Major Global Shifts Affecting Forests and Forest Livelihoods

1. Major Global Shifts Affecting Forests and Forest Livelihoods Andy White Coordinator, Rights and Resources Initiative with Augusta Molnar, Arvind Khare, Justin Bull, Megan Liddle U.S. Forest Service: Meeting the Future December 11-12, 2006

2. (My) Starting Points • US (and its forest sector) is now embedded in the global economy – a price taker • Markets/politics/ecosystems are (all) changing (and) at an accelerated pace – future challenges are different from those past • Other sectors more important than the forest sector in shaping forest and forest industry – the tail, not the dog • All the above magnifies need to understand what is happening around us in order to understand our own challenges and options.

3. Outline • Shifts in the Global Economy • (Relative) decline of US, growth of BRICs • Demand shifts to developing economies, Asia driving • Energy: big changes, big unknowns • Social and Political Shifts • Declining (relative) authority of government • Increased access to information, empowerment • Continued poverty: more pain and peril • Continued threat, and changing nature, of violent conflict • Increased migration and urbanization: new (and more) constituencies • Environmental Shifts • Climate change: hotter and more uncertain • Water: less, and less, (and less) available • What might this suggest for forests, forest livelihoods (and public forest agencies)?

4. (1) BRICs drive markets and politics • Wall of capital: • BRICs overtake the G6 by 2040 • $55 trillion global GDP today, near $80 trillion by 2020, $150 trillion by 2100? • Economics reshape political influence and business practice • End of Western dominated and colonial world • New investors, “changing rules” of the gentleman’s game (new investors, new values – not members of the Equator banks) • By 2020, the United States will not be manufacturing at all. (Economist, 2007 Projections.) • Implications: BRICs drive the market and investment – don’t follow our rules Global Economics: Goldman Sachs. 2003

5. (2) Dramatic increase in demand for food and commodities • Demand for food will double by 2020 • Demand for meat will increase 50% by 2020 • Palm oil production will double by 2020 • Increased (and continued high) growth in prices for commodities: • Since 2001: Sugar prices, doubled • Oil, steel and gold have tripled • Copper, quintupled • Greater pressure to deforest…increases opportunity costs for plantations

6. (3) Energy: big changes, big unknowns • Continued surge in demand; • All energy: demand 50% greater by 2030 (Economist) • Oil: demand 40% greater by 2030 (Chevron) • Alternative energy sources: (e.g. biofuels), growing but uncertain importance • Tremendous investment needed will delay change • Price will eventually make the shift economically viable. The question is when and what will drive the shift. • “Energy security” a major driver • Implications: • trade remains relatively cheap • Biofuels has potential to have major influence on forest lands – either positive or negative? Tree plantation for jatropha – oilseed for biodiesel in India

7. Social and Political Shifts

8. (4) Declining authority (and legitimacy) of the state. Rising power of the disenfranchised. Declining role of the state and decentralization • Public authority - from central to local - > ¾ of developing countries engaged in decentralization, rise of the city-state • Forest ownership: (1) from public to private – 70% private/community by 2020?; (2) fragmentation • Regulations: from “command and control” to outcomes, incentives • Decreasing importance of international agreements and intergovernmental arrangements Rising importance of civil society, informal networks • Rise of independently set standards and monitoring, CSR, • Increasing role of local agreements • Increased questioning the legitimacy of the state – rights become key (e.g. Mexico) • Increased expectation of transparency and easy access to public information

9. Source: Economist; iAfrica MIT and Nicholas Negroponte’s $100 laptop (5) Increasing flows of information, enabling empowerment, changing governance Rapid expansion of telecommunication • In 2006, 1.5 billion consumers owned mobile phones; 80% of the world lives within range of a global network; 25% have a mobile phone (Economist) • April 2007: $100 laptop goes on sale in developing countries, initially for $130 Increasing access to information • More than 70 countries have implemented some form of freedom of information legislation • Mapping technology and information is increasingly available and accessible (GPS, Google Earth) • Simple translation is becoming faster, cheaper; English spreading as a lingua franca Implication: much greater ability to hold govts accountable, economically develop remote areas, mobilize rebellion

10. (6) Continued poverty and powerlessness – pain and peril • Background: forests and poverty frequently co-located • Few expect the world will meet the MDGs • 2015: There will still be pockets of extreme poverty in remote rural areas (i.e. forests) • Poverty, powerlessness - fuels unrest, and migration

11. (7) Continued threat and changing nature of violent conflict • Growing population pressures on increasingly scarce natural resources stress local relations and political situations • Example: Rwanda (Gasana 2002) • Changing nature of local conflict: • Alliances facilitated and sustained by better and cheaper communication • Local and disenfranchised groups use external alliances to leverage media and political attention, prevent bullying

12. In the past twenty years 30 countries in the tropical regions of the world have experienced significant conflict between armed groups in forest areas. Source: D.Kaimowitz ETFRN NEWS 43/44 Continued threat and changing nature of violent conflict – in forested countries

13. Continued threat and changing nature of violent conflict December 2006 Conflict CrisisWatch (International Crisis Group) Deteriorated SituationsAzerbaijan, Bolivia, Burundi, Central African Republic, Chad, Colombia, Côte d’Ivoire, Fiji, India (non-Kashmir), Iraq, Lebanon, Somalia, Sudan, Tonga Improved SituationsKyrgyzstan, Nepal, Senegal Unchanged SituationsAfghanistan, Albania, Algeria, Angola, Bahrain, Bangladesh, Basque Country (Spain), Belarus, Bosnia & Herzegovina, Chechnya (Russia), Cyprus, Democratic Republic of Congo, Ecuador, Egypt, Ethiopia, Ethiopia/Eritrea, Georgia, Haiti, Indonesia, Iran, Israel/Occupied Territories, Kashmir, Kazakhstan, Kosovo, Liberia, Macedonia, Madagascar, Mali, Mauritania, Moldova, Myanmar/Burma, Nagorno-Karabakh (Azerbaijan), Nigeria, North Caucasus (non-Chechnya), North Korea, Northern Ireland (UK), Pakistan, Philippines,  Rwanda, Serbia, Sierra Leone, Solomon Islands, Somaliland (Somalia), Sri Lanka, Syria, Taiwan Strait, Tajikistan, Thailand, Timor-Leste, Turkey, Turkmenistan, Uganda, Ukraine, Uzbekistan, Venezuela, Yemen, Zimbabwe Conflict Risk AlertsBangladesh, Central African Republic, Chad, Côte d’Ivoire, Fiji, Lebanon, Somalia.

14. Forests and Armed Conflict • Often – not always – a product of limited human, civil, property rights • Logging often a means to finance violent conflict • Tenure reform a priority of many “post-conflict” countries • Liberia, Mozambique • Tenure reform, civil rights often proposed by many as one means to reduce or resolve social and political conflict

15. (8) Migration and urbanization – changing political constituencies • Increasing Migration • BUT: No net loss of rural populations (and some reverse migration of wealthy), and huge new pressures on urban areas (EcoAgriculture Partners 2006) • AND – are remittances the new development mechanism? • 2006: > $200 billion in remittances to developing countries worldwide, an increase of 20 billion in 2005 alone, doubling since 2001 (World Bank) • Increasing Urbanization – but not so fast • 2008: 50% of the world’s population will live in urban areas. 2030: 60%. • Mega-cities and city-states. By 2015, 23 cities will have populations greater than 10 million. (UN HABITAT) • Isolated governance, urban bias in decision-making. (Rural areas as tourism refuge for the urban.)

16. (9) Environmental Shifts: Increased demand for (and scarcity of) water • 2025: two thirds of the world (5.5 billion) will live in areas facing moderate to severe water stress • World Bank: India may run out of water by 2020 • Annual global water withdrawal is expected to grow 10-12% every 10 years. • Demand for water will increase 50% by 2020 • Implications: mixed – less plantations, more natural forests, more conflicts IFPRI 2020 Vision. Water and Food to 2025.

17. (10) Climate Change – and dealing with it Source: Stern Review on the Economics of Climate Change, 2006

18. Environmental Shifts: Climate Change Source: Stern Review on the Economics of Climate Change, 2006

19. Environmental Shifts: Climate Change Drought in the Amazon • 2005 saw worst drought in 100 years • Strong indications that 2006 could be a second successive year • Fear amongst ecologists of a “tipping point” • 3 years of consecutive drought could lead to a 10% mortality rate amongst mature trees Source: WWF, Environment News Service. Online.

20. Environmental Shifts: Climate Change Pine Beetle in British Colombia • Over 8 million hectares of forest degraded • By 2013 almost one trillion m3 of timber will be lost to the infestation • Total standing volume lost is equal 150% of annual global roundwood production • Only effective control mechanism, cold winters, have been absent • Warmer winters may spread infestation to Jack Pine, a species prevalent across the Boreal forests that span Canada Source: Canadian Forest Service. Online.

21. Effects: Increase in Forest Fires in the USA Source: USDA Forest Service. Online. • Wildland fires have almost doubled in acreage in the past 40 years • 2006 has been one of the hottest fire seasons on record, with more land being lost to blazes than any previous year • Fires have a way of focusing the minds of political leaders

22. Forests, part problem, part solution Source: Stern Review on the Economics of Climate Change, 2006

23. Growing Carbon Market: Great Expectations

24. Mitigating Climate Change • Species/ecosystems will move…public parks and forests insufficient • New urgency to act is spreading across the globe, (high) risk of misguided projects • “Avoided deforestation” back on the table • New leaning toward national/sectoral level intervention – rather than projects – putting government back into the deal • Safe bet that there will be a federal climate regime in the US within 5 years • Big question: where will the financing go? Limited prospect for investment in much of the “South” where property rights unclear, uncertainty and risk of conflict – will it bounce back to the “north”?

25. In Sum… • Natural forest will decline, close of the “frontier”; secondary forest shift to plantations – crops or trees? • More violent conflict, more effort to mitigate climate change, less power to regulate, (much) more uncertainty, more diffuse constituencies • Future very different for the past – forest markets, forest governance, forest constituencies • US increasingly exposed/vulnerable, with less market and political clout to shape outcomes (even with protectionism) • US constituencies will feel effects, but not know source, making it even more difficult to resolve issues

26. Two ideas, what this might suggest… • From “place-based” to landscape focus – across jurisdictions • Building on and expanding “ecosystem mgt” • From public land management to facilitating/learning/dialogue/planning/solutions/payments across landscapes and jurisdictions • Empowering others to effectively anticipate and manage change