Combining Natural Savings and Parallel Planting in Kenya

1. Combining Natural Savings and Parallel Planting in Kenya A Green Currency to Support Indigenous Forest Stewardship Joel Thompson joel@africurrency.org Tesla Conference, Split, July 2012

2. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion Combining Natural Savings and Parallel Planting in Kenya A Green Currency to Support Indigenous Forest Stewardship Natural Savings = A green CC concept designed by Lietaer and Hudon Parallel Planting = ‘Planet Positive’ - methodology developed by African Forest to grow indigenous tree varieties alongside exotic varieties in Kenya  agro-forestry investment products. Green Currency = Complementary currency backed by renewable energy or an organic growth process. Indigenous Forest Stewardship = Protection and advancement of closed canopy forest cover. Instrument to unite the conceptual nature of natural savings with the practical success of the parallel planting methodology to realise investor-friendly and policy-friendly indigenous forest stewardship and advancement.

3. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion • The state of Kenya’s forests: impacts and trends • Environmental • Endemic biodiversity, crucial climatic and watershed services to the Kenyan population. • Indigenous closed canopy forests declined by 8% from 1990 to 2010, sinking Kenya’s indigenous forest cover to 1.96% of total land area. • Societal • NCCRS acknowledges climate change in Kenya as ‘unmistakeable and intensifying at an alarming rate’. 2011 cumulative failure of annual rains. • Political • Environmental degradation and the ensuing fight for diminishing resources strongly contributed to the 2008 post-election violence.

4. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion Government Policy The Forests Act of 2005 GoK Forest Policy 2007 – ‘enhance the contribution of the forest sector…’ ‘Rehabilitation and Protection of Indigenous Forests in Five Water Towers’ is one of Kenya Vision 2030’s ‘flagship projects’. International Conventions Convention on Biological Diversity UN Framework Convention on Climate Change UN Convention to Combat Desertification

5. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion • Decoupling of money supply from ‘natural’ limits • Money can and must grow indefinitely regardless of the ability of the biosphere to replenish its stocks. • Limitations of REDD, eco-tourism and other industries. • A micro money supply tethered to the growth of Kenya’s indigenous forests? • Complementary currencies (CCs) could bypass this system to find a solution for Kenya’s indigenous forests. • Green CC design considerations: unit of value, eco-mimicry, anthropology, sustainability.

6. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion • Natural Savings • Microsavings tool and medium of exchange for marginalised communities in inflationary and environmentally degraded environments. • Backed by an organic growth process, e.g. in return for labour on a tree plantation, labourers earn shares which grow in value over time as the trees mature and come closer to the time of harvesting for timber. Once harvested, the shares return a monetary profit. • The shares may also act as a medium of exchange among community members and, hence, as a complementary currency. •  A type of payment issued in anticipation of future revenue.

7. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion • Parallel Planting/Planet Positive • Plant indigenous tree varieties alongside fast-growing exotic varieties (presently • grown for firewood and charcoal manufacture). The indigenous trees mature • into standing trees harvested for non-timber forest products, such as medicinal • compounds and essences. • Indigenous tree plantations generate revenue and long-term individual and • corporate investment instruments from the non-timber products, including • carbon offsetting. • Farmers, land owners and community forest associations can profit while larger • socioeconomic and environmental benefits accrue to society. • Investor funded; multiple revenue streams.

8. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion • Parallel Planting Complementary Currency • Combined, natural savings and parallel planting could operationalise a • formidable tool to realise the advancement of indigenous forest cover and • stewardship. • Parallel Planting Complementary Currency (PP-CC) provides a variety • of favourable returns for forest community residents, land owners and farmers: • Short term: issuance of PP-CC in return for growing indigenous trees and protecting extant (standing) indigenous trees. • Medium term: planting, growing and felling of fast-growing exotic tree varieties selectively planted in parallel with indigenous varieties. • Long term: issuance of PP-CC in return for the sowing, cultivation and conservation of indigenous trees harvested for non-timber products. • Functions: micro-savings, micro-finance and micro-currency.

10. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion Conclusion Environmental – Reduction in forest fragmentation; climate regulation and watershed management. Socioeconomic – Injects additional purchasing power through circulation; encourages savings; longer-term horizons; profitability and scaling up of PP projects; resilience in diversifying currencies. Political – Tackles a lack of economic incentives for land owners to participate in SFM; long-term impact on environmental refugees and resource conflicts. PP-CC could (a) improveprofitability through integration with existing parallel planting projects, (b) improveeconomic security in rural communities dependent on Kenya’s forests for their livelihoods and (c) appeal to investors by boosting the financial resilience of PP projects.

11. Introduction Policy Green CCs Natural Savings Parallel Planting PP-CC Conclusion