Executive summary

A Global Model Since 2009

In 2009, Guyana launched the first Low-carbon Development Strategy (LCDS) from a developing country, setting out a vision for inclusive, sustainable development, while simultaneously maintaining the country’s forests, about 85% of the country’s territory, to help meet some of the most urgent challenges the world faces.

Guyana has the second highest percentage of forest cover on earth and is working with partners to sustain 99.5% of that forest while building the foundation for a new low-carbon, ecosystem economy. The expected opportunity to access a market mechanism for forest climate services, and other ecosystem services, will enable Guyana to store 19.5 billion tons of carbon dioxide equivalent (the measure used for greenhouse gas emissions – the world emits about 50 billion tons a year). At the same time, Guyana can grow its economy five-fold over 20 years and keep energy emissions flat; invest in Amerindian, Hinterland and sustainability planning; protect the coast and Hinterland from climate change; create jobs; and integrate Guyana’s economy with its neighbours. Guyana will stay true to the vision set out in 2009 which is to create a model low-carbon economy for the world.

Since then, the country has gained a greater understanding of the outsized contribution that Guyana’s ecosystems make to the world’s health and economy, as well as its role as one of the world’s most important countries for biodiversity conservation:

• Guyana has maintained the second highest percentage of forest cover on earth, with more than 99.5 of the forest’s 18 million hectares remaining. Deforestation rates are among the lowest in the world and Guyana is one of only four countries in the world (and one of only two in the Amazon Basin) verified to have sustained a High Forest Low Deforestation (HFLD) state.
• Guyana is one of four countries which host the Guiana Shield, one of the most pristine rainforest landscapes in the world. The Guiana Shield stores around 18% of the world’s tropical forest carbon and 20% of the world’s fresh water.
• The country has extremely high levels of biological diversity and endemism. It is home to approximately four percent of known animal species, including the following iconic Amazonian species: jaguar, giant river otter, harpy eagle, tapir, giant anteater, and giant armadillo. There are more bird species in Guyana than the entire United States of America. The country is also home to 2.4% of known plant species–and unique tepui and natural savannahs give Guyana exceptionally high levels of endemism. It also maintains a percentage of littoral forest in the coastal area.
• Guyana’s ocean area – more than half of Guyana’s terrestrial area – offers a new frontier for sustainable development through the expansion of the Ocean/Blue Economy.

Estimates of the economic value that Guyana’s eco-system services provide to the world are considerable.

Guyana’s forests alone provide value that is estimated to range from US$40-US$54 billion annually. Yet, this value is not recognised in monetary terms. By contrast, jobs and economic value can be generated by clearing forests for agriculture, mining, infrastructure, and other uses. This is a global problem and one of the reasons that the world’s tropical forests are worth more dead than alive and forest areas that are the size of Greece disappear each year, causing about 16% of global greenhouse gas emissions.

As one of nine countries/territories in the Amazon Basin, Guyana, since 2009, has sought to address this challenge by creating a global model for promoting broad-based economic development while also avoiding the deforestation-led development path followed by countries all over the world. The then President of Guyana, Dr. Bharrat Jagdeo, set out a vision for the first LCDS, and called for international partners to work on three inter-linked objectives:

• Create new economic incentives: how to make forests worth more alive than dead.
• Stimulate future growth using clean energy and non-deforesting economic activities.
• Protect against climate change.

The means to advance these objectives were set out in the first draft LCDS which underwent one of the most extensive national consultations in Guyana’s history before being finalised. The 2009 LCDS, and a 2013 update were overseen by the Multi- Stakeholder Steering Committee (MSSC) and combined national plans for investment with calls for international action on climate change.

The Guyana-Norway Partnership

Recognising that the first objective of the LCDS required international action, Guyana sought partners who shared the country’s vision. In 2009, Guyana and Norway agreed to work together to create a model for how progress on economic incentives for forests could be made. President Jagdeo and Norway’s Minister of the Environment and International Development, Mr. Erik Solheim, signed an agreement where Norway would provide Guyana with result-based payments for forest climate services, alongside cooperation between the countries in the fight against climate change, the protection of biodiversity and the enhancement of sustainable development.

For the period 2009 to 2015, Guyana earned US$212.52 million in payments, to be invested in the LCDS. This has created low-carbon jobs, enabled Amerindian villages to receive legal title for communal lands, rehabilitated the Cunha Canal to protect against flooding, and started to equip Amerindian and hinterland communities with renewable energy, digital infrastructure, and sustainable livelihood opportunities. Crucially, Guyana and Norway cooperated to build a world-leading forest Monitoring, Reporting and Verification System (MRVS) which enables Guyana to move to the next stage of the LCDS with partners who share its vision for climate and biodiversity.

Towards 2030 – The New LCDS

The new LCDS 2030, as outlined in this draft for consultation, focuses on harnessing Guyana’s unique advantages to create a new low-carbon economy, built on the platform provided by the MRVS and other areas of enhanced capacity in Guyana. Since 2009, Guyana also ratified the 2015 Paris Climate Agreement, under which 197 countries — including Guyana — agreed to pursue development pathways that are aligned with stabilising global temperatures at 1.5 degrees Celsius above pre-industrial levels.

LCDS 2030 will create a new low-carbon economy in Guyana by establishing incentives which value the world’s ecosystem services, and promoting these as an essential component of a new model of global development with sustainability at its core. In Guyana’s case, harnessing the value of the country’s ecosystem services can build a long-term, low- carbon diversification opportunity.

The three objectives set out in 2009 continue to provide a guiding framework and have been enhanced based on knowledge gained since then, as well as new opportunities created by international progress. This LCDS Draft for Consultation addresses these objectives:

• Forest Climate Services and other Ecosystem Services: From early 2022, there is a strong possibility that Guyana can access market-based mechanisms for forest climate services that includes private, as well as international public sector financing. This will enable a pathway to transition from the existing Guyana-Norway partnership and increase the value of sustainably managing Guyana’s forests. The MRVS system, built since 2009, will also act as a platform for integration with other ecosystem services markets.
• Stimulate future growth through clean energy and sustainable economic activities: Guyana can undergo one of the world’s most ambitious energy transitions and grow the economy up to five-fold, while keeping greenhouse gas emissions from energy generation at around 2019 levels. This can be done through the replacement of expensive, polluting heavy fuel oil with natural gas as a bridge to an energy system built mainly from hydropower, solar and wind power. Alongside the national low-carbon energy transition, targeted investments can be made in the underlying infrastructure of a broader, low-carbon economy to create jobs all over the country and enhance livelihoods. This includes investments to enhance digital connectivity in under-served communities, to improve transportation, improve access to finance, and create micro and small, low-carbon enterprises. It also includes targeted support for Amerindian and other forest-dependent communities, with a dedicated 15% of revenues from forest climate services adding to other investments for Amerindian communities. The development of the Ocean Economy is a further priority – to bridge the land-ocean nexus via low-carbon growth. This will include areas such as fishing, ocean biodiversity and mangroves, and shipping and transport.
• Protect against climate change: Global wellbeing continues to be damaged by climate change, including in Guyana where extreme weather events are destroying livelihoods and damaging the economy. Early 2021 saw catastrophic flooding, the social and economic damage is likely comparable to the 2005 flood which affected close to 37% of the population and caused economic damage equivalent to 60% of GDP. The Hinterland also experiences drought conditions, including a very serious episode in 2015.

Apart from the three objectives carried forward from the 2009 LCDS, the LCDS 2030 introduces a fourth objective:

• Align with global climate goals: Since the production of the 2009 LCDS, Guyana has discovered oil and gas, which has transformed the country’s development prospects. Guyana will act strategically and responsibly as the sector develops, supporting global energy security while diversifying and decarbonising Guyana’s domestic economy and investing in development priorities for all Guyanese, including health, education and low-carbon opportunities. At the same time, the Government will advocate internationally for a strong global carbon price and the removal of subsidies on fossil fuel – to incentivise the lowest carbon, most cost-effective oil and gas in the global marketplace in line with the goals of the Paris Climate Agreement under which there will be demand for decades to come. In parallel, Guyana will advance a “no flaring” policy, and mandate the use of best technology in the Oil and Gas sector to limit its environmental impact.

The LCDS 2030 sets out how to accelerate the achievement of these four objectives.

In determining how to do this, planning for sustainable development is the core principle that guides the LCDS 2030. This means promoting development and stimulating future growth for all Guyana’s people through a balance across:

• Human Capital: Ensuring that Guyanese citizens achieve greater health, education and other social outcomes.
• Financial Capital: Ensuring equitable access to finance for all, whether seeking to invest in start-ups, expand existing businesses or cope with unexpected external shocks.
• Physical Capital: Upgrading Guyana’s energy, transportation, digital, water, and housing infrastructure on a low-carbon, non-polluting trajectory.
• Natural Capital: Introducing mechanisms to sustain Guyana’s world-class natural capital to enhance quality of life for all Guyanese and deploy natural capital as part of solutions to global problems, including climate change, biodiversity loss and deteriorating water resources.

All of these areas will be explored and advanced as part of the LCDS national consultation to ensure that the vision contained in this new version of the LCDS responds to the needs and aspirations of the citizens of Guyana. This includes the coastal population and particularly, those communities that reside in forest and/or depend on forest resources for economic livelihoods. This LCDS is a draft to gather input and ideas from all Guyanese and will be subject to national consultation in late 2021 and early 2022. A final version will be tabled in the National Assembly before June 2022. In this draft:

• Chapter One looks at the building blocks for the new low-carbon economy: forest climate services, biodiversity, water management and the Ocean Economy.

• Chapter Two outlines how forest climate services can be evolved because of the capabilities Guyana has built, and the potential of integrating with the emerging voluntary carbon markets.

• Chapters Three and Four summarise Guyana’s new LCDS Investment Programme to develop Guyana’s human, financial and physical capital. Chapter Three focuses on a low-carbon energy transition and Chapter Four focuses on wider social and economic investments.

• Chapter Five addresses how Guyana will protect against climate change.

• Chapter Six addresses sustainable management of the oil and gas industry.

• Chapter Seven sets out the plans for the oversight of this LCDS by a national consultation, the National Assembly and the Multi-Stakeholder Steering Committee.

• Appendix One provides background on the definition and valuation of Guyana’s forests.

• Appendix Two summarises ART-TREES.
  
• Appendix Three highlights the achievements under the Guyana-Norway Partnership.