F.J.C. Chandler[4]
ABSTRACT
Current thinking is that market oriented approaches to forest management are going to provide an efficient mechanism for promoting and financing forest protection and sustainable forest management. However, linked with the continuing degradation of forest ecosystems in the tropics is the issue of poverty. In Asia, nearly one quarter of the absolute poor (some 250 million people) eke out a meager existence in upland areas and most depend directly on a mixture of agriculture and forest resources for their livelihoods. They live in contexts where their natural resource base is rapidly deteriorating. Many upland and mountain communities in Asia manage landscapes that provide environmental services to outside beneficiaries, but without sharing in the benefits of those services. Clear opportunities are now emerging in this respect. However, the current successes in environmental transfer payments have only benefited large landowners and concessionaires. In addition there is a danger that some types of transfer payment mechanisms that are currently evolving are being designed and implemented to the disadvantage of the upland poor. Rewarding Upland Poor for Environmental Services (RUPES) is a programme to develop appropriate methods for rewarding the poor upland communities for the environmental services that they provide. The RUPES Programme will build working models of best practices for successful environmental transfer agreements adapted to the Asian context. The programme will look at whom the rewards should go to, who will pay the rewards, how and in what form they would be collected and what amount or form is appropriate. This paper provides the rationale for the RUPES project and how it has and will contribute to linking upland communities, markets and conservation of ecosystem services in the Asian region.
THE CHALLENGE
Market oriented approaches to forest management are becoming increasingly common as they are seen as being able to provide an efficient mechanism for promoting and financing forest protection and sustainable forest management (Landell-Mills and Porras 2002). It is often the failure of markets along with policy and institutional failures that causes deforestation and environmental service loss. Market and policy failures mean that forest products are undervalued in the market place while for forest services providing public good values there is usually no market place at all (Richards and Moura-Costa 1999). It is presumed that the market will ensure that beneficiaries of the services provided by forests pay the land managers for adopting land management practices that deliver the desired services.
The total value of forests to human kind is not insignificant. There are both use and non-use values of forests that can directly and indirectly benefit people. Forests provide livelihoods (direct-use values) both at present and, for many forest users, provide a buffer in times of hardship and so act as a “bank” when there are shortages (option values). The indirect values of forests include watershed protection, soil fertility, landscape value, biodiversity protection and carbon sequestration. Other values, often seen as non-use values, are those associated with the forests’ ability to provide peace of mind (bequest value) and benefits to culture and society (existence value). As often happens the more valuable the benefits from forests, the greater the competition for control, and in competitive environments it is the poorer and marginalized groups who become vulnerable. And conversely the continuing loss of forest ecosystems-especially in the tropics-is linked to rural poverty.
Among the vast multitude of the poor in Asia, the populations that have been most affected by the process of marginalization are those living in the uplands, namely in the hills and mountainous areas which cover almost half the total area of Asia[5]. Nearly one quarter of Asia’s absolute poor (some 250 million people) eke out a meager existence in these areas and most depend directly on a mixture of agriculture and forest resources for their livelihoods.
The benefits of national and local investments in economic development have tended to bypass most of the poor upland people because the composition of development initiatives and/or their products are often irrelevant or inaccessible to the upland communities. Being far away and disconnected from administrative and economic power centres means that the political, social, economic and ecological niches occupied by them are not central to national development concerns or priorities. Hence their development needs and aspirations are often not on the “map” of the decision-makers and rank very low in the hierarchy of national priorities.
In addition, upland and mountain people often bear a disproportionate share of the negative externalities of the development process. This may be due to the loss of their production base to land acquisition for development projects or to migration from the lowlands or the appropriation of natural resources (including forest and water) by national and non-local interests. The lack of security of tenure over livelihood resources has led not only to disempowerment but also to unsustainable natural resource management practices.
The steepness of slopes and the high risks of erosion, landslides and flooding in downstream villages, however, should make the uplands a priority target for development initiatives to reduce poverty. However, lack of local capital and security of tenure over land and tree resources have resulted in a low level of investment. It has also led to practices that are environmentally unsustainable, such as slash-and-burn agriculture with insufficient fallow periods, farming on steep slopes with inadequate investments in soil and water conservation, or inappropriate exploitation of forest and other biological resources.
It is increasingly realized that the real plight of mountain and upland poor has been overlooked. The vulnerability of poor areas and poor people to different livelihood shocks and stresses was never seriously considered, resulting in inadequate measures to safeguard these people. Years of continuous neglect and the recent crises (financial, El-Nino, La-Nina, political insurgency) have created a sense of helplessness in the uplands. There is a major challenge to help restore the lost self-confidence of these people in their own abilities to come out successfully from the current situation. The poor clearly need policies, markets, technologies, and infrastructure that can help them improve their incomes and well-being.
The urgency for preventing or reversing the deterioration of livelihood systems of target groups in upland areas is not justified exclusively by humanitarian concern for these marginalized populations. Many upland and mountain communities in Asia manage landscapes that provide environmental services to outside beneficiaries, but without sharing in the benefits of those services. The services include clean and abundant water supplies from watersheds, biodiversity protection, landscape beauty as a core element of ecotourism and stocks of carbon that alleviate global warming.
Clear opportunities are now emerging to bring environmental services into the marketplace. However, the current successes (re: Malaysia, Costa Rica, Colombia, Venezuela, Chile) in environmental transfer payments have only benefited large landowners and concessionaires. In addition there is a danger that some types of transfer payment mechanism that are currently evolving are being designed and implemented to the disadvantage of the upland poor. They may actually exacerbate the displacement of poor people from the uplands, and increase their poverty. This is potentially true for carbon sequestration. There are also risks that the concerns of national and global societies about biodiversity protection, and about the hydrological services of watersheds, may negatively affect the welfare and land rights of poor upland communities. These risks must be countered by proactive efforts.
Given the above, there is a pressing need to ensure that the major potential benefits offered by transfer payments are tailored to the specificity of target groups and directed to them. This, as the Environment Report (November 2000) has stated, is one of the most strategic and forward-looking interventions that can be undertaken in the coming years.
THE RUPES PROJECT
There are many initiatives across the world to develop new markets and economic instruments to buy and sell forest services; however, these initiatives are dispersed and often isolated within particular disciplines, sectors or countries (Scherr and Martin 2000). The valuable lessons generated from these initiatives are not readily accessible to the growing number of stakeholders around the world interested in this topic.
In 2002, the World Agroforestry Centre (ICRAF) in collaboration with the International Fund for Agriculture and Development (IFAD) designed a project to develop appropriate methods for rewarding the poor upland communities for the environmental services that they provide.
ICRAF has taken on the role of coordinating a consortium of partners interested in participating in rewarding upland poor for environmental services they provide (RUPES). These include such organizations as the Center for International Forestry Research (CIFOR), World Resources Institute (WRI), World Conservation Union (IUCN), Winrock International, Conservation International (CI), the Ford Foundation, The Nature Conservancy (TNC), International Institute for Environment and Development (IIED), Worldwide Fund for Nature (WWF), national partners from the countries in Asia where RUPES is conducting action research, and other investors.
RUPES aims to enhance the livelihoods and reduce poverty of the upland poor while supporting environmental conservation at local and global levels. The purpose of undertaking the project is to create the basis for applying proven institutional mechanisms that will recognize and reward poor upland communities for the environmental services they provide.
To achieve this, project activities will be aimed at creating the knowledge to direct rewards to upland communities. New methods for environmental transfer payments to upland communities will be tested and monitored through action research. These methods will ensure that the transaction costs for these activities are competitive and that there is full community involvement in the decision-making process. The programme will also explore the most appropriate means of institutionalizing a sustainable process of transfer payments.
To lay out the framework for the RUPES action research activities, the World Agroforestry Centre, in February 2002, hosted a workshop to review and learn from mechanisms for environmental transfers. Commissioned papers were presented on insights from developed country experience (Anne Gouyon); experience and potential for the Philippines (Herminia A. Francisco), the setting in development assistance for Philippine upland communities (Lina Jensen), and CIFOR assessment of carbon transfers (Mary Milne).
The following is a summary of the papers delivered at the review workshop that examined various issues associated with linking poor, upland communities, markets and protection of forest ecosystem services.
REWARDING THE UPLAND POOR FOR ENVIRONMENTALSERVICES:AREVIEW OFINCENTIVES FROM DEVELOPED COUNTRIES (PREPARED BYA. GOUYON, DIRECTOR, IDE FORCE, JAKARTA, INDONESIA)
Developed countries have already established a number of mechanisms to implement environmental transfers either within their own country or towards other countries, including developing nations. All these mechanisms have been designed to provide rewards to farmers for environmental services and the study done for the RUPES workshop focused on those that seemed to target upland farmers. In as much as not all the schemes had poverty alleviation as their objective, they did have some social orientation and so could be targeted to reach poor upland communities. Five main types of mechanism were identified, as summarized below:
First, there must be some institutions able to design contracts adapted to local conditions. Second, funds must be available to finance the process if it has to benefit the rural upland poor, who cannot pay for requested changes or even for the certification of existing beneficial environmental practices. This can be done through public aid, through NGO funding, or through private companies marketing ecolabeled products purchased from the poor. Finally, the whole process depends on the credibility and accountability of the institutions managing it.
All these conditions mean that contractual approaches, despite the huge hopes that they create-especially in the case of certification-remain difficult to implement on a large scale in developing countries, especially if the upland poor are the target beneficiaries.
Like in all other RUPES instruments, ecotourism, to be sustainable and to succeed in actually reaching the poor, must be based on a proper institutional framework. Adequate institutions and funds are also needed to provide capacity building to local players in the form of training, marketing support and seed financing when needed. Finally, ecotourism projects need to ensure that there is a dialogue between the stakeholders to avoid harmful conflicts and set up a participatory monitoring and evaluation system managed by the stakeholders. Ecotourism can be subject to ecolabeling to guarantee consumers and other stakeholders that it actually meets a number of social and environmental conditions. But this brings in the constraints associated with certification, i.e. complexity and costs.
First, the earnings from genetic resources use are uncertain and take at least 10 years to materialize. The recipe for success seems to combine public funds to start a programme and royalties from private companies as a “bonus”. The involvement of public institutions, especially international ones, can also help to ensure that the host country receives assistance in its negotiations with the foreign private partners, and that there is some transparency in benefit sharing within the country.
Another cause for controversy is the fact that because the largest part of the added-value in the creation of a new crop variety or drug is made in high-tech developed countries laboratories, the share of the benefit going to the suppliers of the raw genetic information will always remain small-unless they can access that technology. Hence technology transfer and capacity building should be key components of any genetic resources benefit-sharing project.
This mechanism remains weak for a number of other reasons. First, the funds available are not that great yet. For the moment, the market seems rather experimental and based on the goodwill and image strategy of companies, and their anticipation of the market. If this market fails to materialize and if countries and private companies can continue emitting carbon without any clear sanction or benefits in case of emission offset, they might lose interest in this type of project. Another worrying element is the number of projects and countries that are offering carbon credits or planning to develop some. When compared to the actual low requirements of carbon emissions reductions, this means that supply could become so abundant that prices will fall. This means that the future of such projects will depend a lot on the success of international organizations to make international treaties stronger and binding.
There are three main conclusions to this review. The first is that the path leading to effective implementation of RUPES mechanisms is very narrow. All the mechanisms reviewed here require a fair amount of institutional development, and hence need funding for capacity building, if they have to actually reach the poor and effectively promote environmental conservation. This is bad news since the funds available for such projects are very limited when compared to the needs.
The second lesson is that market-based mechanisms seem to have a much larger potential in terms of funding available and that they can be effective RUPES whenever they are implemented by the private sector in cooperation with NGOs or other institutions enabling the involvement of all stakeholders. Market-based mechanisms are defined here as the ones which are the most efficient at internalizing the social environmental costs or benefits of a particular practice. The involvement of private companies often result in a greater efficiency under the condition that their activities are closely monitored and complemented by NGOs representing all stakeholders, and ensuring that the benefits of these mechanisms actually reach the poor.
The last and first lesson of this review is that these mechanisms in most cases have little chance to be of use because their potential impact is contradicted by a number of perverse incentives running against the upland poor and against environmentally friendly practices. Identifying and trying to remove these penalties should be the first step before starting to design and implement RUPES mechanisms. The effectiveness of removing them rather than trying to implement complicated RUPES mechanisms with limited resources needs to be assessed. In many cases, it is likely that removing the penalties will provide a more effective way of meeting environmental conservation and poverty alleviation objectives than any of the RUPES mechanisms.
ENVIRONMENTAL SERVICE “PAYMENTS”: EXPERIENCES, CONSTRAINTS AND POTENTIAL IN THE PHILIPPINES (PRESENTED BY H. AROCENA-FRANCISCO, DEPARTMENT OF ECONOMICS, COLLEGE OF ECONOMICS AND MANAGEMENT, COLLEGE, LAGUNA, PHILIPPINES)
The paper discusses the various forms of environmental service “payments” that have been implemented through the various upland development programmes in the Philippines. Environmental service “payments” (ESP) as defined in this paper refers to assistance in cash or in kind received by upland dwellers in exchange for their participation in efforts to protect the environment. “Payments” often take the form of free planting materials, wages as hired labourers in reforestation and other forest protection activities, material support in construction of soil conservation measures, credit, technical assistance and training opportunities, among others.
Several upland sites were analysed to investigate the forms of ESP, the kind of services rendered by the upland communities, and the potential for the implementation of RUPES initiatives. The sites chosen represent varying socio-economic, environmental and political conditions to capture the diversity in upland situations.
The paper strongly emphasizes the need to look at payments from two perspectives: payments to the providers (upland poor) of the environment services (SUPPLY-SIDE) and payments from the beneficiaries of the environmental services (DEMAND-SIDE). It makes the point that current RUPES document seems to negate the demand-side aspect, which is equally important in sustaining efforts to support the supply-side payment. These two aspects though would require different strategies and may involve different collaborators but are two important efforts that should be pursued side-by-side to ensure a more sustainable system of “payment” to the upland poor. Finally, the paper closes by identifying key questions that must be addressed in the development of the reward mechanism for RUPES.
DEVELOPMENT ASSISTANCE TO UPLAND COMMUNITIES IN THE PHILIPPINES (PRESENTED BY C. JENSEN)
Over the last two decades, there has been a growing concern about the alarming rate of Philippine forest degradation and upland poverty. The government has initiated and implemented programmes, and policy reforms were adopted to address the problem. The country has also been the recipient of substantial development assistance of loans and grants from international funding agencies in support of sustainable forest management and poverty reduction. Although there were some successes, upland development assistance has been short of its targets in addressing poverty reduction and natural resource degradation. This can be attributed to:
ASSESSING THE LIVELIHOOD BENEFITS TO LOCAL COMMUNITIES FROM THE PROFAFOR CARBON SEQUESTRATION PROJECT, ECUADOR (PRESENTED BY M. MILNE AND P. ARROYO, CIFOR, INDONESIA)
The Clean Development Mechanism (CDM), under Article 12 of the Kyoto Protocol, is one of three “flexibility mechanisms” available to industrialized countries (Annex 1 countries) to meet their emission reduction targets and also contribute to sustainable development of non-Annex 1 countries. A pilot phase called “Activities Implemented Jointly” (AIJ) was initiated to explore ways of implementing CDM-like projects and institutionalizing, in the future, the provision for working jointly to achieve emissions reductions objectives. Drawing on experiences from the AIJ pilot phase, it is possible to begin assessing, whether or not, land use, land-use change and forestry (LULUCF) projects have the potential to protect carbon and biodiversity, and simultaneously contribute to long-term sustainable rural development.
This study assesses the actual and potential livelihood impacts of PROFAFOR, a carbon sequestration project in Ecuador, in the knowledge that the AIJ phase projects did not have a sustainable development requirement, but that this was an opportunity to explore the livelihood opportunities and risks of LULUCF projects. For PROFAFOR, addressing the livelihood needs of contracted communities will help to increase the duration of the carbon sequestered.
Short-term impacts on community assets
In the short term, the financial contribution, technical assistance and provision of planting material by PROFAFOR have, to differing degrees, increased the financial, environmental, human, social and physical capital of project participants. In most cases, the subsidy had been used for paying local wages and food for the community members in establishing the plantations and the surplus funds had either been used for community or individual needs. Since the project prohibits the grazing of livestock and agricultural activities in the plantations, there were some reported community conflicts over the use of the land under plantation.
Short-term livelihood impacts on community activities and income
The project has provided the communities with the opportunity to either expand their existing exotic plantation area or diversify on-farm activities. Many of the surveyed community members were experiencing reduced income from livestock and agricultural activities and hence needed the project subsidy to establish the plantations to provide local employment and additional income.
Long-term livelihood impacts on communities
All communities expected that the plantations would generate increased income for community members in the future. Community projections of the importance of forestry activities, particularly in terms of contribution to income, were varied. In a few cases, if existing constraints to livestock and agricultural activities continued, forestry activities were likely to replace agricultural activities. Some communities were establishing plantations to diversify their income base whilst others were expecting timber revenues to become the major income source for the community.
Given decreasing returns from other on-farm activities, the project contracts for 15 to 20 years represent a potentially profit able investment for the surveyed communities, particularly to those with plantations of exotic species. Fire, harsh climatic conditions, pests and diseases, and access to markets were noted as the major risks to the profit ability of the plantations. However, under the new 99-year contracts, only communities interested in both financial and environmental benefits are likely to gain. As a purely financial investment the 99-year contracts are likely to be unprofitable, especially if the opportunity cost of the land increases in the future. Community members would be better off establishing plantations under other schemes, where contract conditions are more flexible.
Recommendations
Forest carbon projects have multi-stakeholders and multi-objectives. To ensure that all objectives are met and that no stakeholder is made worse off, it is important to identify potential trade-offs and conflicts of interest at the start of the project. In the two case studies, the community members were not expected to receive benefits directly from the carbon offsets, but instead earn income from project related activities.
At the outset, projects managers should implement socio-economic assessments in communities that are interested in participating in the projects or are expected to be impacted on by project activities, in order to identify initial risks and opportunities to project goals. In particular, the opportunity cost of land under the project needs to be assessed in detail before projects are implemented. Once projects are implemented, monitoring of socio-economic conditions should continue, thereby capturing changes at the community level that may impact on the goals of the project.
Since forest carbon projects have a longer time frame than most development projects, project designers need to provide adequate incentives to stakeholders to ensure their long-term commitment and enter into collaborative and flexible partnerships with communities. For poorer communities with limited land, inflexible long-term contracts are likely to have adverse livelihood impacts, and may also be counter productive to achieving the carbon sequestration goals.
Most forest carbon projects have invested in long-term benefits to communities, either through supporting community plantation activities or supporting local enterprises. In doing so, project managers will need to ensure that the community members receive adequate training and information on both the production and the marketing side, to develop profit able and sustainable enterprises. If community ventures do not generate adequate funds for the community, the project risks negative leakage and early emission of carbon.
IMPLEMENTING THE RUPES PROJECT
As concluded from the input to the RUPES Inception Workshop, the main challenge found in all RUPES mechanisms is how to make sure that the rewards effectively reach the upland poor. This is all the more difficult since upland communities are remote, isolated, and usually lack institutions able to represent them in a democratic and effective way. There are three main types of institutions that have been found to channel environmental rewards to the poor.
The first is government, whether at national, regional or local level. They usually take part in the coordination and regulation of RUPES mechanisms. When they are the ones counted on to deliver the rewards, lack of capacity and corruption are important constraints to effective delivery. For this reason, NGOs-including international, national and community or local level ones-have increasingly been relied upon to deliver benefits to the rural poor through their capacity, representatively and legitimately. Finally, a number of mechanisms rely on the market to deliver the benefits to the farmers such as ecolabeling and trade in carbon emissions offsets. However, even in such cases, NGOs are often needed to make sure that the poor really benefit from the transfer.
Another way to differentiate amongst RUPES mechanisms is through the type of rewards. Three main types have been identified. The first is direct financial rewards such as subsidies given in exchange of the implementation of a particular land-use change. The second is rewards in kind, like the case in many community development projects providing infrastructure, training or other material benefits or services to the upland poor. The third is access to resources or markets such as land tenure, or access to better markets through ecolabelling, or schemes in which the allocation of public contracts is given partly based on environmental quality.
The most effective RUPES systems are the ones in which a clear link of conditionality between the environmental service and the rewards with some sanctions exists, usually in the form of a contract. This is the case of targeted agro-environmental subsidies in Europe and the USA, and is also the case of most ecolabelling schemes, as well as some bioprospecting schemes. However, these schemes require a sophisticated institutional setting, with the capacity to understand contracts and to enforce them.
This directly leads to the last point in the RUPES analysis, i.e. whether there is a monitoring and evaluation system to ensure that the poverty alleviation and environmental targets are met. Schemes that are based on a contract usually have such evaluations in order to check that the contracts are respected. Mechanisms that are project-based usually rely in classical project cycle evaluations.
The approach taken in the RUPES project is to build working models of best practices for successful environmental transfer agreements adapted to the Asian context. It will conduct targeted action research at a number of sites across the region to examine and explore what the environmental services are and how can they be measured. Mechanisms to anticipate and prepare for changes to environmental services will also be considered as part of the programme.
The programme will look at whom the rewards should go to, who will pay the rewards, how and in what form they would be collected and what amount or form is appropriate. The action research will define appropriate methods with the beneficiaries for best practice in environmental transfer payments. It will provide simple, practical examples of how innovative, institutional arrangements and reward mechanisms can be applied to foster local development while at the same time preserving and restoring the environment.
The emphasis will be on easily understood, sound and financially and institutionally sustainable approaches. There will be a particular focus on the development and strengthening of local institutions associated with environmental transfer payments. Networking at global, regional and national levels will be another key element of the RUPES Programme.
PROGRESS TO DATE
Through the RUPES Programme, a target set of ten sites is expected to generate the diversity of experience and lessons for institutionalization leading to wider applications throughout relevant situations in Asia. The first year of the programme focused on reviewing past experiences and initiatives to assist in the planning and establishment of the criteria for the selection of the action research sites. Initial sites were identified in the first year; however, it was recognized that further investigation and solicitation are needed so as to ensure a diversity of sites are included. Efforts were made to firm up the organizational and institutional collaboration for the RUPES Programme to set in place a firm foundation for the set of activities that will be implemented at the pilot sites and at a wider programme level according to each of the programme outputs.
Inputs to the project identified well over 50 initial “ideas” for RUPES sites. Through a series of interactions, conversations, discussions, etc., more formal indication of probable sites was received through the completion of 31 in-depth, comprehensive questionnaires. These in turn were honed down and developed into 17 proposals that were considered by the RUPES International Steering Committee (ISC).
Two sites are now officially conducting RUPES activities. The first is in the Philippines and the second in Nepal.
The Ikalahan Ancestral Domain includes the Kalahan Reserve and totals approximately 58 000 ha of mountain lands between 550 and 1717 m above sea-level on the island of Luzon in the Philippines. The reserve has been under the legal control of the Ikalahan community, represented by its People’s Organization, the Kalahan Educational Foundation, Inc., since 1974. The Philippine Government in 1999 approved the Ancestral Domain Claims.
The Domain provides both water for drinking and irrigation systems and has a proportion of the land in production forests as well as agriculture. About 20 000 persons live within the Ancestral Domain of whom at least 90% belong to the Ikalahan and another 5% belong to other tribes of indigenous people, primarily the Ifugao, Ibaloy and Kankanaey. About 2500 persons live within the Kalahan Reserve.
The RUPES project with the Kalahan Foundation will confirm the carbon sequestration and watershed protection functions of the reserve and the Ancestral Domain and test payments for these services. The buyer of the carbon is still to be determined although there is some certainty that the managers of the irrigation systems will provide the payment for the Ikalahan community’s efforts in protecting the watershed. In addition there is the possibility of using payments from ecotourism efforts to bolster the biodiversity conservation in the reserve.
The Kulekhani watershed is located in the Makwanpur district, approximately 50 km southwest of Kathmandu in Nepal. At an altitude of between 1400 and 2300 m this watershed has a total area of 12 496 ha and has a total population of 43 003 with the majority of the inhabitants being disadvantaged ethnic groups and low caste people (Dalits).
Water from the Kulekhani River and its tributaries is the source of power for two hydropower plants located downstream of this watershed. In their work with RUPES, Winrock International will work with local communities to identify the range of environmental services being provided, quantify and value such services, and identify transfer payment mechanisms, including new methods and approaches, and determine what preconditions are necessary and constraints to consider in implementing these services. The project will work towards strengthening the capacity of local institutions to implement transfer payments through appropriate institutional arrangements, agreements, and monitoring and enforcement mechanisms, and then compile and disseminate best practices and lessons learned from these projects to raise awareness at all levels on how the transfer of payments in delivering environmental services can benefit upland communities in Nepal and other Asian countries.
Nine additional sites are just completing their project proposals. These sites are in Indonesia (6) and the Philippines (3) and cover the testing of rewards and reward mechanisms for biodiversity conservation (2 sites) and watershed protection (7 sites). Currently there are two sites (under the auspices of WWF) that are included in the RUPES portfolio but are there purely for sharing of information and knowledge (e.g. no funds are required from the project to assist the activities).
In addition to the action research activities at the sites, there are a number of other studies underway to facilitate the understanding and implementation of RUPES. These include an institutional study in Indonesia that will help to understand and shape social, political, legal and economic environments to become more supportive of rewards that are linked to environmental services provided by upland communities.
Also being undertaken is a typology of environmental services as the term “environmental services” is often used as a generic concept. Yet, for any effective relationship between outside beneficiaries of these services and the upland communities that generate them, it is necessary to be explicit in defining what the functions are, and how they can be measured and monitored. The typology aims to decompose the broad concept into components.
ICRAF is leading a study to review the development of environmental services markets in Indonesia. The objective of this study is to undertake a literature review to assess the development of environmental services market. The assessment will follow a framework of environmental services typology that has been developed and the focus of the assessment will be to identify the sellers and buyers of environmental services, the payments/rewards of environmental services and the mechanisms, intermediaries, transaction cost, supporters and obstructers.
To facilitate any transfer of benefits from environmental payments, it will be necessary to understand at each of the action research sites, what the environmental services are, who provides them, and how they are generating benefits. Threats to these services that cause changes across various spatial and temporal scales will need to be assessed to facilitate the development of appropriate land management schemes and the corresponding environmental reward mechanisms that will benefit the upland poor. RUPES is currently undertaking a scoping study to make recommendations on the design of an appropriate information system that will support the needs of the RUPES sites, enable both local and independent monitoring of the welfare of the beneficiaries and provide regular and credible monitoring of environmental services at appropriate levels. The design of the appropriate information system that will serve these objectives will include an inventory and analysis of existing information systems on upland poor target beneficiaries of environmental rewards, land-use practices at the site level, environmental services and their users and potential buyers at three of the RUPES action research sites (Indonesia, the Philippines and Nepal) in order to guide an appropriate information system for all action research sites working with the RUPES project.
In Viet Nam, RUPES has been supported by the Swedish SIDA to explore constraints and potential to addressing important aspects of poverty in Viet Nam uplands through rewarding the upland poor for environmental services they provide. The conclusion of this study in late 2003 will result in the nomination of potential RUPES testing sites in that country.
There has already been a RUPES “kick off” workshop in Yunnan Province, China, which brought together over 25 participants from a range of organizations in both the governmental and the NGO sectors to discuss China’s Sloping Lands Conversion Programme and the feasibility, roles and action plan for initiating one or more RUPES testing sites in China.
With the leadership of the IUCN’s Regional Environmental Economics Programme in Asia, RUPES “kick off” workshops are being planned for Lao PDR and Sri Lanka that will lead to more awareness of the RUPES project and identification of RUPES testing sites in those countries.
In support of the capacity building aspects of the RUPES project, the Netherlands under an SII grant to ICRAF is conducting a nine-day workshop in September for invited participants (including, but not limited to, site personnel at RUPES action research sites who can influence decisions on their site project) to share their experiences and add to their knowledge on environmental transfer payments and the poor. The workshop will be a combination of theoretical knowledge on the basic principles of rewarding upland poor for environmental services they provide interwoven with case studies relating experiences and the extent to which rewards or payments for environmental services did or did not reach and benefit the poor.
CONCLUSION
The primary impact of the RUPES project will be to create and study experiences, on the use of environmental reward transfers as a tool for promoting effective and sustained environmental management while at the same time increasing benefit flows to poor upland communities. The main result will be a deeper and more practical understanding of how to formulate such arrangements, their viability and potential for replication. This initiative will serve as an intellectual focal point for collection and analysis of experience derived for these innovative approaches.
Experience and analysis will feed directly into government planning for environmental management and poverty alleviation in the uplands of selected countries and present opportunities for IFAD to become the leading financial and intellectual resource in support of such approaches in IFAD priority areas.
Poverty alleviation impact will likely come from rewards to upland communities taking the form of secure land tenure, development assistance such as credit, market infrastructure, improved/expanded extension services, particularly in terms of better access to quality germplasm for trees or other agricultural products, and when appropriate, direct financial payments. The emerging market for carbon, whether or not linked to offset arrangements, offers the most immediate potential opportunity for the upland poor to generate a capital base on which to grow economically. As more experience is gained and analysed in this and other environmental service markets, the greater is the potential for magnifying impact beyond the initial project areas.
Another anticipated project impact would be on understanding and addressing factors that constrain efforts to link the provision of environmental services to rewards to the providers. It is likely that institutional and policy constraints will be prominent and a deeper understanding of these and a way to address them may be among the important impacts of the project.
Expanding the influence on the global poverty and environment agenda. The global climate agenda has been largely driven by global environmental issues, with little recognition of the tight linkages between environmental degradation and poverty. The international agencies and developed country governments driving the efforts in climate change mitigation are often focused on this limited objective, without adequately considering how their actions may negatively impinge upon the poor. They are not always adequately cognizant of how, with careful attention, their actions and investments in environmental mitigation could also better contribute to meeting the objective of eradicating poverty.
The RUPES project will be a mechanism to acquire the necessary knowledge base to influence the global poverty and environment agenda. The programme will provide a flow of scientifically credible knowledge and pragmatic, tested solutions that enables it to confidently influence the entire direction of climate change investments. (For more information on the RUPES project please visit the RUPES website at http://www.worldagroforestrycentre.org/sea/Networks/RUPES/index.htm).
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Richards, M. & Moura-Costa, P. 1999. Can tropical forestry be made profit able by ‘internalising the externalities’? ODI Natural Resources Papers.
Scherr, S. & Martin, A. 2000. Developing commercial markets for environmental services of forests. Katoomba Workshop II proceedings and summary of key issues. Vancouver and Parksville, British Columbia, Canada.
The World Agroforestry Centre. 2001. Project design for the project “Rewarding Upland Poor for the Environmental Services They Provide”. Bogor, Indonesia, ICRAF.
| [4] The World Agroforestry
Centre, Bogor, Indonesia; E-mail: [email protected] [5] Out of a total of 1700 million hectares that make up the continent, nearly 236 million hectares (14 percent) have slopes exceeding 30 percent and a further 664 million hectares (39 percent) have slopes between 8 and 30 percent. |
