Incentive and market based mechanisms for SLM

1. Incentive and market based mechanisms for SLM

2. Session’s Objectives • Why incentive & market based mechanisms for SLM • Types and examples • How to identify appropriate mechanisms in your country • Recommendation

3. Why incentive & market-based mechanisms? • Land use decisions by a land users may have implications far beyond the site • Return for investments in land management often occur in the medium to long term • Land users cannot be expected to pay the total cost of implementing measures to prevent land degradation We need to provide incentives for land users to invest in Sustainable Land Management Practices (SLMPs)…

5. 1. Public payment schemes Green fund of Trinidad and Tobago • Established by the Finance Act 2000 • 0.1% tax on gross sales of companies conducting business in T&T into a Green Fund • Fund goes to grants to community groups and organisations engaged in activities to reforest and conserve the environment • Fund serves as a mechanism whereby financing for environmental programmes and projects can be sourced

6. 1. Public payment schemes China – Contract farmland set-aside • “Grain for Green” • Implemented in areas with land soil erosion and desertification • 15 mill farmers received compensation for setting aside their land • 1999-2008: 8,216 million hectares of farmland were converted into forest land

7. 3. Self organized private deals Tanzania – Direct payments for environmental services • Watershed services • Objective: To decrease soil erosion and overall land degradation in Uluguru region • Coca Cola and public water company – willing to pay farmers for implementing SLM practices because it reduces their water treatment costs • CARE responsible for training and monitoring

8. 4. Eco-labeling of products and services Zambia – Marketing labels • COMACO:Community Markets for Conservation • Objective: to improve the situation of poverty and eliminated hunger in the Luangwa Valley whilst conserving environment • Poor, food insecure farmers are organized into producer groups, trainedin quality, legal and income-generating skills focused on sustainable agriculture • Sustainable land use practices qualifies the farmer for conservation dividends that reward the farmer  • COMACO purchases surplus crops and resells them as processed, value-added, organic products under the special brand IT`S WILD!

9. Factors determining the suitability of incentive & marked based mechanisms The success and feasibility depend upon factors at national and local level One type of mechanism may be a good option in one context but not in another Score card system have been developed by GM and CATIE to select the most suitable mechanisms within the specific country and site context

10. Factors determining the suitability of marked based mechanisms

11. Cameroon sudano-sahelian zone results

12. Cameroon sudano-sahelian zone results 1st tier: • Co-finance • Subsidies • Taxes and fees 2nd tier: • Payments for proven investments in land conservation • Ecolabeling and certification

13. Recommendations for implementation of incentive & market based mechanisms • Identify appropriate mechanisms for the national and site specific context • Ensure enabling conditions (sufficient credit, resources and knowledge, tenure security) • Undertake a broad analysis of benefits and costs of land use activities (to decide optimal SLMP and to present solid arguments for those who will pay for the services provided) • Identify partners (buyers & sellers of environmental services and facilitators for setting up the appropriate mechanisms).

14. Thank for your Attention!