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Dra. Marie Cordonier - Carbon Markets


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Market Access Workshop - Honduras September 2011. IDLO presentation on carbon markets

Market Access Workshop - Honduras September 2011. IDLO presentation on carbon markets

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  • 1. Access to Carbon Markets in the new Green Economy:
    Public laws for small & medium private producers
    Prof. Marie-Claire Cordonier Segger, MEM (Yale), BCL & LLB (McGill), BA Hons
    Director, Centre for International Sustainable Development Law (CISDL);
    Manager, IDLO Sustainable Development Law Programs;
    Visiting Professor, Faculty of Law University of Chile &
    Affiliated Fellow, LCIL Cambridge University /
  • 2.
  • 3. Opening Carbon Markets for a Global & Local Green Economy
  • 4. Green Economy must support Rural Development
    The rural poor depend the most on and are most vulnerable to ecosystem services for income, subsistence and future resilience
    Healthy ecosystems are critical to natural capital that generates economic activity for well-being (agriculture, aquaculture, forestry, climate system)
    The poor have few means to cope with and face disproportionate losses from the depletion of natural capital
    Many ecosystems are nearing critical thresholds beyond which their services to the poor are drastically reduced (coastal ‘dead zones,’ deserts, depleted soils)
    (TEEB: The Economics of Ecosystems & Biodiversity, 2010)
  • 5. Rural Development through Participation
    in the Green Economy
    Direct benefits
    More employment
    New low-carbon products
    Stimulated existing sectors
    Local/national/international investment
    Small business development
    Sustainable energy, water and sanitation
    Indirect benefits
    Infrastructure development
    Local/national capacity building
    Resilience to natural disasters
    Meeting international commitments (UNFCCC, T&I Treaties...)
    2% GDP Green Investment Scenario v BAU
    (UNEP Green Economy Report, 2011)
  • 6. Global Commitments to Open Carbon Markets
    & Green Economy
    UN Framework Convention on Climate Change
    Changes financial flows towards low-carbon and climate resilient pathways, from: “public and private, bilateral and multilateral, including alternative sources”
    - Clean Development Mechanism (CDM)
    - Reducing Emissions from Deforestation and Forest Degradation (REDD+)
    - Technology Mechanism &Nationally appropriate mitigation actions (NAMAs)
    Many Other Accords for Sustainable Development
    - UN CBD: Payment for Ecosystem Services (water services, biodiversity & habitat protection, etc)
    • ABS Nagoya Protocol: Access to Genetic Resources & Sharing of Benefits (ABS)
    • 7. EU-Central America Association Agreement (SMEs, organic goods, carbon markets); CA-USA-RepublicaDominicana FTA, CA-Panama FTA, Mexico-Nicaragua FTA, Mexico-Honduras-El Salvador-Guatemala FTA, Canada-Costa Rica FTA, CA-Chile FTA, Panama-Singapore FTA, El Salvador - Taiwan FTA (diverse commitments to support sustainable development & SMEs)
    … Upcoming Rio + 20 UN Conference on Sustainable Development will focus on green economy in context of poverty reduction & sustainable development
  • 8. Overcoming Legal Barriers to Carbon Markets
  • 9. Growing Regional and Voluntary Carbon Markets
    In the past 5 years, international, regional, domestic and voluntary carbon markets have grown from:
    USD 11 billion to 141.9 billion
    (Carbon Finance at the World Bank, 2011)
  • 10. Many Laws are Important – Not All are Clear
    Business registration and rules
    Taxation laws
    Subsidy policies
    Anti-corruption laws
    Financial planning, reporting and auditing laws
    Trade and investment laws
    Intellectual property laws
    Land use planning regulations
    Protected areas laws
    Payment for ecosystem services, community-based natural resource management and participatory forest management regulations
    Environmental and natural resource management laws
    Energy and electricity laws
    Agriculture laws
    Transportation policies
    Easement and acquisition provisions
    Building codes
    Water management laws
    Land tenure laws
    Forestry laws
    Biodiversity protection policies
    Human, indigenous and gender rights guarantees
    Constitutional laws
  • 11. Legal barriers to access carbon markets:
    Clear Property rights
    Green investments can support poverty eradication & sustainable development, and laws can help with:
    Equitable and secure land tenure
    Clear guarantees for small & medium scale carbon owners
    Simple clear contracts for benefit sharing
    Reliable rules for insurance
    Straight rules for small land owners to associate & participate
  • 12. Legal barriers to access carbon markets:
    Small & medium laws for SMEs
    Micro to medium sized enterprises may not gain access to open market opportunities, and laws can help with:
    Clear and affordable business registration
    Economic incentives for credit advances or capital start-up costs
    Elimination of perverse subsidies to competing “brown” businesses
    Guidelines for the transfer and sale of assets
    Corporate liability protection for owners and investors
  • 13. Public – Private Dialogue & Participation for Green Economy
  • 14. Conclusions: Time to move forward
    • New green economy markets are emerging, and important opportunities are opening for Central America.
    • 15. There is a need for meaningful participation of SMEs and rural producers in the opportunities ofthe global green economy,especially carbon markets (CDM, REDD+, NAMAs).
    • 16. Changes may be needed to public laws and policies. Successes can be shared, legal and governance barriers can be identified, reforms can be recommended, training and technical assistance can be provided, and solutions can be tailored for each sector / community.
    • 17. With new cooperation all along the value chain, producers & consumers can build the green economy together!
  • Gracias / Thank you / Merci
    International Development Law Organization (IDLO)Viale Vaticano, 106 00165
    Rome, Italy
    +39 06 40403200
  • 18. Annexes
  • 19. Carbon credits (CERs) represent the difference between the baseline and actual emissions
    Greenhouse gas emissions
    Project start
    Historical Trend
    Generating carbon credits through REDD+ activities
    Source: UNDP 2010
  • 20. Aid targeted at biodiversity, USD million
    (OECD, Rio Markers 2011)
  • 21. Trends in public and private green instruments
    REDD+ activities will be eligible for support under new international finance mechanisms
    Renewable energy feed-in tariffs and other power purchasing agreements are being implemented across North America, Europe and Africa
    Carbon markets have gained traction in developing economies such as Brazil, China, India and Mexico with worldwide growth from USD 11 to 141.9 billion in 5 years
    Technology development and transfer to developing countries is supported by Japanese and Chinese initiatives
    Global market for eco-labeled fish products grew by over 50% in 2008-2009
    Ecotourism is the fastest growing area of the industry with an estimated increase in global spending of 20% annually
  • 22. Green economy is more than global commitments
    New public & private investment & trade
    • International trade and investment agreements
    (renewable energy, transport, tourism)
    • Voluntary and regional carbon markets
    (agriculture and land-use)
    • Domestic tax policies and subsidies can encourage
    green investments
    • Value-added production and certification schemes
    Official Development Assistance
    significant portion is designated to green growth in:
    energy efficiency projects, low-carbon industries,
    natural resource management, disaster risk reduction
    OECD: bilateral ODA for climate mitigation
  • 23. Practical example:Rising organic production and processing
    Organically managed lands reached 35 million hectares in 2010 with the highest number of producers in Latin America, Africa and Asia and revenues of USD 50.9 billion
  • 24. Legal barriers to accessing green instruments:
    Access to justice
    Inaccessible institutions can lead to corruption, exploitation and administrative barriers without:
    Free, prior and informed consent (FPIC)
    Stakeholder decision-making procedures
    Rules for participatory project implementation
    Clear and affordable rights of recourse
    Culturally sensitive and customary justice systems
    Targeted legal training of officials, the judiciary and administrative tribunals
  • 25. Legal barriers to access carbon markets:
    Fair employment rules for the poor
    Increased employment from new economic activity may not create fair and equitable labour, clear laws can help with:
    Fair negotiation of contracts
    Guarantees for decent wages
    Guidelines for safe working conditions
    Freedom of association & cooperatives
    Compensation for workplace injuries
  • 26. LPPCI Methodology
  • 27. International Development Law Organization
    • Inter-governmental Organization specialized in Legal and Institutional Aspects of Development
    • Legal Capacity Building and Technical Assistance Programs on Sustainable Development (Climate, Natural Resources, Green Economy) and other issues.
    • Legal Professionals; Governments; Policy Makers; Regulators; and Civil Society in Developing Countries, Transition Economies and Countries Emerging from Conflicts
    In-Country Programs: over 175 Countries
    Project Offices: Bishkek, Juba, Kabul, Nairobi
    Rome Headquarters, Regional Centers in Cairo and Sydney
    Alumni Legal Network in 44 Countries
  • 28. IDLO Strategic Plan 2009-2012
  • 29. Overcoming legal barriers to the green economy
    • The LPGE aims to ensure the meaningful participation of developing countries in the opportunities presented by the global green economy, while supporting the development of a legal environment that promotes sustainable use of biodiversity and equitable access to its benefits.
    • 30. The LPGE is a unique methodology that systematically identifies legal and governance barriers, makes recommendations, provides legal and regulatory training and technical assistance, and implements consensus-based solutions tailored uniquely for each recipient country in order to access international green economy markets.
  • 31. Overcoming legal barriers to the green economy
    Research on common barriers and legal best practices
    Context specific impact assessments to identify legal and institutional barriers between green economy benefits and poverty alleviation
    Consultation with stakeholders to build consensus on desired benefits
    Revision of finance instruments to ensure: access to justice, and property, labour and business rights
    Country-driven legal and institutional reforms to national, subnational and local regulatory frameworks
    Capacity building for ongoing domestic reforms
  • 32. But a few IDLO programs...
    NationalLegal Preparedness for Climate Change and REDD+programs in countries such as Zambia, Vietnam, Mexico, Colombia, Ecuador with partners such as IFAD, CDKN, FAO and UN-REDD
    Training workshops to the Zambian Development Agency on green growth through legal incentives for international carbon investments
    Land titling legislation, REDD+ and customary lawresearch and legal training workshops on reform processes for communities in Uganda, Benin, Burkina Faso, Senegal, Liberia, Mozambique, Rwanda, Madagascar and Indonesia
    Legal training in selected communities in Kenya on rights to protect traditional knowledge through community-based mechanismsthat enable them to set legal conditions to share knowledge with non-traditional users on questions of biological diversity and REDD+
    Rural microfinance legal capacity analysis and training programsfor low-emission sustainable food production and labeling in communities in Ecuador and Uganda with partners such as the Government of Italy