Seminar 13 Mar 13 - Opening Session - Impacts of trade and investment on forests and people by PPacheco


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Seminar 13 Mar 13 - Opening Session - Impacts of trade and investment on forests and people by PPacheco

  1. 1. Theme 5:Impacts of trade and investment on forests and people Bogor, March 2013
  2. 2. Two research sub-themes Understanding the processes and impacts of forest-related trade and investment Improving responses and policy options to mitigate the negative impacts and enhance the positive impacts of trade and investment
  3. 3. Main goalTheme 5 of CRP6 (ex-Component 5) aims tocatalyze shifts in trade and investment trendstaking place in forested landscapes, targeted atreducing their negative impacts and enhancingtheir positive effects on forests and people toadvance sustainable and inclusive development
  4. 4. Rationale There is a growing influence of T&I on forest resources use, landscape change and people’s livelihoods Main trends are linked to: • Shifts in commodity flows; • Growing convergence of food, feed, energy and financial markets; • Expanding role of transnational capitals in producer countries and emerging-market multinationals Impacts are mediated by multiple policy, market and institutional conditions that operate at different scales
  5. 5. A simplified framework Drivers Impacts Responses Timber Global Oil palm Soybean Minerals Corporate Responses in Others Global T&I strategies consumer flows and and business countries Impacts and responses patterns models Impacts on National and sub- Multi- forests and national policies and stakeholder people and legal frameworks processes trade-offs Local actors and Socio- conditions (socio- Responses in ecological economic, institutional producer interactions and ecological) countries linked to T&I Local Transition pathways
  6. 6. Subject areas Impacts from Chinese trade and investments in Africa The role of emerging economies in Large-scale land land and forest resources use acquisition for food, fiber, and energy In Indonesia Large-scale land acquisition and investments and their impacts Building enabling legal Implications on forests from food frameworks for sustainable land use and low carbon systems and biofuels development investment Domestic and international timber trade and legality compliance Integrating the domestic timber sector in the formal economy in Forest crime, corruption and the context of FLEGT-VPAs integrated law enforcement Anti-corruption and anti- money-laundering frameworks associated with the forestry sector
  7. 7. Research highlight 1 China – Africa: Value chains, households, environmental impact Chinese involvement in timber extends into all forest Different patterns of Chinese involvement in Congo regions, and further to the Basin Region Timber middle of the continent Country Number of Area (ha) Share of national Observations Chinese actors are heavily active Concessions concession forest (2010) engaged in mineral Gabon (2010) 121 2,7 m 25% High-level gov’t arrangements with extraction, with potentially Cameroon 5 0.5 m 10% Chinese logging companies One Hong kong-based group large indirect effects (2009) DRC (2010) 0 0 0 Small scale permits/domestic Little evidence that Chinese market trade interests are important in large-scale land acquisition
  8. 8. Research highlight 2 Chainsaw milling in Central Africa  Domestic timber markets contribute with €60M (excluding DRC) to the national economies  Contribution (in some cases) higher and (always) redistribute better than industrial  Networks of corruption “fight” formalization and affects income distribution from timber Distribution of chainsaw milling costs by production factor Source:Cerutti and Lescuyer 2011; Lescuyer et al. 2010, Lescuyer et al. 2011, Cerutti et al. Forthcoming.
  9. 9. Research highlight 3 Implications of biofuel-induced land-use changes Direct and/or indirect land-use changes from cultivation of feedstocks can cause emissions due to carbon losses from biomass and soil Among the different case studies, the largest carbon debts are related to oil palm (certainly in peat land). Repayment times are the longest for oil palm due to peat land conversion and for Jatropha due to low yields and consequently low CO2 repayment rates Carbon debt andrelated repayment time due to direct (dLUC) and indirect land-use change (iLUC) Source: Achten and Verchot (2011). Ecology and Society Note: the graph represents the low iLUC scenario
  10. 10. Some findings and observations The corporate strategies rather than the “ethnic origin” of investments explain the differential practices and outcomes “Business models” adopted by companies are crucial to understand the differentiated local socio-economic impacts The disparate outcomes of large-scale investments tend to depend on local state-society-agribusiness configurations Options for smallholders largely depend on the access and performance of broader market and financial networks Better governance requires concerted efforts by governments of producer and consumer countries, financial sector and investors
  11. 11. Emerging issues on pathways Emerging new narratives of development - green economies, but business as usual will persist unless incentive systems and power structures [+ others] are modified While large-scale investments often lead to negative environmental impacts, they can contribute towards sustainable land use and low carbon development Interesting policy innovations are being put in place in forest-rich producer and consumer countries, but impacts on forests and people are still uncertain