1. Mesoamerican Biological Corridor and the Environmental Goods, Services and Impacts. Mesoamerican Biologicas Corridor – promotes conservation of biodiversity and economic development Rado Barzev (MSc), rbarzev@hotmail.com rbarzev@hotmail.com

2. Mesoamérica (Central America and the South of Mexico) is a region between two continental bodies (North and South America), that is a natural biological bridge, making possible the flow of flora and fauna.

3. Out of the 250,000 species, described worldwide, about 20000 can be found in the Region. BIOLOGICAL TREASURES MESOAMERICAS Mesoamérica 0.5% World Territory World Biodiversity Mesoamérica 10%

4. BIODIVERSITY POPULATION COMMUNITY PLANTS ANIMALS SOIL, ENERGY, AIR, WATER ECOSYSTEMS INDIVIDUALS COMMUNITY ASSOCIATION GENES

5. BIODIVERSITY = ENVIRONMENTAL GOODS AND SERVICES

6. Genetic Resources Raw materials for the pharmaceutics GENES Biological Control Food Production Wood, Fire Wood SPECIES Soil formation Water supply and quality Erosion control Climate regulation Nutrients Recycling Flood control Oxygen production and carbon sequestration Landscapes Species habitat Waste recycling ECOSYSTEMS ENVIRONMENTAL GOODS AND SERVICES

7. MARKET PRICES FOR SOME GENETIC RESOURCES AND THEIR DERIVATIVES (US $/KG) Growth Hormones20,000,000. Taxotere-Docetaxol (anti leukemia)12,000,000. Viscristine sulfato11,900,000. Cocaine 150,000. Camptothecin 85,000. Anti AIDS 5,000. Tiger bone 3,000. Shark oil 550. Coffee 10. Cotton 1.5

8. Land use planning under CBM Environmental Goods and Services Protected Areas MBC BIODIVERSITY

9. FRAGMENTATION X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z x x x x x x x x y y y y y y y y y x z z z z z z

10. Biological Corridors Z X Y Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z X Y X X X X Y Y Z Z Z Z Y X X X X Y Y Z Z x y x x x y y y y x z z x x y z y z x x y y z z

11. Protected Areas Country X Example of land use planning in order to establish the Mesoamercian Biological Corridor

12. Biological Corridors

13. Buffer zones

14. Mesoamerican Biological Corridor A corridor of protected areas surrounded by other multiuse and nature friendly areas

15. The neighbor country Y Protected Areas

16. Repeat the process

17. MBC spreads

18. *A land use planning system for the Central American Protected Areas System (SICAP), including buffer zones and multiuse areas. *It provides several environmental goods and services to the central American society and also benefits societies from all over the world. *The system promotes as well the sustainable use of the natural resources. This happens through a process of consulting a wide range of population in order to improve the sustainable livelihoods. DEFINITION OF THE MBC ( SUMMARY)

19. COMPONENTS OF THE MBC – The Project I. Strengthen the Institutional Capacity of Management of the MBC. II. Strengthen the Sustainability Conditions of the MBC. III. Establish construction processes for Local Biological Corridors, focusing on the border areas.

20. CCAD - Central American Commission for the Environment and Development Agendas (1) Green(2) Grey Biodiversity, EGS Envir. Benefits Clean Production/ Pollution Envir. Costs Economic Instruments for the Conservation in the Mesoamerican Biolgical Corridor MBC

21. MESOAMERICAN BIOLOGICAL CORRIDOR Map Source: DCW, 1975 ; CIAT, 1998; USGS, 1995 RESERVA DE LA BIOSFERA MAYA GOLFO DE HONDURAS SOLIDARIDAD CAYOS MISQUITOS TRIFINIO GOLFO DE FONSECA BAHIA DE SALINAS SIAPAZ PILA GANDOCA-BOCAS RB DARIEN Priority Areas of the Central American Protected Areas System

22. OBJECTIVES General:  Analyze and make available the results from the efforts in Economic Valuation of the Natural Resources in the Region and the Establishment of Payments for the Use of the Environmental Goods and Services. Specifics:  Introduce the concepts and methodologies in economic valuation of the natural resources and the establishment of Payments for the Use of the Environmental Goods and Services.  Describe the process of negotiation between the supply and the demand of the natural resources, in order to establish the Payments for the Environmental Goods and Services (PES) (key players, environmental funds, environmental commission, environmental legislation).  Determine the economic viability of the implementation of the Payments for the Environmental Goods and Services (conservation of the biodiversity).  Present some successful experiences of PES in Central America.

23. Environmental Goods – Tangible Products of hte Nature (Row materials) Environmental Services – Ecosystemic Functions that benefit Humans - Water for Domestic use -Water for the Agriculture -Water for Industrial use - Wood - Medicine Plants - Firewood - Seeds - Food - Plants y Fruits - Other products of the forest - Biological raw material - Flora and fauna - Handicraft - Cattle - Agricultural products. - Underground water supply - Soil water retention - Soil protection - Carbon sequestration - Flood control - Erosion control - Nutrients retention - Landscape attraction - Watershed protection ENVIRONMENTAL GOODS AND SERVICES THAT GENERATES AN ECOSYSTEM

24. Crops Natural Protected Areas Natural Forest Plantations Communities Private lands Natural Protected Areas Private lands Plantations GEOGRAPHIC DISTRIBUTION OF THE NATURAL RESOURCES (ENVIRONMENTAL GOODS AND SERVICES)

25. ENVIRONMENT - Ecosystem -Protected Areas -Watershed ECONOMICS Wastes: Impacts, Externalities Environmental Goods and Services Decision making Extraction Transfor mation Benefits Costs Consumption Production Costs (PC)Distribution Costs (DC) Contamination Costs (CC) Environmental Costs (EC) = Depreciation Costs + Reposition and Recycling Costs Benefits > Costs (Costs = PC + DC + CC + EC) USE OF THE ENVIRONMENTAL GOODS AND SERVICES COST/BENEFIT ANALYSIS

26. Achieve an environmental management system: A) Internalize the Environmental Costs: With the Cost/Benefit analysis find out if Benefits are higher than Costs. B)Costs Reduction: Cost/Efficiency analysis to achieve the productive goals at the lowest costs possible. Economic viability and competitiveness CONSERVACION: Management and use of the biodiversity, guaranteeing the higher and most sustainable benefits, without endangering its potential for the future generation. It implies activities such as protection, maintenance, sustainable use, restoration and improvement of the environment.

27. TOTAL ECONOMIC VALUE Direct Use Value Indirect Use Value Use ValueNon Use Value Option ValueExistence Value - Species - Habitat Conservation - Biodiversity Protection - Pharmaceutics Potential - Recreational Potential -Wood -Firewood - Food products - Handicraft - Water supply -Landscape and - Tourism - Medicines -Construction materials - Raw materials - Research - Education -Plant and Animal Species - Endangered Species - Esthetic Value - Cultural and Historical Values - Flood Control - Disaster Prevention - Erosion Control - Nutrients Retention - Water Quality - Habitat - Oxygen Production - Carbon Sequestration - Watershed protection VET=VUD+VUI+VO+VE TEV= Total Economic Value DUV= Direct Use Value IUV= Indirect Use Value OV = Option Value EV= Existence Value

28. Methodologies Effects measuredValuation bases A) Objective Valuation 1. Change in ProductivityProductivityTechnical/physical Assumed behavior 2. Health CostsHealth (Desease) Technical/physical Assumed behavior 3. Human CapitalHealth (Deth) Technical/physical Assumed behavior 4. Replacement CostsCapital, Natural Resources Technical/physical Assumed behavior Economic Valuation Methodologies

29. B) Subjective Valuation 1. Preventive and Mitigation Costs Health, Productivity, Capital, Natural Resources Revealed behavior 2. Hedonic Prices Property Values Wage Differential Environmental quality Health Revealed behavior 3. Travel CostNatural Resources qualityRevealed behavior 4. Contingent ValuationHealth, Natural Resources quality Revealed behavior

30. X Px EXTERNALITIES Private Marginal Cost - Supply Social Marginal Cost – Negative Externalities Social Marginal Cost – Positive Externalities Price Reduction Price Increment Demand

31. BENEFITS FOR THE ECONOMY

32. SERVICIO AMBIENTAL OWNER Local Mechanisms COUNTRY National Mechanisms THE WORLD International Mechanisms Sustainable Wood Production  Water for different use  Landscape  Biodiversity  Carbon sequestration  BENEFITS DISTRIBUTION AND IMPLEMENTATION OF THE ECONOMIC MECHANISMS FOR THE ENVIRONMENTAL GOODS AND SERVICES PAYMENTS 

33. PHYSICAL INDICATORS ECONOMIC INDICATORS SOCIAL AND ECONOMIC ASSESMENT ENVIRONMENTAL AND ECONOMIC INDICATORS

34. ECONOMIC VALUATION METHODOLOGIES Costs Benefits

35. Damage by each additional unit of contamination Cost for each unit of contamination mitigated Costs Contamination MITIGATION COSTS FOR THE NEGATIVE IMPACTS (EXTERNALITIES) Q2 Q1 C2 C1

36. LA NEGOCIACIÓN – SITUACIÓN “TODO EL MUNDO GANA (WIN-WIN SITUATION) Up the RiverUp the River Down theRiverDown theRiver $ Q equilibrium Q2Q1Q0 Level of Production and Level of Contamination A B Benefits for each additional unit of commodity Costs for each additional unit of contamination

37. ECOSISTEM SUPPLY Owners of the Natural Resources DEMAND Consumers Charging Consumers Paying the Owner of the Natural Resources Environmental Services Commission PES: - Fees - Environmental Taxes - Trading Permissions - Licenses - Penalty, etc. Environmental Fund Paying the Nature PAYMENTS FOR ENVIRONMENTAL SERVICES (PES)

38. BASIC PROCEDURES FOR ESTABLISHING PAYMENTS FOR ENVIRONMENTAL SERVICES Identify the consumers of the Environmental Goods and Services (the Demand). Physical and economic quantification of the Demand. Identify the owners of the Environmental Goods and Services (the Supply). Physical and economic valuation of the Demand. Determine and characterize the geographic area where the PES will be implemented. Determine the Investment and Costs required for implementing activities for sustainable management of the Environmental Services considered. Economic valuation of the Environmental Goods and Services: Quantify in monetary terms the Supply and Demand.

39. Establishing economic mechanisms for capturing financial resources (establishing the Payments for Environmental Services). Form the Environmental Services Commission. This commission will be in charge of monitoring the process of implementation of the PES. Establishing the Environmental Fund. Based on negotiations, agreements are achieved and there will be contractual relationship between Owners and Consumers. Hire experts who will provide technical assistance on activities required for the conservation of the Environmental Goods and Services (Technological changes – Environmental Management System). Certification of the Environmental Management System proposed. Monitoring the Environmental Management System implemented and the PES established.

40. BASIC FUNCTIONS OF THE ENVIRONMENTAL SERVICES COMMISSION Help negotiation process between owners and consumers. Monitor the transparent use of the Environmental Funds. Involve different sectors of society into the Conservatión Effort proposed through the establishment of PES. Coordinate activities with Certification Experts. Coordinate activities con Experts on Technical Assistance.

41. Environmental Problem Needs Demands EV Study and other technical studies Economic Mechanism Proposal Negotiation Environmental management policies change Implementation Training The Process of establishing the PES Programme

42. THANK YOU