Natural Resources
     and Environment

Incentives for ecosystem services

Ecosystem services in agriculture are the benefits society gets from ecosystems due to interventions by farmers. Nutritious food, clean water, healthy soils, pest and disease control and biodiversity are just a few examples of those benefits. 

The provision of ecosystem services in agricultural systems always requires concrete activities by farmers, for example terracing, agroforestry practices, afforestation, conservation tillage, and many others.

Ecosystem services, such as biodiversity habitats, culturally valued landscapes and watershed protection have the character of public goods. Existing markets often fail to value them but if farmers are to adopt more sustainable practices, they will require more than information and capacity building.  To ensure sustainable food and agriculture systems, farmers need to receive an adequate integrated incentive package combining (i) information, knowledge and capacity, with (ii) access to rural finance, higher value markets, payments and greater participation in the design of underlying policies and programmes.

The design and implementation of an adequate incentive package requires locally adapted arrangements and enabling framework conditions. These agreements must bring the various stakeholders together. Incentives for ecosystem services link beneficiaries of the service, such as society or private businesses, with farmers providing the service. They remunerate farmers for their activities and assure that the services are valued by private sector and society.