Assigning an economic cost to preventing deforestation is very difficult, and estimates are based on the cost of providing economic incentives to those who currently deforest the land. This could be done either through providing a cash bonus for those who practice sustainable agriculture or through purchasing land for use as nature preserves.
The first fact needed is the annual rate of deforestation. Based on a World Resources Institute (WRI, 1990) report, this is 20.4 million hectares per year. The arbitrary assumption can then be made that 70 percent of such deforestation could be prevented by using one of these programs.
The carbon content of the soil and vegetation in different ecosystems has been estimated by the Conservation Foundation, World Wildlife Fund, and Fundacion Neotropica (1988). This content, in tons of carbon per hectare (ha),1 is 256 for an undisturbed forest, 210 for a logged or managed forest, 256 for a 30- to 40-year-old forest plantation, and 75 for land deforested for use as pasture or agriculture. The net carbon saved through forest protection is the difference between a managed forest and pasture land or net carbon saved = 210 - 75 = 135 t C/ha, which would be 495 t CO2/ha if burned or otherwise oxidized. The carbon release avoided would be (495 t CO2/ha)(0.7)(20.4 × 106 ha/yr) = 7068 Mt of CO2 per year.
The cost of preventing this deforestation is based on information from the Conservation Foundation and the World Wildlife Fund. The World Wildlife Fund proposal would create an endowment of $200/ha. Interest
from that endowment is used as a financial incentive for those living near a tropical forest to practice sustainable forestry. The community retains ownership of the land and interest from the endowment as long as it practices sustainable forestry. The purpose of the endowment is to compensate the community for the additional income it would have received by using current agricultural techniques. At present, this method is being used in Costa Rica (Conservation Fund et al., 1988).
By using these estimates, a cost-effectiveness of
1. Tons (t) are metric; 1 Mt = 1 megaton = 1 million tons.
Conservation Foundation (CF), World Wildlife Fund (WWF), and Fundacion Neotropica (FN). 1988. The Forestry Fund: An Endowment for Forest Protection, Management, and Reforestation in Costa Rica. Washington, D.C.: World Wildlife Fund.
World Resources Institute. 1990. World Resources 1990–91. New York: Oxford University Press.