AT last, the Conference of Parties (COP 13) to the United Nations Framework Convention on Climate Change (UNFCC) in Bali, Indonesia, has agreed upon the future of the Reduced Emissions from Deforestation in Developing countries (REDD) as a carbon reduction tool in the post-Kyoto protocol regime that will come into action after 2012. The most important attribute of REDD is that it is the first major attempt from the developing countries in the climate change arena. Papua New Guinea and Costa Rica proposed at the climate talks in Montreal two years ago that reducing greenhouse gas emissions by avoiding deforestation should be incorporated urgently in a UN compensation scheme. FAO estimates that 13 million hectares of the world's forests are disappearing annually, and that accounts for 20 per cent of all global greenhouse gas emissions. Most of the forest rich countries are located in the tropical and sub-tropical regions of the world and, because of extreme poverty, over 1 billion people depend directly on the extraction of forest resources for their livelihood. If deforestation continues at the present rate then the tropical forests may be lost by 2050. This is likely to be true, but so far no international treaty has provided any financial incentive for reduction of deforestation and degradation of the ecosystem in the tropics, except the Kyoto Protocol's Clean Development Mechanism (CDM), which allows investment from developed countries to compensate for their greenhouse gas emissions through forestry schemes for developing countries. [In COP 13, most of the participants from developed countries asserted not to wait anymore about climate change and the projected impacts of deforestation and ecosystem degradation with particular concern of the role of forests as a carbon sink and ecosystem services to the humanity and biodiversity conservation as a whole.] The World Bank has launched a multimillion dollar fund through the Forest Carbon Partnership Facility (FCPF) as an initiative to raise awareness about the global value of local forests elsewhere. Nine developed countries (Germany, UK, Japan, the Netherlands, Australia, France, Switzerland, Denmark and Finland) and a US based non-governmental organisation, the Nature Conservancy, have already made financial commitments to the FCPF totalling $160 million. The FCPF will take up financial and technical programs to build the capacity of developing countries in tropical and sub-tropical regions to minimise the impact of deforestation and improve their existing forest resources for biodiversity, as well as for enhancing the livelihoods of the forest dependant communities with focus on indigenous peoples. In this regard, indigenous people and forest dependant communities are to be given observer status like other constituents groups such as international organisations, non-contributing private sector, and non-governmental organisations in the FCPF governance. The FCPF will use two separate mechanisms to implement the compensation scheme. In the first, the readiness mechanism will support approximately 20 countries to build basic infrastructural capacities such as preparing a national REDD strategy, establishing a baseline and creating a monitoring system in consultation with the indigenous peoples as well as other forest dwellers. After preparing a readiness mechanism, successful countries will be allowed incentive payments for REDD. Then, as per negotiated contracts for reducing emissions, the selected countries or actors within the countries will be remunerated under carbon fund. To date, many developing countries from Latin America, Africa and the Asia-pacific region have expressed their interest in participating in the FCPF. Bangladesh had no significant achievement at Bali, yet REDD may be a new opportunity to be a part of it to protect our critical tropical forest ecosystems as a strategy to reduce carbon emissions and insure livelihood of the forest dependant communities as well. Ronju Ahammad and Mohammed Abdul Baten are studying Ecosystems, Governance and Globalisation at Stockholm Resilience Centre, Stockholm University, Sweden.