REDD+ Mechanism:

Pakistan faces the challenge of arresting the very high deforestation rates along with low and declining forest area coverage. Both these statistics provide a dismal picture of the country’s forestry sector. However, ironically, they inherently provide an opportunity to benefit from REDD+ which is globally aimed at financially rewarding a reversal of high deforestation. Like other countries in the tropical belt, it stands to greatly benefit from interventions carried out to arrest the rapid deforestation especially in the forests stocks still left standing. This will not only assist Pakistan in addressing a local environmental issue but also generate global value by contributing to the fight against climate change through preserving a valuable carbon asset.

To realize this, however, the carbon value of the forests in Pakistan needs to be financially identified and quantified in both current as well as future terms in preparation for an international REDD regime which aims to recognize the value of these global assets of sequestered carbon. The REDD regime is currently in a state of flux and no clear international regime has, so far, emerged. However, being a country with an obvious potential to benefit from REDD+, Pakistan needs to adopt a pro-active plan of action on both, the negotiations as well as readiness tracks of REDD+ by carrying out a “REDD Readiness” capacity building exercise to include a national carbon stock assessment and identification of possible REDD+ projects as well as creating the necessary MRV (Measurement, Reporting and Verification) technical capacity in the country.

In terms of availability of funds, a number of developed countries have committed to provide scaled up funding for readiness and capacity strengthening as well as for supporting implementation of REDD+

66 plans and actions, including demonstration activities and payments for results. In the margins of COP 15, six donor countries dedicated USD 3.5 billion as initial public finance over the 2010 to 2012 period, as a component of their collective commitment of fast start finance under the Copenhagen Accord, to initiate an effort of slowing, halting and eventually reversing deforestation and forest degradation in developing countries, while also expressing their willingness to scale up financing for REDD+ thereafter, as appropriate, in line with opportunities and the delivery of results. Since then, further pledges of support have been made, including at the ministerial meeting on REDD+ in Paris in March 2010 and at the Oslo Climate and Forest conference in May 2010. The total pledges, as of May 2010, stand at 4.0 billion USD97 _{which are aimed to be utilized for REDD readiness in the 2010-2012 time frame.}

Although the exact methodology for disbursement of these funds is still not clear, considerable progress was recently made by the establishment of a “REDD+ Partnership” group in Oslo at a conference in May 2010. This is a voluntary and non-legally binding framework amongst 58 developed and developing countries98 which have agreed to collaborative REDD+ efforts including knowledge transfer, capacity enhancement, mitigation action and technology transfer. The UN-REDD and WB-Forest Carbon Partnership are jointly acting as the secretariat for this group which is open to all for membership and the administration of the group is through two co-Chairs (developed and developing country). This was positively followed up with inclusion of REDD+ under the Cancun Agreements in December 2010

The funds allocated by the donors are going to be, most likely, administered through this partnership either bilaterally or multilaterally depending on the donor preference. There is some doubt, however, as to whether these promises still stand in the absence of a comprehensive climate agreement but the group mentioned above is now providing a fresh impetus and resolve to this announcement. Also, funding for the implementation stage between 2013 and 2020 will require much more money and remains unresolved.

Another projected source of generating REDD+ finance is supposed to be the global carbon market. In this respect a number of carbon funds in the forestry sector have mushroomed which are presently focusing on the voluntary market place and using this as a route to position them for the future REDD market. Such forestry credits are, subsequently, discounted owing to the risk associated with the lack of market clarity and absence of globally agreed rules but still provide a very valuable learning experience in a nascent market. This is expected to change after the international rules for REDD are agreed and could, potentially, trigger the carbon market to serve as a major source for generating REDD+ funding.

4.1.3

The “Green Climate Fund” under the “Cancun Agreements”:

One of the silver linings of the outcome agreements at Cancun (COP16) was that it chalked out the architecture for delivering climate finance through creation of a “Green Climate Fund” and announced the setting up of a transitional committee and a standing committee on finance to make this fund operational in a specified time frame The extensive architecture and framework proposed under these agreements hinges upon the availability of climate finance which is based upon the voluntarily announced pledges by developed countries of providing $30 billion in fast track finance and $100 billion in long term finance – announced at Copenhagen and formalized under the Cancun Agreements.

67 However, the availability, accessibility, adequacy and predictability of this funding remains uncertain but this will hopefully change in the near future making this fund one of the prime sources for securing climate finance.