Saving Yasuní-ITT?

Climate & Natural resources25 Mar 2014Lavinia Warnars

Yasuní, situated in the Amazon, is one of the most biologically-diverse parks in the world and it hosts several indigenous groups, of which two are living in voluntary isolation.

Yasuní, situated in the Amazon, is one of the most biologically-diverse parks in the world and it hosts several indigenous groups, of which two are living in voluntary isolation. However, the park also contains oil reserves in Ispingho, Timbocacha and Tiputini (ITT). Ecuador proposed to leave these oil reserves underground if the international community donates at least half of the revenues (US$3.6 billion) the state would otherwise receive in case of extraction. The other half would have been provided by Ecuador itself and the donations would be invested in nature conservation, renewable energy and social projects. A brilliant idea, and therefore the Yasuní-ITT initiative was widely supported by countries (i.e. Germany and Spain), celebrities (i.e. Leonardo diCaprio, Al Gore, Desmund Tutu, and Vandana Shiva) and organizations (i.e. the UN Development Programme, the EU, and the World Resource Institute).

However, on August 15, 2013, President Rafael Correa announced that Ecuador would forgo the initiative and start drilling for the oil. He argues that rich nations failed to back the initiative with the necessary US$3.6 billion. Indeed, over five years, the initiative only raised US$336 million, mostly from European countries and organizations.[1] Furthermore, the president stated that it was one of the most difficult decisions he had to make during his presidency.[2]

Ecuador argues that the drilling will be done in the most environmentally-conscious way to avoid deforestation and destruction of this pristine park with all its inhabitants. Correa states that it would only affect 0.1% of the park.[3] However, there are already oil extraction activities happening at the borders of the park.

Why did the president decide to go for drilling?

There are other arguments and analyses on why Yasuní-ITT has not become a reality and some of them are mentioned by Pelligrini and Arsel in The Broker. They pinpoint quite important arguments, but here I focus on the ‘prisoner’s dilemma’ idea.[4]

Ecuador is a developing country depending on natural resource extraction for its economy. Therefore, it is locked into the so-called ‘resource curse’, like many other developing countries and as a result needs external support to unlock itself from this curse. The initiative is meant to function in cooperation, collaboration, and co-responsibility of the international community to support Ecuador in its efforts to protect this pristine park. This makes it unique, novel and ambitious.

However, Ecuador was in a prisoner’s dilemma: Ecuador needs the (economic) resources provided by the oil in ITT and therefore Plan A (Yasuní-ITT) as well as Plan B (extraction) were put forward in order to invest in Ecuador. Ecuador found itself in this dilemma (Plan A or B), which permeated into the (international) public and governments too, and therefore they were in this prisoner’s dilemma together. Meanwhile, the initiative is very progressive and goes beyond anything we have seen in relation to environmental and climate change issues, and therefore, many people could not believe it to be true. After five years of fundraising, the financial goals were not met and since the initiative has not gained as much international attention as expected, President Correa felt forced to go for Plan B. Although, Ecuador has the responsibility to protect the park as well as its inhabitants, it also has to take care of all of its citizens, economy and environmental and (other) social issues.

The problems in relation to the insufficient funds are threefold: first of all, the Western countries are still dealing with an economic and financial crisis, which corrodes the willingness to donate. Secondly, (global) citizens are more critical towards (international) development assistance and aid. They want to know more about where their money is going and how it will be spent. Given the bad practices related to international development aid, such as with the tsunami in Asia in 2004 and Haiti in 2010, this public trust is not increasing to say the least. More and more (development) organizations are aware of this and are also stimulated by government funding cutbacks to rethink their business plans. Indeed, running a project of such magnitude as the Yasuní-ITT Initiative, primarily from donations and crowd funding is a little too ‘2008’ and does not correspond to the current worldwide situation. It is financially unsustainable and too dependent on third parties. And third, the prisoner’s dilemma and the utopian idea of Yasuní-ITT, especially after this announcement, may restrict the willingness of countries, organizations and other donors to donate even further.

In the meantime…

The global awareness about the importance of the Amazon, ‘the lungs of the earth’, particularly with regard to its role in mitigating climate change has increased. And so has the feeling of co-responsibility. More and more people are interested and concerned about the Amazon as a whole, not only scientists.

But how can we possibly save Yasuní from oil exploitation? And whom? Several groups are working on turning the tide and devising alternatives, including the following: 1) holding a referendum; 2) establishing a working group of several individuals and organizations, including Hivos, the Dutch Humanistic Development Organization, and 3) preparing the Yasuní-ITT 2.0 plan. The plan was initiated by myself, Carlos Larrea (Professor at Universidad Andina Simon Bolivar), and Marieke Andringa (Green Gas, Vice-Chair and Secretariat of Friends of Yasuní). The idea is that the three possibilities could potentially be mutually reinforcing.

1) The bet on a referendum. The referendum aims to propose a question to try to turn the tide of oil exploitation. It is backed by Yasunidos, a loose organization comprised mostly of Ecuadorian youth. The groups have six months in total (they started in October 2013) to gather at least one million signatures from all over Ecuador. This is possibly the only chance to mobilize civil society and gain more crucial support.

2) The working group and workshop, initiated by Hivos, was held on the 24th of October 2013. Several people from civil society, indigenous groups, and organizations, including myself, discussed and brainstormed on the possibilities to protect Yasuní from oil drilling. First, some presentations were given about the current situation, the problem with oil drilling in national parks and pristine territories (read: oil pollution, health problems of inhabitants, and more), and about indigenous rights and areas. For instance, the argument is that, although oil drilling should spur the national economy, this has not been the case since the 1970s. The investments are too big and the revenues generally go to the (foreign) companies, rather than to the national economy. Thereafter, we grouped together to brainstorm about the possible solutions for the area. One of the groups discussed how to support the referendum, while a second discussed how to support initiatives to protect rights of nature (which has been included in the Ecuadorian constitution since 2008) and rights of indigenous peoples. Meanwhile, a third group discussed the opportunities of alternative models. These working groups will continue to work on protecting Yasuní and the (other) generated ideas.

However, even if the referendum goes through, Ecuador needs an alternative plan to generate the income which would have otherwise been generated by oil drilling. And civil society also needs a back-up plan, an alternative business plan. Therefore, as far as the alternative models go, the Yasuní-ITT 2.0 plan fits in well. The first draft is written and several Ecuadorians are supporting the idea. A selected group of supportive and involved individuals will gathered in January 2014 to brainstorm on the details of this plan.

3) The Yasuní-ITT 2.0 Plan aims to develop an alternative business plan with different business models. Those are meant to increase the financial flows and independency of Ecuador from reliance on donations alone. However, the donations could be used to support a campaign strategy to increase the awareness amongst global citizens about the important of protecting Yasuní and the Amazon in general. In addition, the plan aims to raise as much, or more, funds compared to the oil exploitation scenario. With the funds, Ecuador would become 100% sustainable and also financially independent. The plan proposes to use the carbon market to generate more income, although this is a much-debated issue. So the plan also suggests the use of other financial flows, including those possibly coming from National Appropriate Mitigation Actions (NAMAs) under the UN Framework Convention on Climate Change, impact investing, investments in renewable energy, ecotourism, and the like. How exactly this plan will finally look partly depends on another working group and brainstorming session, which is planned to take place in the near future.

In sum, there are a number of alternatives to oil drilling and if these options are seriously considered by the Ecuadorian government, they may possibly change the tide just on time. And the image of Ecuador as a green, social and innovative government will remain so in reality.

  1.  Planet Ark, 2013, on:
  2.  BBC, (2013) ‘Ecuador approves Yasuni park oil drilling in Amazon rainforest.’ 16 August.
  3.  Ibid.
  4. The prisoner’s dilemma goes like this: two convicts are arrested and imprisoned. Each is in solitary confinement with absolutely no means to message the other or someone else. The police needs more evidence to convict the prisoners while they are planning on sending them to prison for a year. However, the police offer to both of them the Faustian Bargain: they can betray the other, or cooperate with the other by remaining silent. If A and B both betray each other, each will serve two years in prison. If A only betrays B, A will be free and B will serve three years, and vice versa. If A and B both remain silent, both will serve only one year.