A Critical Conversation on Climate Change ... - Green Choices

238 development dialogue september 2006 – carbon tradingAfrica. 22 The following year, the company set up in Tanzania andUganda, and, later, in Malawi as well. In Uganda, it obtained fromthe authorities an extremely low-cost 50-year lease on 5,160 hectareseast of the town of Jinja in the Bukaleba forest reserve on Lake Victoria,which it planned to plant mainly with eucalyptus and fast-growingpines. Bukaleba is one of more than 700 large and small stateownedcentral forest reserves set aside for forestry and forest protection,covering in all 7 per cent of the land area of Uganda. 23Shortly after the Kyoto Protocol was adopted in December 1997,Fjordgløtt increased its capitalisation and invited outside investors tobuy shares. By 2000, Tree Farms controlled at least 20,000 hectaresof land in the region and was in the process of acquiring a further70,000 in Tanzania (see box on page 242: ‘The Money Came from aPlace Far Away’: Tanzanian Land, Norwegian Carbon). The firm hadplanted 600 hectares, mainly with fast-growing pines (Pinus caribaea,P. oocarpa, P. tecunumani) and eucalyptus (Eucalyptus grandis), with IndustrikraftMidt-Norge securing a first option on the associated carboncredits.What does the Ugandan government get in return for turning over its land tothis company for 50 years?It gets a one-off fee of USD 410 and an annual rent of about usd 4.10for each hectare planted with trees. The rent, paid in fast-depreciatingUgandan currency, is adjusted every 10 years according to the indexof infl ation as defined by the Bank of Uganda. No rent is paid forareas that the companies have not planted with trees. For six squarekilometres of plantation established by 2001, then, Tree Farms hadpaid Uganda, when infl ation is factored in, less than usd 11,000. For50 years’ use of the same area of land, given current rates of infl ation,it was set to pay less than usd 110,000.Norwegian journalist HaraldEraker investigated earlyattempts by Norwegianpower and forestry firms tosequester carbon on Ugandanland.That’s outrageous!Yes. Several years after the deal was made, the deputy commissionerfor forestry in the Ministry of Water, Lands and Environment,Ignatius Oluka-Akileng, told NorWatch, an independent news servicemonitoring Norwegian business activities abroad, that the authoritieshad recently realised that investors were ‘taking advantage of thesystem’ to get cheap land.The fact that no rent is paid for areas not yet planted with trees makessuch arrangements particularly attractive to land speculators. Yetit has proved hard for the Ugandan authorities to negotiate betterterms. According to one reliable source, when Ugandan officials tried