Ecosystem Goods and Services

In Development Planning
Assignment 2

Submitted to- Dr. kassahun Embaye

(Envt Dept Head)

Prepared by-

H.U.C
May 2020
 Ecosystem Goods and Services in Development Planning

The aim of the Good Practice Guide (GPG) is to provide a better understanding about the role of
the environment and how development policies and budget processes can effectively
internalize environmental priorities and benefits. This product, which is primarily directed at
officers from finance and planning ministries, will also be of value to individuals from other
sector ministries, government institutions, development and environmental groups .

Ecosystem services are the benefits that people obtain from ecosystems. While ecosystem
goods are the products of the processes and interactions (described above) of natural
systems. Ecosystem goods and services represent the benefits that humans derive from
naturally functioning ecological systems.

First let’s understand the Common Beliefs about the Environment which have consequences on
development planning. It is too costly and can slow down development and it is a secondary
issue compared to socio-economic priorities, it can only generate limited benefits and it is
possible to mitigate environmental damage through modern technologies, it is just about
certain charismatic species and trees also it is not always possible to have clear agreement on
scientific issues concerning the environment, it requires complicated measures of intervention
to deal with some environmental issues.

So in order to overcome Non-accessible environmental jargon demystifying the environmental

jargon is important.

Demystifying the Environmental Jargon

When we come to demystifying the environmental jargon we consider three basic perspectives
which are

o Factor requiring demystification- includes language barriers, gap between scientific

language and policy/financial planning and the environment regarded often as a set of
problems to be solved

o How to demystify? By decreasing language barriers and focusing on environmental

benefits

o Where to apply? Because it must be applied everywhere and in every sector.

 Biodiversity and Ecosystems
Each ecosystem contains complex relationships between living organisms (biodiversity) and non-living
matter as well as the weather patterns that affect them. Development impacts ecosystem services and
Ecosystem services sustain development.so development and ecosystem services have an impact on
each other.

So -Human beings are part of biodiversity

- Ecosystems provide vital services for human needs and development

Humans have overall negative impacts on Biodiversity & Ecosystems. These negative impacts include
loss of wetlands, soil degradation, desertification, high CO 2 emission, Marine and terrestrial species
decline and extinction of both plants and animals

 Biodiversity and Ecosystem Goods and Services

Many key ecosystem services provided by biodiversity, such as nutrient cycling, carbon

sequestration, pest regulation and pollination, sustain agricultural productivity. Promoting the
healthy functioning of ecosystems ensures the resilience of agriculture as it intensifies to meet
growing demands for food production.

 Human Dependence on Biodiversity and Ecosystems

Humans have altered ecosystems more rapidly and extensively than ever, largely to meet

rapidly growing demands for resources along with economic development. Our preliminary
results show that economic growth has actually
made humans more dependent upon ecosystem services and biodiversity.

 Millennium Ecosystem Assessment (MA) has put ecosystem goods and services in to
four catagories-
1. Provisioning Services- Food, Fiber and Fuel, Genetic Resources, Biochemicals, Fresh
Water.
2. Cultural Services -Spiritual and religious values, Knowledge system, Education and
inspiration Recreation and aesthetic value.
3. Regulating Services -Invasion resistance, Herbivory, Pollination Seed dispersal, Climate
regulation, Pest regulation, Disease regulation, Natural hazard Protection, Erosion
regulation, Water purification.
4. Supporting Services - Primary production, Provision of habitat, Nutrient cycling, Soil
formation and Retention, Production of atmospheric oxygen, Water cycling.
Two solutions have been offered for sustainable development.

o Ecosystem Based Solutions

o Man-Made Solutions

Ecosystem Goods & Services (EGS) in Development

When we see EGS in Development Sectors two questions arise-

 What are the inter-linkages, impacts and dependence of socio-economic sectors on

ecosystem goods and services?

The rural poor, still depend on rivers and streams for their water

The poor often rely on traditional medicines for many of their ailments

One billion persons live in bamboo houses and 75% of the 2.6 billion people who live on less
than $2 a day are dependent upon local natural resources;

Sectors’ activities can impact ecosystems in different ways (negatively/positively) while

having conflicting goals relative to the potential use of available EGS;

Negative Impacts like -Deforestation and forest degradation increase greenhouse gas
(GHG), Mining industry accelerates deforestation and releases toxic compounds (e.g.
mercury, cyanide…), livestock sector generates greenhouse gas

 How can EGS contribute to development, through sustainable economic growth,

poverty reduction and resilience to climate change and natural disasters?

There are 5 reasons to integrate ecosystem-based management in disaster risk

reduction and development planning:

1. It can decrease vulnerability to natural disasters ;

2. Natural disasters have a high cost;

3. It costs less to prevent disasters than it does to fix the damage they cause ;

4. At-risk populations depend on ecosystems for their livelihoods;

5. Natural disasters and the responses to them have a negative impact on biodiversity.
 DEVELOPMENT PLANNING
Development planning refers to the strategic measurable goals that a person,
organization or community plans to meet within a certain amount of time. Development
planning with sound environmental vision and governance can favor sustainable results:

By- Strengthening environmental governance

- Working with nature

 Building Governance and Vision

Three main factors can shape the management of natural resources and governance-
related arrangements these are:

1. The characteristics of natural resources (water, minerals, timber…);

2. The actors involved (private and the public, business and consumers, as well as local
communities and Indigenous Peoples);

3. The institutional framing and rules (Role of ministries and government institutions).

Environmental Vision by building an inclusive long term development vision of EGS.

 Green Constitutions & Legal Initiatives- Constitutions which refer directly to

environmental rights.
 National Priorities NSDS- Clear reference to ecosystem/biodiversity objectives in long
term development strategies.
 Global environment commitments- Policies integrative of Multilateral Environmental
Agreements.

 Assessment and Valuation of EGS

EGS assessment and valuation are crucial to recognize the importance of integrating
biodiversity and ecosystems within planning processes by allowing the following:

 Providing justification relative to EGS;

 Building EGS argumentation ;

 Raising EGS awareness;

 Enhancing planning processes and success based on EGS

  Integrative and EGS Inclusive Planning
Planning must include

A. Decentralized Plans
B. Sectors Plans
C. Spatial Plans.

Plan must be - In terms of spatial layers

- At lowest level possible

- Include green considerations

In order to have an EGS inclusive planning we must first have a Guiding Questions for Policy
Makers. Questions like

 What are the main ecosystem services that a country’s economy relies on?
 How will the proposed policy/strategy depend on ecosystem services?
 How will the proposed policy/strategy change the indirect and direct drivers
affecting these ecosystem services?
 What will be the impact of the change in drivers on the ecosystem services?
 What is known about the status and trends of these services? And so on.

But there are Common Environmental Policy Challenges which includes

 Lack of political support/will to environmental initiatives

 Limited power/influence of environment ministry
 Limited resources/capacities for environmental activities
 Limited understanding and access to knowledge about ecosystem goods
and services
 Economic growth and development needs focusing on short to medium
term income generation

Benefits of Integrative and EGS Inclusive Planning

 Increasing the level of ownership and success of policies and plans;

 Contributing to good governance (responsive to citizens needs) by involving stakeholders;

 Enhancing visibility of gender and indigenous role to the environment;

 Downsizing and streamlining of central government institutions;

 Scaling up successful local/traditional experiences linked to ecosystem management ;

 Enhancing integration and harmonization of policies in terms of EGS;

 Enhancing strategic thinking for sectoral policies by integrating environment in sector policies
and across time/space;

 Reducing conflicts between stakeholders

BUDGETING AND FINANCIAL PLANNING

 Budgeting and Financial Planning Background
Budgeting and Financial planning need to be environmentally inclusive. From the
economic perspective, the most important gaps to be filled relate to the measurement
of ecosystem services and of the ecological condition of the ecosystems that provide
them.

Environment and Finance Ministries can assess where sources of green benefits exist by
identifying: EGS sources of revenue generated at the national level, EGS revenue
opportunities from international sources, Non-market value of EGS, Non-use value of
EGS, Option of reallocating negative subsidies to greener initiatives.

 Environmental Fiscal Reform

Halting the erosion/pressure on natural resources by identifying opportunities to
generate green revenue, taking into consideration the impact of development on the
environment. EFR raises fiscal revenue while furthering environmental goals. This can be
taken in effect because Environmental fiscal reform refers to a range of taxation and
pricing measures which can raise fiscal revenues while furthering environmental goals.
Example of what is captured by EFR are measures in: Strengthening environmental
finance, Introducing system for environmental taxes and charges, Abolishing perverse
subsidies, Introducing pro-poor EFR

 Innovative Environmental Finance Architecture

Why? New means exist to generate income based on ecosystem goods and services.
Taking advantage of these opportunities at both national and international levels
can open new sources of revenue
 How? Identifying contributions of EGS to various sectors and linking sector funding
to environment initiatives, Through basket funding mechanisms integrating EGS in
sector approaches such as agriculture and environment, health and environment…,
Introducing Payments for ecosystem services (PES).

Payments for Environmental Services (PES) are one type of economic incentives for those that
manage ecosystems to improve the flow of environmental services that they provide. Generally
these incentives are provided by all those who benefit from environmental services, which
includes local, regional and global beneficiaries

 Medium Term Expenditure Framework

It provide a planning and budget formulation process within which there is an opportunity for
environment ministries to develop strategic thinking, and stronger financial discipline.

ADAPTIVE PLANNING AND KNOWLEDGE MANAGEMENT

By including EGS dimensions (benefits and limits) the integration of planning approaches
is enhanced and aligned, resulting in sustainable and equitable development strategies.
Adaptive Management and Knowledge Consolidation includes-
 Data Collection Monitoring and Evaluation-Develop new EGS knowledge .
 Lessons Learned and Knowledge sharing- Continuously adjust strategies and plans .
 Awareness and Capacity Building-Enhance awareness and capacities.

 Capacity Building and Awareness Raising

As EGS understanding is often new, capacity building is required, involving staff
from all ministries. It can be done by building capacity to introduce EGS in sector
plans, building capacity for valuation of ecosystem services, building capacity to
introduce EGS in budgeting through

 Policy and Budget Monitoring

Regular monitoring by government agencies is needed to identify impact of policy and
financial planning and to conduct adjustments when needed in terms of environmental
performance. Which can be done by Developing an evidence base relative to EGS
benefits, Including EGS based indicators for monitoring success of policies (e.g. In
Performance Assessment Framework) , Conducting monitoring and evaluation of public
environmental expenditures(e.g. Public Environmental Expenditures Reviews…),
 Gathering new EGS related data, Developing poverty-environment indicators to build
links between EGS and poverty in policies.

 Lessons Learned and Knowledge Sharing

 Sustainable strategies depend on constant information availability and update.
 EGS knowledge base has to be reinforced regularly and made accessible for informed
development planning.
 Developing a biodiversity/EGS clearing house mechanism;
 Developing networks between key stakeholders and promoting cooperation at multiple
levels ;
Constantly updating EGS related information and rendering it accessible to decision
makers

Benefits of Adaptive Management & Knowledge Consolidation

 Enhancing budget allocation opportunities for environment as a result of transparent
budget process ;

 Improving capacity to trace environmental expenditures;

 Packaging EGS data in an accessible and useful form to planning officers;

 Developing and sharing new EGS based knowledge products;