7th Biennial GEF International Waters Conference Bridgetown, Barbados Key outcomes from the pre-workshop on Economic valuation Eduard Interwies, InterSus

Aim of the presentation Present briefly the key outcomes of the pre-workshop “Set the scene” for the upcoming table dialogues on economic valuation

The pre-workshop: Sat & Sun 26 & 27.10 Centered on economic valuation as a tool to link science-based management & policy Aims: Raising capacity among GEF project managers and partner organizations representatives on the topic Better use & integration of valuation approaches and methods during GEF IW project implementation (esp. TDA-SAP process) More than 100 registered participants Presentations, 3 breakout groups, facilitated discussions etc. – conveying economic valuation methodologies and practical examples – what worked, what not

The background/basis: Management of aquatic resources based on the ecosystem understanding! Multiple uses…limited resources… ...ecosystem services (ES) approach fosters understanding and integration Variety of objectives and underlying conditions per ecosystem

Ecosystem Services: (MEA, TEEB)

An example: Various ecosystem services related to wetlands-estuaries, e.g.: Provisioning: Food, water (direct values) Regulating: Climate regulation, moderation of extreme events (indirect values) Habitat: Maintenance of life cycle of migratory species (indirect value) Cultural: Aestetic and religious role (non-use values)

Economic valuation of ES Decision-making needs to integrate a variety of socio-economic factors & issues: Economic growth needs/related investments; Livelihood & distributional issues; Costs and benefits of specific policy decisions… but also how a policy decision influences the ES functioning & the related values! Valuation of ES only one part of socio-economic consideration for policy making has its specific role to play within the different steps of the policy cycle (analysis & advice – decision making – implementation – Review/evaluation & monitoring)

Economic valuation of ES - methods Various approaches & methods for economic valuation exist Many options for managers, but: “you need first to be clear on what question you want to answer” Very case specific  No silver bullet: method selection should be “purpose driven, objective specific” (what question, policy, sector, stakeholders, scale, timeline, data available?)

Economic valuation of ES Variety of examples available, some presented & discussed (both LMEs and River Basins) Key insights on successful link to policy-making: Valuation only one of the tools supporting better decision making Do it at the scale of the policy question Strong local partnership & stakeholder engagement Local demand for valuation Opportunities of revenue raising Effective communication & access to decision makers – integration, not “stand alone” Clear presentation of methods, assumptions & limitations

Regarding market-based instruments… ..and the links to economic valuation:

Regarding market-based instruments… ..and the links to economic valuation: Relevant for Payments for Ecosystem Services (PES)-schemes, but also other market-based instruments e.g. taxes, quantity-based, liability-based, voluntary FIRST SLIDE BY MARK???

Regarding PES – and use of valuation Promising, good examples of work done so far Specific “do´s and dont´s” out of this experience Fundamental concerns: water as a human right vs. water as a commodity Role of GEF: to be further discussed Continue exploration: how to upscale to national/transboundary level? ”Out-of-box”-thinking – innovative ideas Further case study applications (part of TDA-SAF-process) to promote and use PES-schemes

Linking valuation to policy-making GEF-Action points: Broad(er): Incorporate all relevant aspects of social, economic data/analysis as an integral part of the TDA – SAP framework and related documents Part of effective governance – of the entire policy cycle Foster indicator use: further develop socio-economic indicators (linked to data access & availability) & baseline/trends in GEF-SAP results framework Use of e.g. Cost-Benefit-analysis/Multi-criteria analysis (quantitative & qualitative information) in the assessment of options throughout the process (not only towards the end!) Complements – does not replace – other data and analysis currently used in GEF-projects

Linking valuation to policy-making GEF-Action points: Incorporate valuation as an integral part of the TDA – SAP framework and related documents Ecosystem diagnostic analysis (including valuation) to identify national & regional key issues: for each member country (communication issues, collecting information/data) undertake individual evaluation & then bring together into the TDA-SAP-process Causal chain analysis (including valuation) maybe useful earlier in designing the process (in assessment of options) – identifying the key use & methods of ES valuation Include values of large ecosystem assets - add information on economic impacts of options - use CBA (qualitative-quantitative) of options – for the SAP

Linking valuation to policy-making GEF-Action points: Develop guidance for the use of socio-economic assessments, esp. ES valuation: Guidelines – practical manual Clear framework for project managers on what is most useful for their project Show the needs for socio-economic assessments (CBA etc.) and the specific use of ES valuation Use of specific methods (flexible: not all aspects suited to all projects), considering data availability Success stories – lessons learned (evidence of approach advocacy) Improve data availability / accessability for ES valuation (“do it quicker and easier”)

Linking valuation to policy-making GEF-Action points: Support capacity building: Improve capacity (within GEF-projects, but also of users/authorities) Creating a critical mass of expertise – professionalization – community of practice Support a stronger incorporation of decision makers & stakeholders in the ES valuation-process

Linking valuation to policy-making GEF-Action points: Foster practical application of ES-valuation at the project level: Conduct high-level ecosystem valuation studies (“fast and cheap”) to kick-start acceptance & understanding – improve “buy-in” by users/authorities through involvement & awareness raising Conduct Pilot projects - Demonstration projects: Hot-spot and small demonstration projects in national diagnostic analysis/TDA/SAP formulation – with strong decision maker & stakeholder involvement

Special thanks to: The IWLearn-team The co-facilitators: * Mark Smith & Stefano Barchiesi (IUCN) * Christian Susan (UNIDO) * Warwick Sauer (Rhodes University) * Stephen Lutz (UNEP GRID-Arendal - Blue Forest project) * Adrian Cashman & David Gil (University of the West Indies) * Peter Edwards (NOAA) The presenters …and of course the very involved participants!