Implementation of climate finance / REDD+ / Transparency

A closer look at German climate finance in Peru

REDD+ in the focus, photo: Brot für die Welt, F. Schultze

The international climate negotiations in Lima kick off today – a good opportunity to take a look at the projects financed by German development cooperation in Peru in the fields of climate protection and adaptation to climate change.

The database of the German Climate Finance website provides an overview of the projects that Germany has been supporting in Peru since 2008. In the years 2010 to 2012, the Federal Ministry for Economic Cooperation and Development (BMZ) made financing commitments totaling €87.6 million for 19 projects – equivalent to just over 60 percent of the total funding. Another third comes from the Federal Ministry of the Environment (BMUB), which has pledged a total of € 45.5 million for 13 projects from 2008 to 2014. Other funding came from projects by non-governmental and faith-based organizations and by Capacity Building International (InWEnt), the Centre for International Migration and Development (CIM) and the German Development Service (DED) in the years 2011 and 2012.

Source: Database German climate finance, November 2014

Of the BMZ and BMUB funds, just over half (51 percent) went toward adaptation, while 45 percent were earmarked for forest conservation and REDD+ projects. Emissions reduction plays a minor role at 5 percent. The preponderance of the adaptation sector is partly due to the fact that in addition to projects that are explicitly designed as an adaptation projects (including integrated financial management of climate risks in the agricultural sector in Peru), a number of major water projects – primarily by the KfW development bank – are counted as climate finance as they list adaptation to climate change as a secondary objective.

The greatest public attention is focused on the REDD+ sector, however, as Germany is one of the largest donors worldwide and finances a number of large-scale projects in Peru. This includes a KfW project worth €6.3 million to support the Peruvian government in developing a national REDD+ system, including setting up a national REDD registry and developing a Readiness Preparation Proposal for funding by the Forest Carbon Partnership Facility. The German Association for International Cooperation (GIZ) has also been financing a variety of projects, including one to promote the Peruvian tropical forest protection program since 2010, and has been supporting Peru’s indigenous peoples through a partnership with the Peruvian ombudsman office (Defensoría del Pueblo de Perú). The REDD+ projects are all relatively recent, so not much in the way of independent information or evaluations have been made available to the public to date.

Focus on REDD+

The fact that – with more than 68 million hectares of forest – Peru is home to one of the five largest and best preserved rainforest areas with the highest biodiversity worldwide is a further factor in making REDD+ a growing field of German climate finance.  However, the Director of the Peruvian Office for Forest Affairs (SERFOR) estimates that around 110,000 hectares of forest are cut down every year – an area roughly the size of Vancouver. Around seven million hectares of forest have been degraded or destroyed; 20 to 30 percent have been earmarked as concessions for gas, oil or logging companies.

Germany announced its most recent initiative at the UN climate summit in New York: a REDD partnership with Norway and Peru in which it will continue its support for climate and forest protection projects. Transparency, accountability and stakeholder participation, land rights, land use and emissions reduction are to count among the important topics for the new partnership. In return, the Peruvian president promised to entitle indigenous communities to four million hectares of forests; a further two million hectares could be added with the funds from Norway. However, this initiative stands in conflict with a parallel project of the Inter-American Development Bank, as AIDESEP, the umbrella organization of the indigenous peoples in Peru, notes. It is crucial for Germany to study potential projects closely and not be dazzled by impressive hectare figures.

While the international community wants to counter the destruction of forests as carbon stores with programs such as REDD+, COICA, the confederation of indigenous organizations of the Amazon basin, has developed an alternative proposal for forest protection: REDD+ Indígena Amazónico (RIA) is also being developed in Peru and consists of a political program based on preserving traditional ways of life of the indigenous Amazon peoples and protecting their territories, and thus goes well beyond the simple goal of reducing emissions associated with deforestation and degradation.

In its commitment to REDD+, Germany must not only consider the effectiveness of forest protection measures with regard to the conservation of biological diversity and the sustainable use of forests and climate protection, it must also ensure compliance with human rights obligations and minimum social standards – all the more so since German development cooperation is expressly dedicated to furthering human rights. In terms of REDD+ projects, this means that the local indigenous peoples must be included in decision-making processes in an effective and self-determined manner. Germany must recognize the contribution of the indigenous communities in the preservation of Amazon forests, take their demands and recommendations seriously and respond to them with sensitivity.

Christine Lottje