Project Title: Biorights: a financial tool de-linking economic development and destruction of biodiversity and natural resources in developing countries

Grant Agreements No. WGP2-3430 & WGP-27 GPI 64

Agreement holder:
   Dr.Herbert Diemont    Alterra, P.O. Box 47, 6700 AA Wageningen

Country/region: Mali, Costa Rica (WGP2-3430) & Indonesia (WGP-27GP164)

Activity period: 01/ 09/2002-31/12/2004


Documentation and products available:

Partners:
Government:
  • BPPT, Ministry of Research and Technology,
    Indonesia
  • Governor of Central Kalimantan
  • UK Embassy, Jakarta
  • RIZA
  • Ministry of Environment, Mali
  • Ministry of Environment and Energy, Costa Rica
  • National Park Service (SINAC), Costa Rica
  • National Forestry Fund (FONAFIFO), Costa Rica
  • National Exec. Comm. Of the San Juan La Selva
    Corridor, Costa Rica
NGOs
  • Wetlands International
  • Wildlife Conservation Society
  • Orang Utan Project
Science agencies
  • University of Nottingham
  • Universoty of Leicester
  • Sriwijaya University, Indonesia
  • University of Palangka Raya, Indonesia
  • Gadja Mada University
  • STRAPEAT project, Alterra
  • Wageningen University and Research Centre
  • University of Hokkaido, Japan
  • International Food Policy research Institute (IFPRI)
Background: The Biorights system was developed after urgent requests from the University of Palangka Raya in Central Kalimantan and other academics from Indonesia to re-direct EU peatlands research funding in Central Kalimantan towards enhancing income opportunities for local communities. Action was required after serious social unrest in the province. The Global Peatland Initiative made funding available for fighting peat and peat swamp forests fires in the region and in the meantime partners in the EU scientific STRAPEAT project obtained seed funding from Alterra to assess possibilities for direct income generation for the local people that depend on the peatland resources in one of the poorest areas of Indonesia. The area is also of importance as a carbon store (peat forest fires pose a significant threat to the global climate) and has globally important biodiversity values, including one of the largest remaining populations of Orang Utan.
Initial official discussions where hosted by the British ambassador in Jakarta. The Biorights concept was presented at the Ramsar COP8 in Valencia, where Mali delegates showed a keen interest to be involved. The government of Costa Rica was asked by the Biorights project team to participate as Costa Rica has most experience with payments for environmental services.
Biorights thus is a demand driven initiative, but simultaneously it can not be seen separate from the Millenium Goals which recognise the need to de-couple poverty and environmental destruction in developing countries as a priority. The system was tested on request of local stakeholders and the government in 3 countries, including Indonesia, Costa Rica and Mali.

Brief project description:
The Biorights project focuses on the global rural poverty gap as a major cause of both poverty and loss of biodiversity in developing countries. Its philosophy is that sustainable development in developing countries often comes with opportunity costs for local people in poverty trapped rural regions. These people often depend for their income to a significant extent on exploitation of natural resources, and under poverty conditions it is generally unavoidable that natural resources and biodiversity become over-exploited. The project assessed the willingness of local stakeholders in Indonesia, Costa Rica and Mali to follow a Biorights approach towards sustainable development. All three countries welcomed the project initiative and local stakeholders, NGO`s and governments fully co-operated on project execution. The project also assessed the willingness of global stakeholders to provide direct payments for conserving biodiversity to local stakeholders in poverty trapped regions with a high biodiversity value. To this end, discussions were held with the World Bank, International Finance Corporation, RABO bank, and Conservation International, Forest Trends, World Resources Institute, DGIS and partner organisations, including Wetlands International, IFPRI, Plant Research International and IUCN. Substantial interest was shown by global donors and financial institutions, resulting in willingness to co-operate in further development of the approach. The approach was presented at the CBD, the UNEP-FI Global Roundtable in Tokyo (Oct. 2003) together with government representatives from Indonesia, Costa Rica and Mali. Opportunities identified for implementation of the Biorights approach are documented on the website.
The next step is to provide for a global or regional Biorights fund in order to provide payments. A draft proposal for such a fund has been discussed at the UNEP-FI Roundtable in Tokyo, October 2003.

Results:

Expected
Outputs and Results achieved
Objectives and results:
  1. Describe and disseminate the Biorights concept
  2. Create acceptance by local and global stakeholders including funding agencies
  3. Provide business plans for demonstration areas
  4. Obtain endorsement for Biorights from local and global stakeholders including funding agencies
Achieved:
  1. Fully achieved, including a (previously unforeseen) website, and workshops and presentations at the UNEP-FI Roundtable, World Bank and the Internbati9onal Finance Corporation (IFC), Washington. Post project, a presentation was made at the CBD CoP7 in Kuala Lumpur, which resulted in an invitation by the World Bank for a proposal.
  2. Fully achieved by local stakeholders, but only partly achieved with respect to generating cash flows to local stakeholders. Issue is now discussed with the World Bank. Post project a proposal has been submitted to the EU EuropeAid Programme on Tropical Forests and other Forests in Developing Countries for a Biorights project in South-east Asia focused on poverty areas in peatswamp forest regions in Indonesia, Malaysia and Thailand.
  3. Achieved in Costa Rica, where the opportunity costs for local stakeholders have been calculated. This is now (post project) under further discussion with the government to be matched with existing systems of payments.
  4. Achieved with local stakeholders in Mali and Costa Rica. Agreement under consideration with Conservation International, Forest Trends, The Katoomba Initiative and World Bank. A Bioright -fund proposal has been drafted.
Evaluation
The project achieved all its objectives in the relatively short period of one year only. The sustainability of the project will depend on the results of further promotion of Biorights and the continued interest of donors to invest in the development of this innovative finance system for addressing poverty-environment issues. In this respect it is important that apart from DGIS other funding agencies invest in the system. Several fund raising initiatives were already started towards the end of the project, and have led - post project - to the submission of a proposal to the EU and the request by World Bank for a proposal.
Further actions are needed. Despite the decrease of global poverty, the rural poverty gap is increasing all over the world due to a decrease of both farmers’ income and the terms of trade of agricultural produce. For developing countries the implication is that natural resources including biodiversity can not provide sufficient income to local people who depend on these resources for their livelihood. Under poverty conditions over-exploitation of these natural resources cannot be avoided. In developed countries the same rural crises occurs, but here only 5 percent of the population depends on agriculture, subsidies as high as 1 billion dollar/day are provided to upgrade farm incomes in the EU and the US. In the absence of substantial subsidies and decreasing incomes provided by agriculture and forestry the Biorights system financial system was developed as a possible solution towards poverty-environment issues.
The development of a new global finance mechanism is a very ambitious endeavour, but the project team was able to develop a large number of partners at all levels in the project. Indeed, the organisations involved have taklen care not to claim this initiative as their own, but have developed it as an open partnership under its own logo. Local stakeholders clearly spoke out in favour of such a system, as shown by e.g. the representation of the Dayak communities of Central Kalimantan at the UNEP-FI Roundtable. The project succeeded in developing a vision based on and incorporating the ideas of a great variety of local and global stakeholders.
This now needs to be picked up by donors and conservation agencies.
Biorights documentation is available on the Biorights website (www.bio-rights.org), open to any scrutiny, comments and inputs.
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last update: 20/07/04