of
London, the Wildfowl and Wetlands Trust and the Open University to work in
partnership with Iwokrama, the North Rupununi District Development Board,
the University of Guyana, the Guyana Environmental Protection Agency and the
Ministry of Education.
The aims of the project were delivered in two phases with the first phase
implemented between 2003 and 2006 which involved assessing the health of
wetland habitats and communities in the North Rupununi, and developing a
process for the sustainable management of natural resources with the key
output of phase one being the North Rupununi Adaptative Management Process
(NRAMP).
Phase two implemented from 2006-2008, served to build capacity of Guyanese
stakeholders at both local and national level in executing the NRAMP process
by:
* significantly expanding the number of trained individuals in bio-diversity
monitoring and management;
* developing material for Guyanese university courses and schools to help
raise awareness of, and build capacity for, bio-diversity conservation;
* developing local, financially sustainable livelihood schemes, such as
eco-tourism, that have a linked objective to the bio-diversity monitoring
and conservation of key wetland habitats important to the local communities

Deal with Canopy Capital could see Iwokrama financially independent by 2010 - Glover

Deal with Canopy Capital could see Iwokrama financially independent by
2010 - Glover
Stabroek News, March 30, 2008
http://www.stabroeknews.com/?p=274#more-274

The investment arrangement struck with Canopy Capital could see
Iwokrama financially independent in another two years, its board
chairman said yesterday.
The agreement between Iwokrama and Canopy Capital was made public on
March 27 at the world's first Biodiversity and Finance Conference in
New York. It opens the way for financial markets to price the 'utility
value' of the Iwokrama rainforests.
The forest and its services and eco-system would be put to dollar
value after a process of assessment and valuation. Canopy Capital is
injecting funding into the preservation and sustainable utilisation of
Iwokrama's forests in exchange for a share of the rights to eco-system
services it provides.
According to its website, Canopy Capital was established in 2007 to
drive capital to the rainforest canopy. It said that 20 per cent of
the company is held by the Global Canopy Programme, a UK charity
dedicated to the research and preservation of tropical forests. The
remaining 80 per cent is funded by a dozen international investors,
including the Waterloo Foundation.
"First of all I want to make it clear that the agreement with Canopy
Capital is not about carbon trading. That is not what Iwokrama wants
to do. What the agreement is about is measuring and then seeking to
place a value in the market place on the ecosystem services of
Iwokrama to humanity," Edward Glover, Chairman of the Iwokrama Board
of Trustees, said.
Glover said such services include rainfall and biodiversity. He said
the agreement will be creating additional income for Iwokrama to help
make the organisation financially independent of donors by 2010 and
this will be in accordance with Iwokrama's business plan. He said the
injection will help meet research obligations and continue to help the
local communities all of whom depend on the resources of the Iwokrama
forest for their livelihoods.
Glover said this was consistent with Iwokrama's role as a test bed,
having been established to test that conservation and economic
activity could be harmonious without destroying the environment.
He said Iwokrama would continue to do its very important research and
to measure and place a value on the services provided.
"This is a very important aspect. Humanity depends on rainfall and
biodiversity. This is just the kind of research opportunity that
Iwokrama will pursue in collaboration with other agencies in Guyana
and beyond," Glover said.
But he said that it will take time to advance the agreement. The
process of measuring was the first step, he added, and "we welcome the
help of Canopy Capital to enable Iwokrama to take this important work
forward over the weeks and months ahead."

Iwokrama on solid ground
Glover said Iwokrama's operational costs have fallen significantly as
a result of ruthless cost-cutting after facing reduction on donor
funding. The organisation's operational budget is between US$1.2M and
US$1.4M per annum.
He said business revenues have increased from 23 per cent in 2005 to
80 per cent in 2007 and further growth was forecast this year. Glover
was hesitant to disclose the amount of resources expected from the
Canopy Capital deal, but said it should steer the organisation out of
financial dependency by 2010.
After the 2001 terrorist attacks in the US, and the death and
destruction of the South East Asia Tsunami in 2004 and other natural
disasters, funding that once propped up organisations that focused on
the environment was diverted. When this happened, Iwokrama, which had
encountered hard times even before 2001, saw further reductions in
funding and has been struggling in the midst of instituting radical
cost-cutting measures.
Glover said ever since he took over as Chairman of the Iwokrama Board
of Trustees he made it clear that as a research institution "we are
ready to work with other agencies in Guyana to advance the knowledge
of sustainable management of the forests. We will continue to work
with all concerned in the months ahead in light of the agreement."
He said Iwokrama would be happy to work with organisations of any
description beyond Guyana in the months and years ahead. "We want to
show what is possible with Iwokrama," he said.
The Iwokrama project arose out of an offer in 1989 by then President
Desmond Hoyte at the Commonwealth Heads of Government Meeting in Kuala
Lumpur, Malaysia to have a million acres of virgin forests in the
centre of Guyana set aside for sustainable forestry studies.
The Chairman said implementation of the agreement between Iwokrama
and Canopy Capital and the preparation of the measuring phase of the
work was underway, but these preparations would take some time, since
they would be detailed measurements and analyses. "We are keen to get
a move on, but as we make progress we will have [more to report]," he
said.
He said the agreement would not interfere in any way with the other
areas of Iwokrama's business, namely sustainable forestry,
eco-tourism, forest management training and services.
Speaking to this newspaper yesterday, Minister of Agriculture Robert
Persaud welcomed the initiative and said it had the support of
government. "We recognise that Guyana and even Iwokrama [need
expertise] to market these resources," Persaud said. He said
government expects that the deal will give Guyana an opportunity to
ratchet up international support in seeking out eventual carbon
trading opportunities.
"We see this is as a catalyst [in our thrust against climate
change]," he said. He said government would have lent support to the
initial negotiations through its seat on the Board of Governors of
Iwokrama. The minister said that there continues to be ongoing
discussions between Government of Guyana and a number of parties
internationally, as a follow up to the recent Bali summit and
President Bharrat Jagdeo's offer to the world of Guyana's rainforests.

An inexcusable lack of professionalism

Guyana Chronicle letter to the editor, Sunday 30 March 2008

http://www.guyanachronicle.com/letters.html
An inexcusable lack of professionalism

AS the President and major shareholder of Agri-Solutions Technologies Inc
(AST), I am writing with significant and grave concern regarding a number of
erroneous and malicious comments uttered in the media on the state of our
operations at the Wauna Oil Palm Estate in Region 1.
It is our intent to seek legal redress from the person(s) who have been
responsible for originating these damaging statements, but in the meantime
would like to inform the public of the fallacy of the media reports.
We would also like to register our consternation that reports in the media
regarding our operations are being made without the necessary steps being
taken to contact AST or its representatives. This is an inexcusable lack of
professionalism.
Statements apparently made by an opposition Member of Parliament on
television regarding our operations have since been also reported on the
radio. In addition, there have been many incorrect allegations reported in
the Guyanese media that:
** AST has significantly reduced the number of employees previously employed
by NEOCOL (the Government Entity which operated the estate before AST
acquired it) despite previous assurances to the workers.
** AST have been experiencing problems with their operations, and have been
unable to supply enough bio-diesel to the regional administration, resulting
in prolonged periods of blackouts being experienced in the Mabaruma
sub-region.
** AST, despite promises to the contrary, have not put any funding into the
estate, and have not commenced with the planned expansion of the acreage of
oil palm under cultivation.
** As the major investor involved, Mr. Dwarka Persaud is dissatisfied with
the investment and is seeking to return the estate to the Government of
Guyana.
We categorically refute all of these malicious allegations, and are taking
this opportunity to discuss and clarify the truth of our activities at the
Wauna Oil Palm Estate.
We became involved with this project when the estate was at an all-time low.
NEOCOL consistently operated at a loss for many years and up to the point
where AST acquired the estate.
In 2006, NEOCOL's sole purchaser of crude palm oil produced on the estate
refused to purchase any more. The estate faced immediate closure and
retrenchment of the some 66 permanent employees.
At the same time, the IAST, under the stewardship of Professor Suresh
Narine, had developed a local pilot plant to produce bio-diesel from a
variety of feedstock, among them crude palm oil.
Dr Narine approached and convinced us to invest in the development of a
bio-diesel Plant to convert the crude palm oil produced on the estate to
bio-diesel, so as to avoid the closure of the estate and the retrenchment of
the workers.
Over the last twenty years after leaving Guyana, we have had success in the
Plastics Reprocessing industry in Canada and the United States. However,
once we saw what Dr Narine was doing, we became (and continue to be) very
interested in the project because of its social impact in the region and its
potential to significantly benefit Guyana's energy sector, employment, and
development.
IAST was then contracted to build a commercial bio-diesel plant at the Wauna
Oil Palm Estate, and this plant was completed and commissioned in 2007.
IAST was also contracted to train the employees of AST in bio-diesel
production and quality control. Subsequently, the privatization unit of the
Government of Guyana, NICIL, negotiated a lease agreement and a Purchase and
Sale agreement of all movable assets to AST to take over the palm oil
production side of the business as well. In July, 2007, AST acquired the
entire estate.
Since July, 2007, AST has reclaimed the entire cultivated estate, as during
the NEOCOL operation, only a fraction of the cultivated estate was
harvested. This involved the hiring of a number of seasonal, part time
workers (23 individuals in total) to clear the growth that had taken over
the estate.
These workers were never hired as permanent staff, and indeed, during the
years that the estate had been operated by NEOCOL, workers who were employed
to clear undesired growth were always hired on an as-needed basis.
AST currently has some 76 permanent staff, approximately 10 more permanent
staff than was employed by NEOCOL. Furthermore, AST now provides daily lunch
to all of its workers on the estate, whether they are permanent or
temporary, as long as they show up for work. It is just one of the many
social impact programs we have planned for the project.
Now that we have cleared the existing cultivated acreage and can begin to
harvest a greater area of palms, we are also moving forward with a new
cash-crop cultivation project.
This will result in even more of the temporary pool of workers being hired
permanently. Furthermore, having restored the cultivated portions of the
estate to a useful and productive state, we are now embarking on a
significant increase of cultivated acreage, having secured a source of
competitive palm seedlings from Costa Rica.
Indeed, we have partnered with our seed supplier so that we can not only
supply ourselves with seedlings, but others in Guyana who are also
interested in palm oil cultivation. Our business plan, submitted to the
Government of Guyana as part of the privatization of Wauna, included a
schedule of investment activities, and we are well on target with those
activities.
We have increased our bio-diesel plant capacity significantly, this
expansion having been only recently completed. Furthermore, we have begun to
improve the physical plant on the estate - buildings have been renovated and
painted, the palm oil factory is going through significant overhaul, and we
have acquired more machinery to groom and maintain the estate.
In addition, soil and foliage on the estate have been evaluated by experts
both in Florida, USA and Ontario, Canada and we have incurred significant
expense to bring experts from Costa Rica to Wauna to assess the best
approach to the increase of our cultivated acreage.
We have ourselves visited plantations in Central America, again to assess
the best possible ways of approaching increased cultivation.
We have seen a reduction in palm oil production over the past five months,
despite harvesting a larger cultivated area of the estate. This is due to a
seasonal lean period.
However, we have not reduced the amount of bio-diesel supplied to the
region. Instead, at a significantly increased cost to ourselves, whenever we
have faced shortages of palm oil, we have resorted to the utilization of
petroleum diesel on the estate, so that we can supply the region with all of
the bio-diesel required for their needs.
We are committed to the partnership with the region, and despite the
difficulty in logistics, production, and distribution in a region as remote
as Wauna, we have been able to meet our commitments to the region.
We would like to point out that the operations with which we are engaged are
pioneering- we have, with the IAST's help, established the first and only
commercial bio-diesel operation in Guyana.
We have done so in a remote part of the country, and have had to train staff
members who were unskilled in this type of operation, all within a very
short timeframe.
In this type of endeavour, it is unavoidable that we will have challenges,
and that from time to time, we will encounter unplanned interruptions to our
activities. However, given the sterling performance of our workers and the
giant strides made, it is surprising and very sad to witness untruths being
propagated, apparently for narrow political gains.
We wish to let all of the political representatives in the Region know - we
are committed to this project, we intend for it to be a success, and we see
the most important resource in this endeavour as being the people of the
region.
We are prepared to sit down with members of the media and all concerned
stakeholders to work out collaborative approaches to real problems that may
arise in the future.
That said, we wish to inform all concerned parties that AST reserves the
right to a zero-tolerance approach to the propagation of malicious untruths,
lies and slander.
As for the reports that we are desirous of abandoning the project, let me
state emphatically: nothing is further from the truth. We are as committed
to this project now as we were at the beginning, and I am eagerly looking
forward to the expansion plans ahead.
Guyana is sometimes a difficult place to conduct business - particularly
when one is based thousands of miles away, as we are. I cannot say that we
have not faced significant challenges with bureaucracy, logistics, and
access to skilled labour. However, in Mr. Zahir Bacchus we have found a
capable and efficient General Manager, and we have been nothing but
delighted with the support we have received from the workers on the estate.
We urge the media and ill-advised Member(s) of Parliament to visit the
estate and interact with our workers. You will see firsthand the
improvements that have been made, and hear firsthand from our workers on how
they are treated, and how appreciated they feel in being a part of the
future of this estate. We will extend all hospitalities to those who wish to
take up this offer.
A small example may help -- the IAST was contracted by AST to operate the
bio-diesel plant they built for us, until our workers were trained.
IAST had to send in trained chemists from Georgetown on a rotating basis.
Now, our bio-diesel is produced by technicians who grew up in the Wauna
area. The young men who now produce bio-diesel under the supervision of Mr.
Bacchus (who is a trained Chemist) have been doing an absolutely wonderful
job. It is a small example of the plans we have for empowering the local
population at all levels of the operation.
We are doing our best, and our intentions have remained noble, and we
believe our performance has been exemplary since acquiring the estate. We
believe what we are engaged in is a project which can have a lasting
Guyanese national impact.
We therefore solicit the help of all elected public officials in the region
in addressing collaboratively any issues that we may encounter in the
future.
Politicians have a mandated role to play in the development of the economic
and social well-being of their constituents. We respect this role and
political process, and you will find that we will listen to your concerns.
However, we will also not tolerate miss-information, slander, and
politicization of our activities. It is an obtuse strategy to openly lie
about a situation which can be easily verified.
It appears there is deeper mischief afoot to thwart our activities, by
damaging our reputation maliciously. We wish to inform such detractors and
mudslingers that their untruths do not serve the employees of AST, the
residents of Wauna or even the progress of Guyana.
Dwarka Persaud
President/CEO
Agri-Solutions Technologies Inc.

Historic deal highlights forests environmental services -Iwokrama

Historic deal highlights forests environmental services -Iwokrama
Stabroek News, March 28, 2008
http://74.54.141.82/?p=131#more-131
Iwokrama says that the deal reached with UK-based investment entity Canopy Capital has more to do with placing monetary value on environmental services that the rainforest provides while uncut, rather than just trading in carbon credits.
A press statement from Iwokrama said that the deal, announced yesterday at the world’s first Biodiversity and Finance Conference in New York, opens the way for financial markets to price the ‘utility value’ of rainforests.
“For the first time investors will pay for the ecosystem services produced by a rainforest, including rainfall generation, climate regulation, biodiversity maintenance and water storage - utilities with global significance which are vanishing as forests fall,” Iwokrama’s Chairman Edward Glover said in a statement. The deal was first reported in yesterday’s edition of the Independent newspaper in the UK
Iwokrama said that the transaction between it and Canopy Capital pioneers the use of risk capital to safeguard such services within the Iwokrama Reserve in Guyana.
Reuters reported yesterday that Canopy Capital has also bought rights to the carbon stored in the forest’s timber. It said that Hylton Philipson, Canopy Capital’s director and a former investment banker, hopes to sell the carbon storage and other rights at a profit within 18 months.
“It’s a new asset class,” Reuters reported Philipson as saying. “I think there’s a real appetite out there (for this type of investment. If you fly over the forest, you can see there’s no cloud coming off the cleared land.”
Acting CEO of Iwokrama Dane Gobin said that it would be some time before Iwokrama draws down on the valued resources in its rainforest.
He said that teams of scientists would have to visit the grounds to look at the stock levels.
“There is value, but it has to be monetised and a financial model [built],” said Gobin, adding that in a few months the stocking value will be determined. He said until that time, it will be difficult to say how much money Guyana will be receiving.
According to Gobin, with the injection from Carbon Capital, Iwokrama will be focussing on further research and environmental services, including medicinal plants and other non-timber resources, further advancing on the organisation’s business plan.
He said too that a part of the plan is Iwokrama’s sustainable harvesting of selected species of trees.
Iwokrama said that funds already secured from Canopy Capital will be used to continue the management of the Iwokrama forest in accordance with its philosophy of conservation through sustainable best practice, providing livelihoods and business partnerships for the 7,000 people living in the forest and the surrounding area.
Expressing community sentiments, Iwokrama Head Ranger Ron Allicock said “I love this place. This is my home. I want it to be around for my children, my children’s children, forever.”
Glover said that forests do much more for us than just store carbon.
“We should move beyond emissions-based trading to measure and place a value on all the services they provide,” he said.
Iwokrama said that this initiative fits perfectly with its original mandate to demonstrate that conservation, environmental balance and sustainable economic activity can be mutually reinforcing.
“Moreover, this first significant step is in keeping with President [Bharrat] Jagdeo’s visionary approach to safeguarding all the forests of Guyana.
It also ensures, with the Commonwealth’s support for Iwokrama, that the world hears a knowledgeable and persuasive voice on a matter of growing international concern” Iwokrama quoted Glover as saying.
Jagdeo last October had announced that Guyana stands ready with its rainforests to contribute to the fight against climate change.
The deal, drawn up by international law firm Stephenson Harwood, comes in the wake of a pivotal year for standing forests. The release said that the contribution of deforestation to runaway climate change has been recognised internationally and new measures to conserve forests are set to be included in a post-Kyoto framework after 2012.
Iwokrama said that the deal creates an investment template for first-movers in an emerging market for ecosystem services. “Such a market could generate billions of dollars for developing nations, making it more valuable to keep their forests standing than to cut them down,” the release said.
Gobin said that focus is returning to climate change and the environment after a hiatus that began soon after the US terrorist attacks in 2001 and the slew of devastating natural disasters which followed some years later.
He said that this shift in focus augers well for Iwokrama.
The Iwokrama project arose out of an offer in 1989 by then President Desmond Hoyte at the Commonwealth Heads of Government Meeting in Kuala Lumpur, Malaysia to have a million acres of virgin forests in the centre of Guyana set aside for sustainable forestry studies.

Investor buys Guyana forest's rain and carbon

Investor buys Guyana forest's rain and carbon
Thu Mar 27, 2008 12:32pm EDT
http://www.reuters.com/article/environmentNews/idUSL2668925320080327
LONDON (Reuters) - The British-based investment firm Canopy Capital said on Thursday it had bought a share in the rain-making potential of a chunk of Guyanan rainforest bigger than the Mediterranean island of Mallorca.

The move is a novel twist in an investor frenzy to make money from the prospect of climate change that has also seen businesses snap up permits to emit greenhouse gases and invest in low carbon-emitting technologies.

Perhaps more lucratively, the company has also bought rights to the carbon -- a heat-trapping gas when released into the atmosphere -- stored in the forest's timber.

Canopy Capital is betting that global climate talks due to end next year in Copenhagen will agree a successor to the Kyoto Protocol that includes a legal format for paying developing countries to preserve their forests.

Deforestation contributes 20 percent of total greenhouse gas emissions. Scientists say the effects of global warming could reduce rainfall, and make it more irregular.

"It's a new asset class," said Hylton Philipson, Canopy Capital's director and a former investment banker.

"If you fly over the forest, you can see there's no cloud coming off the cleared land."

"I think there's a real appetite out there (for this type of investment)," he said.

The company said it would fund a "meaningful" chunk of the $1.2 million annual management budget for the 371,000 hectare (917,000 acre) Iwokrama reserve.

Pressure is growing for tropical countries such as Indonesia to be able to sell carbon offsets to rich countries in return for not destroying their remaining forests and so prevent more carbon entering the atmosphere. The concept is known as "avoided deforestation".

Philipson hopes to sell the carbon storage and other rights at a profit within 18 months.

"I would seriously hope to put something together of real value between now and Copenhagen with appeal to the wider investment community," he said, adding that the reserve would receive 80 percent of any profit.

"There is a road planned from Manaus to Georgetown that goes slap through the reserve. If you can generate income from standing trees, maybe people won't chop them down."

(Reporting by Gerard Wynn; Editing by Kevin Liffey)

Investor puts his money in the rainforest

Investor puts his money in the rainforest
18:38 27 March 2008
NewScientist.com news service
Catherine Brahic
http://environment.newscientist.com/channel/earth/dn13549-investor-puts-his-money-in-the-rainfores

t.html?feedId=online-news_rss20
It is either a visionary piece of capitalism or throwing money into the wind. A venture capitalist today made a huge environmental bet – that one day the environment services that sustainable forests provide will be worth big money.

The Iwokrama reserve in Guyana is a 371,000 hectare chunk of tropical forest – roughly the size of Majorca – and is a successful experiment in sustainable forest management.

Hylton Murray-Philipson, director of the UK-based financiers Canopy Capital, has signed a deal with Iwokrama guaranteeing a "meaningful" contribution to their running costs for five years, a deal which may be renewed.

In return for these funds, Canopy Capital is given "ownership" of the forest's ecosystems services and a claim on any profits that might one day be made from them.

Zero deforestation

The value of the deal is undisclosed, but it is unprecedented. Murray-Philipson describes it as "creating wealth that is worth having".

Iwokrama is home to the same level of biodiversity as the neighbouring Brazilian Amazon but, unlike the Amazon, it is not disappearing. According to the UN Food and Agriculture Organization, between 2000 and 2005 the rate of deforestation in Guyana was 0%.

Logging in Guyana is selective, with only 35 of more than 1000 tree species logged commercially. The Iwokrama reserve itself operates a low level of logging equivalent of one tree per hectare each year on just half of its total surface.

Guyana's pristine forests as yet have no financial value. But they seed rain that irrigates farmlands as far away as the American Midwest, house thousands of species of plants and animals, including many rare ones, and store tonnes of carbon.

Unknown value

In November 2007, Guyana's president put his forests up for adoption in exchange for development aid. "What else has Guyana got to offer the global economy?" asks Murray-Philipson.

The trouble is, because of Guyana's excellent track record in forest conservation, no-one else seems to think the forests have any value.

"Let's not be idiots about these ecosystem services," says Niki Mardas of the Global Canopy Programme, "humans are getting a free ride." Mardas's organisation is a partner in the Canopy Capital deal and will receive 20% of any returns on the firm's investment.

Murray-Philipson reckons the forests are worth about $20 per hectare, although he admits he may never see a penny of return on his investment. He says the price tag is considerably less than what some companies are considering paying to store carbon under the sea.

'Winds of change'

Worked out in terms of carbon storage – the only ecosystem service to have some sort of value at the moment – it comes to $0.20 per tonne. Meanwhile, he notes that oil giant BP is looking at spending $50 to $60 a tonne on pumping carbon into disused oil fields in the North Sea.

"The winds of change have to blow through the canopy," Murray-Philipson says. "If I am wrong, we have a write-off, but at least we have tried to do something to change the paradigm of how man relates to nature."

"Rewarding people for good management is intrinsically more palatable than REDD [Reduced Emissions from Deforestation and Degradation] which rewards people for addressing a situation out of control," says Duncan MacQueen, a forestry expert at the Institute for Environment and Development in London, referring to a UN programme that was launched at the climate change summit in Bali, Indonesia, last December.

REDD aims to pay countries to reduce deforestation. The details need to be ironed out and the final agreement is not expected until 2009, but it looks unlikely that REDD will reward countries, like Guyana, that have a long-standing record for conserving their forests.

Iwokrama in revolutionary carbon deal -one million acres to be valued

http://www.stabroeknews.com/index.pl/article?id=56541790

Iwokrama in revolutionary carbon deal
-one million acres to be valued
Stabroek News, Thursday, March 27th 2008

The Iwokrama International Centre for Rain Forest Conservation and Development is to announce a revolutionary deal in New York today that will see a financial value being assigned to the climate services it provides.

The UK's Independent newspaper reported last night that the deal with Canopy Capital will be unveiled today. Iwokrama had previously indicated here that a carbon credits deal had been under discussion with a UK company. Iwokrama officials could not be contacted last night for further information.

The Independent said that the deal "will place a financial value on rainforests - paying, for the first time, for their upkeep as `utilities' that provide vital services such as rainfall generation, carbon storage and climate regulation."

Since its conception in 1989, Iwokrama has struggled to stay financially viable but the recent global momentum towards valuing standing forests for their climate services has given it a new lease on life. The deal comes in the wake of an offer by President Bharrat Jagdeo of almost all of Guyana's forests in the battle against climate change. He made the offer here last year at a meeting of Commonwealth Finance Ministers.

Hylton Murray-Philipson, director of the London-based financiers Canopy Capital, who sealed the deal with the Iwokrama rainforest, told the Independent: "How can it be that Google's services are worth billions but those from all the world's rainforests amount to nothing?"

"Forests do much more for us than just store carbon ... This first significant step is in keeping with President Jagdeo's visionary approach to safeguarding all the forests of Guyana," Iwokrama's chairman and former UK High Commissioner to Guyana, Edward Glover told the Independent.

The deal, drawn up by the international firm Stephenson Harwood, is the first serious attempt to pay for the ecosystem services provided by rainforests, the report said.

Guyana's attempt to secure its entire standing forest has received the backing of the British environment minister Phil Woolas. According to the report, Down-ing Street has told The Independent that it is "considering the offer". President Jagdeo met with UK Prime Minister Gordon Brown on the fringes of the re-cent Commonwealth Summit in Uganda where they discussed the proposal.

The Iwokrama project arose out of an offer in 1989 by then President Desmond Hoyte at the Commonwealth Heads of Government Meeting in Kuala Lumpur, Malaysia to have a million acres of virgin forests in the centre of Guyana set aside for sustainable forestry studies.