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248 development dialogue september 2006 – carbon tradingThe enthusiasm is not unanimous, even in Costa Rica. In fact, theboom in carbon forestry fits into an existing trend of support formonoculture tree plantations that has aroused concern among localenvironmentalists. Between 1960 and 1985, about 60 per cent ofCosta Rica’s forests disappeared due to cattle farming. Then therewas a ‘wood shortage’ scare, and the government subsidised monoculturetree plantations extensively between 1980 and 1996. Helpedby govern ment incentives, over 130,000 hectares have been coveredby the plantations over the past 20 years. By 2000, plantation monoculturescovered over 3 per cent of Costa Rica’s territory.The Clean Development Mechanism (CDM), Costa Rican environmentalistsfear, may help spread the monocultures even further. Inthe late 1990s, a government official active in the climate negotiationshelped promote a new law supporting monocultures. Half of a 3.5 percent fuel tax went into an ‘environmental service programme’ designedlargely to give incentives to private landowners to be ‘green’ in a countryin which 20 per cent of the land is national parks, a few per cent indigenousterritories and the rest private land. Under the programme, alandowner might get, for example, usd 90 per hectare per year to conserveforest, or usd 500 per hectare over five years to establish a plantation.In return, the state gets rights to the carbon in the plantation,which it can use to bargain with in international negotiations.A typical ecosystem on whicha Costa Rican plantationmight be established. Thecarbon released from thestanding trees, removed tomake way for the plantation,often will not appear inproject accounts.How much of this tax money goes to forest conservation, and how much toplantations?Most payments under the environmental services programme go toforest conservation, but 20 per cent is used to subsidise monocultureplantations and agroforestry. This has provoked objections from ecologists,academics and indigenous peoples who argue that monocultureplantations, often lucrative in themselves, can damage the soils, waterand biodiversity that the programme is supposed to protect. The programmemay also soon be supported by a tax on water and electricity.Still, 20 per cent is a pretty small proportion, isn’t it?Overall, Costa Rica is today putting usd 1.5 million annually into financing4,000-6,000 hectares per year of new plantations. That maynot seem much, but Costa Rica’s total territory is only a bit over 5million hectares. A UN Food and Agriculture Organization consultant’sstudy has suggested that the country set up even more plantations,up to 15,000 hectares per year, using carbon money. Anotherstudy estimates that, during the period 2003-2012, some 61,000 hectaresof monoculture plantations, or 7,600 a year, could be establishedin so-called ‘Kyoto areas’. That’s well above the current rate, 47