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Saving Forests with Carrots as well as Sticks - Part 2

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Part 1 of this blog overviewed the recent rise of robust interdiction of illegal logging, including stronger laws recently passed in the US and the EU, and an emerging trend towards stronger enforcement. These recent developments are significant signs we're getting serious about protecting forests, and they have been one factor among others in cutting illegal logging by 25% in the last decade.

But there are other important factors in the current gains that we shouldn't ignore, because they will be decisive in future gains. They include better due-diligence tracking, building markets for voluntary sustainability certification regimes and sourcing practices, encouraging higher industry CSR standards and greater consumer demand for legal and sustainable wood products, plus positive incentives for forest preservation. It will take all these factors working together with interdiction to cut illegal logging all the way to zero.

In other words, we need carrots as well as sticks. Protecting forests is not only or even primarily a question of policing bad actors; it's mainly a question of shifting the future of the global forestry onto a positive, sustainable path.

One good example is built into the ban on illegal logging passed by the EU last month. In addition to negative penalties and stronger enforcement, it also provides a new set of due-diligence monitoring requirements for all importers and traders of wood products, requiring them to track the provenance and prove the legality of wood they source from abroad. The supply chains are often very complicated, with some wood being sold at auction, which makes it challenging to track from the forest to the manufacturer.

On that front, my organization the Rainforest Alliance helped pioneer independent, third-party legality verification for wood producing and processing industries around the world. RA and our European partner NEPCon specialize in verification services and tools for companies to improve their due diligence, and we're also building new ones, like a new Global Forest Risk Registry risk assessment platform. Demanding better tracking and transparency and making better tools available will make it harder for illegally sourced wood to creep into supply chains. That builds confidence in the legal market and makes enforcement more viable not only by catching cheaters, but much more often, by positively verifying legally sourced wood.

Another key factor that will take global forestry beyond just penalizing bad actors is the UN's REDD (Reducing Emissions from Deforestation and Degradation) scheme, which provides strong positive incentives for forest preservation. Under REDD 37 producer (mainly tropical) countries would be paid some $14 billion from consumer countries by 2015. The purpose of the payments is to help them reduce their carbon emissions by changing their logging and other forestry practices. Among other things, the money helps offset the short-term perverse incentives they would otherwise have to clear their forests for the timber money or to make room for slash-and-burn agriculture.

France and Norway have already pledged $3.5 billion by 2012. When fully functioning, REDD payments would far outstrip current international aid and be a key factor in developing economies. This is a bargain because it could reduce global carbon emissions 17-20% -- more than the entire global transport system currently emits.

Voluntary regimes for third-party independent certification of sustainable forestry such as the non-profit, multi-stakeholder Forest Stewardship Council, established in 1993, have been and will be major factors both in stopping illegal logging and making legal forestry sustainable. Only a small fraction of the world's remaining forests are parks or government preserve. The vast majority are privately owned, working forests. FSC certification places these under a strict sustainability regime that ensures sustainable livelihoods while preserving forests and habitats and cutting carbon emissions.

To date about 335 million acres and counting (the land area equivalent of California plus the entire American southwest) of forest around the world are FSC certified. This has made a significant contribution to the recent decline in illegal logging. In fact, FSC certification can be much more effective at preventing encroachment and preserving forests than government protected areas. This was the case in Guatemala's Mayan Biosphere Reserve, where the FSC management areas were much better preserved and many times safer from encroachment and fires than adjacent government-preserved areas.

Voluntary certification regimes like FSC give companies positive incentives to conserve forests, because they offer efficient management, a transparent supply chain, a way to build consumer loyalty and a more profitable operation. In the wake of the Lacey Act and EU ban on illegal logging, they will be doubly attractive as compliance tools. This not only encourages more acreage to come under certified sustainable management, it's also helping build new markets for sustainable forestry in key emerging economies, including in China.

So although ramped up government interdiction, better spy satellites and stiffer penalties are deservedly in the media spotlight today, interdiction is necessary but not sufficient. It will only take us so far, because we aren't going to be able police all logging on billions of acres of forest worldwide, any more than we can outlaw the forest-based livelihoods a billion people worldwide depend on. If we tried, we'd only get more illegal logging.

The key is to use a coordinated combination of sticks and carrots to build a viable system of incentives and disincentives that puts forest-based livelihoods on a sustainable footing, using best practices for habitat protection, sustainable harvesting and carbon sequestration. That's the way to realize the potential for new forestry reforms to cut global carbon emissions deeply, zero out illegal logging and protect our climate, forests, biodiversity, economies and livelihoods.

The current junction in the history of the long fight to stop forest loss and preserve what's left is an auspicious one, because after decades of work, ramped up interdiction is coinciding with ramped up monitoring, voluntary regimes, best practices and positive incentives that are reaching global scale and critical mass. That amounts to a genuine bright spot in the struggle for a sustainable future.