No one disputes that deforestation, particularily in tropical locations such as Brazil, is a major problem for the health of the planet and of humanity. However, one also cannot blame tropical countries for engaging in deforestation when they are in desparate need of economic growth for an impoverished populace. A carbon trading solution suggests that an acre of forest left intact might actually yeild more money for a country's coffers if the carbon sequestering value of that acre could be sold on an open exchange. Critics, however, point out that some degree of carbon trading may help, but it has the potential nagative side effect of discouraging industrial nations for changing their habits by simply letting them pay to pollute. Read more on WBCSD.
An interesting twist to the debate that I haven't seen discussed is the "exit strategy" that carbon credits gives land owners. That is, if the $$ given for preserving forests is a one-time payment, and is equivalent to the amount paid for reforestation, would it not be more advantageous to chop the trees, reap profit as grazing land, then later reforest the land for a final windfall? Of course, there is the cost of the trees and felling/planting labor, but over the course of X years, this may be more than offset by annual income.
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