Equitable Payments for Watershed Services: A joint WWF, CARE and IIED programme Morten Fauerby Thomsen, CARE Danmark

 A partnership between CARE, WWF and IIED  Linking poverty reduction and conservation  A partnership between donors: Danida and DGIS Innovative partnerships

Ecosystem Services and Poverty Reduction  Poor rural communities are often stewards of environmental services  Millennium Ecosystem Assessment: Nearly 2/3 of world’s ecosystem services now under threat Degradation of ecosystem services is a barrier to achieving the MDGs Harmful effects of degradation ecosystem services borne disproportionately by the poor

 Aims to bring substantial benefits to the poor: Direct: financial benefits to farmers and households; at community level (hospitals, schools) Indirect benefits: community empowerment, decreased vulnerability, conservation of ecosystem.  Aims to make payments to the poor in a just and equitable way  Intermediaries? Equitable PES

Payments for watershed services are supporting sustainable natural resource management, improved livelihoods and social justice for the rural poor Overall Programme Goal

 Philippines: Cantingas watershed (Sibuyan) & Mt. Isarog watershed (Camarines Sur)  Indonesia: Kapuas Hulu (Borneo) & Eastern Nussa Tengara (Timor)  Peru: Jequetepeque river basin & Piura river basin  Guatemala: Sierra de las Minas & Polochic watershed  Tanzania: Uluguru mountains and East Usambara 10 Sites of Intervention

 Phase 1: Making the business case Buyers: profitability, viability of payments Sellers: incentives for land use changes required 1.5 years, funding from DGIS and Danida  Phase 2: Full implementation PES For each site that delivers a viable business case 3-4 years Program Strategy: Phasing

Phase 1 Data Collection } Biophysical Livelihood Legal/institutional 1 Buyers & Sellers 2 Problem defined (situation analysis) 3 PWS = Addressing the problem 4 Cost / Benefit analysis 5 Impact on conservation and poverty 6 Business Case 7 MoU 8 Implementation Phase II 9

Tanzania (1) Uluguru and East Usambara Mountains Uluguru Mountains: Provides water to Dar-es-Salaam (Ruvu river) Increased water scarcity and quality problems High level of poverty in watershed

Potential BuyersMotivation Domestic water users  Agricultural water users  Industrial water users Includes:  Cement factories  Breweries and distilleries  Bottling companies (water/soft drinks)  Textile factories  5 star hotels Cost of water treatment are high  Costs of alternative water supply are high (trucks, boreholes)  Revenues are foregone due to limited production in times of low water availability  Fear of pending water crisis and the sustainability of alternative sources Potential SellersMotivation Poor communities in the catchment area (specific communities to be identified) Direct and indirect benefits Tanzania (2)

What role for Donors Tanzania (3)  Better linkages to government  Better placed to support/facilitate an institutional and legal environment that is supportive of PES schemes:  Tanzania PES Task Force  No PES without government in Tanzania

Contact: Please see programme handout !!