By Vanessa Meadu
A central question at the current Rio+20
negotiations is how to shift to a sustainable, green economy.
One way is to place an economic value on
environmental goods and services and encourage a shift towards more sustainable
activities by paying or rewarding those who practice good stewardship. In the
agricultural sector, this means paying or rewarding farmers who adopt good
practices. Payment for Ecosystem Services, or PES, is an innovative
market-based approach currently being used around the world to encourage such
shifts.
An example PES scheme has beneficiaries of
environmental goods and services, such as a company that uses freshwater,
paying the custodians of those environmental services (such as upland farmers
who operate in the watershed) to adopt or continue agricultural practices (such
as integrated soil fertility management or conservation agriculture) that keep
that environmental service healthy. The benefits to the users are clear: water
is cleaner from the source, and therefore less costly to filter and treat. The
overall quantity of water flow may also increase. There can also be multiple
benefits to farmers: not only do they get compensated for their efforts (in
terms of cash or investments in infrastructure, health, education) but can they
also ultimately benefit from the use of more sustainable agricultural
practices, which can increase crop yields, be more resilient to drought or
heat, and therefore diversify and improve income opportunities and help farmers
adapt to a changing climate.
It's a great theory, but can it work?
Dosteus Lopa of CARE International, shared
experiences from the Uluguru Mountains in Tanzania. In this region, the project
on Equitable Payments for Watershed Services (EPWS) has been working with the
local water authority in Dar es Salaam, Tanzania’s capital city, to help reward
and compensate the upland farmers to adopt agricultural practises that reduce
sedimentation and improve water quality to the downstream users. A similar
scheme has also been implemented by the Regional Environmental Center for
Central Asia in Kyrgyzstan. Both projects report a range of common challenges
including dealing with property rights, building knowledge and capacity of
farmers to use the new practises, designing transparent and fair payment
schemes, and properly identifying and involving all the stakeholders along the
value chain. There must also be proper institutional strucitures, laws
and policies that allow these shcemes to be set up.
Rewards come in various shapes and sizes. In
Kyrgyzstan, implementers had to deal with downstream water users who were not
willing to make cash payments – because they didn’t have any money. In that
case, residents preferred to pay via their labour, working for several days in
exchange for receiving the environmental service.
While the transaction costs of setting up
these schemes can be high at the outset, including need for detailed
environmental and socioeconomic assessments and monitoring, the Tanzanian and
Kyrgyzstani experiences show that PES can indeed be successful with the right
efforts and investments, particularly as more companies adopt corporate social
responsibility (CSR) policies. Better knowledge sharing is needed to reduce the
costs and make projects easier to set up and more profitable.
Sara Namirembe of the World Agroforestry
Centre shared experiences from their initiative on Pro-poor Rewards for
Environmental Services in Africa (PRESA) which brings together people working
in several PES projects to share lessons and exchange strategies for successful
implementation. Balancing fairness and efficiency is the main challenge she has
seen across different programs. As well, buyers want proof that they will
actually receive what they are paying for; that is, that the land use practices
will deliver the anticipated environmental services. This is a necessary
condition for buy-in. Programs such as PRESA are helping to build a solid base
of knowledge and enhance the capacity of local groups that want to implement,
and perhaps benefit from, PES.
PES shows that environmental and economic
goals don’t need to be at odds. PES systems can be equitable and pro-poor,
supporting economic development as well as protecting ecosystems. Decisions
made at Rio+20 must help support more projects that exemplify what a green
economy can achieve.
The CGIAR Research Program on Climate Change,
Agriculture and Food Security (CCAFS) is covering the Rio+20 Conference live
between 12 - 22 June. Read the latest stories related to agriculture and
food security from the conference. To get the latest updates follow both CCAFS
on Facebook and Twitter and Agriculture Day Facebook and Twitter.
Join the conversation about agriculture and food security during at Rio+20
using #Rio4ag on Twitter.
Vanessa Meadu is the communications
manager for CCAFS.
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