The Fate of the Tropical Forest: Carbon or Cattle?

background

The Clean Development Mechanism, established by the Kyoto Protocol, includes small-scale afforestation and reforestation projects as a means for participating developed countries to receive credit for emission redcutions.

Research Goals & Methods

The authors conducted a small-scale study of a CDM afforestation/reforestation project proposal among the indigenous Embera people in Panama. The proposed project included 39 households that would reforest 692 ha of land (22% of community land) for carbon sequestration with teak and fruit trees. Surveys were conducted in the community to determine household opinions on the attractiveness of cattle ranching, avoided deforestation, and reforestation land-uses.

Conclusions & Takeaways

The researchers found that the net income (benefits minus the costs) of planting trees and selling timber at 25 years was higher (with $780 / ha income from carbon credits) than from the net income of cattle raising. However, the benefits are so far apart (in year 1 and year 25) and provide no cash flow in the intervening years. Instead, the authors recommend that avoided deforestation payments (REDD+), where residents would be compensated every five years for choosing forest preservation over cattle raising would be a more viable option. In that case, the total cost of the subsidy would be effectively equivalent to the upfront payments for carbon storage. The authors suggest that avoided deforestation, or conservation of forest, should be accepted internationally as a means of carbon emissions reduction and trading.