16 September, 2015
UN report: government subsidies may exacerbate deforestation
to a new United Nations brief, government subsidies, estimated at $200
billion annually are often the key underlying drivers of forest loss
worldwide, with policy makers rarely recognizing their impact. It is
estimated that 80 percent of global deforestation occurs as a direct
result of agricultural practices.
The report, entitled Fiscal incentives for agricultural commodity production: options to forge compatibility with REDD+,
explores ways of aligning government subsidies and other fiscal
instruments with the objectives of REDD+ (reducing emissions from
deforestation and forest degradation in developing countries).
Steiner, executive director of the UN Environment Programme said, "The
negative impact of subsidies on forest cover is often caused by outdated
and incoherent policies. Any government-led effort to bolster
agricultural productivity should account for the broader implications of
such schemes. This report demonstrates that policy that decouples
economic growth from deforestation and land degradation is the clearest
pathway toward an agricultural sector that realises both sustainable
land use and sustainable inclusive economic growth. I encourage policy
makers to consider the case studies in this report as they work to
orient agricultural policy toward green economy fundamentals."
on examples from Ecuador, Indonesia, Brazil, India and ten other
countries, the study demonstrates that subsidies to inputs, such as
fertilisers and irrigation water, often fail to increase yield per
hectare and can instead contribute to a wasteful use of resources and
environmental damage to tropical forests.
The report cites best
practices from developed and developing countries, where reversing
perverse incentives significantly reduced deforestation. In Brazil, for
example, a change in policy prevented $1.4 billion from being loaned to
unsustainable initiatives, contributing to a 15 percent decrease in
deforestation in the Amazon between 2008 and 2011.
success story, changing a policy that encouraged farmers in Niger to
remove trees from their farms resulted in the regeneration of 4.8
million ha of land and an increase of farmer household incomes of 18 -
Many fiscal incentives
supporting agricultural development were designed well before forest
conservation was identified as a major national and global environmental
priority. Countries can achieve both objectives simultaneously. Fiscal
incentives supporting agricultural production can be important levers to
promote sustainable land use, but only if they are conceptualised and
designed to do so.
The report calls for greater compatibility
between rural development, commodity production and REDD+ objectives to
ensure the long-term sustainability of agricultural production, healthy
ecosystems and wellbeing of local communities. It recognises that
subsidy reform should be accompanied by a package of policies, such as
sustainable commodity supply chain initiatives and development
assistance, to manage the socio-economic impacts of change and reinforce
The publication was launched by the
UN-REDD Programme ahead of the 14th World Forestry Congress, which will
be held in Durban, South Africa, between 7 and 11 September this year.