How PES can help the poor In 2001 the World Bank defined poverty as ‘pronounced dep- rivation of well-being’. Well-being depends on basic material needs including food, personal security, reliable social rela- tions and freedom. Te state of well-being or poverty is also dependent on other factors such as geography, environment, age, gender and culture (MA 2003).
Ecosystems and poverty Ecosystems have an intrinsic value in the way they sustain the world in which we live. Te healthy working of ecosys- tems is a highly complex process, involving multiple interac- tions between various ecosystem services. In the interaction between human activities and ecosystems, poverty is oſten related to ecosystem degradation and, in turn, ecosystem deg- radation oſten aggravates rather than addresses poverty.
Te provision of ecosystem services is vital for all of us – par- ticularly for the poor. When ecosystem services are disrupted the poor are generally the first to be affected: more prosper- ous members of society tend to have the financial and social assets to obtain resources, or their substitutes, and ecosystem services elsewhere (FAO 2011).
Poverty alleviation and ecosystem conservation: a vital linkage Nature is a lifeline for many of the world’s 1.1 billion people living in severe poverty (WRI 2005) – a vital asset for those with few material means. Tis is especially true for the rural poor, who make up three-quarters of all poor households worldwide.
Poverty oſten occurs when links between ecosystem services and human well-being have been damaged or broken. Te re- sult is the loss of essential services including provision of food, water, wood, fibre and fuel. Ecosystem conservation and pov- erty reduction are intertwined because the rural poor oſten rely directly on ecosystems for their day-to-day well-being.
A central point made by Te Economics of Environment and Biodiversity (TEEB 2010) initiative is that forests, watersheds, biodiversity and other ecosystem services play a key role not only in sustaining the overall health of the planet but also in contributing to livelihoods in rural areas. Healthy ecosystems are ‘the wealth of the poor’.
It has been estimated that ecosystem services and other non- marketed goods make up between 50 and 90 per cent of the total source of livelihoods among poor rural and forest-dwell-
62 VITAL GRAPHICS ON PAYMENT FOR ECOSYSTEM SERVICES
ing households – the so-called ‘GDP of the poor’ (TEEB 2010). Tis contrasts with various national GDP figures where, for the most part, agriculture, forestry and fisheries account for between 6 and 17 per cent of overall GDP.
Putting a monetary value on ecosystem services is part of modern science. For example Lescuyer (2007) values the services Cameroon’s forests provide at US$560 per hectare per year for timber, US$61 for fuelwood, and from US$41 to US$70 for non-timber forest products. Moreover the contri- bution which Cameroon’s forests make to climate regulation, expressed in monetary terms, is estimated at between US$842 and US$2 265 per hectare per year.
When ecosystems are threatened or degraded, then the val- ue of the services they provide decreases. Priess et al. (2007) valued pollination services provided by forests in Sulawesi in Indonesia at US$60 per hectare per year. As more forests are cleared for palm-oil plantations and other land uses, pol- lination services are reduced. Te knock-on effect reduces re- gional coffee yields by as much as 18 per cent. As a result net revenue per hectare of land is projected to drop by 14 per cent over the next two decades.
Taking part in PES schemes Tere are four basic criteria governing involvement in PES schemes by low-income households and communities: eligi- bility to participate, desire to participate, ability to participate and competitiveness relative to other prospective sellers of ecosystem services.
To be eligible to take part in PES schemes, low-income land groups must manage land or resources which provide or could provide ecosystem services demanded by buyers. Poor people offering ecologically valuable services not in demand are unlikely to benefit from PES. Eligibility also depends on meeting rules or criteria established by the PES market or programme. For example smallholders have so far been large- ly excluded from the regulatory carbon market due to limi- tations and complex rules related to land-use-based projects under the Kyoto Protocol’s Clean Development Mechanism. Furthermore, some government PES programmes have in the past imposed eligibility criteria which disadvantaged the poor, such as requirements for legal land title and minimum land holdings for enrolment in schemes (Milder et al. 2010). Te structural, market and institutional requirements for PES schemes can make it challenging for local communities and the rural poor to be competitive when setting up or taking part in PES schemes.