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Payments for environmental services (PES) in theory and practice: Lessons learned and way forward

Dear Forum Members,

The concept of payments for environmental services (PES) has gained prominence as a tool for achieving ecosystem conservation and, at the same time, improving the livelihoods of farmers as environmental service providers.  Since the UN Millennium Ecosystem Report, published in 2005, PES is increasingly discussed as a tool to remunerate farmers for the positive externalities they create through the adoption of sustainable agricultural practices. 

Through a 3-year project on the “Remuneration of Positive Externalities (RPE)/Payments for Environmental Services (PES) in the Agriculture and Food Sector” initiated in June 2012, FAO would like to learn more about the opportunities and challenges encountered in ongoing and completed PES projects.

The theory and practice of PES

The provision of environmental services, such as preservation of biodiversity habitats, watershed protection, and carbon sequestration have the character of a public good. They benefit mankind at large but tend to be available at no charge. This situation leads to the unsustainable use of scarce natural resources because existing markets fail to value them properly. PES schemes aim to address this market failure by providing financial incentives and other types of rewards (such as capacity development, knowledge sharing, risk alleviation, etc.)  to land users to maintain/improve the provision of valuable environmental services.  For the scheme to work there must be a willing buyer of a particular environmental service who transfers a payment to a land-owning seller who is willing to adopt measures that ensure the sustainable provision of the particular service.

There are however many open questions with regard to the scope of PES, their cost-effectiveness in addressing the growing global challenges of climate change and food security, and the theoretical baseline assumptions, largely derived from neoclassical economics.

The answers to such questions can often be found in lessons learned from existing projects, and they have to be taken into account in future designs of PES schemes.

Independent of the particular context and the targeted ecosystem service(s), an effective PES project needs to be based on incentives that help to better align the private interests of the local actors with the general public interest of preserving the environment while increasing food security. This is often achieved through public private partnerships that result in innovative practices, institutions and products that make PES schemes financially sustainable and generate positive externalities on their own. Yet, the impact of innovation on the design, implementation and sustainability of PES has so far hardly been addressed in the current academic literature.

The objective of the online discussion

In this online discussion we hope to find answers on how best to address the challenges and opportunities based on prior practical experience and research. We therefore invite practitioners, policy experts and scholars in the public and the private sector and other parties interested in PES to provide us with insights from particular PES projects in developing and developed countries and suggestions on how to make PES more effective as a tool to build up natural capital while also investing in human capital and poverty reduction.

Questions to be discussed in the FSN Forum:

1. What are the lessons learned from PES in developed and developing countries?

  1. What are the main challenges and opportunities with regard to PES projects in your particular country?
  2. Do you know of highly successful PES cases in your particular field of expertise (watershed management, biodiversity/wildlife conservation, carbon sequestration,…)? If so, what were the main factors that contributed to the success of the PES scheme?
  3. Do you know of PES projects that have failed to deliver despite substantial donor support? If so, what were the reasons that caused the failure?

2. PES can be conceived as a diverse set of policies, institutions and processes that mobilize funding from direct beneficiaries, taxpayers, consumers and other interested parties to reward/remunerate/pay providers of environmental services. Which type of PES-related policy instruments would you recommend for your own particular country and why?

  1. Are PES-related policy tools applied in affluent countries with lots of off-farm employment opportunities and low population growth rates also adequate for least developed countries where farm sizes often tend to get smaller due to lack of opportunities outside agriculture?
  2. What should be the role of the public sector in creating a regulatory/enabling environment for PES to deliver?  Where is public sector assistance most needed (knowledge transfer,  communal/private land rights, infrastructure, measurement of environmental quality changes, etc.)?
  3. To what extent is it justified to abandon the ‘polluter pays’ principle of PES to increase agricultural productivity and reduce poverty in developing countries? Or should we use other tools to tackle these objectives separately?

3. What should be the role of innovation and entrepreneurship in making PES work for sustainable development?

  1. In some cases, PES has become a vehicle for a market for environmental goods (e.g. farmers respond to a growing regional demand for trees by setting up their own tree nurseries). Do you know of other business opportunities for farmers that could arise from the implementation of a PES scheme?
  2. According to your practical experience with PES, where do we need innovation to make PES more effective and what type of reward system could create such innovation?
  3. Innovative landscape approaches focus on the improvement of environmental services on the landscape-level while the PES approach is focused on the remuneration of individual farmers on the field-level. How can the two approaches be reconciled?

We look forward to receiving your inputs.

Thank you very much

Philipp Aerni 
Bernardete Neves

This discussion is now closed. Please contact for any further information.

Gill Shepherd IUCN, United Kingdom
Gill Shepherd

I like Dr John Kazer's comments about PES in the UK very much. However, the fact that, to date, CAP farm payments for set-aside have been insufficiently monitored for the effectiveness of inputs to outputs is a reason to try harder, not a reason to abandon these types of payments.

I was surpised at a recent meeting to find that PES purists do not regard these European payment systems as proper PES at all.  I don't think we will progress far if we are that picky. PES is such a messy area at the moment, with so few genuine successes, that in my view we should be considering as wide a range of models as possible and monitoring them for impact and effectiveness.

In remoter developing country contexts, we run, as we know, into many more problems. Probably top of the list are these:

  • Ambiguous tenure (people feel they own communal land, through tradition and customary law, that the national government does not regard as theirs)
  • Payments of many kinds to rural people (benefit-sharing schemes, payments by loggers or mining companies to local people whose lands are exploited) are curtailed, paid to the wrong people, kept by chiefs and not distributed further, etc. If the flaws in these earlier systems are not understood and dealt with, PES cannot succeed either.
  • Payments are too low to effect changes in behaviour

PES is an economist's dream solution -  put a price on what has not previously been monetised, pay for it, and all will be well. But the social complexities of the deal are still being hugely under-rated.

Dr. John Kazer Carbon Trust, United Kingdom

From a UK perspective, there are two broad approaches towards PES.

The first is long established and linked to the EU's common agriculture policy - the stewardship schemes run by Natural England that reward farmers for following certain specified pro-biodiversity etc. practices.  There is some on-going investigation towards expanding these schemes to encompass climate change mitigation.  The existing scheme, in my opinion, lacks for robust data and farm audit process regarding the measurable impact of the ecosystem services created.

The second is a more recent private, voluntary programme that I've been involved in.  Essentially I've been auditing large-scale, increasingly national-level farm carbon footprint measurement and management programmes - typically based around livestock.  These are not linked (as yet) to payments, but do show what might be involved in running a cost-effective PES.

For a livestock mitigation programme, the extent of data required and achieving suitable quality of data is critical - particularly when budgets are small.

For an arable mitigation programme, the key factors for me are balancing yield against inputs.  Anything which increases yield whilst maintaining or reducing the inputs required is a positive thing and can be measured quite cost effectively.  I would include in this list soil improvement as part of a sequestration programme - I believe that any benefit from such a programme will create much more value, more simply, for the farmer via lower costs and increased yields from better soil than carbon credits or direct PES.

PES in my view are typically best targeted at research, capacity building and farmer engagement programmes that will enable them to generate win-win scenarios of better soil and lower emissions accompanied by increased production and profits.

Adam Drucker Bioversity International, Italy
FSN Forum

Despite the existence of important ecosystem services specifically associated with the maintenance of agrobiodiversity (e.g. related to: agroecosystem resilience in the face of climate change and emerging pests and diseases; and the maintenance of gene flow, evolutionary processes and future option values, as well as underlying traditional knowledge and seed systems), PES schemes have, to date, largely ignored agrobiodiversity conservation issues per se. Instead they have tended to focus on carbon sequestration, wild biodiversity and water management.

Bioversity International and its partners have consequently been exploring innovative developing country applications of PES through an assessment of the potential of so-called “payments for agrobiodiversity conservation services” (PACS) to serve as a least-cost and pro-poor agrobiodiversity conservation incentive scheme.

Following the development of a conceptual framework and the identification of conservation priorities for a case study threatened Andean grain in Peru and Bolivia, competitive tenders (reverse auctions) were implemented across a number of communities in each country in 2010-2011 in order to determine farmer willingness to provide conservation services. Selection criteria were developed in order to facilitate the identification of preferred farmers/communities to undertake such services based on efficiency, effectiveness and equity (pro-poor) considerations (Narloch et al., 2011a; Narloch et al., 2011b)

Findings (see video, factsheets and journal articles indicated) show that farmers/communities were indeed willing to undertake a conservation services contract for the threatened genetic resources and that participation costs vary widely between communities, thereby creating opportunities to minimize intervention costs by selecting least-cost providers. In-kind, community-level rewards (rather than cash payments made to individuals) were shown to provide sufficient incentives and suggest that a number of them could be provided through existing government agricultural and educational development programmes. The circumstances under which such incentives may build upon rather than crowd-out pro-social behavior related to existing institutions of collective action was explored (Narloch et al., 2012; Midler et al., forthcoming). Research also revealed how tender selection protocols may be designed to account for local perceptions of fairness (i.e. accounting for such principles as proportionality, inclusiveness, consensus and distributional equality) in order to facilitate political acceptability and long-run sustainability of the intervention (Narloch et al., forthcoming)

The enthusiasm of the project participants to maintain the threatened genetic resources in future years, regardless of any further intervention (see farmer quotes in the PACS video) and their interest in exploring market development opportunities for the case study genetic resources, suggests that the potential for PACS to support national biodiversity policy implementation and make a significant contribution to agrobiodiversity conservation and use goals, as well as to improve poor farmer livelihoods, once it is up-scaled, continues to appear promising.

Future Research and Development

In addition to issues related to targeting, strategic prioritization (since not everything can be saved) and establishing scientifically rigorous relationships between specific conservation goals and actual ecosystem service provision, future research and development issues include consideration of the degree of potential complementarity between more conventional niche product/value chain development initiatives and PACS. The potential to use market development approaches as a cornerstone of a PACS-related wide-ranging cost-effective, diversity maximizing national agrobiodiversity management strategy (as opposed to the many examples of individual threatened crop and livestock genetic resources market development applications) remains to be explored.

Further Information:

A video, policy brief and a series of short fact sheets and technical notes in English and Spanish, as well as scientific articles related to PACS can be found on:

Adam Drucker


Dear moderators

1.       Contradiction on your arguments

I do not agree on your argument that payment for environmental services (PES) is a prominence tool to provide environmental services in all places or countries. Please have a read my understanding and our findings of a study in the following sections. You have poorly recognized the possibility of tradeoffs of environmental services that can result by PES. If you want to produce a quality research report, you have to read literatures on biophysical phenomena of environmental resources and consult other people with good experience of community in developing countries. I regret to say that some opinions expressed by participants in this discussion have based on narrow assessment or dubious, and some others have no science bases. This is a common problem of people working in forest and other environment resource management field. This is one of the causes of bad outcomes of development support on forest and other environment resource management field.  

2.      Do you know of PES projects that have failed to deliver despite substantial donor support? If so, what were the reasons that caused the failure?

REDD is a failure PES project in Nepal for those who also value the ecosystems services other than the carbon sequestration (climate regulation). Animal and plant species of biodiversity importance exist not only in protected areas but also in community forest. Maintaining suitable habitats of the species requires diversity in the forest.  Growing numbers of studies showed that the industrial and conservative models of forest management practiced by following international advices and supports have suppressed the habitats and threatened the species due to degradation of habitats. The REDD forestry project, (e.g. in the REDD project funded by NORAD and implemented by ICIMOD groups) has advised and provided payment communities to fill remaining open spaces in the forests for increasing forest carbon stock. It has worsened the habitats for the species. The conservative model of forest system also affected agro-biodiversity. Increasing forest cover has reduced dry season stream flow of water which is another concern for communities. Studies showed that reduction of access to forest and availability of non-timber forest products hampered local forestry knowledge.  The reason of failure is bad governances of donor, implementer and host government agencies which introduce the project for their own benefit and little considered potential problems.  It is not due to lack of information because the potential problems are well documented in literature and textbooks.

3.      PES debate in literatures

Some scholars claimed that PES can be an effective mechanism to transfer wealth from rich to poor groups or non-farmers to farmers, and contribute to environment conservation and poverty alleviation or economic development. PES critics argued that the payment concept was introduced by developed countries as a policy instrument to redistribute state income to farmers, particularly to compensate for the loss of subsidies through international agricultural policy changes but the countries justified it as a policy measure for reducing environmental problems caused by industrial farming systems. However, international development agencies experimented the PES for environmental conservation and poverty alleviation in developing countries. According to the PES critics the proponents of PES argued for the sake of their own working benefit and interest. The real benefit from PES will be small or often negligible in developing countries. PES commoditised environmental services available freely to public. Developing countries have many socio-political complexities and bad governance to use opportunities of PES. The government agencies of developing countries hop up on the bandwagon of the international agencies without considering needs and problems in the countries. Then the PES further marginalizes poor people due to bad socio-political institutions and regressive financial systems. The countries have also inadequate resources for social development. Implementation of PES can cause misallocation of available budget of the countries and international sources, and increase administrative burden to the institutionally weak government agencies. It affects investment in important areas such as poverty alleviation and other social development programmes. Experimenting of PES on livelihood means of poor people is also an unethical practice as it can create humanitarian and long lasting problems.  

4.      Our test on the debate

We attempted to rectify the arguments. The study evaluated socioeconomic impacts of payment of six main (specified into 20 for analysis convenient) kinds of ecosystems services provided by mountain agricultural landscapes and their potential impact on the well being of women in Nepal. The study is titled “Socioeconomic impacts of PES of mountain agricultural landscapes on women”. We considered that the women are de facto custodians and manager of the resources providing ecosystem services of mountain agricultural landscapes. This study examined the impacts on the policy system model with 13 criteria. Firstly the study examined whether the resource management warrants conservation payment or other kinds of policy interventions. The study showed that only some services were threatening and warrant for some kinds of policy interventions. It is not in all places and all services as claimed by environmentalist and international organizations. PES could be one of them.  The potential impacts of PES on women vary according the type of the ecosystem service and the activities that need to be performed for conservation. Provisioning only some services contribute food security otherwise they hamper food security. Interestingly, provisioning of some services make positive effect on one socioeconomic criteria (e.g. reduce work burden and ill health) and negative effect on others (e.g. food insecurity). Bad governance is the main problem to take advantages the opportunities of benefiting from the services.  

5.      How bad are bad national and international governances?

I would like to present the bad governance cases of PES in next posting. It may embarrass many readers particularly to those involved in environment conservation, international organizations and PES field.

6.      Remarks

Ways of life of people and environmental systems in many developing countries are sustained in complex relationship of many informal institutions. It requires scholarly inputs with broad visioning, constructive thinking and high precaution to evaluate and work on new development institutions including PES in the developing countries.

Philipp Aerni and Bernardete Neves Facilitators,
FSN Forum

Summary of the first week of discussion on the FSN forum on RPE-PES

Many thanks for the stimulating contributions to our FSN Forum on Payments for Environmental Services (PES). After one week of discussion we identified three major aspects that received particular attention:

a) REDD+  and PES projects designed for the compensation of carbon sequestration in agriculture,

b) PES and other market-based instruments to ensure the provision of environmental services and

c) the scope of PES and its applications.

The commentators so far came primarily from Latin America and Africa where many PES projects are currently being implemented. The view about the effectiveness of the projects in the respective countries is mixed and there seems to be a sort of consensus that PES schemes need to be complemented with a national environmental policy strategy that signals support and assistance from governments for local initiatives that aim at improving the provision of ecosystem services through corresponding incentives for land-users. Many commentators further believe that PES projects in developing countries need to take into account the local economic conditions. Unless the problem of poverty is properly addressed there is little hope for the improvement of environmental services. In this context, innovation and entrepreneurship  are seen as important ingredients in efforts to generate local revenues, off-farm employment and achieve a general improvement of rural livelihoods. This would all add to the financial sustainability of PES.

This week we hope to obtain some views from all World regions addressing also the specific challenges and opportunities in concrete areas such as watershed, biodiversity, livestock and fisheries. We would like to address some of the questions that have so far obtained little attention such as the gap between theory and practice when it comes to the polluter pays principle that still constitutes one of the main justifications of PES but often looks more like a ‘pay the polluter’ principle in practice, especially in PES projects that aim first of all at addressing poverty problems. Furthermore we would like to learn more about the application of landscape and territorial development approaches in efforts to improve rural development and the provision of environmental services. Finally, we would like to follow up Emmanuel Suka’s  contribution pointing out at the need to better understand the local context in PES projects and design incentives schemes that generate tangible economic opportunities for local people (e.g. new markets, off-farm employment, rural finance etc). Which types of incentive packages/business cases could lead to financial sustainability when applied to the fields of agriculture, forestry, fisheries and livestock?

Question about prior PES activities at FAO

We are very grateful to Prof. Conrado Lucas from Angola who was wondering about  previous FAO activities on PES.  Depending on how broad the PES concept is defined, PES-related activities at FAO cover activities in quite a few FAO departments.  But generally, PES obtained most attention in the Natural Resources Department (NR) where the present project is based. Prior to our project, the NR Department also hosted the SARD-Mountain project that had a major focus on PES in mountain regions (see ). Moreover there was the earlier workshop in Arequipa, Peru on Payments Schemes for Environmental Services which was published as a Land and Water Discussion Paper (No. 3, 2003)  (see We think it is this workshop that Professor Lucas was referring to. The Land and Water Division of the NR Department (NRL) has also supported feasibility studies in East Africa and is part of the practitioners networks in Africa, Asia and Latin America. It is the NRL regional office for Latin America and the Caribbean (FAORLC) where probably most technical assistance to implementation is currently happening.

Our project takes in account the findings of these prior activities not just in the NR department but also the Agricultural Economics Department (ESA) that was in charge of the SOFA report 2007 on PES (see, and numerous projects in the forestry department where PES plays a role in one form or another.

Currently, all three departments are involved in follow-up activities to Rio+20, and PES is also considered to be one of the important instruments to promote a ‘Green Economy’.

a)    REDD+  and PES projects designed for the compensation of carbon sequestration in agriculture

Marcus Vinicius Alves Finco from the Federal University of Tocantins, Brazil regards REDD+ as an opportunity for farmers and the environment. He forsees a ‘win-win’ approach that could be achieved by paying farmers to sequester carbon and enabling them to increase yields through sustainable practices; provided that the international carbon market further evolves and enables trade in carbon offsets at moderate transaction costs.

Mr. Silenou Demanou Blondel from the African Youth Initiative in Cameroon is more skeptical wondering whether a market for carbon sequestration as envisioned by REDD+ will ever benefit farm and grassroots communities in his country. Payments should first go to motivated local people who are committed to the improvement capacity building and the build-up of infrastructure, as effective pre-conditions to make PES schemes work in the first place. He also points out the importance of linking PES to youth development strategies.

Ms. Nelly-Diane Alemfack from the Efozo Young Volunteers for Environment in Cameroon describes a carbon PES project funded by the UK Rainforest Foundation and Communities Bio Climate Research and Development.  She basically considers the project to be a success but also identifies many major constraints and challenges in the implementation of the PES. Environmental legislation on the national level is complex and cumbersome and therefore difficult to implement on the local level. There is a need not just mobilize more financial resources but also some local competent people who have the leadership capacity and the trust of the local community to credibly engage in PES contracts. She thinks the establishment of community institutions must be based on a proper understanding of the power of informal and family-oriented institutions that prevail in rural Cameroon. Otherwise such institutions designed to implement PES will have no real impact on natural resource management.

David Mwayafu from the Uganda Coalition for Sustainable Development, Uganda, agrees that the support of the national government and a consistent and implementable national strategy for the protection of environmental services is crucial in PES. He illustrates this by discussing the case of ‘Trees for Global Benefits’. This government supported initiative works with the farmers as tree growers for carbon sequestration. Another example is the Mt. Elgon Regional Ecosystem Conservation Programme (MERECP) with its REDD+ pilot. Like ‘Trees for Global Benefits’, it offers alternative income generating activities and through community Revolving funds. What needs to be done is replicating such good initiatives to other areas. According to Mr. Mwayafu, there are however remaining  challenges because some projects may work well in one particular community but not in others. If they fail it is because the cultural set up of the communities and other factors such awareness and education levels have not been taken into account to a sufficient extent.

b)    PES and other market-based instruments to ensure the provision of environmental services

Demetrio Miguel Castillo from Universidad Experimental Felix Adam, Dominican Republic deplores that PES has so far not been very effective, even though he firmly believes that there must be alternative policy instruments that help award communities for protecting environmental services in an effective way.

Mr. Carlos Alborta, IFAD Consultant in Bolivia suggests some interesting alternatives such as Community Contests (CCs). He argues that CCs have the advantage of being based on open community rules and regulations with incentives that ensure the provision of ecosystem services via a prize on investment rather than a recurrent cost project cost. He believes that therefore CCs have proved to be successful in community management of natural resources   In view of some of the inconsistencies with regard to the identification of water buyers and sellers in a water fund scheme in Peru, he suggests water management contests as a a creative and innovative way out of this riddle.

Mr. Emmanuel Suka from the Association of Friends of Limbe Botanic Garden, Cameroon believes that current PES projects in his country are not delivering what they promise. He therefore suggests to improve PES schemes by including ‘Best Available Technologies’ packages and capacity building programs that aim at enabling the local stakeholders to effectively implement PES activities while also becoming more productive. For that purpose, PES schemes should encourage the development of community business plans that describe measurable objectives and how to ensure the permanence of the economic and environmental benefits for the local community once outside support for PES decreases. He thinks that local communities have assets that are worth investing in. Yet, the value of these assets (local knowledge, innovation, practices) have hardly ever been quantified and therefore remain largely ignored by in PES schemes that are also designed to generating alternative income generating activities. Even though there are successful PES projects, it is not sure how long they will last, especially if PES schemes ignore the particular developing country context. The expansion of farm activities due to land scarcity and lack of off-farm employment opportunities may even lead to a colonization of protected sites and thus a reversal of previous environmental achievements.  According to Mr. Suka, a combination of PES with micro-finance schemes and institutions could therefore important to generate more local businesses and employment.

c)    The scope of PES and its applications.

Prof. George Kent from Hawaii University: Should the concept of PES be extended to other sustainability challenges that generate negative externalities (passing on debt to future generations, exclusion of small-scale farmers in the global food chain) and positive externalities (investing in education and extension services for farm families, making nutritious food more widely accessible)?

Prof. Bayron Medina from Guatemala argues that there must be a more clear distinction between PES in the narrow sense (buyer and seller of a single measurable environmental service) and PES in the broad sense (government policies and environmental projects designed to provide farmers with incentives to adopt environmental sustainable practices). In Guatemala, there is still no coherent environmental policy framework that would be supportive of a broad PES scheme. But there are nevertheless 35 interesting cases of PES that have an impact on communities, the environment and rural empowerment.

Bertha Cecilia Garcia Cienfuegos from Universidad Nacional de Tumbes in Peru expresses her optimism about the future of PES in her country. She observes that many PES projects in Peru have already improved environmental services in certain regions. She personally does not know any projects that have failed but expects FAO to provide further clarification about reasons of possible failure.  After all, it is a learning process.

George Kent Department of Political Science, University of Hawai'i, United States of ...

Greetings –

The project on “Remuneration of Positive Externalities (RPE): Payments for Environmental Services (PES) in the Agricultural and Food Sectors” is very worthwhile because it leads to more complete accounting for resources and other concerns that had not been valued adequately.

As the title indicates, the focus is on environmental services. This should lead us to ask, what other externalities are there? Are there other important issues that should not be ignored?

For example, are there cultural resources in the communities of food producers and food consumers that ought to be recognized?

Educational services to farmers, both formal and informal, surely are important.

Should the ability to pass debt to future generations be recognized as an externality?

Should the services of regulatory agencies be recognized as external factors that really ought to be paid for? Aren’t they required in any comprehensive view of food systems?

If attention is given to the ways in which industrial modes of food production can lead to environmental depletion and pollution, shouldn’t attention also be given to the ways in which those modes of production tend to concentrate wealth?

Shouldn’t attention be given to the fact that modern agriculture preferentially serves high income consumers?

Oliver De Schutter, the United Nations Special Rapporteur on the Right to Food, argues that food systems ought to have three major objectives:

·      First, food systems must ensure the availability of food for everyone, that is, supply must match world needs.

·      Second, agriculture must develop in ways that increase the incomes of smallholders.

·      Third, agriculture must not compromise its ability to satisfy future needs (De Schutter 2010).

Environmental services, one part of the third category, certainly are important, but they should be viewed in a broader context in which many different kinds of values are taken into account.

We have choices regarding how the products of agriculture ought to be valued. For a moment, imagine that agricultural produce was paid for on the basis of its nutritional value, its value in correcting inequities, and its value in protecting the physical environment. What would our food systems look like then? If these were the things we cared about deeply, the world would be a very different place.

Some methods used to take account of concerns about the physical environment might be adapted to take account of other types of issues that have been neglected. The first task would be to identify them. Then there is the need to weigh their importance.

We should also recognize the reality that different people would weigh the issues differently (Kent 1993). Often the environment is harmed because no one speaks for the environment. Similarly, hunger in the world persists partly because the hungry have little voice in deciding what should be regarded as important in modern agriculture.

Aloha, George Kent

Marcus Vinicius Alves Finco Federal University of Tocantins, Brazil
Marcus Vinicius

As the ‘forest standing’ has no economic value to the smallholders, their opportunity costs might lead towards deforestation. A ‘win-win’ approach could be achieved by paying farmers to sequester carbon, which sets up a situation where: CO2 is removed from the atmosphere (mitigation); high soil organic matter increases agro ecosystem resilience (adaptation); and improved soil fertility leads to better yields (production and income generation). If a carbon market successfully allows the trade of sequestered carbon on the international market, deforestation of native forests in tropical countries might decrease. If deforestation is business-as-usual (or the baseline scenario), then the conservation of native forests by farmers would implement change and generate additional positive externalities. Thus, REDD+ project would create a stimulus for the conservation of native forests and increase the amount of carbon sequestered and, therefore, decrease the amount of carbon that is emitted to the atmosphere.

Bellow you find the link of paper of mine that I sent to FAO couple of years ago about REDD+, payment for environmental services, social inclusion, food security and climate change in the Brazilian Amazon region.
Best regards
Marcus Finco, PhD
Professor at Federal University of Tocantins, Brazil

Prof. Conrado Lucas University, Angola

I remember that some 10years ago, FAO had launched an internal discussion on PES with many Departments involved,  based on interesting analysis of PES in agriculture. As a  reseacher, I would find very fruitful to measure how much progress has been achieved so far in understanding and promoting sounds systems given the raising concerns about,  not food production per se, but the quality of food produced, and environmental services have a great role to play.

Could FAO share with us findings from these discussions from the group (led if I remember well by Dr Mansur)?

Demetrio Miguel Castillo Universidad Experimental Felix Adam, Dominican Republic
Demetrio Miguel Castillo

En Nuestro País, República Dominicana es ahora cuando se ha iniciado el pago por servicios ambientales, sin embargo este concepto no ha contrinuido de forma efectiva con los manejos de recursos y su destino. Si bien es cierto que se han beneficiado una serie de elementos que son afines al gobierno como tal la mayoría no ha contado con esos aportes tan necesarios para mejorar los servicios y protección ambiental requerida en sus respectivas comunidades,. Se valora en prinicipio este aporte por servicios ambientales y se piensa que en un futuro inmediato y con mejores amnejos de fondos los servicios serán más efectivos y eficiebntes. Pero siempre recordando que los mejores protectores de esos servicios son las comunidades en las cuales se encuentran ubicados eseos valroes naturales.

Mr. Carlos Alborta Consultant, Bolivia (Plurinational State of)

See roughly the context. In the highlands of Peru, there are downstream water users in Canete and Jequetepeque basins. There are also upstream water keepers in both basins. The idea is to launch a PES/CES initiative in order to preserve the service and make it institutional sustainable by means of a mixed trust fund.

Water demand is normally defined by the amount of water required from the hydrological system from various uses and several users.

There are, distinctively, three major water users in the Canete and Jequetepeque river basins, (a) hydroelectrical companies whose demand is non-consumptive; (b) city dwellers whose demand is consumptive; (c) irrigation users whise demand is consumptive. There are even some rural  rates which are presently being paid.

Notice that the idea that power companies are going to be the greater contributors to the CES scheme is not fully valid. Their need for water is permanent but they do not deplete  the water available. You cannot say that water resources, in their case, diminish, degrade or change. After passing through their dams, e.g. Galllito Ciego,  that water can still be used by other or for other purposes.

Notice also that city dwellers already pay some small fee for the water available, very small indded. That is, they are not going to be keen on paying or contributiong further to the CES scheme proposed.

In the Canete and Jequetepeque river basins water competition is not terribly fierce. In both  basins you may argue that water is relatively abundant. Water prices have been estimated in willingness to pay studies as roughly between S./ 0.0011 - S./ 0.0018 per cubic meter, which is very low indeed.

Water users might be concerned with water decrease in availability. But, this is not foreseable in the future. The hydroelectrical concerns in both areas e.g. Platanal, have already taken provisions in order not to suffer in the next decade from water shortages or large variations. Industries in the cities around are not fully developed, unless some gold mining firm discovers this mineral in the basin. That latter is not yet in sight.

The need for water augmentation is not fully visible as water is, again, relatively plentiful.

See the reasoning of the PES/CES proposal. Incentives are needed to preserve the actual functioning of the basins; that is, to preserve the environmental service. Community contests are one technique if not the effective one in the field. Contests have proved to be (a) all competitive i.e. it is based on open community rules and regulations; (b) incentives can be monitored and geared according to the CES projects goals; (c) incentives are a prize on investment as opposed to a recurreent cost run by the project; (d) contests have proved to be successful in community management of natural resources (IFAD has plenty to support on this statement, particularly in Peru).

Community contests, in the context of natural resources management, have shown a gradualism which is led by project officials. Beneficiaries  have been prone to contests related to household improvement first, and then community assets (see PROMARENaA's, Corredor Puno Cuzco records (1990s and this decade).

Indeed water management contests are the creative and innovative way out of this riddle.

Here it goes.

Best regards,

Carlos ALBORTA (IFAD consultant)