Ten challenges and lessons for donors funding REDD+ as performance based aid

14 March 2014

By: Arild Angelsen

REDD+ was a plan to create a system of Payment for Environmental Services, with the bulk of the funding coming from carbon markets. The failure to create a strong international climate agreement and a foundation for a global carbon market has forced policy makers to revise this plan.

International REDD+ funding is now largely coming from development aid budgets, but has maintained the “performance based” element of the REDD+ idea, at least in theory. This ‘aidification’ of REDD+ has made it similar to previous efforts of conditional, result-based, or performance-based aid.

The idea of performance-based aid is simple: make payments to countries and projects based on performance or results. The performance can be measures in the form of policy reforms that will conserve forests and achieve other stated objectives, or measured more directly in the form of actual reductions of greenhouse gas emissions.

In a just-published paper I review the lessons and challenges of performance-based aid: “REDD+ as performance-based aid: General lessons and bilateral agreements of Norway

A major conclusion from earlier research is that aid rarely can buy policy reforms. Yet this remains a major idea in current REDD+ discourses, as the basic principle of ‘no-cure-no-pay’ is very appealing. Relatedly, valuable lessons learned from performance based aid in other sectors have hardly been brought into the REDD+ debate.

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