Limited markets available for carbon trading, Norway was an exception – GFC

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Guyana has earned millions of dollars in foreign currency from carbon trading; specifically the millions it earned from the Kingdom of Norway for keeping deforestation rates low and for reaching certain benchmarks.

Carbon trading refers to the exchange of credits between nations designed to reduce emissions of carbon dioxide. It originated with the 1997 Kyoto Protocol, with the objective of reducing carbon emissions and mitigating climate change and future global warming.

But with concerns being raised over Government’s apparent policy shift away from carbon trading, it turns out that Guyana can no longer rely on this market.

This emerged on Friday at Parliament during a meeting of the Sectoral Committee on Foreign Affairs and representatives of the Guyana Forestry Commission (GFC), the Office of Climate Change (OCC), and the Guyana Energy Agency (GEA).

Chairperson of the Sectoral Committee on Foreign Affairs, Opposition Chief Whip Gail Teixeira, drew the officials’ attention to the Intended Nationally Determined Contribution (INDC) which Guyana submitted under the United Nations Framework Convention on Climate Change (UNFCCC).

“We are looking at the commitments made by Guyana and what are policy shifts,” Teixeira explained. “So the document that was produced for the revised intended Nationally Determined Contribution kicked off this whole (discussion). Because policy statements are made in there, that is of concern. We are looking at these shifts.”

“In the documents presented in 2015, one of the statements that concern me is ‘Guyana does not see viable opportunities for carbon markets’. These are the kind of issues we have to ask. The problem for me is Guyana was going to make US$235 million from earnings of carbon trading! So this was ours. We didn’t have to borrow money from anybody. We earned it. What are the initiatives to access that kind of money?”

The Parliamentarian acknowledged that Guyana was cited as having one of the lowest emissions in the world, but he questioned how the country would benefit from this. Teixeira stressed that in all its conservation efforts, Guyana still has to survive and make money, taking into account the population.

Head of Planning and Development of the Guyana Forestry Commission (GFC), Pradeepa Bholanath (in blue)

But according to the Guyana Forestry Commission’s (GFC) head of Planning and Development, Pradeepa Bholanauth, Guyana does not have substantial deforestation rates to reduce, and as such, its chances to benefit from the carbon markets are limited.

She noted that there are few countries that would be willing to pay avoided deforestation credits… with Norway being an exception.

“In 2009, when we commenced negotiations with the Government of Norway, the main (issue) was that they were willing to give (money) for what is called avoided deforestation. All the existing markets are trading markets that have been out there, internationally as well as regionally, were paying for emissions reduction.”

“So for a country with high forest cover and low deforestation rates, unless we started to rapidly deforest like other countries around the world with high levels of deforestation rate, it would be (unsuccessful) for us to target those markets when we don’t have a substantial amount to reduce. So there were very few partners at that time, and even now, who were willing to pay for avoided deforestation” Bholanauth posited.

But Teixeira noted that this was the whole point of negotiations back then, which was to ensure rewards for countries already on the right path. Questions were put to the Ministry of Foreign Affairs, represented by Multilateral and Global Affairs Director Troy Torrington, to ascertain whether Government ‘dropped the ball’ in securing carbon trade agreements for Guyana. But he vehemently denied this, stressing that Guyana’s failure to secure such agreements was not from lack of trying.

“There was no lack of effort by the Ministry of Foreign Affairs. I participated in the COP. and we all made all efforts to optimise contributions to Guyana in terms of financing. It was very much an achievement what we had achieved in the Norway undertaking. There were not any other takers in finding meaningful finance for avoided deforestation,” Torrington explained.

The Paris Cop21 Agreement came into being in December of 2015 in Paris, France. The agreement was adopted by all parties to the United Nations Framework Convention on Climate Change (UNFCCC) on December 12, 2015. It has been hailed as the most ambitious international environmental agreement in history. (Jarryl Bryan)

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