More returns as farmers share risk

More returns as farmers share risk

A report, titled "Towards operational payments for water ecosystem services in Tanzania: a case study from the Uluguru Mountains"  shows that Payment for Ecosystem Services Schemes  (PES) works best if the relationship is one of co-investment with shared risk between the buyer and farmer, rather than all risk falling on the farmer.

A scientist with World Agroforestry Centre and one of the authors, Meine van Noordwijk said on Thursday that the results show that there is initial success in reward schemes that encourage farmers to better manage scarce resources by creating shared responsibility over these resources. The study is part of the Equitable Payments for Watershed Services (EPWS) project run jointly by CARE/ World Wildlife Fund (WWF). 

EPWS has been in operation in the country since 2005, with similar schemes in Kenya, Peru and Indonesia.  She said the project, located in the Uluguru Mountains was evaluated halfway through its operation and results are discussed in the report. She said EPWS sought to encourage farmers to practice methods that sustain the regular flow of water from mountain forests, water that is important for downstream stakeholders in seasonally dry tropical countries. 

Currently, there is interest in the idea of PES as a scheme that links rural ecosystem service providers to urban water users through economic transfers. She noted that monetary benefits from payment schemes can be translated into diversification of income streams for subsistence farmers. Farmers can do more with the money than just the direct benefit of cash in hand.

The report notes that farmers participating in the scheme received financial payments to compensate for their labour and opportunity costs and have used the additional money to purchase iron sheet roofing for their houses, goats for milk and manure production. 

It documents others who used the money to purchase extra agricultural inputs, namely better seeds to improve agricultural yields.  In July 2009, 144 farmers had joined the scheme and were paid in May 2010 the equivalent of a total of USD 1,639 as an annual payment (about $12 per household per year).

“Farmers recognize that soil conservation actually increases crop production, and that with some investment help, they can create more profitable and sustainable land use systems,” Project Coordinator of the Rewarding Upland Poor for Environmental Services (RUPES) Beria Leimona said.

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