Discussions of REDD+ occurred in two places in COP17: a contact group under SBSTA and a contact group under the ADWG-LCA. The SBSTA group made good progress on reference levels and safeguards and passed a decision for the COP to consider. The ADWG-LCA considered financing and came up with a less conclusive decision, essentially postponing a final decision to a later meeting of the COP. However, brackets around the whole text show that there is general agreement on this as the best way forward.
The December 7th version of the Amalgamated draft text from the chair of the ADWG-LCA (see reference below) indicates that the negotiators are tending away from market-based toward fund-based approaches to financing. That is, they are calling for the UNFCCC secretariat to develop a technical paper and workshop that will consider all possibilities of raising public funds for REDD+, hoping that public sources (including the Adaptation and Green Climate Fund) can be adequate for the “full implementation” of a results-based approach to supporting actions by developing countries. Responsibility for review of the paper and a final decision would be taken up by SBSTA at its next meeting.
Fund versus market finance has been a long-standing topic in REDD+ discussions. Big advantages of the fund approach are adaptability to national circumstances in both developed and developing countries, its ability to pre-finance upfront investments in governance and capacity that are needed to made REDD+ viable, and its ability to fund public, private and community action at the national level. It is generally assumed, however, that market-based approaches would be necessary to generate the amount of resources needed to fully implement REDD+.
Personally, I hope that the process ends up with a viable fund approach. The fund approach has so far generated positive developments in many countries (eg Norway's agreements with Brazil, Guyana, Tanzania), showing that it pays to take care with accountability in financial management to adapt funding arrangements to national circumstances. The REDD+ Partnership shows that Norway is not the only country willing to dedicate public funds to REDD+. On the other hand the market-based approach failed to finance A/R under the Clean Development Mechanism; the experience with 'carbon cowboys' from the REDD+ pilot activities -- see my previous blog on this topic -- would be magnified under a market-based approach.
Update of the amalgamation of draft texts in preparation of a comprehensive and balanced outcome to be presented to the Conference of the Parties for adoption at its seventeenth
Session, Pp 33-34.
FCCC/AWGLCA/2011/CRP.38, 7, pp. 33-34 , December 2011
C. Policy approaches and positive incentives on issues relating to reducing emissions from deforestation and forest degradation in developing countries; and the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries