The Subsidiary Body on Scientific, Technical and Technological Advice
PROPOSALS FOR THE DESIGN AND IMPLEMENTATION OF INCENTIVE MEASURES
(a) Local and regional knowledge, geography, circumstances and institutions;
(b) The mix of policy measures and structures in place including sectoral considerations;
(c) The need to match the scale of the measure to the scale of the problem;
(d) The measures' relationship to existing international agreements.
A. Identification of the problem: purpose and issue identification
C. Provision of capacity and building of support: facilitating implementation
D. Management, monitoring and enforcement
E. Guidelines for selecting appropriate and complementary measures
(a) Any decision-making process for selecting appropriate and complementary measures should take into account the specific circumstances of the country involved;
(b) It is important to consider the context in which the incentive measure is being introduced to assist final decision-making on a particular measure or measures;
(c) A key consideration in the design of an incentive measure is the recognition that a single measure will often not suffice to address the complexities involved in decisions on biodiversity conservation or sustainable use, and that a mix of measures may be needed;
(d) Equity considerations, such as poverty alleviation, should be given a prominent role in the design and selection of appropriate incentive measures;
(e) The implementation of incentive measures should not result in a significant increase in the cost of living and/or increase in revenue to government;
(f) The size of the country's economy is an important factor in the selection of financial incentive measures;
(g) Well defined land and property rights are an important factor in the design and implementation of incentive measures in the conservation of biological diversity and the promotion of sustainable use;
(h) Positive incentives can influence decision-making by Recognizing and rewarding activities that are carried out for conservation and sustainable use purposes;
(i) The removal of perverse incentives eases pressure on the environment. The identification of both internal and external perverse incentives and other threats to biodiversity conservation and to the promotion of sustainable use, is essential to the selection and design of incentive measures. The removal of perverse incentives may improve economic efficiency and reduce fiscal expenditures;
(j) Disincentives continue to be an important tool for ensuring the conservation and sustainable use of biological diversity and can be used in combination with positive incentives.
Maximize economic efficiency
Rely on measurability of single components and on agreement about external cost values.
Can require extensive monitoring.
Applicable in situations where impacts are easily measurable (e.g., hunting) and sources of impacts can be easily mounted.
Result in the most efficient allocation of resources between competing users, and generates appropriate prices for them
Low monitoring requirements
May be imperfect where there are (large) external effects and/or monopolies.
Applicable where clearly defined property rights can be established and upheld for easily identifiable goods and services, and transaction costs are low enough.
Removal of perverse incentives
Reforming or removing these incentives can lead to an easing of pressures on the environment, improved economic efficiency and reduced fiscal expenditures.
Perverse incentives can often be difficult to identify (lack of transparency)
They may be politically difficult to reform because of the strong opposition from recipients.
Applicable where clear benefits in terms of budgetary, economic efficiency and/or environmental goals can be identified and potential compensatory measures exist to facilitate the support removal process.
Can target directly particular activities or processes.
Can be economically inefficient or costly method of achieving environmental goals, especially if proscribing certain technologies.
Strict enforcement is necessary.
May be complex and detailed.
Most applicable where there is a limited range of easily identifiable environmental impacts that need circumscription and/or where the number of actors is limited.
Transparent and high visibility.
Positive public relations.
May not maximize economic efficiency.
May be inflexible because funds are earmarked to some extent.
Applicable where governments have difficulties raising general funds, where fiscal infrastructure is weak and where clearly identifiable and highly popular causes exist.
Popular with recipients.
Promotes desirable activities rather than prohibiting undesirable ones.
May lead to economic inefficiencies.
May encourage rent-seeking behaviour.
Applicable in situations where desirable activities would not be undertaken without support or to create a differential in favour of such activities where it is not feasible to discourage the undesirable alternatives.
SUGGESTED RECOMMENDATIONS FOR FURTHER COOPERATION ON INCENTIVE MEASURES
The involvement of stakeholders including indigenous and local communities
Interlinkages between multilateral environmental agreements (MEAs)
Linking biodiversity to macro-economic policies
Categories of incentive measures
Role of international organizations