With the debate linking greenhouse gases and climate change increasingly shifting from the science arena into policy and finance, a number of issues are emerging around carbon trading. Carbon sequestered in forests until recently was un-ownable. But who owns the carbon and who trades in what some are calling a new financial product, or a new form of money, are still highly contested questions. Allocation of ownership rights is hampering the transition of carbon from collectively owned ecosystem input to individually owned commodity. But should forest carbon become a financial product? This paper examines the issue of carbon sequestered in forests and the global mechanisms to exploit it. Some of the consequences of distinguishing the carbon from the tree and building a multi-million dollar enterprise around this distinction are discussed. Consequences include carbon crime and the rebound effect of wealth accumulating to the wealthy and spent on carbon intensive goods; and the possibility of funds flowing back into forest communities. It concludes with the divergent consequences of two alternatives for exploiting the world’s forests.
