UN's forest protection scheme at risk from organised crime, experts warn

International police, politicians and conservationists warn that the UN's programme to cut carbon emissions by paying poor countries to preserve their forests is 'open to wide abuse'
John Vidal, environment editor
guardian.co.uk, Monday 5 October 2009 17.00 BST
A revolutionary UN scheme to cut carbon emissions by paying poorer countries to preserve their forests is a recipe for corruption and will be hijacked by organised crime without safeguards, a Guardian investigation has found.
The UN, the World Bank, the UK and individuals including Prince Charles have strongly backed UN plans to expand the global carbon market to allow countries to trade the carbon stored in forests.
If, as expected, this is agreed at crucial UN climate change talks taking place in Bangkok this week and concluding in Copenhagen in December, up to $30bn a year could be transferred from rich countries to the owners of endangered forests.
But experts on all sides of the debate, from international police to politicians to conservationists, have warned this week that the scheme, called Reducing emissions from deforestation and degradation (Redd), may be impossible to monitor and may already be leading to fraud. The UN itself accepts there are "high risks".
Interpol, the world's leading policing agency, said this week that the chances were very high that criminal gangs would seek to take advantage of Redd schemes, which will be largely be based in corruption-prone African and Asian countries.
"Alarm bells are ringing. It is simply too big to monitor. The potential for criminality is vast and has not been taken into account by the people who set it up," said Peter Younger, Interpol environment crimes specialist and author of a new report for the World Bank on illegal forestry.
"Organised crime syndicates are eyeing the nascent forest carbon market. I will report to the bank that Redd schemes are open to wide abuse," he said.
The significance of the felling of forests across great swaths of the world cannot be overstated - it is are responsible for about 20% of the globe's entire carbon emissions. With governments anxious to find new ways to meet increasingly stringent national emission targets, a scheme which promises to benefit poor countries, cut emissions cheaply and not require any new technology is highly attractive.
But most of the countries rich in forests are also home to some of the world's most corrupt politicians and uncontrolled logging companies, who stand to make billions of dollars if they can get Redd projects approved.
"Fraud could include claiming credits for forests that do not exist or were not protected or by land grabs. It starts with bribery or intimidation of officials, then there's threats and violence against those people. There's forged documents too," said Younger. "Carbon trading transcends borders. I do not see any input from any law enforcement agency in planning Redd."
Hans Brattskar, director of Norway's forest and climate programme, whose country is financially backing the UN Redd programme, said last night: "It will be extremely difficult to make it work. Law enforcement is vital because the corruption issued are very real. But we have to put in safeguards and we have to try. Redd can save up to 20% of all the world's emissions. Without it, I believe it will be impossible to reach the target of stemming climate change and holding global temperatures to 2C," the level judged acceptable by the European Union.
Last month, Papua New Guinea, one of the countries pushing hardest for Redd to be accepted in the UN climate talks, suspended their climate change minister after allegations that $100m of fake carbon credits had been handed to communities to persuade them to sign up to forest protection schemes.
Last night the UN admitted that Redd schemes were dangerously open to abuse. "Where countries are corrupt the potential for Redd corruption is dangerous. [In Papua New Guinea], people have tried to take advantage of the market in an unacceptable way and carbon cowboys are trying to get the benefits. We can expect more of this as Redd develops," said Tiina Vahanen, a senior officer at UN-Redd.
People setting up Redd schemes also fear that they may be discredited by fraudsters aiming to profit from public money. "The potential for Redd rape and pillage is staggering. Logging companies may turn into carbon companies. All they have to do is count, not cut. It's like giving a mass murderer money," said Rob Dodwell, a British conservationist setting up schemes in Kenya and Cameroon.
The UN estimates that 25% of the world's forestry emissions, or nearly 5% of total global carbon emissions, could be saved by 2015 if rich countries invest $15bn to set up Redd schemes.
So far rich countries have put up $52m to establish nine official pilot Redd schemes in Asia, Latin America and Africa. In addition several hundred private schemes are being set up by bankers, conservation groups, and businesses who plan to offer carbon credits on the voluntary market.
But academics and environment groups with long experience working with the logging industry and indigenous communities said that both government and private schemes are being set up with no guarantees to protect communities who depend on the forests. "Decisions are being rushed, communities are not consulted or compensated and the lure of money from cutting emissions is overiding everything," says Rosalind Reeve of forestry watchdog group Global Witness.