This presentation by Bernardo Strassburg, IIS, discusses the pact for the restoration of the atlantic rainforest, how to develop a restoration economy and also large scale restoration & the landscape.

1. The Economics of Restoration:
Costs, benefits, scale and
spatial aspects
Bernardo BN Strassburg
Agnieszka E Latawiec
Global Landscape Forum, 2013

2. Structure
Introduction
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape

3. Structure
Introduction
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape

4. The Atlantic Rainforest Biome
115 million hectares

5. The Atlantic Rainforest Biome
Less than 14% of original forest remains
Less than 8%, if only fragments > 100 ha.
45% of species under risk of extinction due to Climate Change
70% of Brazilian GDP
2/3 of Brazilian Population
250 mammals (22% endemic)
340 amphibians (26% endemic)
197 reptiles (30% endemic)
1,023 birds (18% endemic)
More than 20,000 vascular plants
World record of tree species per hectare (458, ac. NYBG)
About 7% of global biodiversity
Source: Conservation International

6. The Atlantic Rainforest Biome
(William F. Laurence, 2009)

7. Structure
Introduction
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape

8. The Atlantic Forest Restoration Pact
Our goal, our challenge:
Restoration of 15 million
hectares by 2050
Through:
Protection and restoration of ecosystem
services
•
Legal compliance of agribusiness and food
production
•
Job and income generation for local
communities
•

9. Our strategy
To articulate public and private
institutions, governments, NGO,
researches, corporations, landowners, etc...
...To integrate knowledges, efforts and
resources...
...To promote large-scale restoration and
conservation of biodiversity...
...At the most critical areas in the Atlantic
Forest.

10. Members
257 members
Government: 47
Private Sector: 66
Third Sector: 127
Labs and universities: 17

11. The Pact´s impact
Thinking at large-scale, or the
challenge to upscaling more
and more.
An approach based on landscape
ecology and environmental
services.
The concept of forest restoration
supply chain.
Matching and applying science and
economic incentives to legal
compliance.

12. Governance
Members
Board of Coordination
Steering Committée
Executive Secretary
Task Forces
Technical and scientific issues
Knowledge and information
Communications
Forest restoration economy

13. IIS- PACTO – Agenda Economics Working Group
1. Financial analysis of the
reforestation models
2. Spatial prioritization analysis
3. Socioeconomic impacts of
reforestation models
4. Development of financial
mechanisms
•Phase 0: Define the models and structure the questionnaire
•Phase 1 : Costs and revenues
•Phase 2: Risks, market and business case
•Phase 1: Prioritization for carbon, water, biodiversity, costs and opportunities, pasture productivity, legal deficit
•Phase 2: Incorporation of the spatial aspects of restoation models (inc. relation com infrastructure and markets)
•Phase 3: Optimized multiobjective spatial prioritizaion
•Phase 1: Jobs and income
•Phase 2: Poverty and inequality reduction
•Development of financial models (in function of the models)
•Survey of the potencial financing sources
5. Estimate of environmental benefits
of large-scale reforestation (e.g. Pacto)
•Ompacts on biodiversity
•Impacts on climate mitigation
•Impacts on water resources
•Impacts on other ecosystem services
6. Estimate of socio-economic benefits
of large-scale reforestation (e.g. Pacto)
•Estimate of the potencial job screation (direct and indirect within the entire chain), income, poverty and inequality
reduction following large-scale reforestation

14. IIS - PACTO – Agenda Economics Working Group
1. Financial analysis
of the reforestation
models
2. Spatial
prioritization
analysis
3. Socioeconomic
impacts of
reforestation
models
• Phase 0: Define the models and structure the questionnaire
• Phase 1 : Costs and revenues
• Phase 2: Risks, market and business case
• Phase 1: Prioritization for carbon, water, biodiversity, costs and
opportunities, pasture productivity, legal deficit
• Phase 2: Incorporation of the spatial aspects of restoation
models (inc. relation com infrastructure and markets)
• Phase 3: Optimized multiobjective spatial prioritizaion
• Phase 1: Jobs and income
• Phase 2: Poverty and inequality reduction

15. IIS - PACTO – Agenda Economics Working Group
4. Development of
financial mechanisms
• Development of financial models (in function of the models)
• Survey of the potencial financing sources
5. Estimate of
environmental benefits
of large-scale
reforestation (e.g. Pacto)
• Ompacts on biodiversity
• Impacts on climate mitigation
• Impacts on water resources
• Impacts on other ecosystem services
6. Estimate of socioeconomic benefits of
large-scale reforestation
(e.g. Pacto)
• Estimate of the potencial job screation (direct and indirect
within the entire chain), income, poverty and inequality
reduction following large-scale reforestation

16. Structure
Introduction
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape

17. Paradigm shift - Current Prevalent Paradigm

18. Paradigm shift - Current Prevalent Paradigm

19. Paradigm shift
Current Prevalent Paradigm
New Paradigm
Restoration involves very high costs per
hectare…
R&D and extension help to reduce costs…
… with no financial return for the land
owner…
… and, in some cases, increase revenues…
… only has environmental benefits…
Restoration is an industry that create jobs,
contributes to the general economy…
… and these environmental benefits are
poorly perceived…
… and the resulting Natural Capital provides
goods and services to humanity, including
spiritual services and existence value of
biodiversity
… and not internalised
… and should be at least partially
internalised

20. One word of caution
• Natural Capital, Ecosystems Services and similar approaches have a
tremendous potential to help society realize the value Nature provides for
humans;
• Included in these are spiritual and existence values (recognizing that
biodiversity have value for us even if there are not direct or indirect benefits);
• These might be enough to justify “Ecocentric” restoration for wild habitat;
• But these approaches do not include a potential intrinsic value of nature, an
ethical perception that other living beings have value in themselves;

21. Challenges
Time
• Very long time horizon (esp. for small-holder farmer)
Costs
• Current cost per hectare is very hingh, perception of opportunity
costs, costs of transition
Returns
Risks
Incomplete information
Extension
Incomplete market
• Uncertainty com future prices
• Of production, of the market, legal aspects
• Farmer and the society do not recognize the value of forests
• Even if the the will exists, there is a lack of extension for
forest restoration
• Externatilites are still not internalized, high costs of the transition
in incipient markets

22. Some possible solutions
Time
• Non-timber products, consorcium with the species of fast
growth, PES
Costs
• R&D, dissemination, experience, scale
Returns
Risks
Incomplete information
Extension
Incomplete market
• Consolidation of the markets, warranty for the demand/prices,
consorcium with the leading species
• R&D, consolidation of the market, simple and clear legal frame
• Roboust research and research-based dissemination
• Better extension from public sector, incentives for private
extension
• Internalization of the benefits, PES

23. Developing commercially viable systems
Tropical forest restoration: show us the money
P.H.S. Brancalion, R.A.G. Viani, B.B.N. Strassburg & R.R. Rodrigues

24. Level the playing field
Low-productive
Cattle Ranching
Restored
Ecosystem
Perceived Value
Not Perceived Value
Subsidies

25. To further level the playing field
Low-productive
Cattle Ranching
Restored
Ecosystem
Perceived Value
Not Perceived Value
Subsidies
Partial PES

26. The current playing field

27. Structure
Introduction
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape

28. The Economies of Scale and Spatial Prioritization of Restoration
Ecological value
Economic and Social values
connectivity
Economies of scale due to reduced costs
potential habitat
higher resiliency
water
lower border effects
carbon
reduced conflicts and opportunity costs
border effects
increased value of services
conflict with other land-uses

29. Addressing fragmentation
New study showing effects of isolation on mammal communities
Although the study is based on islands the authors hihglight “ a dire need to
maintain large intact forest blocks to sustain tropical biodiversity"

30. Competition for land
• Lambin and Meyfroidt, 2011 Global land use change, economic globalization,
and the looming land scarcity, PNAS; Smith et al., 2010 Competition for
Land, PTRS
• In Brazil – competition with agriculture (in all biomes)
• Atlantic Rainforest – extensive pasturelands, no ongoing deforestation (around
90% already gone)
• Espirito Santo State – plans to both increase agricultural productivity and
forest cover
• Difficult without produtivity increase (except in abandoned areas)

31. Competition for land, leakage
Forests Elsewhere
Pasturelands

32. The “Land Neutral Ecological Restoration” Mechanism
After
Before
In-Farm Mitigation
Multiple Uses
Single Use +
(Crop-Livestock)
Intensification
Consortium
Compensation

33. Reducing competition for land and sparing land for
reforestation
Latawiec AE, Strassburg BBN, Brancallion P, Rodrigues R., in prep

34. Avoiding the “Conflict for land”
• Current productivity : 118 million Animal Units;
• Potential sustainable carrying capacity: 367 mi Animal Units;
 Current productivity only 32-34% of potential
Current Productivity
Potential Productivity
All 2040 production targets +
36 million hectares restored
Restored Areas
Strassburg, Latawiec et al. (submitted)

35. Take home messages
• The Atlantic Rainforest has lost 88% of its area, and is
under risk from climate change;
• A movement with significant representation from
Brazilian society is pushing for large scale restoration;
• A paradigm shift is need in terms of financing
landscape restoration;
• Restoration systems delivering goods and services can
be financially attractive;
• Special attention to landscape benefits and risks are
needed when designing large scale restoration;

36. Thank you
b.strassburg@iis-rio.org