REDD payments as incentive for reducing forest loss

Strategies for reducing emissions from deforestation and forest degradation (REDD) could become an important part of a new agreement for climate change mitigation under the United Nations Framework Convention on Climate Change. We constructed a system dynamics model for a cocoa agroforest landscape in southwestern Ghana to explore whether REDD payments are likely to promote forest conservation and what socio-economic implications would be. Scenarios were constructed for business as usual (cocoa production at the expense of forest), for payments for avoided deforestation of old-growth forest only and for payments for avoided deforestation of all forests, including degraded forest. The results indicate that in the short term, REDD is likely to be preferred by farmers when the policy focuses on payments that halt the destruction of old-growth forests only. However, there is the risk that REDD contracts may be abandoned in the short term. The likeliness of farmers to opt for REDD is much lower when also avoiding deforestation of degraded forest since this land is needed for the expansion of cocoa production. Given that it is mainly the wealthier households that control the remaining forest outside the reserves, REDD payments may increase community differentiation, with negative consequences for REDD policies.