The demise of the Yasuní-ITT initiative – Back to reality or the end of the beginning?
‘A big idea from a small country’. This is how Ecuador promoted its proposal to leave oil in the soil of Yasuní National Park in exchange for financial compensation from the international community. Yet, in August 2013– six years after its official launch– Ecuadorian president, Rafael Correa pulled the plug on the Yasuní-ITT initiative, despite vigorously campaigning for it in his early years. Negotiations over the proposal were marked by major struggles between actors at various political and geographical levels, and revealed inherent trade-offs facing resource-rich developing countries.
The Yasuní-ITT initiative was a proposal by Ecuador not to extract oil from the Ishpingo Tambococha Tiputini (ITT) field in oil-rich Yasuní National Park, which is home to two isolated indigenous communities, in exchange for financial compensation from the international community. The initiative combined pragmatism with idealism; it aimed to conserve one of the most biodiverse spots on earth and protect its indigenous inhabitants, while at the same time guaranteeing that Ecuador would not lose out financially.
Announcing the decision to abandon the initiative, Correa’s reasoning was straightforward: ‘rich nations have failed to back the initiative’. He blamed the international community for not contributing the $350 million a year required to push the initiative forward. Soon after, Correa stated that extracting oil from the ITT field is necessary in the country’s fight against poverty. The decision to completely abandon the initiative highlights the insurmountable tension between the extraction-led development model of the Ecuadorian government and the environmental protection and conservation agenda pushed by civil society and the international community. While sustained attempts are being made within Ecuador to challenge the decision through a referendum, 1 the future of the initiative seems uncertain at best.
A pragmatic, yet idealistic proposal
The Yasuní-ITT initiative was both pragmatic and idealistic. It was pragmatic, because Ecuador took to heart what many knew to be true, but few were willing to translate into concrete action. As the Stern Review on the economics of climate change stated: ‘Even if the rich world takes on responsibility for absolute cuts in emissions of 60-80% by 2050, developing countries must take significant action too’. 2 The developing countries’ action should, however, follow the ‘shared but differentiated responsibility’ principle articulated in the 1992 Rio Declaration. The idea of the initiative was that the international community would change its relationship with the environment by contributing to a fund that transcended national and private interests. The estimated 846 million barrels of oil would, if extracted, provide Ecuador with approximately $7.2 billion in revenues. Moreover, in addition to the direct losses, non-extraction would also entail a loss of foreign investment, taxes and other financial revenues stemming from oil extraction. In exchange for non-extraction, the Ecuadorian state aimed to acquire compensation of $3.6 billion by 2024 from contributions by governments, foundations, the private sector and individuals – that is only half of the total revenues that extraction generate for the state. 3
The proposal was also idealistic, because it envisaged fulfilling Ecuador´s share of the responsibility to combat global climate change, as the amount of revenue not compensated for by the global fund would be attributed to Ecuador alone. In addition, not extracting oil in the ITT field in Yasuní National Park would help protect the atmosphere and biological diversity, which would be in the interest of the whole global community. Besides the direct benefits to local socio-ecological systems, a ban on oil extraction in the National Park would have substantially reduced CO2 emissions. Non-extraction alone would have reduced emissions by 407 million metric tons, while non-deforestation would have reduced them by 800 million metric tons. 4 The ITT initiative sought to address the concern that the national park was considered valuable without transforming it into an economically interesting ‘natural resource’. Nevertheless, the area does have intrinsic value – for the indigenous communities who reside in the rainforest, and for the healthy functioning and regeneration of the world’s ecosystems. It is also important to stress that the indigenous population of this area includes two communities – Tagaeri and Taromenane – who are in voluntary isolation.
At the time of its unveiling, the Yasuní-ITT initiative enjoyed broad domestic and foreign support, but conflicts have since soured the significance of this groundbreaking proposal. Tensions between the Ecuadorian state and civil society, in the international political arena, and between capitalist markets and global patrimony, finally led to its demise.
This article is based on research conducted by Murat Arsel and Lorenzo Pellegrini, and is part of the research project ‘Nationalization of extractive industries’ (NEBE)’ of the Netherlands Organisation for Scientific Research – WOTRO Science for Development (‘NWO-WOTRO’) programme ‘Conflict and Cooperation over Natural Resources in Developing Countries’ (CoCooN). The research findings presented in this article are based on interviews (with activists, policy makers, and other stakeholders), participant observation and critical review of policy documents.
State versus civil society: whose agenda?
The initiative has long been the cause of tension between the Ecuadorian state and civil society. 5 Originally, the ideas underpinning the Yasuní-ITT initiative came from environmental NGOs and were broadly supported by indigenous rights’ movements . Organizations like Acción Ecológica condemned Ecuador’s extractive-led development model, which has been causing damage to ecosystems as well as to the health and wellbeing of indigenous communities. To these organizations, the either-or portrayal of the intensifying tension between economic growth and nature conservation was no longer acceptable.
However, following the electoral victory of Correa and his Alianza PAIS movement, the state took the lead in pushing the ITT initiative. It became one of the most visible manifestations of Ecuador’s ‘Left Turn’. 6 Correa appointed the economist Alberto Acosta, who had long criticized the country’s dependence on oil extraction, as Minister of Energy and Mining. Since then, Correa himself and the government under his rule have been strongly identified with their support for the ITT proposal. Indeed, Correa claimed ownership of the concept when stating that the Yasuní-ITT initiative represents a ‘citizen’s revolution’, of which he is the leader.
The change of ownership of the initiative strengthened the power of the state vis-à-vis Ecuadorian civil society. Moreover, by taking ownership, the Correa administration was able to legitimize itself internationally while quashing dissent from environmental and indigenous organizations. In the international sphere, Correa was able to project a greener and more democratic image, partly due to his perceived support for the Yasuní-ITT initiative. At the same time, indigenous leader, Pepe Acacho, a vocal critic of the plans to create intensive mining projects in the south of the country, was arrested on charges of terrorism, thus demonstrating how wide the gap had grown between Correa and the organizations that helped get him elected.
International politics and Ecuador’s sovereignty
The power struggle over the control of the Yasuní-ITT initiative can also be analyzed at the level of international politics. Against the backdrop of a long history of colonialism and domination of Latin American nations by Europe and the United States, the Yasuní proposal became potentially contentious, because it concerned the right to extract oil reserves as well as environmental values. Some critics saw this as a new frontier of colonialism, or ‘eco-imperialism’, 7 aimed at transforming the whole Amazon forest into a global reserve and thereby limiting the sovereignty of Ecuador over its own natural resources.
Another area of tension regarding Ecuador’s sovereignty arose over the management of the revenues collected as financial compensation for non-extraction. The government had to reach a compromise between the national sentiment urging the sovereign use of revenues, and the need to have a credible and attractive fund that would elicit donations from the international community, including governments, funds, NGOs and the private sector.
The government chose to strategically invest the capital in the renewable energy sector and to spend the return on capital on forest and environmental management and social development of Yasuní Park. While Ecuador wanted to spend the revenues according to these national developmental priorities, the international community still had a say on the way they were spent. That is because the governance structure of the fund had been designed with the involvement of supranational institutions, such as UNDP and the donor community. In addition to representatives of the international community and the Ecuadorian government, Ecuadorian civil society had also been involved.
While this compromise was successful in overcoming the initial deadlock that faced the initiative, it might not be sufficient to overcome the concerns of international donors who continue to doubt the long-term validity of the agreement to leave the oil in the soil. These concerns are further magnified by Ecuador’s long history of political and economic instability.
Capitalist markets versus global patrimony
The third and final power struggle is the tension between the dominance of capitalist markets and the inalienable rights of indigenous communities. The isolated people in Yasuní National Park and the park’s biodiversity are global patrimonies, but the costs of safeguarding their rights are high. Ecuador is highly dependent on the export of its natural resources, and the three oil fields in the Yasuní National Park represent 20% of its oil reserves. 8 Therefore, it is reasonable to expect a developing country like Ecuador to appeal to the international community for joint responsibility. Nevertheless, the call for global monetary compensation for conserving a natural environment and the livelihoods and culture of a very particular group of people raises a deep moral dilemma, as it opens up the possibility of blackmail surrounding fundamental rights. That is, the initiative could be seen as posing a request to the international community and threatening that a negative answer will result in the violation of human rights and/or destruction of invaluable ecosystems. Instead of portraying the value of the initiative on the basis of net avoided emissions, an alternative would have been to appeal to the notion of the cost of safeguarding basic rights and the responsibility of the international community in sharing the burden of covering the costs.
The Ecuadorian government’s appeal for monetary compensation from the international community to cover part of the forgone revenues from oil extraction may certainly create clear incentives for the state to conserve Yasuní National Park. However, monetary transactions are not morally neutral, and monetary incentives might backfire if their moral meaning is in conflict with the moral framework of intrinsic motives for undertaking a particular task. In the case of the Yasuní initiative, external monetary compensation could undermine the intrinsic motivation of the Ecuadorian government to conserve Yasuní due to the rights of nature and isolated people. In the current scenario, where the international community has not contributed the expected resources, the decision to exploit oil reserves might have been triggered in part by retaliatory motives.
Back to reality
After the demise of the Yasuní-ITT initiative, critics argued that this was proof that economic development remains the singular goal in countries like Ecuador, which needs to liberate vast swathes of their populations from poverty and deprivation. Such a pessimistic reading views the extraction of natural resources as the quickest and most certain road to achieving this goal. Besides, in other parts of the country, mining and oil extraction activities have expanded as well. In that sense, abandoning the Yasuní-ITT initiative is only a small, albeit significant, manifestation of the power struggle between the Correa administration and social groups.
A more optimistic interpretation celebrates the initiative and the distance it has travelled in less than a decade. While the initiative seems to have failed, it has raised consciousness about the trade-offs facing developing countries. It has also concretely placed the need for rich countries to match their rhetoric of global responsibility with tangible financial flows to developing countries on the international agenda. Developing countries are otherwise left on their own to face the impossible task of choosing between the health of globally significant ecosystems and the wellbeing of their populations.
Ajit Menon, Associate Professor, Madras Institute of Development Studies, Chennai, India.
Aklilu Amsalu, Assistant Professor, Addis Ababa University, Addis Ababa, Ethiopia.
Daniëlle Hirsch, Director, Both Ends, Amsterdam Netherlands.
Domien Huijbregts, Communications Officer, NWO-WOTRO Science for Global Development, The Hague, The Netherlands.
Frans Bieckmann, co-founder, executive director and editor in chief, The Broker, Amsterdam, The Netherlands.
Teyo van de Schoot, Human Rights Senior Advisor, HIVOS, The Hague, The Netherlands.
- At the time of writing, signatures for a referendum initiative are being collected.
- Stern, Nicholas (2007), The Price of Change. The Stern Review looks at the economics of climate change (pdf). IAEA BULLETIN 48/2, March 2007, p. 27.
- CBD (2013) The Yasuni-ITT initiative in Ecuador (pdf). Resource Mobilization Information Digest, no. 177.
- CBD (2013) The Yasuni-ITT initiative in Ecuador (pdf). Resource Mobilization Information Digest, no. 177.
- Arsel, M. and N.A. Angel (2012), “Stating” Nature’s Role in Ecuadorian Development: Civil Society and the Yasuní-ITT initiative. Journal of Developing Societies 28(2), p. 203-227.
- Arsel, M., C. Mena, L. Pellegrini and I. Radhuber (2013), Property rights, nationalization and extractive industries in Bolivia and Ecuador. In: M. Baavinck, E. Mostert and L. Pellegrini (eds.), Conflict and Cooperation over Natural Resources. CRC Press; Pellegrini, L., Murat Arsel, Fander Falconí and Roldan Muradian (2012), A New Conservation and Development Policy: Exploring the Tensions of the Yasuní ITT Initiative. CoCoon-NEBE Working Paper.
- Driessen, P. (2005) Eco-Imperialism. Green Power, Black Death. London: Academic Foundation.
- Martin, P.M. (2011) ‘Global Governance from the Amazon: Leaving Oil Underground in Yasuní National Park, Ecuador’, Global Environmental Politics, vol. 11, no.4, pp. 22-42.