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bodies, and improving the reliability of water resources. They also hope to provide employment opportunities and improve the availability of drinking water, particularly during the summer. Between 1996 and 2004, the government of India spent more than $6 billion on watershed development (WRI 2005), but no systematic, large-scale assessment of the impact of these programs has been conducted (Joshi and others 2004). There are nevertheless some positive results for integrated landscape approaches. In Kazakhstan, the Syr Darya/Northern Aral Sea Control program in the lower Syr Darya watershed supported innovations in water management, combining “soft” and “hard” infrastructure solutions and flood management, which helped restore river functions and the Northern Aral Sea, leading to recovery of grazing lands, ecosystems, and fisheries (World Bank 2011b). In Rwanda, the land husbandry, water harvesting, and hillside irrigation programs have already increased yields and incomes and have reduced soil losses (World Bank 2011a). Payments for ecosystem services. The Pago por Servicios Ambientales (PSA) program, implemented in Costa Rica in 1997, was one of the first schemes to pay people to provide ecosystem services. Under this program, private landowners and communities receive payments for conserving the forest and helping protect water quality downstream. Financing for the scheme comes from donor grants, earmarked taxes, and buyers of ecosystem services, including municipal utilities. Other examples of payments for ecosystem services include schemes established to eliminate or reduce animal waste and agricultural chemical residues to protect water reservoirs, payments to landowners to encourage conservation, and REDD+ schemes, under which payments will be made for carbon sequestration services and to provide an incentive to reduce deforestation and forest degradation.12 In some developing countries, policy makers have tried to design payment for ecosystem services programs to benefit the poor, but the evidence on both the environmental and

the poverty reduction effects of payment programs is thin (Pattanayak and others 2010). In China’s Sloping Land Conversion Program, average household incomes remained unchanged, although incomes increased for some households and decreased for others. In addition, increased availability of fodder to improve income from livestock rearing, and extension services to improve agricultural productivity have helped compensate households for the loss of agricultural incomes from the conversion to forests. In Ecuador, Costa Rica, and Mexico, large-scale payment for ecosystem services schemes (table 5.2) may have benefited the poor, although assessments remain to be done. Whether the poor are helped will no doubt depend on the scheme’s design. Those based on land diversion (from current use to a use that is more oriented toward the provision of environmental services) are likely to benefit the landed, some of whom are poor— although they could also hurt poor households, especially the landless, by reducing access to key natural resources. Those based on working lands are likely to increase the demand for labor and may thereby benefit the poor. However, schemes expected to meet poverty reduction goals may be less effective in meeting environmental goals (Jack and others 2008). Where the poverty reduction impacts are likely to be small, it may be better to design schemes to be as effective as possible in achieving environmental goals and draw on other instruments to reduce poverty (Bond and Mayers 2009; Wunder 2008).

Climate-regulating services Natural capital—including the oceans, land, and their living organisms—plays a key role in climate regulation.13 However, the value of these key regulating services is not adequately captured through markets, and valuing them is difficult. One of the most important services that forests, soils, and water provide is storing carbon. Indeed, out of the 9 gigatons (Gt), or billion tons, of CO2 emissions released in 2007, the

Inclusive Green Growth  

As the global population heads toward 9 billion by 2050, decisions made today will lock countries into growth patterns that may or may not b...