1. IADB, November 19 th, 2007 Richard Huber Claudia S. de Windt Poverty and Environment Partnership-PEP Meeting: Infrastructure, Growth and Poverty Reduction: The Role of Ecosystems and Natural Resources Private Sector Views and Experiences on Ecosystem Services, Environment and Poverty, Session 2: What Division of Labor among Main Stakeholders would foster private sector investment in environment and livelihoods?

2. Conversion of forests to farmlands in Santa Cruz, Bolivia 1975: Forested landscape 2003: Large corporate agricultural fields transform the landscape

3. Shrimp farms replacing mangroves in Gulf of Fonseca, Honduras 1987-1999: shrimp farms and ponds have mushroomed, carpeting the landscape around the Gulf of Fonseca, Honduras, in blocks of blue and black shapes

4. Regulators The Law Plants Government: Create Market Conditions and Climate for Investment. Regulator/Mediator Regulatory Standards n Market-based Instruments n Legal Liability State

5. u Power u Social Norms u Negotiations u NGOs Maximize Impact on people and specific groups and information awareness NGOs Plants Citizens Community …and Other Actors are Important

6. u Reputation u Profits Consumers Investors Plants Markets

7. State Markets Community The New Model: Multiple Agents, Multiple Incentives

8. Payments for Ecological Services: Trends in the Americas u Database compiled from Rainforest Alliance Eco- Index, Katoomba Group, Ecosystem Marketplace u Original Transation sources like FONAFIFO (Costa Rica) and PSA-H (Mexico), Chicago Carbon Exchange. F Tries to assess PES trends in the marketplace – Price paid/HA/year, price/ton/yr # projects/country/year, type of project, are # of projects increasing or decreasing/country.

9. PES Trends in the Americas

10. Momentum or stagnation?

11. 4 Countries have more proposals than ongoing.

14. Are Governments creating the right conditions for PES schemes to be profitable and sustainable? n Detailed country Analysis u Bolivia u Chile u Costa Rica u Colombia u DR u Ecuador u Panamá u Perú n Laws and Public Policies that facilitate or inhibit PES n Environment n Forest management, n Water resources management, biodiversity and protected areas n Fiscal and tax Laws n Public utilities, n Property rights

15. Are Governments creating the right conditions for PES schemes to be profitable and sustainable?

16. Are Governments creating the right conditions for PES schemes to be profitable and a sustainable approach to conservation? http://www.doingbusiness.org/

17. Next Steps: n Conceptual and Policy discussion on enabling conditions n Need to refine concepts on property rights, legal nature of ecosystem/environmental services and parties to a PES agreement (Institutional Framework) n Lack of systematic information (Valuation) n Need to remove perverse incentives n Private Sector Trends and role n Best Practices n Hemispheric Approach?

18. Thank You! www.oas.org/DSD