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Peru’s New Environmental Policies: What Are They and Will They Work?

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Madre de Dios

In Madre de Dios in the southern Peruvian Amazon, the devastation from illegal gold is clear from above. Image by Rhett Butler. Peru, 2016.

In the waning days of President Ollanta Humala’s administration, Peru’s National Congress approved a set of innovative climate change-related policies designed to reduce deforestation, protect watersheds and biodiversity, and provide the tools needed to leverage international investment through UN programs such as REDD+ and the Green Climate Fund.

Great optimism surrounds the new policies, especially in Lima. But it is tempered by the reality of a new administration just coming to power and the lawlessness and economic expediency that often defines the far-off Peruvian Amazon and its vulnerable ecosystems.

“These are a great and important set of laws that have been put into place; three very important signals,” Michael Jenkins, the founding president and CEO of Washington-based Forest Trends, told Mongabay. “But Peru is a very complicated place; I can’t candy coat that. They’ve created these laws at the federal level, but implementation will take need to take place at the state and local level.”

In essence, the new policies:

* Regulate the public investment in ecosystem services through specific international mechanisms. For example, in the water and sanitation sector, some $30 million (U.S.) has been set aside to leverage funds from countries such as Norway, Germany and the U.S. to help secure the water supply for cities through watershed conservation.

* Approved a National Forestry and Climate Change Strategy for diagnosing major threats to Peru’s forests by developing varied plans to counter the threats. The “production-protection” approach aims to make more efficient use of land already deforested while ensuring that more trees do not fall.

* Provide official guidance on developing biodiversity offsets in Andean ecosystems. The guidance creates a process to evaluate the potential loss of biodiversity through mining, hydropower or road construction and create regional offsets to assure that there is no net loss of biodiversity.

The new policies were years in the making with input from NGOs such as Forest Trends and World Wildlife Fund and guided by Manual Pulgar-Vidal, Peru’s influential minister of the environment. Pulgar-Vidal chaired the UN climate summit in Lima in 2014 and co-chaired the Paris summit last December.

In doing so, he raised Peru’s visibility as an ecologically vital country committed to climate change adaptation and mitigation. The new policies will also come under UN review to align with monetary incentives provided through REDD+ to reduce deforestation and forest degradation. Billions have already been pledged to REDD+ programs internationally. Under REDD+, wealthier countries offer financial incentives to developing countries to help them protect their tropical forests and, in doing so, stave off the carbon emissions that accompany land conversion.

Pulgar-Vidal and the entire Humala administration turned over power on July 28 to the newly elected administration of President Pedro Pablo Kuczynski. In June, he won a run-off election with just 50.1% of the vote. An economist eager for Peru to remain one of the fastest-growing economies in the Latin America, Kucynski’s commitment to Peru’s vast Amazonian rainforests, the fourth largest on earth, is unclear.

“It remains to be seen if the new government will take advantage of what’s in front of them,” said Enrique Ortiz, a Peruvian tropical ecologist who directs the Andes Amazon Fund in Washington, DC. “We are hearing positive signs, but it’s hard to say yet just how seriously they are taking these new laws.”

A unifying approach

Gena Gammie, the associate director of Forest Trends’ water initiative in Peru, said the new policies provide a unifying strategy for the country’s forests as well as multiple policy objectives for climate change mitigation and adaptation.

“When we took a hard look at this, we realized that regional leaders were doing their own thing, while the national government was doing something else,” Gammie said. “We started to ask: what are we trying to achieve? What is driving deforestation? What do we need to take on and what’s the best strategic approach?”

Gammie pointed to research indicating that in the densely jungled Amazon basin, small landholders were responsible for much of the deforestation–just one to five hectares at a time, and rarely more than 50 hectares.

Such an assumption is not without its critics, with a recent study claiming the data used to justify land conversion by small-scale agriculture was not verified on the ground. Still, Gammie said she sees broad opportunities to influence smaller landholders.

“Here you have farmers producing coffee and cocoa without any sophisticated skills,” she added. “They cut forests to establish crops, wear out the soil pretty quickly, then move on to kill more forest. These farmers aren’t associated with any….cooperatives or take advantage of any credits.”

With the new policies, a goal is to help small-scale farmers make more efficient use of the land they have, make it more productive and sustainable, and reduce the necessity of further deforestation. Such intervention, following national policy, must take place at the local and regional level.

Jenkins added: “We cannot have a strategy of simply ‘save the forests.’ Lots of people live there and make their living there. You need protection and production opportunities. And you need to provide alternatives to illegal gold mining and the illegal extension of growing oil palm. That’s going to be hard because both are so lucrative.”

But there are ways, say the experts. If fairly implemented and enforced–big ifs in Peru–the new policies would provide incentives for impoverished locals to mine or farm on land already degraded or deforested while steering clear of dense, intact, biodiverse forests.

Jenkins says that either through REDD+ or the Green Climate Fund, some $500 million in international funds have been committed to Peru for forest preservation. Ideally, he said, such funds could in part help farmers get established with legal, sustainable crops such as coffee, cacao for chocolate, and even oil palm, which is emerging as a new cash crop in Peru.

“You can take money from Norway, for example, to stimulate that activity until you create the brand (for Peruvian coffee or chocolate) and build the necessary markets,” he said.

However, solutions like Jenkins’ are challenged by a recent study of the drivers of deforestation in the Peruvian Amazon that takes issue with a monoculture commodity trajectory.

“Evidence from elsewhere in the Amazon, such as in Brazil, shows that even when small-scale agriculture—as diffuse and diverse as it is—does primarily drive deforestation, new processes such as land consolidation, plantation establishment, and large-scale ranching can and do become more significant drivers over time,” the study states.

Published in the Journal of the Society of Conservation Biology, its authors urge more research to find a variety of possible outcomes that could lead to more sustainable land-use in the Amazon Basin.

“If Peru is to reduce deforestation and forest degradation while still meeting development and livelihoods objectives, more rigorous mixed-methods research on the drivers of deforestation coupled with multi-stakeholder processes to evaluate trade-offs is required,” they write.

“Old assumptions about deforestation must be revisited. But acquiring better information to understand the drivers of deforestation is only an initial step in devising effective land use plans and policy interventions.

Regional variations

Luis Fernandez, a tropical ecologist and director of the Carnegie Amazon Mercury Project, believes the new national policies are “very positive.” But he said they may have a greater impact on the arid, western side of the Andes where most companies operate legally than in the remote Amazonian region where states vary in degree of political and social stability.

“The northern Amazon–Loreto and San Martin, for example–are the oldest areas,” said Fernandez, who has done extensive research on illegal gold mining in the Peruvian Amazon. “The institutions there are very old. People have lived there a long time. Politicians are invested in seeking solutions to the challenges there.”

But in the mid-southern Amazon of Madre de Dios, one of Peru’s most ecologically vital and vulnerable regions, all bets are off. Regional governor Luis Otsuka is not only a miner, but formerly headed the Artisanal Miners Association. These are miners who often go unlicensed, ignore regulations and pay no taxes.

“He wants to take care of his people and his people know how to mine,” Fernandez says. “But that kind of activity does a lot of environmental damage. To change this is a big problem and a big challenge.”

Increasing the challenge is the fact that a good portion of the population of Madre de Dios is migrant workers who move into the region temporarily for hard labor and low wages, and move out when the work dries up. They have no connection to the land, the culture or the indigenous traditions. They care little if at all for healthy forests or ecosystems.

“Organizing the kind of solutions that are proposed requires a kind of societal glue,” Fernandez said. “It’s a wonky answer, but it gets to the point of why so many projects don’t work.”

Ortiz, with the Andes Amazon Fund, said President Kuczynski has signaled that he intends for the country to modernize in part by streamlining regulations for development. The president has already indicated that he wants a hotly contested copper mine called Tia Maria in the southern Andean region of Arequipa to go forward, even though the farming community has vehemently opposed it for six years. Farmers contend the mine will destroy a fertile valley that supports 15,000 families.

“To improve and country and the economy, we hope it doesn’t mean we are going to turn our back on the environment,” Ortiz said. “That would be a big mistake. We do know (Kucynski) has a strong interest in climate change. He believes it’s a big issue. But we don’t know yet what he will do.”

Jenkins at Forest Trends, who had a role in the environmental policies coming to fruition, recognizes the risks and the stakes.

“There are a lot of moving parts, but frankly, there is no other way to do it,” he said regarding the impact of climate change. “We are sprinting in a marathon. And you need to be sprinting because we are running out of time.”