Tuesday, January 17, 2012

661. Ecuador: The Initiative to Keep Oil Underground in Exchange for Foreign Aid to Save Rainforest Moves Forward

Germany pledged $50 millions

By Eric Marx, Science Insider, January 13, 2012
After receiving pledges totaling more than its goal of $100 million by a year-end deadline, the Ecuadorian government last week announced that it would move forward with the so-called Yasuni ITT Initiative, an innovative plan to leave untapped more than 900 million barrels of crude oil beneath a pristine Amazonian nature reserve, in exchange for annual international donations. Last summer, there were fears that Germany would back away from a nearly $50 million pledge to the effort, but $116 million in contributions has now been collected from it, other foreign governments, individuals, and foundations, according to Ivonne Baki, the head of the Yasuni ITT Initiative. "We've created amazing momentum," says Baki. That momentum will be needed as the Ecuadorian government has now set a new goal of securing $291 million in contributions in both 2012 and 2013 to keep the initiative going.
Launched in mid-2010 after 3 years of technical consultation, the Yasuni ITT project was lauded by foreign governments and environmental groups as an innovative way to fight global warming: Not exploiting the Ishpingo-Tambococha-Tiputini (ITT) oilfields in Yasuni National Park will, according to the United Nations Development Programme (UNDP), prevent the emissions of around 410 million metric tons of carbon dioxide—equivalent to the annual emissions of France and accounting for 20% of Ecuador's known oil reserves. The project could also prevent the extermination of at least two indigenous tribes that live in voluntary isolation, while conserving a forested area that scientists say is the most biodiverse place on earth.
But for a variety of reasons, donor countries initially declined to support the initiative, which is supposed to be financed through a trust fund overseen by UNDP. Many have questioned commitment of Ecuador's President Rafael Correa, citing expanded oil and mining in other parts of the Amazon. Still another impediment has been fear that the initiative's "avoided emissions" strategy would lead to similar plans being considered as part of future global warming/climate change treaty negotiations.
This last concern appeared to scare off Germany's Secretary for Economic Cooperation and Development Gudrun Kopp, who in June 2011 told a German parliamentary commission that "a direct payment into a fund of this type would set a precedent that could ultimately prove very costly." Per the agreement signed with UNDP, however, Yasuni's precedent is "very limited in scale," says Pamela Martin, author of Oil in the Soil: The Politics of Paying to Preserve the Amazon. It only applies to countries situated between the Tropics of Capricorn and Cancer which have tropical forests, a certified high level of biodiversity, and a credible program for investment in sustainable energy programs, she notes. Germany is now tentatively back in the initiative, agreeing to a one-time, nonrefundable commitment of $47 million in bilateral technical assistance to be paid over 3 years. The contribution is not an all out endorsement of Correa's vision, say analysts, because Germany's monies will not pass through the UNDP Trust Fund but will be invested instead directly in the park. The other funding committed to the Ecuadorian Government amounted to approximately $69 million, including pledges from provincial governments such as the Belgian region of Wallonia and the French department of Meurthe-et-Moselle. The Initiative was previously open to only governments and corporations pledging more $100,000. Now, individuals and businesses wishing to contribute amounts as small as $25 may become involved.
In Ecuador, Baki notes, a recent poll indicates that nearly 90% of the public approves of the project. Baki says the next step is to launch an aggressive advertising, social networking, and promotional campaign focused on Europe, North America, and Australasia. Insiders say the new strategy is an attempt to put public pressure on elected officials, while also drawing upon the financial resources and discontent of a global population that finds itself increasingly frustrated with slow-paced climate negotiations. "The next 2 years are going to be telling because we know there is now finally a budget to carry out a real publicity campaign," says Kevin Koenig, the Amazon oil campaign coordinator for Amazon Watch based in Quito.
Koenig says environmental campaigners are deeply concerned about stepped up drilling plans in other parts of the Ecuadorian Amazon but they see merit in supporting the Yasuni Initiative as a means by which to enable Ecuador to extricate itself from its current "oil debt trap." At present, Ecuador relies upon oil income for more than half of its annual export revenue. "If the world is so concerned about preserving biodiversity, protecting indigenous rights and trying to find solutions to climate change, this proposal merits support," he adds. "It's not perfect but, regardless, it's important for Ecuador and the world."

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