Transcript Presentation Title

Markets for Watershed Services
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Background
Where
How
Duration
Partners
Markets for Watershed Services
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Lessons
Hydrology
Economic
Social
Engaging with private sector
Pro-poor?
Copies will be available in English,
Spanish, Bahasa
Use as a teaching / training aid
Feedback welcome
Further ideas of how to use the
material
Website with case studies
Making Payments for
Watershed Services Work for
People and Nature
For KATOOMBA Group, Uganda 2005
Programme Goal
Payments for watershed services are
supporting sustainable natural resource
management, improved livelihoods and
social justice for the rural poor
Potential support from DGIS (Netherlands) and
DANIDA (Denmark)
Programme Outcomes
1. Financial transfer mechanisms that enable regular
contingent payments between buyers and sellers of
watershed services are established in 10 sites
2. Organizations involved in payments for watershed
services have been established and strengthened
(buyers, sellers, intermediaries, facilitators)
3. Local governments promote and facilitate the
development of payments for watershed services
4. Methodologies and tools for facilitating and
monitoring pro-poor payments for watershed
services have been identified and developed
Programme Outcomes
5. Action learning mechanisms have enabled the
sharing of information, experiences and skills
within the 6 countries; between these countries
and other initiatives; and with other national and
international agencies
6. CARE, WWF, IIED and other partners are formally
engaged in payments for watershed policy
processes that support pro-poor payments for
watershed services at local, national, and
international levels
Justification
1. Severe development and environmental problems
have been identified in each of the sites
2. In each of the 6 countries, payments for watershed
services show much promise
3. Pro-poor payments for watershed services can
contribute to poverty reduction and sustainable natural
resource management
4. Payments for environmental services are recent
innovations – benefits from sharing knowledge &
methodologies with others and between development
and environmental organizations like WWF, CARE and
IIED
Sites of Intervention
• Philippines: Cantingas watershed & Mt. Isarog
watershed
• Indonesia: Ujung Kulon national park & Nunukan
district
• Peru: Jequetepeque river & Piura river
• Guatemala/Honduras: Sierra de las Minas & Orica
Creek
• Tanzania: South Nguru mountains & Ulguru
mountains
Can PWS be pro-poor?
•Point of substantial discussion over last 5 years
•Developed as a tool for financing natural resource
management
•Old wine in new skins
•Limited evidence from Costa Rica – is it replicable?
Programme phasing
• Agreed with donors to split the programme into two
discrete phases.
• PHASE ONE: Developing compelling business
cases for 10 sites (18 months, starting in January
2006)
• PHASE TWO: Implementation of viable sites
(potential 3.5 to 4 years)
Phase One Activities
Core problem analysis and
quantification
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Identify core problem at
each of the sites
Conduct robust
hydrological analysis
Understand landuse and
livelihood strategies of
sellers
Develop options to
address core problems
Develop cost:benefit
analysis from both
buyers and seller
perspectives
Supporting activities
Compelling business case
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Understand legal and
policy options for
payments for
watershed services.
Networking with
potential buyers and
sellers of services
Facilitating learning
within country sites,
between country sites
and from other
organizations and
sites.
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Synthesise quantitative
analyses into a
compelling business
case
Develop implementation
workplans
Commit both buyers
and sellers to the
implementation phase
in MOUs.
Relationship with the Katoomba
Group
o Katoomba is a pool of skilled people with diverse
experiences
o Phase One of the programme is very mechanistic
with an emphasis on showing that there is a viable
business case
o Need:
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to review the experience with similar approaches from other sectors
Skills (consultants) to assist with developing a common
methodological approach that will be a useful tool for working with
private sector buyers
Underestimating the challenge
•PWS mechanisms require a
fundamental “mind-shift”
•PWS mechanisms are not
simple
•PWS mechanisms are a tool
for both land management
and poverty reduction – not
a “silver bullet”
Example Business Case Template
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Introduction & buyers profiles
Core problem statement: problem to the potential buyers & costs of the problem to the buyers
Defining the geographical target area
Quantified hydrological analysis & land use change options to ensure a sustainable flow of watershed
services
Legal & policy review (local and national government)
Financial cost-benefit analysis of watershed services (costs and benefits for company X)
Sellers:
Organization” profile
Livelihoods analysis (focused, including land use change options)
Institutions profile, including tenure and property rights
Cost-benefit analysis of provisioning watershed services to sellers
Funding and bridging mechanisms
Risk analysis scenarios
Validation mechanisms - monitoring plan
Conclusion: Business opportunities in paying for watershed services