Africa: Paying Farmers to Protect the Environment?

Food and Agriculture Organization of the United Nations (Rome)

PRESS RELEASE
15 November 2007
Posted to the web 15 November 2007

Carefully targeted payments to farmers could serve as an approach to protect the environment and to address growing concerns about climate change, biodiversity loss and water supply, FAO said today in its annual publication The State of Food and Agriculture.

Agriculture employs more people and uses more land and water than any other human activity," said FAO Director-General Jacques Diouf in his foreword to the report. "It has the potential to degrade the Earth's land, water, atmosphere and biological resources - or to enhance them - depending on the decisions made by the more than two billion people whose livelihoods depend directly on crops, livestock, fisheries or forests. Ensuring appropriate incentives for these people is essential."

Population growth, rapid economic development, increasing demand for biofuels and climate change are putting environmental resources under pressure throughout the world. For instance, agriculture is expected to feed a world population that will increase from six to nine billion by 2050.

One of the important reasons for environmental degradation is the perception that many of nature's services are free - no one owns them or is rewarded for them and farmers have little incentive to protect them. In addition, subsidies that encourage the production of marketed goods at the expense of other ecosystem services can aggravate their degradation.

Incentives

Current incentives tend to favour the production of food, fibre, and increasingly, biofuels, but they typically under-value other beneficial services that farmers can provide, such as carbon storage, flood control, clean water provision or biodiversity conservation.

Farmers can provide better environmental outcomes, but they need incentives to do so. Payments for environmental services represent one way of increasing incentives to adopt improved agricultural practices--and even to offset pollution generated in other sectors.

However, "payments may also have adverse impacts on poverty and food security in some cases, should they result in a reduction in demand for agricultural employment or increases in food prices," noted Dr Diouf.

Carbon sink

Farmers will need to play an important role in mitigating the effects of climate change, the FAO report said.

Agriculture plays an important role as a carbon "sink" through sequestering and storing greenhouse gases, especially as carbon in soils, plants and trees. Less deforestation, planting of trees, tillage reduction, soil cover increase and improved grassland management could, for example, lead to the storage of more than two billion tonnes of carbon in around 50 countries between 2003 and 2012.

"Well-designed payments for environmental services are one way to help farmers to change land-use practices and make farming more environmentally friendly," said Leslie Lipper, Senior Environmental Economist. "These are payments for real services farmers can provide, much like farmers are paid for the rice or coffee they produce."

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The report however cautions that payments for environmental services are not the best solution in all situations, and that significant implementation challenges remain.

Valuing Ecosystem Services: An Answer for China’s Watersheds?

Lila Buckley – September 11, 2007 – 5:00am

China Watch Home About China Watch

Government officials and researchers in China are increasingly trying to solve the economic piece of the nation’s environmental puzzle. Policy suggestions include subsidies for technologies that save both energy and money, taxation schemes that provide financial disincentives for polluters, and funding mechanisms that support ecosystem conservation. The latter approach—financing conservation—is particularly crucial to China’s future stability, says Dr. Liu Guihuan, who has spent her career at the Ecology Institute of the Chinese Academy of Environmental Planning searching for economically viable solutions to ecosystem protection.

According to Liu, the primary obstacle to ecosystem protection in China is not the cost of protection itself, but how this cost is allocated. “It is always cheaper to protect ecosystems than to have to rebuild and restore them once they are destroyed. But it is a question of who is paying those costs,” she observes. Liu argues that protecting China’s ecosystems requires putting the burden of payment on the appropriate resource users.

Protecting watersheds—Dr. Liu’s research focus—is a case in point. Liu and her colleagues point to the many benefits intact watersheds provide beyond supplying humans and wildlife with water. These so-called “ecosystem services” include soil and water purification, habitat for biodiversity, and carbon sequestration. “The beauty of healthy watersheds is that these services are provided for free, and indefinitely,” she notes. But as with any free public resource, ecosystem services are prone to overexploitation and degradation by some users, making the services unavailable to others. By the same token, “costly protection and restoration efforts by some are usually enjoyed by others who do not pay for them,” Liu adds.

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Making the Business Case for Ecosystems
Source: WBCSD.org

If anyone understands the business case for ecosystems, it is Madeline Brien, current Assistant to the CEO of Det Norske Veritas (DNV), the independent Norwegian technical inspection foundation whose core business is safeguarding life, property and the environment.

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Ecosystems are a dynamic web of plants, animals and physical elements that interact and support one another. They include all the world's biomes: wetlands, marine environments, deserts, forests, grasslands and tundra. The services they provide -- habitats, freshwater, food, fiber and fuel, natural regulatory mechanisms, cultural resources -- underpin life itself.

They also supply the raw materials upon which many large corporations rely or which support their production processes. Ecological economists have calculated that the Earth provides some US$16-54 trillion worth of "services" to humans every year.

Yet, the 2005 Millennium Ecosystem Assessment found that two-thirds of the assessed ecosystems and their services are being degraded or used unsustainably.

Current pressure on ecosystems resulting from demographic growth and the increasing demands of industrial and economic development is negatively impacting them and threatening their ability as providers. If measures are not taken to mitigate this, some ecosystems and their services may disappear altogether.

In light of this, the FLT has been given the task of making the business case for ecosystems. Madeline believes it is a strong one. To date, initiatives aimed at protecting ecosystems and their services have been largely government-led -- through legislation or taxation -- or voluntary -- through self-imposed sectoral certification schemes, for example.

Business-inspired initiatives, while gaining in currency, are still in their infancy and are not as yet widespread across industry sectors. Says, Madeline, "Once businesses are able to comprehend the risks inherent to ecosystem degradation and take measures to mitigate the impacts of their activities, there will be an opportunity to factor them into their operations and make gains. They will also provide an opportunity to develop new ideas. The challenge will be to bring ecosystems to global business."

Some ecosystem-based enterprises, such as the forest products or fisheries industries, have clearly understood the importance of ecosystems. This awareness is reflected, for example, in the Forest Stewardship Council and Marine Stewardship Council initiatives.

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Moving Ecosystems Services from Theory to Reality

WorldChanging Team
September 4, 2007 3:00 AM

Ecosystem Goods and Services Series: World Resources Institute Interview
A collaborative series by Hassan Masum, David Zaks, and Chad Monfreda.

As the ecosystem services meme trickles down from the science and policy worlds to on-the-ground programs, it's informative to peek behind the curtain to observe its evolution.

One group working very hard at mainstreaming ecosystems services is the People & Ecosystems program of the World Resources Institute. WRI has been at the forefront of this type of research for many years. Its Pilot Analysis of Global Ecosystems (PAGE) project was the precursor to the Millennium Ecosystem Assessment, and many of their publications carry weight in both the scientific and policy communities.

Here we interview WRI staff who are all playing a vital role at the interface between academic theory and real-world practice: Karen Bennett, Charles Iceland, Evan Branosky, and Stephen Adam.Keep reading to see their thoughts on how the ecosystem goods and services idea plays out in a policy environment.

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