The most prominent international responses to climate change focus on mitigation (reducing the accumulation of greenhouse gases) rather than adaptation (reducing the vulnerability of society and ecosystems). However, with climate change now inevitable, adaptation is gaining importance in the policy arena, and is an integral part of ongoing negotiations towards an international framework.

Fires are considered a potential threat to sustainable development for their direct impacts on ecosystems, their contribution to carbon emissions, and impacts on biodiversity. In 1997/98, Indonesia had the most severe fires worldwide, and smoke haze pollution recurs yearly. The fire-related policy problems are defined as smoke haze pollution, forest degradation and deforestation, and impacts on the rural sector. Some of the apparent major causes of the problems are identified. The estimate of area affected by fires in 1997/98 is revised from 9.7 million hectares to 11.7 million hectares.

This paper first provides a brief overview of what are and what represent forest ecosystem services. Then it considers the issues of price and valuation, and shows that valuation itself is not a solution but merely a tool. Considering then the reasons of the overall degradation of forest ecosystem services it shows that the main reasons tend to be fundamental: deforestation most often happens because it pays for local people - not so much because the institutionally created arrangements are perverse.

Popular concern about tropical deforestation largely drove the rapid growth in forestry assistance in recent years. Nevertheless, forestry assistance has had limited impact on forest clearing and much of it has gone to address other problems. To reduce inappropriate deforestation requires a combination of a multi-sectoral approach, greater regulation, and payment for environmental services. Aid officials have been partially unwilling and partially unable to adopt these approaches.

Short-term trends show that livestock production is becoming an increasingly important factor in regional development, possibly because of the combined effect of increasing the forages on offer and planting crops better adapted to the environmental and economic conditions of marginal areas and the decreasing interest of the State in expanding the agricultural frontier. Overall planning of land use should be improved, but to do so, a more detailed characterization and monitoring of deforestation are essential.

There is renewed interest in the use of native tree species in ecosystem restoration for their biodiversity benefits. Growing native tree species in production systems (e.g. plantation forests and subsistence agriculture) can also ensure landscape functionality and support for human livelihoods. Achieving these full benefits requires consideration of genetic aspects that are often neglected, such as suitability of germplasm to the site, quality and quantity of the genetic pool used and regeneration potential.

The implementation and success of REDD+ strategies, plans and projects will depend on whether REDD+ influences governance or is shaped by existing governance failures.