US$250M Norway forest deal…Guyana gets extension to complete obligations

Jun 17, 2016 News

Norway’s Minister of Climate and Environment, Vidar Helgesen and Guyana’s Minister of Natural Resources, Raphael Trotman, have reiterated their commitment to reach shared goals as set out in the US$250M bilateral partnership on climate and forest.

This was concluded at a bilateral meeting in the margins of the Oslo REDD Exchange

Norway’s Minister of Climate and Environment, Vidar Helgesen (left) with Guyana’s Minister of Natural Resources, Raphael Trotman.

conference on Wednesday.
The two Ministers announced that they will continue the current collaboration until Guyana has implemented all agreed key reforms in the forestry sector, according to the Norwegian government’s website.
Both countries have signaled intentions to seek a new agreement. The previous one expired last year but Guyana is still to fully implement all the benchmarks.
Guyana is set to keep its deforestation rate amongst the lowest in the world, and to continue working to improve governance in the forestry sector. Guyana is also determined to keep its commitment to fully transforming its energy sector to clean and renewable energy. This is key to reducing the country’s emissions of greenhouse gases, according to Minister Trotman.
Guyana and Norway’s partnership on climate and forest was initiated in 2009. Guyana had at that time already defined a national low carbon development strategy that outlined how the country could meet its ambitious targets for economic and social development, while at the same time keeping deforestation at a minimum and transforming its entire energy sector to clean and renewable energy.
Guyana is a High Forest Low Deforestation (HFLD) rate country. The deforestation rate for 2014, recently verified by a third party, was as low as 0.065%, which is among the lowest deforestation rates of tropical forest countries.
The Norway-Guyana partnership demonstrates how HFLD countries like Guyana can be incentivized to keep their deforestation low, and using the proceeds to establish a completely clean and renewable energy sector as well as a broader green economy.
Through the financial support, Norway intends to support Guyana in implementing its national strategy for economic and social development without compromising the forest and the vital ecosystem services they provide, Minister Helgesen asserted.

US$150M RECEIVED
Norway had committed to contribute up to US$250M to Guyana if the country keeps its deforestation rate low and reaches key forest governance targets. So far, Norway has disbursed about US$150M, rewarding Guyana’s achieved results.
Of this, US$70M has been transferred to Guyana REDD+ investment fund – GRIF (administered by the World Bank), and US$80M has been set aside in an account with the Inter-American Development Bank (IDB) to cover Guyana’s equity share in the Amaila Falls Hydropower project.
Guyana and Norway are currently conducting a review of the latter project to reach a fact-based decision on its feasibility and the way forward.
Efforts are underway to improve governance in Guyana, including the development of an ambitious roadmap for initialing an agreement with the EU on combatting illegal logging by the end of 2016, as well as plans to become an Extractive Industries Transparency Initiative (EITI) candidate this year.
EITI is a global standard to promote open and accountable management of natural resources. In addition, the Guyana Forestry Commission has recently published data on all forest concessions held in the country on its website as a step to increase public transparency.
Indigenous peoples make up 10% of Guyana’s population. Making sure that these groups’ rights are being respected, for example by involving them in all relevant decisions and processes, is important to both Guyana and Norway.
A project that enables Guyana’s indigenous communities to take part in the work to keep deforestation low, and to be remunerated for the results is currently receiving support under the partnership between the Guyana REDD+ Investment Fund.
All projects are implemented by the World Bank, the IDB or the UN Development Programme (UNDP), and thus adhere to their strict rules and safeguards, Norway said.
Eight projects are currently receiving support under the GRIF. Results include the approval of 167 loans and grants worth over US$1M to micro and small enterprises in low carbon sectors.
“A development fund has been established to support the socio-economic development in indigenous communities and US$1.3M has been disbursed to 90 communities. A new project to reduce Guyana’s vulnerability to floods was initiated in 2015.

AMAILA HYDRO
Approximately US$80M has been transferred from Norway to the IDB for Guyana’s Amaila Falls Hydropower Project. The funds correspond to Norway’s payments for Guyana’s deforestation results in 2011 and 2012 and were transferred in two tranches.
If Guyana and the IDB choose to go ahead with the project, the IDB will administer the purchase of Guyana’s equity share in the project. A review of the project’s viability will take place this year.
Guyana has also developed the world’s first national system for monitoring of forest cover and carbon content with the money earned from continued low deforestation.
With regards to the protection of forests, Norway said it will support the forest information and monitoring system Global Forest Watch with 115 million krone (US13.7 million) for the period of 2016-2018.
“Global Forest Watch is a groundbreaking tool for increased transparency around the state of the world’s forests. Information regarding where deforestation is happening is crucial if we are to halt tropical forest loss. With the support we are announcing today, we will also contribute to the development of tools to monitor the effectiveness of private companies’ commitments to stop deforestation from happening in their business operations. Several large companies, including Unilever, Mondelçz, Cargill and Mars, have used GFW technology to monitor their supply chains,” said Helgesen.
The Norwegian Ministry of Climate and Environment has already supported Global Forest Watch with 68 million Norwegian krone (US$8 million) for the period of 2013-2015.