Payment schemes to reduce carbon emissions from deforestation in the Brazilian Amazon are most likely to fly high if they target smallholders
Worldwide, at least 40% of rainforests have been destroyed in the past 30 years. The Brazilian Amazon is a principal candidate to reduce emissions from deforestation and forest degradation (REDD), because it contains most of the globe's largest remaining tracts of rainforest and suffers the world's largest forest loss every year in absolute terms. This is important for climate change, because up to one-fifth of global carbon emissions annually come from land-use change such as clearing forests for agriculture.

According to the Brazilian National Institute for Space Research, between 2000 and 2005 roughly 13 million hectares of Brazilian Amazon forest were felled. Reducing the carbon emissions associated with continuing deforestation of this kind may secure important side benefits, such as conserving biodiversity and cultural values as well as regulating the regional climate.

Owners of relatively large tracts of land, thought to be responsible for 80% of current deforestation in the Brazilian Amazon, would be the biggest financial beneficiaries if direct payments were used to curb emissions of greenhouse gases from forests. This is according to a new study by researchers in the Center for International Forestry Research (CIFOR) and their partners.

"When four-fifths of a major environmental problem is caused by large landholders, then any solution will have to provide some compensation to this group for their losses," said Sven Wunder, a CIFOR scientist and coauthor of Direct Conservation Payments in the Brazilian Amazon: Scope and Equity Implications, which was published this year in the journal Ecological Economics. "And if that achieves the desired emission reductions, perhaps it's a necessary evil."

The research team estimated that an investment of US$6 billion in REDD could halve the forest loss projected between 2008 and 2019 in the Brazilian Amazon. This would conserve about 12.5 million hectares, an area more than half the size of the United Kingdom.

If direct payments for avoided deforestation were targeted to areas with high historical deforestation rates, the study finds that a large share would go to owners of large holdings measuring 100 hectares or more. Yet, the authors emphasize that three-quarters of future deforestation will take place in areas that have ill-defined or insecure tenure, mainly on unclassified public lands or private land without clear boundaries or inside strictly protected areas - conditions under which payment schemes are often ineffective. Only a quarter of future deforestation is projected to occur in indigenous territories, sustainable use areas, and land reform settlements, in which farmers can legally negotiate forest use rights.

"The land-tenure chaos represents the single largest impediment for using on-the-ground payments to implement REDD in Brazil on a large scale," says Jan Börner, a CIFOR scientist and coauthor of the study. This is because many big players have only shaky claims to the forestlands they operate on. Targeting payments to smallholders may thus be not only an effective, but also a pro-poor short-term bet for pilot payment schemes designed to reduce carbon emissions, the authors suggest. Further investments in land tenure regulation and improved enforcement of forest conservation laws will be needed before direct payments can be introduced at larger scales.