Economics of Coastal Afforestation

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PRESENTATION ON THE PROPOSAL WILL BE HELD ON 6 DECEMBER 2022 (Tuesday)

Project Background

Climate change increasingly threatens the stability of fragile ecosystems and livelihoods in mountain communities and downstream areas. The IUCN posits that ecosystem restoration is crucial in many developing countries because about 25% of global emissions come from the land sector, the second largest source of greenhouse gas emissions after the energy sector. The 2018 IPCC report Global Warming of 1.5 °C identified forest restoration as one of the most cost-effective nature-based solutions (NBS) for reducing atmospheric concentrations of carbon dioxide. The report suggests that an increase of 1 billion ha of forest will be necessary to limit global warming to 1.5°C by 2050. A global review of literature on forest restoration in low- and middle-income countries (LMICs) suggests that forest restoration is biophysically possible on up to 2 billion ha of land, which is equivalent to half of the existing global forest area (Vincent et al., 2021). Studies suggest that restoring forests can potentially not only compensate for a vast amount of human-caused emissions but also promote environmental justice and sustainable development (Erbaugh et al 2020). The Glasgow Declaration of the world leaders on forest and land use at COP26 reaffirms their commitments to sustainable land use, and to the conservation, protection, sustainable management and restoration of forests as the tools for combating global warming and resulting climate change.[1]

Governments in South Asia have promoted tree planting and other forms of forest restoration for decades, in order to increase production of timber, fuelwood, and fodder and to conserve biodiversity, soil and water resources (Lee 2008). As a part of the Paris Agreement, these countries have submitted their revised NDCs (nationally determined contributions) for mitigating the climate change, where forest restoration is one of the key areas. For example, Nepal intends to increase its forest cover to 45% by 2030, where restoring forest in Chure, the proposed study area, is one of the focus areas, and the 10 billion tree tsunami program of Pakistan intends to sequester 149 MtCO2e over the next 10 years. However, the economics of the past and present forest restoration programs as carbon mitigation option, including its environmental and human impacts, remain poorly understood in the region, with conflicting evidence on these impacts. Some countries in the region are investing substantial effort and resources into large-scale tree planting, such as Pakistan’s 10 Billion Tree Tsunami (Shah 2018; Kamal et al. 2019). Recent journalistic reports on this program and evidence from other countries have raised concerns that large-scale tree planting can damage natural ecosystems (Berna et al. 2019), dry up water supplies (Wang and Fu 2013), and push people off their land. Yet, early results from Pakistan’s previous Billion Tree Tsunami suggest that participating communities have benefitted from the program, although the sustainability of the benefits is in question (Khan et al. 2019; Rauf et al. 2019). Across the Global South, rigorous evidence on the effects of tree-planting programs on local livelihoods and poverty is scarce and offers no consensus (Afonso and Miller 2021). Research on this issue in South Asia thus has the potential to be valuable for scholarship and policymaking not only in the region but more broadly too.

Important knowledge gaps include the effectiveness, costs, and benefits of existing or past tree-planting/forest regeneration programs, including benefits other than carbon sequestration and the persistence of the restored forests; incentives for encouraging households and communities to plant trees or in other ways promote forest restoration (e.g., assisted natural regeneration); and the impacts of forest restoration programs on livelihoods, employment generation, poverty, and gender equity within and between households and communities. This research aims to understand the economics of forest restoration as a potential nature-based climate solution in South Asia, through the re-establishment of forest cover in degraded or recently harvested forests (reforestation) or marginal or abandoned croplands and pastures (afforestation).

[1] https://ukcop26.org/glasgow-leaders-declaration-on-forests-and-land-use/ (accessed on November 26, 2021)

Research Objectives

The IPCC report, Global Warming of 1.5°C, provides evidence on forest restoration as one of the most cost-effective solutions for limiting global warming to 1.5°C. However, it lacks evidence on the costs and benefits of forest restoration to local communities and within them, in different settings, including settings typical of South Asia. Also, it provides only rudimentary analysis of the likely impact on the provision of ecosystem services, food security, and local livelihoods. Bastin et al (2019) estimate the global tree restoration potential under existing and projected climate as a climate-mitigation option, but they account only for biophysical aspects of expanding tree cover. They completely ignore the human side, which our proposed research will emphasize. Global studies that have investigated socioeconomic aspects of restoration, such Brancalion et al (2019), Busch et al (2019), and Erbaugh (2020), have tended to focus on the tropics, resulting in the exclusion of most of South Asia. Smaller-scale studies on socioeconomic aspects of restoration have been conducted in other regions. For example, Birch et al (2010) examined the costs and benefits of forest restoration in Latin America and evaluated the different ecosystem services that the restored forest would supply. Similar work is needed in South Asia.

The recent Dasgupta Review commissioned by the UK Treasury (Dasgupta 2021) on the Economics of Biodiversity makes a high-level case for why forest restoration matters for not just attaining the sustainable development goals but also sustaining the humanity which is embedded in nature. UNEP (2021) also published a report ‘Making Peace with Nature’, with the similar message that protecting and restoring nature means protecting our future. These issues have been mounting for a decade, since the announcement of the Bonn Challenge in 2011 (https://www.bonnchallenge.org/), and have been picked up by global organizations such as the United Nations and the World Bank and their member countries. In June of this year, the United Nations launched the UN Decade on Ecosystem Restoration, which aims to raise USD 800 billion in support of global restoration efforts, with forest restoration playing the lead role. During the COP26 at Glasgow, the government of the United Kingdom has launched the Climate Action for Resilience Asia (CARA) programme, where ICIMOD will be part of the programme implementing agencies. There will be a great deal of synergies between the proposed research project and the CARA programme that ICIMOD will be initiating in the later part of 2022.

Our research aims at making the ideas in these reviews and reports more actionable for Bangladesh, by generating information needed to design and implement effective nature-based climate solutions and access financial resources to support forest restoration. In particular, the research intends to:

Elucidate the economics of forest restoration (both plantations and natural regeneration) as a nature-based carbon mitigation option in Bangladesh.
Examine if forest restoration can generate job opportunities for women, youths, and marginalized communities and support rural livelihoods of smallholder farmers as a pathway out of poverty.
Identify and compare different interventions for promoting forest restoration, such as payment-based mechanisms versus alternative mechanisms (e.g., tenure reform, outgrower schemes, and technical support), to attain sustainable and green recovery and equitable resource use systems.
Propose appropriate institutional arrangements for scaling up forest restoration.
Build the capacity of younger and emerging researchers to conduct policy-relevant research on the topic.

Based on the above objectives, the key questions that the research intends to examine are:

Under what conditions (e.g., institutional arrangements) is forest restoration economically viable (benefits > costs), and how substantial are its co-benefits in addition to carbon sequestration?
Under what conditions do marginal landowners prefer compensation for forest restoration as a nature-based climate solution (NBS) option on agricultural land over continued agricultural use of the land?
Are there costs at the local level that marginal landowners do not integrate in their valuation of a fair compensation for forest restoration effort, for instance if forest restoration increases human-wildlife conflicts? How can the design of forest restoration programs dampen these potentially negative effects at the local level?
Does forest restoration as a NBS support rural livelihoods of smallholder farmers as a pathway out of poverty? What are its distributional impacts (gender, socioeconomic groups, etc.)?
What are the implications of the use of payment-based allocation mechanisms versus alternative restoration strategies to attain sustainable and equitable resource use systems in forest management in South Asia?

Bangladesh Context

Coastal Plantation and Afforestation program began as early as in 1960 by the Bangladesh Forest Department. The Forest Department established the Coastal Divisions and the Sundarban Forest Division to promote these programs. According to Bangladesh Forest Department (BFD), plantation in coastal region started since 1960-61 to 1961-62 and planted around 33930 ha in coastal area and offshore island. Since then under different project BFD established mangrove, Nypa, non-mangrove and strip plantation in coastal district of Bhola, Potuakhali, Noakhali, Chattrogram and Barisal. In costal district of Bhola under different forestry project in total 39209.38 ha mangrove, 271.38 ha Nypa, 1075.10 non-mangrove and 1603.17 strip plantation was established since 1960 to 2014. Simalarly, in total 26607 ha mangrove, 2601 ha Nypa, 546.5 ha non-mangrove and 3426.9 ha strip plantation was established in costal district of Patuakhali under different project since 1965-66 to 2013.

Bangladesh Forest Department implemented forest restoration program (popularly known as Afforestation program) since early 80s. There are several programs and they have different objectives. For example, a) restoring the denuded hills in the south and southeastern regions to prevent soil erosion and protect livelihoods using ‘assisted natural regeneration’ and plantation programs of fast-growing species; b) coastal afforestation program in order to i) create ‘coastal green belt’ to help accretion of new land in the tidal zones, ii) to stabilize the soil in newly accreted land on coastal islands; and iii) to protect land from being eroded by tidal waves; and c) development of swamp forests in haor in the northeastern regions of Bangladesh which are critical for i) modifying impacts of waves to protect villages in the floodplains; ii) provide a rich spawning ground for many fresh-water species of fishes; and iii) provide a stable supply of firewoods in remote rural areas.

In coastal district of Noakhali in total 77684.95 ha mangrove, 2377.95 ha Nypa and 3593.84 ha non-mangrove plantation was established between 1973-74 and 2010-13 under different forestry projects. In Chattragram coastal region in total 488 91 ha mangrove, 4680.68 ha Nypa, 1406.45 ha strip plantation and 280 ha bamboo and cane plantation were established between 1965-66 and 2013-14 under different forestry projects. In Barisal, the Social Forestry Division, created 8.05 ha mangrove and 1911.77 ha strip plantation between 1981-82 and 2010-2013. In addition to project funds, Bangladesh Government also spent its own fund strip plantation on 3927 ha of land, and block plantation on 39931 ha of deforested forest land between 2021-02 and 2015-16.

IUCN-Bangladesh will be the main partner organization in Bangladesh. Bangladesh joined IUCN as a State Member in 1972. IUCN started its operations in the country in 1989 and established a country office in 1992. To achieve its goals and objectives, IUCN in Bangladesh works in close collaboration with its members comprising national non-government organisations, with key support from the Ministry of Environment and Forest, a State Member.

Key researchers involved in this research from Bangladesh are:

Raquibul Amin, Country Representative, Bangladesh Country Office, IUCN (International Union for Conservation of Nature), Bangladesh; Email: raquibul.amin@iucn.org
AK Enamul Haque, Professor of Resource Economics, East West University, Dhaka, and Director, Asian Center for Development, Bangladesh, Email: akehaque@ewubd.edu.
Saiyeeda Saniya Munim, MA Economics, Senior Lecturer, East-West University, Dhaka, Bangladesh.
Estiaque Bari, Senior Lecturer, East West University/Asian Center for Development