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Environmental Services and the Precautionary Principle: Using Scenarios to
Reconcile Conservation and Livelihood Objectives in Upper Catchments
Laura German a; Grace Villamor b; Edgar Twine c; Sandra J. Velarde d; Berhane Kidane e
a
CIFOR, Bogor, Indonesia b World Agroforestry Center, Los Banos, Philippines c International Institute of
Tropical Agriculture, Kampala, Uganda d ASB-Partnership, Tropical Forest Margins/World Agroforestry
Center, Nairobi, Kenya e Forestry Department, Holetta Agricultural Research Center, Addis Ababa, Ethiopia
Online Publication Date: 01 April 2009
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ISSN: 1054-9811 print/1540-756X online
DOI: 10.1080/10549810902791515
Environmental Services and the Precautionary
Principle: Using Scenarios to Reconcile
Conservation and Livelihood Objectives
in Upper Catchments
1540-756X
1054-9811
WJSF
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of Sustainable Forestry,
Forestry Vol. 28, No. 3, February 2009: pp. 1–39
LAURA GERMAN1, GRACE VILLAMOR2, EDGAR TWINE3,
SANDRA J. VELARDE4, and BERHANE KIDANE5
Environmental
L.
German et al.Services and the Precautionary Principle
1
CIFOR, Bogor, Indonesia
World Agroforestry Center, Los Banos, Philippines
3
International Institute of Tropical Agriculture, Kampala, Uganda
4
ASB-Partnership, Tropical Forest Margins/World Agroforestry Center, Nairobi, Kenya
5
Forestry Department, Holetta Agricultural Research Center, Addis Ababa, Ethiopia
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2
Strategies for environmental governance and conservation in
Africa have relied on regulatory mechanisms (policies) that further
restrict already limited livelihood options by prohibiting certain
land uses and isolating people from forest resources. Environmental
service rewards (ESR) present an opportunity for incentives-based
conservation, enabling livelihood and conservation goals to be
more easily reconciled. Yet context has an important effect on the
viability of ESR and on the trade-offs or synergies that emerge
between conservation and livelihood, local and off-site benefits.
This article analyzes ethnobotanical data from three sites in the
eastern African highlands to analyze the likely consequences of
applying diverse regulatory and incentive (ESR) schemes. Data
illustrate that when applied in isolation, carbon rewards can
undermine water conservation and local livelihood objectives
alike through expansion of fast-growing tree species at the expense
of water supply and other land uses. The article presents an
approach for building upon local knowledge and scenario analysis
during the planning phase of environmental service reward
The authors would like to acknowledge SDC, IDRC, and the Rockefeller Foundation for
their financial support for fieldwork, and the guidance and friendship of the late Dr. Ann
Stroud and Dr. Luis Navarro.
Address correspondence to Laura German, Center for International Forestry Research
(CIFOR), Box 0113 BOCBD, Bogor 16000, Indonesia. E-mail: L.German@cgiar.org
368
Environmental Services and the Precautionary Principle
369
schemes to identify a suite of incentive and regulatory mechanisms
most likely to reconcile local livelihood with local, national, and
international conservation objectives.
KEYWORDS agroforestry, carbon sequestration, environmental
services, precautionary principle
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INTRODUCTION
Strategies for environmental governance and conservation in Africa have
focused on regulatory mechanisms that further restrict already limited livelihood options by prohibiting certain land uses and isolating people from forest resources. Tensions created through regulation (i.e., conservation versus
livelihoods, rural versus urban interests) have made enforcement difficult.
Environmental service reward (ESR) systems (incentives) represent a promising alternative to regulation, enabling livelihood and conservation goals to
be more easily reconciled (van Noordwijk, 2005). The trade-offs between
livelihoods and environmental service (ES) functions of highland watersheds
are perhaps most acute in Africa, where chronic poverty has led to more
extreme levels of resource degradation. Loss of critical ES is felt by local
(rural) and off-site (urban and rural) users alike. Low levels of household
income suggest that modest rewards may catalyze far-reaching change in
Sub-Saharan Africa. These factors combined suggest that a functioning ESR
scheme holds significant promise for reconciling livelihood and environmental goals in the region.
While opportunities are apparent, context is likely to have a profound
effect on the viability of ESR schemes and on the trade-offs or synergies
that emerge. Recent research has shown that strong trade-offs exist in tree
species selection in agricultural and forested landscapes in the absence of
carbon credits. Observed trade-offs are both biophysical (i.e., trees versus
water) and social (i.e., land owners versus affected users) (Bruijnzeel,
2004; Farley, Jobbagy, & Jackson, 2005; German, Kidane, & Shemdoe,
2006c). Application of carbon payments in isolation from other regulatory
or incentive mechanisms may exacerbate trade-offs by stimulating expansion of high-value, fast-growing evergreen species at the expense of crops
(due to competition for land and water) and water for human and livestock consumption (Farley et al., 2005). Negative effects of certain tree
species on water availability (a trade-off widely felt by smallholders otherwise selecting these species for their fast growth, and by neighboring
farmers), for example, seem to be inversely associated with the degree of
deciduousness of the species (Muthuri et al., 2002). It is therefore essential
that an intimate knowledge of context—including the unique “environmental signatures” of diverse tree species and their likely expansion or
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L. German et al.
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contraction under carbon credit schemes—is incorporated into the design
of ESR schemes.
This article utilizes ethnobotanical data from four sites in the eastern African
highlands to project into the future the likely consequences of overlaying market-based incentives in the form of carbon credits on existing environmental and
human choice scenarios and the trade-offs embodied in these. Data suggest the
need for complementary measures to ensure that the trade-offs associated with
current (agro)forestry practice—depletion of groundwater, competition with
crops, and related conflict—are not further exacerbated through carbon incentive schemes, and suggest that a precautionary approach to environmental service rewards is warranted. Following a description of the methodology and
findings from this research, an approach for using scenarios to anticipate the
likely consequences of applying discrete incentive and regulatory mechanisms
alone and in combination is proposed. Steps in the proposed approach are outlined and their respective contributions to precautionary planning highlighted.
BACKGROUND
Environmental Governance in East and Central Africa
Strategies for environmental governance and conservation in Africa have
focused on regulatory mechanisms in the form of environmental policies and
social norms regulating the use of water resources, trees, forests, and agricultural
grazing land. Statutory regulations are often ignored, creating a governance vacuum and exacerbating land-use conflicts. This problem has historical roots in
the Colonial era, when traditional governance and belief systems were systematically discredited and eroded. In many countries, the modern legal system has
proven ineffective in filling the governance gap, with local leaders finding it difficult to impose sanctions on their neighbors and relatives and a common perception that laws are imposed top-down with no regard to local realities.
While failure to respect norms and bylaws has many causes—from historical forces which marginalized traditional governance systems to poor
enforcement in the contemporary era—it is hypothesized that it is also due
to the role these regulations play in restricting already limited livelihood
options (German et al., 2006b). Tensions created through regulation (i.e.,
conservation versus livelihoods, rural versus urban interests) have made
enforcement difficult, leaving many regulations to exist on paper only.
Results include encroachment on protected areas and a breakdown in environmental governance and policy enforcement.
Environmental Service Rewards: An Alternative to Regulation
In the past decade or more, there has been an upsurge in global interest surrounding the protection of environmental services. An environmental service
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Environmental Services and the Precautionary Principle
371
is considered to be a result of the dynamic nature of landscapes that are valued by external stakeholders as a service (Van Noordwijk, 2005). This consists of flows of materials, energy, and information from natural capital stocks,
which combine with manufactured and human capital services to produce
human welfare. Costanza et al. (1997) classified the many environmental services into 17 major categories with functions and examples. They estimated
that these services provide at least US$33 trillion worth of services annually.
These include provisioning (e.g., food, fiber, water, etc.), regulating (e.g., climate, disturbance, and water regulation), and cultural services (e.g., recreational, spiritual, and educational) that directly affect people, and supporting
services (e.g., above and below ground carbon stocks in natural forests, agroforests, and agricultural areas) needed to maintain the other services.
Currently, provisions for environmental service reward or payment
systems—largely focusing on watershed protection, biodiversity conservation, and carbon sequestration—are widely recognized in Latin America,
Asia, and increasingly in other parts of the world. ESR schemes (incentives)
represent a promising alternative to regulation, enabling livelihood and conservation goals to be more easily reconciled (van Noordwijk, 2005)—in particular where high levels of poverty would seem to pitch livelihood and
conservation goals against one another.
While opportunities are apparent, context is likely to have a profound
effect on the viability of ESR schemes and on the trade-offs or synergies that
emerge from land-use change and benefits flow. Recent research has shown
that strong trade-offs exist in tree species selection—with trees bringing the
highest economic returns carrying negative biophysical and social consequences (i.e., groundwater depletion, reduced productivity of neighboring
cropland) (Bruijnzeel, 2004; Farley et al., 2005; German et al., 2006c). Application of carbon payments in isolation from policies to regulate species
selection or location, or from incentive schemes to balance attention to
diverse environmental services (e.g., carbon and water), may exacerbate
unfavorable trade-offs by stimulating expansion of high-value, fast-growing
evergreen species (Farley et al.). This will have the effect of enhancing ES
functions of interest to the global community (i.e., carbon) while undermining ES of higher local and national importance (i.e., water). Thus, trade-offs
must be analyzed along three dimensions: local livelihood versus conservation functions; trade-offs among different types of environmental services
(carbon versus water); and trade-offs of scale (environmental services or
specific dimensions within each service of interest to local people, the
nation-state, or the global community).
Carbon Sequestration and the Kyoto Protocol
The Kyoto Protocol to the United Nations Framework Convention on
Climate Change (UNFCCC) is an agreement that assigns mandatory limitations
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L. German et al.
for the reduction of greenhouse gas (GHG) emissions to the signatory
nations. The foundational element of the protocol is Article 3, which consists of the joint commitment of industrialized or Annex I countries to
reduce their aggregate GHG emissions by at least 5% below 1990 levels in
the commitment period (2008–2012).
Developing countries (referred to as Non-Annex I countries) are able to
participate under the Clean Development Mechanism (CDM) as one of the
flexible mechanisms of the Kyoto Protocol. CDM-approved projects implemented in Non-Annex I countries are eligible for receiving carbon credits which
can be sold to Annex I buyers. However, the Non-Annex I countries have to
first meet a number of complex requirements, and ensure compliance with
international rules and national regulations and priorities. As a result, there is a
rapid expansion of forestry programs operating under the voluntary market.
Since carbon sequestration is a function of biomass accumulation, the
simplest way to expand land–based carbon stocks is to plant trees (Lasco,
Pulhin, Roshetko, & Banaticla, 2004). The CDM sets specific requirements for
land use, land-use change and forestry (LULUCF) projects to be eligible for
funding. Specific rules or guidelines relevant to LULUCF projects include:
• Agricultural sink projects are excluded (e.g., soil organic matter enhancement projects);
• Reforestation can only be carried out on lands deforested prior to 1990;
• Leakage (increase of all greenhouse gases outside the project boundary
that are measurable and attributable to the project) must be subtracted
from project sequestration;
• Eligible small-scale forestry project size is between 500–1000 ha;
• Project lifetimes are a maximum of 30 years or 3 × 20 years; and
• Potentially invasive alien species and genetically modified trees are
treated according to the rules of the host and investor country.
Several of these guidelines suggest that expansion of carbon reward
systems throughout the eastern Africa region may exacerbate the negative
consequences or trade-offs from existing land uses. First, the minimum eligible farm size would favor medium- and large-scale farmers over smallholders, and perhaps also plantation forestry over mixed production
systems given the tendency to segregate trees from cropland as farm size
increases. Historically, this plantation forestry has been characterized by
cultivation of single species over large areas—with species generally
selected for their ability to yield high-value timber in short time periods.
These patterns of tree species selection would likely exacerbate biodiversity loss and—in the eastern Africa context where Eucalyptus and pine are
seen by small–scale farmers and plantation managers alike as choice species for timber yield—depletion of groundwater (Carrere & Lohmann,
1996). While ESR schemes would enhance the profitability of existing
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Environmental Services and the Precautionary Principle
373
patterns in tree species choice, other stakeholders would be negatively
affected due to the environmental and social consequences embodied in
these choices (i.e., water scarcity to agriculturalists, herders, and urban
populations). This raises the question of “environmental services for
whom?” The last specification under CDM guidelines—namely, that invasive alien species and genetically modified trees be treated according to the
rules of the host country—would tend to foster a similar expansion in
harmful exotics in eastern Africa, where regulations on tree harvesting (and
thus planting) are generally biased against indigenous species (Ashley,
Russell, & Swallow, 2006; Cameron et al., 2000) and forestry practice is
strongly rooted in the colonial legacy (LeRoux, 1990; Scott, 1998).
Lasco et al. (2004) also noted that how a country defines a forest is very
important in determining which activities qualify for carbon payments. The
CDM defines forest as tree crown cover (or equivalent stocking level) of
more than 10–30%, containing trees with the potential to reach a minimum
height of 2–5 m at maturity. The higher the required crown cover, the
greater the likelihood of isolating CDM trees from crops, given the increased
competition of trees with crops for water, light, and nutrients. Finally, the
fact that species choice will affect the potential to sequester carbon, with
fast-growing species yielding carbon more quickly on average (Moura-Costa
1996), will favor fast-growing exotics exhibiting the strongest social and
environmental trade-offs (German et al., 2006c). In short, ESR schemes raise
a number of political questions regarding which services to be rewarded
and for whom.
METHODOLOGY
Local Knowledge Assessment of Niche Compatibility
To understand the likely consequences of carbon payments in the region,
many insights may be gained by looking at what local residents are already
saying about the functional role of trees in landscapes and livelihoods.
A methodology for identifying niche compatibilities and incompatibilities in
agroforestry was developed to enable the design of afforestation practices
that minimize the negative trade-offs of trees in densely settled agricultural
landscapes (German et al., 2006c). This methodology can be used in anticipating the likely consequences of a shift in incentive systems in these landscapes. The methodology has the following steps:
Step 1: Identification of Tree Niches, Species, and Niche Compatibility Criteria
1. Identification of different niches or locations where trees are currently
found or could be grown on the landscape. Farm boundaries, springs,
communal land, forest boundaries, within farmland and valley bottoms
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L. German et al.
are some examples, but niches of relevance to specific sites need to be
identified on a case-by-case basis.
2. Identification of a list of important tree species, which is done by asking
local residents to list: (a) culturally- or economically-important tree species, (b) tree species with harmful effects, (c) species compatible with
each of the niches identified above, and (d) species incompatible with
each of the niches identified above.
3. Identification of the properties of trees that make them culturally important, harmful, or niche-compatible. To do this, each time a species is
mentioned in (a), (b), (c), or (d) above, the facilitator asks, “why?” (“Why
is this tree important?” “Why is this tree harmful?” “Why is this tree (in)
compatible?”).
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Step 2: Participatory Ranking of Species According to Identified Criteria
1. Compilation of a single list of species from step (1.2) and a single list of
tree features from step (1.3) above, in matrix form using a spreadsheet
(features in rows and species in columns);
2. Interview key informants knowledgeable about both indigenous and
exotic tree species, asking them to rank each species according to the
degree to which it exhibits each identified tree feature. The number “2” is
entered if the answer is “yes, the species exhibits this characteristic”; “0”
if the answer is “no, the species does not exhibit this characteristic”; and
“1” if the answer is somewhere in between (exhibiting the feature only
sometimes or only to a certain degree); and
3. Group rows (features, with their corresponding rank for each species) by
niche, so that only those features determining tree species compatibility
for the niche in question is utilized to assess compatibility.
Analysis of these data can be through descriptive statistics or more
complex statistical analyses (German et al., 2006c). What is most crucial
to the current application is identification of incompatibilities of
“important” (prevalent, culturally important, harmful) species with different niches, livelihood goals, and environmental services. This information is instrumental in projecting likely consequences of carbon
rewards, and considering possible complementary incentive and regulatory instruments to minimize trade-offs (in this case, the negative consequences which would accompany expansion of certain tree species on
the landscape).
Participatory Bylaw Reforms
Multistakeholder negotiations for improved governance of highland landscapes have been utilized as a subsequent step, to identify technological
Environmental Services and the Precautionary Principle
375
and governance solutions to niche incompatibilities. The approach includes
the following steps:
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1. Stakeholder identification by niche and, in this particular application of
the methodology, by service (“stakeholder” in this case is not used in the
apolitical sense of “actors with a relevant mandate,” but rather to
acknowledge the diverse and often conflicting local interests around the
niche or service in question within local communities themselves);
2. Engagement of a mediator highly respected by each party (site-specific);
3. Consultation of different stakeholder groups to elicit their views and
bring them closer to the negotiating table; and
4. Multistakeholder negotiations by niche, including the following sub-steps:
• Feedback findings from niche compatibility study (species found to be
compatible and incompatible by niche, and niche compatibility criteria
of different stakeholders);
• Negotiate “binding” niche compatibility criteria (the criteria most
important to each stakeholder) that must be met in tree species selection, or move directly into the identification of species that meet the
needs of the landowner while minimizing any negative effects on
others—which proved to be conceptually easier for participants in
practice;
• Identification of local bylaws and technology dissemination activities
required to put agreements into practice; and
• Development of a detailed work plan with activities, responsibilities,
and timeline.
In the context of this article, this methodology and related findings are
presented for two purposes: (a) to highlight the tensions which emerge
between livelihood goals of certain stakeholders and regulations designed
to minimize social and environmental trade-offs; and (b) as a potential
instrument for forging desirable future states in the context of carbon incentive schemes.
FINDINGS
Niche Compatibility Study
The niche compatibility study was conducted in four sites of the eastern
African highlands: the highlands around Ginchi town, located in West
Shewa Zone, Ethiopia (“Ginchi”); the Emuhaya area of western Kenya
(“W. Kenya”); a site in Lushoto District, in the Usambara mountains of
Tanzania (“Lushoto”); and a site in Kabale District, in the Kagezi highlands
of southwestern Uganda (“Kabale”). Results show that a number of tree
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L. German et al.
species are considered harmful by local residents. Reasons cited included
their negative influence on crops, soil, springs, other tree species, and valley
bottoms, and their role in increasing runoff. A summary of these species for
four research sites of the African Highlands Initiative, an ecoregional
research-for-development program seeking solutions to integrated livelihoodconservation challenges in the highlands of eastern Africa, is presented in
the Table 1.
Evidence also suggests that in addition to these negative effects, strong
social and environmental trade-offs exist in the selection of tree species
(German et al., 2006c). Multidimensional scaling of tree species × tree feature
matrices facilitates the generation of 3-dimensional graphical representations of how locally-salient tree characteristics covary within the available
species. Graphical outputs (Figure 1) suggest that species chosen for their
economic functions (solid thin circle) will tend to carry with them negative
environmental impacts (dotted thick line), while a different suite of species
(solid thick line) will tend to bring positive environmental impacts. Clearly,
TABLE 1 Species Identified by Farmers as “Harmful” in Four Sites of the Eastern African
Highlands
Species
Sites
Reasons
Eucalyptus spp.
All crops
Eucalyptus robusta
Acacia Mearnsii
Lushoto
Kabale,
Lushoto
Persea americana
Cupressus lusitanica
Kabale
W. Kenya,
Ginchi
Erythrina abyssinica
Albizia gummifera,
Albizia schimperiana
Olea europaea subsp
africana.
W. Kenya
Allanblackia
stunlammanni
Solanecio mennii
Ocotea usambarensis
Ficus thonningii
Markhamia obustifolia
Olea africana
Vernonea auriculifera
Senecio gigas
Lushoto
Arrest undergrowth; increases run-off
Arrests undergrowth; leaves bad for crops/ soil;
heavy feeder on water; out- competes other
tree species; dries up valley bottoms
Leaves bad for crops/soil
Lushoto
Lushoto
Lushoto
Lushoto
Ginchi
Ginchi
Ginchi
Leaves bad for crops/soil; heavy feeder on water
Heavy feeder on water; dries up valley bottoms
Out-competes other tree species
Dries up valley bottoms
Dries springs
Changes the taste of water
Changes the taste of water
Lushoto
Lushoto
Drains the soil of water, competes with and
nutrients, dries springs and valley bottoms,
has a negative affect on soil, changes the taste
of water
Out-competes other tree species
Drains the soil of water, competes with crops
for nutrients, arrests undergrowth; increases
run-off, destroys soil for subsequent uses; outcompetes other tree species
Drains the soil of water.
Shallow rooted, dries soil, dries springs,
competes with adjacent crops, has a negative
affect on soil
Massive root system, competes with crops
377
Environmental Services and the Precautionary Principle
LushotoOut
GdFert
GdCrop
WatCons
TrCpat
Indigen
NoDrySl
Fodder
FastGr
SWC
FewSeed
Axis 3
SlowRel
Runoff
Fuel
AltEuc
GdBnd
Shade
Prnble
Extracts
EasProp
RockDeg
WatComp
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Fruits
Compete
SmShad
TreeCmp
AdptsWa
RdStab
Income
Poles
Timber
Demand
HvyFeed
DryVal
NegLvs
AggrRt
Axis 1
FIGURE 1 Clusters of tree characteristics in multidimensional space, Lushoto, Tanzania
a,b
.
a
Analysis based on 30 species (reproduced from German et al, 2006c).
b
Multidimensional scaling helps to reduce multi-dimensional data to few dimensions to make patterns
visible. Each of the axes in Figure 1 represent 30 dimensions (30 tree species) to a certain degree, but
each of the 3 axes represent some dimensions or species better than others. This reduces 30-dimensional
space (30 species each with its own unique assemblage of characteristics) to 3 dimensions, enabling the
visualization of how species characteristics co-vary with one another within a specific assemblage of
species and identification of trade-offs inherent in species selection
this poses a problem to management, as in the absence of collective choice
rules regulating individual behaviors, farmers will tend to emphasize individual goods (income) over collective goods (water, consequences to
neighboring households, etc.). Indeed, this is a widespread problem in the
highlands of eastern Africa (German et al., 2006a, 2006b).
Participatory Bylaw Reforms
Most bylaw reforms proposed by farmers to address negative problems stemming from cultivation of “harmful” trees focused largely on Eucalyptus spp.
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L. German et al.
and Acrocarpus spp. given the magnitude of negative effects, and on the
two niches where these effects cause most harm: farm boundaries and
springs. In this context, bylaws can play a role in shifting farmers’ attention
from individual goods alone to optimizing individual and collective goods
and impacts. Stakeholders identified for each niche include:
• Farm boundaries—landowners (individual farmers, tea estates, Missions)
and affected households;
• Springs—owners of land around springs and affected households.
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Bylaws proposed by farmers for ameliorating negative effects of fast-growing
exotics are summarized for two sites (Ginchi, Ethiopia, and Lushoto, Tanzania)
in Table 2. These bylaws are indicative of how “harmful” trees are currently
affecting livelihoods, and of farmers’ desire to strengthen environmental
TABLE 2 By-Laws Proposed for Addressing Negative Livelihood Consequences of ‘Harmful
trees’ in Ginchi (Ethiopia) and Lushoto (Tanzania)
Site
Springs
Ginchi
Lushoto
Farm Boundaries
Ginchi
Lushoto
Proposed by-laws
(i) Only water-friendly trees (Hagenia abyssinica, Buddleja
polystachya, Juniperus procera, Dombeya torrida, Olea africana) to
be planted within 100m and 25m from springs in upslope and
downslope locations, respectively.
(i) Ban thirsty trees in water sources or in areas around the water
sources;
(ii) Ban further deforestation around springs;
(iii) Areas around springs to be owned by local government (hamlet
level, Kwalei village);
(iv) Ban harmful trees and activities (cultivation, illegal cutting of trees,
grazing) within certain radius of water sources, with the area
protected varying by village (5 to 45m) depending on land use and
number of spring users;
(v) Total ban on Eucalyptus in the village (1 village);
(vi) A fine of 5000 Tshs per goat and 10000 Tshs per cow caught grazing
on water sources (1 village).
(i) Eucalyptus spp. should not be planted within 10 m of cultivated land.
(ii) Those ignoring the by-law shall compensate affected farmers for
damages incurred.
(i) Ban Eucalyptus on farm boundaries (all villages).
(ii) Minimum of 15 meters between Acrocarpus trees on farm boundaries
to minimize competition with crops (1 village).
(iii) Ban on Acrocarpus (1 village).
(iv) To establish a minimum distance from farm boundaries for the
cultivation of species valuable for timber to minimize ownership and
management conflicts, unless otherwise agreed with neighboring
farmer (1 village).
(v) Anyone caught planting harmful trees on farm boundaries will pay a
fine of 5,000 Tanzania shillings (1 village).
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Environmental Services and the Precautionary Principle
379
governance to minimize negative livelihood consequences of current farm
forestry practices. They also illustrate how two species in particular are
targeted for improved governance due to the negative social and environmental impacts they embody.
While many of these proposed bylaws require further refinement to
be enforceable, it is clear from these proposals that improved governance
of tree selection and management on densely settled agricultural landscapes would have the effect of restricting already limited livelihood
options. In the case of farm boundaries, watershed residents have proposed that certain economically profitable but environmentally harmful
species be banned entirely and that others be regulated in terms of
spacing or density. Around springs, Lushoto residents proposed that all
economic activity be banned within a certain buffer zone while in Ginchi
farmers proposed a ban on one of the most profitable enterprises (Eucalyptus woodlots) within designated buffer zones. Furthermore, sanctions—
a necessary precondition to effective self-governance of common property
resources (Ostrom, 1990) and other natural resource management processes at landscape scale—pose a financial burden on individuals disobeying established rules. It is hypothesized that the livelihood burden of
improved governance is a major contributing factor to low levels of compliance with policies and bylaws in eastern Africa, as law enforcers generally emanate from the same villages (families, social networks) as the
accused parties, and the social cost of law enforcement is generally high.
The desire of local government representatives to be reelected is a further
incentive for selective or nonenforcement.
Those trees singled out by farmers for bylaw reforms (Eucalyptus and
Acrocarpus species) are also those considered by farmers to have the fastest
growth rates for timber. This, in large part, is why farmers select these species despite the known trade-offs. Should payments for carbon sequestration take root in eastern Africa, the tendency would be for the negative
consequences of tree cultivation to be exacerbated due to the correlation
between growth rates, current economic incentives, and rates of carbon
sequestration (Moura-Costa, 1996). While these consequences in landscapes
dominated by smallholders may rest on the ability of smallholders to overcome the bureaucratic hurdles of market access, access to carbon markets
by medium- to large-scale landowners in diverse agroecosystems is likely to
embody similar trade-offs for resident smallholders and pastoralists.
Alternative strategies are needed to encourage forestry practices
compatible with other land uses (and livelihood objectives of other land
users), and with environmental services of local importance (a clean and
reliable source of water, low runoff, etc.), but which nevertheless meet
livelihood goals. This article argues that a precautionary approach is
needed to environmental service reward schemes in the region to help
stakeholders anticipate the likely consequences (positive and negative)
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to different stakeholders at different scales, and to incorporate this
understanding into decisions of whether and how to engage with the
CDM and voluntary carbon markets.
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TOWARD A PRECAUTIONARY APPROACH TO ENVIRONMENTAL
SERVICE REWARDS IN EASTERN AFRICA
This next section proposes a stepwise approach to environmental service
reward schemes in eastern Africa that takes a precautionary approach by facilitating stakeholders to anticipate the likely social and environmental outcomes
of different scenarios, to negotiate socially–optimal scenarios and to design
incentive and/or regulatory schemes to foster mutually agreed outcomes. We
argue that these steps can be used to anticipate and manage, through ex-ante
assessments and stakeholder-based planning and monitoring, outcomes so that
the positive effects are enhanced and negative consequences minimized. The
proposed steps are outlined below.
Analysis of Biophysical and Social Trade-offs of Different
Tree Species
Step 1 (Biophysical trade-offs): Synthesis of farmer and scientific knowledge
on “harmful trees.” The first step consists of the systematic assessment of
local knowledge on niche compatibility, as described above and in the literature (German et al., 2006b, 2006c). This methodology assists in grounding
the assessment of the “environmental signatures” of tree species in a locallyrelevant suite of species (trees that are culturally important, harmful, and
compatible or incompatible with different niches), and helps to identify the
environmental and social service functions of greatest salience to local residents. In regards to the latter, local residents have tended to emphasize
compatibility with water resources and agricultural productivity in sites
where this methodology has been implemented. However, these emphases
are likely to vary by site. Ideally, if multiple stakeholder groups are comanaging landscapes and interacting around the niches and services in question,
local knowledge assessments should be conducted with each stakeholder
group so that commonalities and discrepancies are highlighted.
A second step in the assessment of trade-offs of different tree species is
a literature review to synthesize scientific literature on the negative effects of
species prevalent within the landscapes and niches in question. Such information can compliment farmers’ knowledge through clarification of biophysical
processes underlying observed phenomena, or legitimize local knowledge
among other stakeholder groups or actors (i.e., government agencies). While
such information is patchy (due, in large part, to the tendency for research to
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emphasize economic characteristics over the social and environmental
impacts of trees), the articulation of new information needs can and should fuel
innovations in research. This step should follow the first, so that literature
reviews can be fine-tuned to the problems, species, niches, and environmental
and social service functions of local importance. However, following subsequent steps of negotiation, broader literature reviews might also serve the
purpose of identifying alternative species or management practices that
could play a role in minimizing observed trade-offs.
Step 2 (Social trade-offs): Stakeholder analysis. While the stakeholder
concept in the context of environmental service rewards tends to emphasize
“providers/sellers” and “buyers” as discrete stakeholder groups, in the context
of this approach the stakeholder concept must be grounded first and foremost
in divergent local “stakes.” This is because current land uses, likely to be transformed through new incentive and regulatory mechanisms, already embody
social and environmental trade-offs for diverse local land users. In other words,
local communities are heterogeneous—with diverse political interests characterizing land use incentives and behaviors, and new arrangements between buyers
and sellers are likely to have uneven effects on local actors. The question then
becomes, “how can environmental service rewards be governed so that compensations that benefit buyers are harmonized with diverse local interests, and
the social and environmental service functions embodied in these?”
Common usage of the term “stakeholder” tends to depoliticize it, interpreting it to mean all the different actors present in an area and having a
mandate related to the topic rather than specific interests as implied by the
term (“holders” of “stakes”). This tends to give all parties equal legitimacy in
negotiation, when in fact the key actors with a stake in specific niches or
services can generally be classified into those managing the resource or
niche (often with some form of property rights) and those negatively
affected by these actions. Other actors with claims to knowledge or decision-making authority may claim a stake due to their legitimacy vis-à-vis the
state or civil society, yet they can be considered secondary stakeholders
with respect to their relationship to the problem (German et al., 2006a).
In line with each of the above considerations, stakeholders should first be
identified with respect to “problem niches” as identified in Step 1. This aligns
subsequent negotiations with the trade-offs currently characterizing land use
and those likely to be exacerbated through new incentive schemes. It also
helps to focus subsequent negotiations on the unique features of local livelihoods and landscapes and the compatibility criteria of each stakeholder, and to
prioritize the involvement of local actors who have the largest stakes in the outcomes. The second stage of stakeholder analysis involves the supply and
demand side of the environmental service. In this case, the stakeholders from
the supply side have already been identified and are juxtaposed as a heterogeneous group against the buyers. While any number of approaches to stakeholder identification may be used, it is essential to ensure that when problems
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diagnosed by one group implicate another interest group, the new group is
also consulted to identify their own views on the problem. Following stakeholder identification, each stakeholder group should be consulted on their
views about the problem or niche in question, how it affects different parties
(the social trade-offs), and how to go about multistakeholder negotiations.
As new stakeholder groups emerge, there may be a need to return to Step
1 to assess their own knowledge on niche compatibility. The first two steps
may therefore be seen as iterative. In our own experience, however, despite
the presence of conflict around “problem niches” and divergent perceptions of
what constitute viable solutions, stakeholders tend to agree on the biophysical
dimensions of the problem (i.e., the negative properties of species x). Therefore, stakes or interests—rather than knowledge or positions (i.e., preference
for a particular solution)—tend to become the basis for negotiation.
Scenario Analysis: Analyzing Alternative Futures and Articulating
Social and Environmental Goals of each Stakeholder Group
Step 3: Development of participatory scenarios. The third step involves
constructing scenarios with local stakeholders in an area where environmental service rewards are under consideration to identify ways in which conservation and livelihood goals of different stakeholders may be fostered while
minimizing any negative impacts. Scenarios are creative stories about the
future, and provide answers to the question, “What if . . . ?” The resulting stories can be images of desired as well as undesired futures. The stories have to
make sense and they have to be plausible. At the same time, scenarios can be
used to actively engage stakeholders, identify their different perspectives, and
provide an active learning space for those involved (Patel, Kok, & Rothman,
2007; van der Heijden, 1996). In the context ESR, participatory scenarios can
help local communities anticipate the likely consequences of ESR schemes to
livelihood and environmental service functions of local importance, to negotiate social and environmental services of crucial importance to diverse local
interest groups, and to incorporate this understanding into decisions of
whether and how to individually or collectively engage with the scheme.
Scenarios are built with diverse local stakeholder groups independently, using focus group discussions stratified by gender and age within an
interest group—or simply by identified local stakeholder groups in the
aggregate. The number of participants will depend upon the stakeholder in
question —whether a particular interest group within communities having
many “members” (in which case groups of 10–25 participants may be
appropriate), or local and external interest groups with few representatives.
Generic steps for participatory scenario development are outlined in Box 1
(Evans et al., 2006). These steps need to be adapted to the application in
question—namely, how to reconcile social and environmental services of
importance to local residents and buyers.
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Box 1. Key Steps for Building Participatory Scenarios (Adapted from Evans et al., 2006)
1. Identification of historical eras of change. The groups discuss together and come
up with a “time line” for their site. They have to think far beyond their life times into
the past and draw on the long-term history of the area. By identifying major changes
in the past, the participants are ready to open their minds and be creative about the
future and be aware of “surprises” and changes that would affect them and consider
them in the scenarios they will build.
2. Identification of focal questions. Focal questions are the main concerns or issues
of the participatory scenarios exercise. It is important that participants come up with
their own focal questions in a language and form they understand. The scenarios
resulting of the exercise have to provide answers to these questions. These answers
can be used as indicators to do monitoring and follow through.
3. Identification of driving forces. Driving forces are factors that will influence the
future of a community in a positive or negative way. Participants identify driving
forces in breakout groups. Once the driving forces are identified they should be
classified in certain and uncertain and then ranked.
4. Creation of narratives and images. Participants divide in breakout groups of 4-6
people plus a facilitator and answer: “What happens in X years time if (driving force
change)…? Drawings can help participants to maximize their creativity and provide a
better estimate of spatial distribution and volume of crops, forests, boundaries,
transects, etc. under different circumstances analyzed. The drawings can be scaled
and adjusted to produce geo-referenced maps of the area (by the researchers). Go
back to the focal questions and make sure the narratives are answering them.
5. Presentation and discussion. Each group presents its story and discuss its
implications in plenary. Some questions that would help the discussion are: “Does the
story make sense? Is it plausible? Why or why not? Who are the “winners and losers”?
What do they win and lose?, ” “What components of the story are under the
community’s control? Which ones are not?”, “How can the community monitor if this
story is actually occurring?”
6. Refinement and analysis of impacts. After getting feedback from plenary
discussion, each group goes back to their original breakout group and refines its
scenario narrative. Then, the facilitator introduces a “shock” or a “surprise” into the
story, asking, “Does the story still make sense? Is it believable?”. For example, a shock
could be drought or famine. In breakout groups, discuss the impacts of their
scenarios: “What if the future unfolds like the scenario?” “Who gains and who loses in
each scenario?”, “What skills do I (or my family) need to acquire in each scenario”,
“What actions I (my family, my community) need to take to bring about a desirable
future or mitigate a negative one?”. Then, ask the participants to list the top 3
opportunities and threats across the scenarios and to answer: “How to take
advantage of the opportunity? What can be done to prevent this threat? If it is not
possible to prevent the threat, how can you best prepare?”
Each substep needs the facilitator to start the discussion with some
motivating questions. For example:
1. Identification of historical eras of change: (a) Precolonial era: Is there any
agriculture? Grazing? Which crops are planted? How is the social structure?;
(b) Colonial era: What has changed, and how? Who owns the land? What
crops or trees are introduced?; (c) Postcolonial era/present: What changes
have occurred? What are the trends in farm forestry, and with what effects?
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2. Identification and prioritization of focal concerns and indicators: In the
context of rewards for ES, water and carbon are two key environmental
services that may be considered in the context of negotiations. The facilitator may ask the participants to recall positive and negative properties of
common tree species, and then ask, “What would be the outcomes to
livelihoods if small payments were made to farmers who accumulate
more trees/wood on their farms?” “What would be the outcomes to the
environment? To water?” and “Would you have any [other] concerns?”
Participants write their answers (focal questions), discuss, and rank them.
Facilitators record livelihood and environmental service indicators of
local importance.
3. Identification of driving forces and creation of narratives: “You mentioned
that the expansion of certain tree species would have negative consequences to [parameters x, y, z]. If this has occurred in the past, what have
been the causes?” Participants would then divide themselves into breakout groups of 4–6 people plus a facilitator to explore future scenarios
related to the introduction of new environmental incentive and regulatory
instruments. The facilitator would introduce a hypothetical incentive or
regulation (additional payments for the accumulation of wood/timber onfarm, payments for groundwater recharge), one at a time, and ask participants to explore the likely consequences —with a focus on identified
indicators of local concern. Questions to be asked by the facilitator might
include, “What happens if the price of [trees/wood or water] increases?
Which species will be planted? Which will be replaced? What will be lost
in the process? How would neighboring farmers lose/gain? What will be
the positive and negative consequences on indicator x?” Participants are
encouraged to return to the focal questions and make sure the narratives
are answering them. Once the consequences of changes in the price of
carbon and water are identified independently, participants can be asked
to consider more complex scenarios including each of these incentive
systems applied alone, applied in combination, and in combination with
regulatory instruments that govern tree species selection, location, or density. This serves to create awareness of the linkage between current landuse scenarios and related trade-offs, and how these would be affected by
different incentive and regulatory mechanisms if applied in the future. It
also serves to bolster their collective understanding and advocacy capacity for subsequent multi-stakeholder negotiations.
Throughout each of these substeps, facilitators keep track of local indicators used to evaluate different scenarios by tracking responses to focal
questions for different land uses, niches (forest margins, springs and waterways,
farm boundaries, valley bottoms) and environmental services (spring
recharge, runoff control, etc). Indicators of local relevance might include
income generated from diverse enterprises (crop, tree, livestock) at farm
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level, availability of water for domestic use, and/or prevalence of conflict,
among others. This list of indicators is consolidated throughout the process,
and presented back to the group at the end of the meeting to identify gaps
and inconsistencies. Indicators can also be ranked by level of importance to
each stakeholder group, and used to negotiate desired future scenarios.
Step 4: Desktop analysis. Following scenario analysis with discrete
stakeholder groups, a desktop analysis can be used for two purposes. First,
it can be used for further analysis of the extent to which new incentives/
rewards are likely to shift farmers’ behavior toward different tree species or
cultivation scenarios. This can be done through modeling and the insertion
of modeling outputs into subsequent multistakeholder decision support
processes, or through direct participatory assessments of the levels of price
fluctuations that are likely to catalyze a behavioral change. The latter would
be done in the context of Step 3, disaggregated by stakeholder group and
wealth strata. Desktop analysis can also serve as a tool for synthesizing
what is known so far from Steps 1 to 3, and to foster collective understanding among the facilitators of commonalities and differences emerging from
the different stakeholder groups.
Farmers’ behavior toward natural resources may be partially understood
as a rational assessment of costs, benefits, and trade-offs (Ashley, 1996).
Rewards for environmental services may either encourage or discourage sustainable natural resource use, depending on which environmental parameters
are rewarded. If a modeling approach is used, these incentives/rewards can be
further analyzed in the context of three environmental service (ES) valuation
scenarios, namely: (a) marginal changes in the price of carbon, holding the
price of water constant; (b) marginal changes in the price of water, holding the
price of carbon constant; and (c) simultaneous marginal changes in the price
of water and carbon where (i) water is valued more than carbon; (ii) carbon is
valued more than water; and (iii) water and carbon are valued equally.
SCENARIO 1—CHANGE
IN THE PRICE OF CARBON
Different tree species have different carbon storage densities measured in
megagrams of carbon per hectare of plantation. The value of carbon
sequestered or released can be estimated based on global estimates generated by climate-change impact models. For instance, assuming 1% of GDP
as the climate-change damage cost, the value of carbon would range from
US$5/t to US$130/t (Hassan, 2002).
For any given land-use change —for example, conversion of cropland
to forestland—sequestration rates will vary considerably depending on the
species involved, geographic area covered, and management practices
adopted (Stavins & Richards, 2005). The appropriate price incentives for
carbon sequestration must take into account the opportunity cost of land.
Stavins and Richards observed that average carbon sequestration cost
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estimates were greater by 2 to 3.5 times in studies that took the opportunity
cost of land into account. Three approaches—namely, bottom-up engineering
cost studies; optimization models that account for behavioral responses;
and econometric analyses of revealed preferences of land owners concerning alternative uses of their land—can be used to analyze the opportunity
cost of land. Most appropriate for this study is the revealed preference
approach, which involves estimating a response function that shows the
relationship between actual land use changes (land use choices) and
relative prices in the agricultural and forest sectors. Using that response
function, the effect of hypothetical incentives such as price incentives for
carbon sequestration on farmers’ preference for different tree species can
be modeled.
The logical a priori expectation is that, holding other factors constant,
an increase in the price of carbon is likely to encourage the cultivation of
tree species with high carbon sequestration rates—in particular within farmland where secure tenure helps to guarantee investments. Since the amount
of carbon sequestered depends on forest biomass, payment for carbon
services is expected to rise as the forest matures (Sedjo, 2001) or for fastgrowing exotic species. Currently, international markets are dictating the
prices for carbon. These prices result from two main determinants: the flow
of surplus Assigned Amount Units (AAUs) from the economies in transition
to meet demand within the European Union and other countries, and the
ability of the power generation sector to reduce carbon dioxide equivalent
(CO2e) emissions (ICF International, 2005). In the EU Emissions Trading
Scheme (ETS), the price allowances vary between €6 (approximately
US$7.13) and almost €30/ton of carbon dioxide (tCO2), and is trading
around €24–25/tCO2 (Karmali, 2005). Holding other variables constant, the
extent to which introducing carbon incentives at this level of pricing would
lead to changes in land-use practices and tree species selection would
depend on relative prices of different agricultural and forest commodities
and farmers’ assessments of opportunity costs. In the absence of complex
modeling, this can also be tested through participatory approaches to
assessing behavioral responses at different price levels in the context of Step 3
(Scenario Analysis).
SCENARIO 2—CHANGE
IN THE PRICE OF WATER
The cultivation of exotic tree species such as eucalyptus can be a major
source of pressure on scarce water resources. A second scenario explores
the likely effect of overlaying rewards for ES that would induce very different land use changes. If applied to securing water yields from catchments,
the likely change in tree species resulting from marginal changes in the
price of water paid to a community would have a bearing on the nature of
water-consuming activities in communities. If the dominant economic
Environmental Services and the Precautionary Principle
387
activity of a community is heavily dependent on water, price incentives that
lead to the desired change in tree species may be low. Following Hassan
(2002), assuming that irrigation agriculture is the greatest use of water, the
social value of the water abstraction externality due to afforestation with a
particular tree species can be measured as the Net Value-Added (NVAD)
foregone to irrigated agriculture. The difference between Value-Added
(VAD) per unit water abstracted by trees planted and that used in irrigation
farming is the social opportunity cost of water abstraction. Thus,
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NVAD = VAD/m 3 in agriculture − VAD/m 3 in plantation
The higher the NVAD, the higher the social opportunity cost of water
abstraction; hence, the lower the price incentive needed to encourage cultivation of tree species with lower water abstraction rates. Kosoy, Martinez-Tuna,
Muradian, and Martinez-Alier (2007) noted that if payment schemes for water
conservation are to be efficient, the price incentives to cultivate tree species
with low water abstraction rates should at least be equal to the opportunity
cost of land use (e.g., profits foregone from timber) but lower than the economic value of the environmental externality; for example, the abatement
cost of improving water quality and availability. Options for doing such an
assessment in a participatory manner in the context of scenario analysis may
be more constrained for water than for carbon by the inaccuracy of local
assessments of the extent to which price fluctuations for water would
influence land use behavior. Such difficulties are likely to stem from the
common property resource status of water (i.e., the effect of the free
rider problem on incentive structures and diffuse/aggregate effects of
behaviors occurring within individual land units on water), and from
limited ability to anticipate hydrological response levels to land use
change.
SCENARIO 3—SIMULTANEOUS
CHANGES IN THE PRICE OF WATER AND CARBON
When there are simultaneous marginal changes in the price of water and
carbon, the trade-offs between multiple benefits is the key issue. The farmers’ major objective is assumed to be to maximize their social welfare subject to their resource constraints. Thus they would want the optimal
combination of tree species that would minimize water abstraction and
maximize carbon sequestration at the lowest opportunity cost. A number of
methodological approaches exist in the literature—in the context of either
dynamic or static constrained optimization models. In a review on mathematical programming (MP) for coastal land use optimization, Pongthanapanich (2003) provides a practical framework that closely relates to the
problem in this study. The objective function in this case would be to
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maximize the total net benefits from cultivating different tree species subject
to constraints such as water demand, surface and ground water supplies,
land availability, forest biomass as a proxy for carbon sequestration potential,
and non-negativity constraints. Decision variables would include total land
use areas for agriculture and forestry, price incentives for land conversion
from existing to alternative uses, and ground and surface water supplies.
The results obtained from the model would show, for each tree species, the
optimum prices of water and carbon (effected simultaneously) that would
give maximum benefits to farmers. Often, households have different priorities due to differences in resource endowments and livelihood strategies.
For instance, households with larger landholdings are likely to have larger
woodlots because competition with staple and cash crops would be more
easily tolerated, whereas land-constrained households would have a harder
time incorporating fast-growing tree species into their farming systems.
These resource endowments or constraints are captured as constraints in
the MP model. Solving the model would then show the likely choice of tree
species given these constraints. This could be done for different categories
of households exhibiting different levels of resource endowments and even
for different farming systems. While the ability to embed this analysis in participatory scenarios (Step 3) may be constrained by the inaccuracy of farmers’ assessments of the likely behavioral consequences of water incentives,
attempts should be made to make qualitative assessments of likely behavioral change within participatory scenarios in the absence of modeling
outputs.
The final step would be to develop landscape or niche scenarios to
anticipate how application of carbon incentives, water incentives, and environmental regulations alone and in combination will influence expression
of identified indicators (potential trade-offs and synergies). Given resources,
landscape level models such as FALLOW (van Noordwijk, 2002) can help
with the integration of the results of the participatory scenarios, economic
modeling, and the calculations of biophysical indicators at the landscape
level. More qualitative assessments based on knowledge acquired from
Steps 1 through 4 can also be used. Table 3, for example, presents the likely
consequences of applying incentive and regulatory mechanisms alone
(water, carbon, or bylaws) and in combination (water + carbon, carbon +
bylaws). It helps to illustrate the political consequences of the choice of environmental services to protect in terms of the specific goals fostered (climate
change mitigation, water resource conservation, income generation) and the
scale of these issues and related stakeholders (local, national, global). It also
illustrates the crucial role of explicitly acknowledging “stakes” in incentive
and regulatory instruments, and fostering equitable negotiation support processes that acknowledge trade-offs, seek “win-wins,” and provide local
stakeholders with the technical support and political leverage required to
level the playing field.
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TABLE 3 Illustration of Simplified Output from Scenario Analysis
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Complementary instrument
Instruments
None
+ Regulation
Carbon
incentives
• Expansion of fastgrowing exotics and
their negative effects
(run-off, drying of
water resources,
competition with
crops).
ES of global priority
supported at the
expense of local ES
values
Water
incentives
• Moderate shift away
from fast-growing
exotics to watercompatible and
indigenous species
• Reduction in conflict
and trade-offs from
tree cultivation
(if enforced)
• Negative spin-offs of
fast-growing species
ameliorated through
regulation (if
enforced).
Increased tension
between divergent
aims (income vs.
improved governance
to enhance equity
and local ES
functions)
• Reduction in conflict
and trade-offs from
tree cultivation (if
enforced)
Regulation
(by-laws)
N/A
+ Water
• Negative spin-offs of
fast-growing species
ameliorated through
incentives for watercompatible species (if
enforced).
Increased tension
between divergent
aims (local vs. global
ES functions)
N/A
• Reduction in conflict
and trade-offs from
tree cultivation
(if enforced)
Negotiation Support, Planning, and Monitoring: Reconciling Social
and Environmental Service Goals of Diverse Stakeholders
Step 5: Negotiation support. Multistakeholder knowledge sharing and
negotiation events are next employed to identify viable ESR scenarios that
may best reconcile livelihood and conservation goals while equitably balancing the needs of diverse stakeholders. At this stage, negotiations should
involve diverse local stakeholders (from Step 3) as well as the buyers of the
service, local government, and neutral facilitators. At this point, the negotiation process would significantly diverge depending on the nature of the ES.
In the case of carbon, face-to-face deliberations are likely to never be possible due to the physical and political distance between buyers and sellers.
Therefore, the most likely avenue for stakeholder concerns to be voiced would
be through the negotiation of new instruments (or means to implement existing
instruments) by Designated National Authorities. This would need an internal
process to capture stakeholder concerns at diverse levels in the process of
engaging with global actors, employing the steps highlighted above to do so.
In the case of water or other ES where stakeholders do have the opportunity to interact directly, direct negotiation support processes are possible.
The outputs of the above participatory scenarios and desktop analysis
would feed directly into this negotiation process to inform discussions over
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how to structure incentives and any regulatory mechanisms that might be
needed to minimize anticipated trade-offs and to reconcile ES rewards with
livelihood goals. Intermediaries would initially be required to “level the
playing field” in negotiations and bear some of the transaction costs related
to information and negotiations. The following steps might form part of the
negotiation support process:
1. Reflect on the priorities (desired future state) and indicators of different
stakeholder groups, as articulated through niche compatibility assessments, stakeholder analysis, and participatory scenarios;
2. Pool “bottom line” indicators, ensuring the topmost priorities of each
group are distilled and understood to all parties;
3. Negotiate future scenarios that would help to reconcile the interests of:
(a) diverse local stakeholder groups, and (b) sellers and buyers (using
established indicators);
4. Select the most viable “bundle” of incentive and regulatory mechanisms
likely to reconcile stakeholder interests and lead to desired future states,
and gather input into the design of these mechanisms (specifications of
local bylaws and incentives, procedures for matching rewards to land-use
practices, etc.); and
5. Develop an implementation plan and monitoring system to monitor
changes in consolidated variables.
Step 6: Implementation and monitoring. The final step consists of
close monitoring of mechanisms as they are implemented with inputs from
different stakeholder groups (each local stakeholder group, buyers). Monitoring would include measurement of the consolidated set of social and
environmental indicators identified by different stakeholder groups and
consolidated through negotiations. Results of this monitoring must be fed
back into the design of incentive and regulatory instruments to align these
with the negotiated futures, and periodically into decisions of whether and
how to reengage with buyers under different ESR schemes. Ultimately, the
effectiveness of these actions will rest on the emerg ence of new institutions
that assist producers in reducing the transaction costs of information access
and monitoring, and strengthen their voice in negotiations.
DISCUSSION
This article, its findings, and recommendations represent an ideal approach
to engagement in environmental service reward schemes that take the interests and trade-offs perceived by diverse local actors as a point of departure.
Application of this approach in reality rests on two fundamental conditions:
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391
(a) that national and subnational stakeholders be provided the opportunity to
negotiate terms of engagement; and (b) that a critical mass of smallholders gain
access to carbon markets. Regarding stakeholder involvement, this is currently
easier for environmental services other than carbon (e.g., water). At the
moment, strong international market players—particularly brokers and traders
in carbon markets from Annex I countries—dictate prices for carbon. Though
there are many mechanisms that could help improve the terms of engagement
for farmers in non-Annex I countries, in reality, the tendency is for global actors
to set the terms of engagement and for farmers to adopt the terms (prices and
rules of engagement) set by Annex I actors.
Regarding smallholder access to carbon markets, several factors hinder
their access to benefits. First, there are few buyers for CDM projects, and
other mechanisms that qualify for emissions trading may circumvent nonAnnex I countries. For example, countries in transition can participate
through Joint Implementation projects, which are largely based on innovations in the energy sector to meet Kyoto targets. Moreover, transaction costs
resulting from highly complex rules for qualifying for a LULUCF project
(from project preparation to verification and monitoring) are high. As a
result, voluntary markets—while still limited—are the primary means
through which carbon value has reached local beneficiaries (Cacho et al.,
2002; Ginoga, Wulan, & Djaenudin, 2004). Some estimate that ES bundling
mechanisms are required both to offset transaction costs and to meet minimum sequestration standards (Ginoga et al., 2004).
Resolving the tension between global emission reductions and local
benefits has been earmarked as a key challenge for the future (Ellis, CorfeeMorlot, & Winkler, 2004). One recommendation for improving benefits to
smallholders that is also commensurate with minimizing currently observed
trade-offs in the region include bundling projects and payments for carbon
and other environmental services—namely, water (Cacho et al., 2002).
Another is to integrate these payments with bottom-up regulations in the form
of local bylaws to help manage these trade-offs in an equitable manner. In
short, trade-offs from integration of trees into densely settled agricultural landscapes already perceived by smallholders in the absence of carbon payments,
and innovative strategies for integrating these into decision-making, should be
taken on board as instruments are further developed and refined.
CONCLUSIONS
This study uses findings from ethnobotanical research and participatory
governance reforms to illustrate the social and environmental trade-offs
embodied in agroforestry practices in the eastern African highlands, and the
difficulties of forging more equitable and sustainable practices through regulatory mechanisms. While environmental service reward instruments represent
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a possible alternative to regulation and to the livelihood costs they often
embody, it is clear that such rewards often carry political implications in terms
of which environmental service functions are fostered, for whom, and at what
cost. While this argument is made in the context of interactions among smallholders in the humid highlands, it is also likely to hold true for plantation forestry and other agroecological zones in Sub-Saharan Africa (most notably
where water resources are scarce). We argue that a precautionary approach is
needed to help stakeholders articulate the social and environmental service
functions of importance to them, to negotiate outcomes which balance the
needs of diverse local stakeholders and buyers, and to make informed
choices on whether and how to engage with ES reward schemes.
The authors propose a stepwise approach to planning that builds upon
different theoretical and methodological traditions (ethnobotany, agroforestry, futures, economics) as a precautionary tool for anticipating and managing trade-offs embodied in environmental service reward schemes. An
understanding of local and scientific knowledge on niche compatibility
helps to focus scenario analysis on niches and environmental and social
service functions of local concern. Stakeholder analysis then assists in identifying key local interest groups to be targeted for participatory scenarios
and negotiation support to foster dialogue among these stakeholders
around desired future states prior—and as a precondition—to subsequent
engagement with more powerful actors (in this case, the buyers). Explicit
recognition of “stakes” and “trade-offs” in any given incentive or regulatory
instrument helps to embed a precautionary element into planning, in recognition of the political stakes of any given land use change. A general lesson
that may be derived from this article is the need to adapt ESR mechanisms
to local context, and to the priorities of diverse local stakeholder groups.
This is likely to require initial support by external agencies to cover the
transaction costs of information (most notably, foreseeing likely outcomes),
capacity (learning to manage these outcomes within project design), and
process (costs of organizing internal dialogue and multistakeholder engagement), until farmer organizations emerge which are representative, provide
economies of scale, and strengthen the local “voice” in engagements with
external actors. It is hoped that this work will stimulate more dialogue
about the political implications of ES reward schemes, so that these new
instruments do not become yet another example of elite capture of benefits
from natural resource management innovation.
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