New Internationalist

Bond aid

Issue 428

Ecuador is looking beyond Copenhagen with its bold proposal – that the international community should pay the country not to exploit a vast oil reserve. Jess Worth catches up with the initiative.

Photo by Mauro Burzio / www.yasunigreengold.org
Photo by Mauro Burzio / www.yasunigreengold.org

On sale now at www.newint.org/books
Yasuní Green Gold - the book of the campaign
Remarkable photographs illustrate the Yasuní region’s unique beauty and diversity.
On sale now at www.newint.org/books

Last year, the NI got involved with the campaign to save the Yasuní rainforest – a remarkably biodiverse area of the pristine Ecuadorian Amazon that is perilously perched atop 850 million barrels of oil.

Ecuador has a shocking history of human and ecological devastation caused by oil extraction. So when we heard that Ecuador’s President Correa had challenged the international community to pay his country to leave the oil in the ground, we were both thrilled by his audacity and concerned as to how this might pan out in practice.

We talked to local villagers and indigenous residents of the forest. They were worried. They had not been consulted. They did not know whether their Government was serious. How would the money be spent? Then we began to hear rumours that this might be a plan to turn the Yasuní initiative into a giant carbon offset, a get-out-of-jail-free card for northern polluters that could impact on the rights of locals who depend on the forest for their livelihoods.

One year on, the Ecuadorian Government’s plan has taken a more tangible form. In October I met Yolanda Kakabadse, a warm and friendly woman who is a member of the Presidential Commission on Yasuní, to try to get some answers.

JW Could you summarize the Yasuní proposal?

YK It is based on a simple concept: that doing something about climate change is everybody’s responsibility. Ecuador is willing to partner with those countries emitting high levels of greenhouse gases to achieve a goal that would benefit everybody. The emitter countries cover the cost of keeping the oil underground, and we use the money towards objectives which are terribly important for Ecuador and for the planet. The funds would go to ensuring that not just the Yasuní but 40 key conservation areas of Ecuador are protected. That would be 38 per cent of our territory, making us the leading country in the world in terms of the percentage we would be protecting. And money would go towards addressing poverty at its roots by providing local people with options to benefit economically by using the forest, not by destroying it. So it’s a social agenda, a biodiversity agenda and a climate change agenda.

JW You worked out that the figure you would require is 50 per cent of the potential revenue from the oil – hundreds of millions of dollars. Where are you hoping that money will come from?

YK We’re having very interesting responses from European countries at the moment. Germany responded favourably more than a year ago and gave us some funding, together with the Spanish Government, to invest in all the technical science needed to back up our proposal. Spain has been very positive: we are discussing with them what amount their contribution would be – it might be a swap of Ecuador’s debt to them. We have visited France and the response was positive. We will be visiting Belgium. We have visited Sweden and Norway; we will be visiting the Netherlands and the US. The UK has just said ‘no’, but we will try again…

JW So what will the mechanism be?

YK Ecuador will produce certificates called CGY: Certificado Garantía Yasuní. They will be like a bond, a legally binding document that will be given in return for contributions to this fund. If Ecuador ever breaks this deal, we would have to return the funds to the donor. But what is interesting is that we would make more money out of these non-emitted CO2 certificates than out of oil barrels. What we lose as a country if we go ahead and exploit the oil is much larger, in terms of ecological damage. We have been the first to quantify this and prove that there is a higher value for Ecuador in keeping the oil underground than in selling it.

JW Can you persuade people to pay for a Yasuní certificate?

YK I think so. What is important is to talk to the right decision-makers. Usually technocrats, the people who are immersed in the do’s and don’ts of the Kyoto Protocol, would immediately react saying, ‘Kyoto doesn’t allow you to do that’. Of course it doesn’t, because what we are proposing is totally different, a novelty! The world needs to recognize that Kyoto was not enough and that we need to invent other instruments to reduce emissions. This Yasuní initiative is one of them.

JW So would these work like carbon credits and be tradeable on the carbon markets?

YK They will not be on the market as carbon credits, because they are not carbon credits. The origin of them is fundamentally different. They would be treated as if they were carbon bonds by those countries that decide to support us. A CGY will cost around $50, according to the price of a barrel of oil. So as the oil market changes, the price of the Yasuní certificates will change.

JW Would you expect to get a fair amount of private finance on board?

YK The major income will come from governments but that doesn’t exclude the private sector, individual donations. You, I hope, will buy a barrel. When you go to a wedding and you want to give a gift, you can give them a certificate. Or when a child is born, you can give that child a certificate. We want to attract 5 million, 10 million, 20 million individuals from Tokyo, South Africa, Stockholm, Brazil, Vietnam – individuals who find that solidarity with this new idea might change things.

JW Some people might say you’re naïve, believing that people will do this out of altruism, for no financial gain.

YK I think this reflects the mentality that winning is always material winning. By getting involved in something like this you are not getting an economic benefit. You are getting a spiritual, intellectual, human benefit that is for the planet, not for Ecuador alone.

JW How does this fit in with the negotiations at Copenhagen?

YK Copenhagen is designed to respond to Kyoto, to what has happened and what needs to happen next, not to new initiatives like this. But we will take the opportunity to tell our story, to lobby, to convince – and to demonstrate that Kyoto is not the end of the world. It is one instrument, but we can create others.

JW How are the funds going to be spent, what is the mechanism for deciding that, and will local people get a say?

YK The funds will go into an international trust fund that will direct the money into four activities. I mentioned the 40 protected conservation areas. Number two will be reforestation, reforestation, reforestation. Recovery of degraded land, which unfortunately we have everywhere in Ecuador – on the coast, in the mountains and in the Amazon. The third will be our energy matrix. Ecuador’s matrix today is oil, which is crazy, especially for a tropical country in the middle of the equator that has a lot of potential for wind, solar, geothermal and hydro. So we want to move into alternative energy sources. And the fourth is investment in the social agenda of local communities that live in and around the protected areas.

JW One of the concerns that we were hearing from local communities and indigenous people was that they hadn’t been consulted. They didn’t know what was going on.

YK They were right. We abstained from having a communication strategy for indigenous peoples because unless you can tell them that you have succeeded you will only be creating dreams that will not be fulfilled. And unfortunately, the history of our indigenous peoples is a lot of false announcements, of false commitments that have never been met. Only now are we in a process of disseminating information, public consultations and debates with indigenous peoples, NGOs, local government, the private sector, media and academia.

JW My concern is whether it will be used as a carbon offset, an opportunity for fossil fuel companies to buy Yasuní certificates and therefore continue to pollute at home, because we are finding that this is a barrier to our own rapid transition to a low-carbon economy.

YK We have maybe a different view. The majority of governments and the private sector are trying to do better, and we believe in them and trust them. Whether they do it out of conviction or to get a better image, that doesn’t matter, as long as change happens. It’s also good business to be better, because otherwise you won’t survive. So we are not in the position of criticising what has not yet been addressed. I think it’s important to value what has been addressed, to recognize that it is a step forward, but in an ongoing process. It doesn’t mean that everybody’s in the bag – there are some who couldn’t care less, everywhere in the world. But there are actors who really care, who are investing in new technologies, in improving this planet’s future in many ways. Our certificate would be another instrument to support this partnership of North-South co-operation.

Have your say!
What do you make of this? Is it thrillingly visionary or hopelessly naïve? Just another carbon offset scheme or a genuinely innovative way to channel money towards building a low carbon economy? Respectful towards local people’s rights or top-down and patronizing? Most importantly – would you buy a barrel?

Join the debate at http://blog.newint.org/yasuni/

Yolanda Kakabadse

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