With proper management and the incentives that come with control and accountability, ecosystems could generate enough income to lift the rural poor out of abject poverty, says a new report by the World Resources Institute
Ecosystems are, or could be, the wealth of the world’s poor who have few other material assets, stresses a new report entitled ‘World Resources 2005: The Wealth of the Poor: Managing Ecosystems to Fight Poverty’. For many of the 1.1 billion people living in severe poverty, nature has always been a daily lifeline, says the report. This is especially true for the rural poor who comprise three-quarters of all poor households worldwide.
According to the 254-page report on the health of the world’s environment, conventional models for poverty reduction and economic growth may have worked well for urban populations but they have done little to help the rural poor who make up around 75% of the nearly 3 billion people who live on less than two dollars a day.
The biennial report, from the Washington-based think tank, World Resources Institute, stresses the urgent need to look beyond aid projects, debt relief and trade reform, and focus on local natural resources to address the crisis of poverty all over the globe.
The focus of ‘World Resources 2005’ is that income from ecosystems — what the report calls ‘environmental income’ — can act as a fundamental stepping-stone in the economic empowerment of the rural poor. This requires that the poor manage ecosystems so that, over time, they support stable productivity. Productive ecosystems are the basis of a sustainable income stream from nature.
But for the poor to tap that income they must be able to reap the benefits of their good stewardship. Unfortunately, notes the WRI report, the poor are rarely in such a position of power over natural resources. An array of governance failures typically intervene, such as lack of legal ownership and access to ecosystems; political marginalisation; and exclusion from the decisions that affect how these ecosystems are managed.
Without addressing these failures, there is little chance of using the economic potential of ecosystems to reduce rural poverty. The report attempts to highlight the vital role of ecosystems and their governance — of nature and power — in poverty reduction.
Ecosystem management, democratic governance and poverty reductionare each essential elements of sustainable economic growth. Moreover, they are inextricably linked — more than 1.3 billion people depend on fisheries, forests and agriculture for employment, close to half of all jobs worldwide. This dependence of livelihoods on natural systems is nowhere more important than among the rural poor.
Nature has always been a route to wealth — profits from harvesting timber and fish stocks, converting grasslands to farm fields, and exploiting oil, gas and mineral reserves have created personal fortunes, inspired stock markets and powered the growth of nations for centuries.
But this scale of natural resource wealth has been amassed mostly through unsustainable means, and the benefits have largely accrued to the privileged. It is the powerful who generally control resource access through land ownership or concessions for logging, fishing or mining on state lands; who command the capital to make investments; and who can negotiate the government regulatory regimes that direct the use of natural resources. The poor, by contrast, have reaped little of the total wealth extracted from nature. But that can change, says the WRI report.
Maximising environmental income for the poor requires changes in the governance of natural resources. The need for such change is pressing because the poor are at a great disadvantage when it comes to controlling natural resources or the decisions surrounding them.
Natural-resource corruptionfalls harder on the poor as well; they may be the victims of bribe-demanding bureaucrats or illegal logging and fishing facilitated by corrupt officials who look the other way. The poor are also subject to a variety of policies that are effectively anti-poor.
These governance burdens make it hard for poor families to plan effectively, to make investments that might allow them to profit from their assets or skills, or to work together effectively to manage common areas or create markets for their products. In other words, governance burdens quickly translate to economic obstacles.
Now, more than ever, national governments, international institutions and donors are focused on poverty reduction. But they have paid limited attention to the role of healthy ecosystems in providing sustainable livelihoods, and equally limited attention to the importance of environmental governance in empowering the poor. The models for economic growth that nations continue to rely on for poverty reduction -– job creation through increased industrialisation, intensified large-scale agriculture, industrial fishing fleets, and so on — do not fully appreciate the realities of rural livelihoods.
For example, these strategies miss the basic fact that if ecosystems decline through poor governance, the assets of the poor decline with them. Findings from the recently concluded Millennium Ecosystem Assessment, a five-year effort to survey the condition of global ecosystems, confirm that the burden of environmental decline already falls heaviest on the poor. This often results in an immediate drop in living standards and a descent into greater poverty, which, in turn, precipitates rural-urban migration or a resort to unsustainable environmental practices such as overfishing, deforestation, or depletion of soil nutrients, for the sake of bare survival.
For this reason alone, says the WRI report, simply to prevent an increase in poverty greater attention must be paid to ecosystem management and governance practices that serve the poor. The promise that the environment can be one of the engines of rural growth is all the more reason to keep the environment as a focal point in poverty reduction efforts.
Ecosystems and rural livelihoods
While ecosystems provide all the necessities for human survival, and rich, poor, rural and urban peoples all depend on the goods and services that ecosystems provide, the rural poor have a special relationship with them because they provide them with livelihoods.
Ecosystems have several characteristics that make them attractive as a source of income: environmental resources are renewable, widespread and are often found in common property areas that can be accessed by the poor without them having to own the land. In addition, natural systems often can be exploited with little need for investment or expensive equipment, making the cost of entry low — an important consideration for poor families with limited assets.
Much of the environmental income earned in the developing world comes from common pool resources (CPRs). Common pool resources are forests, fisheries, reefs, waterways, pastures, agricultural lands and mineral resources that no individual has exclusive rights to. They are typically owned and administered by the state, village, tribe or other social grouping, with the idea that the benefits will accrue to many people rather than one person or family. Because these ‘commons’ or ‘public domain’ lands are such a rich source of environmental income, they are a crucial element in the livelihood strategies of the poor, particularly those who do not own land themselves.
Richer families (not necessarily by developed world standards, but those with a greater relative level of wealth and opportunity compared to lower income households within the same community) also make extensive use of income from ecosystem goods and services. In fact, several recent studies have shown that the rich commonly derive more environmental income, in absolute terms, than do the poor. This generally reflects the fact that they have greater ability to exploit what ecosystems can provide.
On the other hand, even if the rich capture greater environmental income they tend not to be as dependent on such income as the poor are. Environmental dependency and poverty seem to go hand-in-hand. A 1999 study of 12 Himalayan villages found that the poor relied on natural resources for 23% of their income, compared to only 4% for the rich. The poor and the rich also tend to use natural resources differently to derive income. While the poor tend to pursue a variety of different sources of environmental income, the rich often concentrate on one or two that allow them to make use of their greater assets for agriculture or livestock rearing.
The continued dependence of the poor on ecosystems for their livelihoods stems from several factors, but these generally reduce to the fact that nature is their best — and often only — option since they often lack the education and social access to find consistent wage labour.
Environmental income is critical to the survival of the poor within the typical rural economy in developing countries. On average, income from small-scale agriculture and the collection of wild products such as non-timber forest produce together account for some two-thirds of the household incomes of families in poverty. Without income from ecosystem goods and services, rural poverty would unquestionably be deeper and more widespread — a lesson to remember as the pace of ecosystem degradation picks up worldwide.
But as important as environmental income is to the poor today, it is typically not used as a route out of poverty. Usually, the poor use environmental income more as a support for current levels of consumption or as a safety net to keep from falling further into poverty. They generally do not have the means or empowerment to use environmental income as a tool for true wealth creation.
“Traditional assumptions about addressing poverty treat the environment almost as an afterthought,” says Jonathan Lash, president of the World Resources Institute. “This report addresses the stark reality of the poor: three-fourths of them live in rural areas; their environment is all they can depend on. Environmental resources are absolutely essential, rather than incidental, if we are to have any hope of meeting our goals of poverty reduction.”
Dozens of case studies detailed within ‘ World Resources 2005’ demonstrate how local stewardship of nature could be a powerful means of fighting poverty. The case studies, which include wildlife management in Namibia and Tanzania , fisheries restoration in Fiji , and watershed management in Maharashtra , India , can be replicated elsewhere, including poor rural communities in developed countries, says the report.
“Community stewardship of local resources should be a critical element of any poverty-reduction model,” says Olav Kjørven, director, Energy and Environment Group, Bureau for Development Policy, United Nations Development Programme (UNDP). “With greater income from the environment — call it ‘environmental income’ — poor families experience better nutrition and health and begin to accumulate wealth. In other words, they begin the journey out of poverty.”
Klaus Toepfer, head of the United Nations Environment Programme (UNEP), says the study clearly demonstrates “the importance of healthy forests, marine environments, freshwaters and other key ecosystems for meeting internationally agreed development targets…In the past, the environment has been viewed as something like a Hermes silk tie or a Gucci handbag — a luxury only affordable when all other issues have been resolved”.
“This World Resources Institute (WRI) report, allied with a series of other new and authoritative studies released over recent months such as the Millennium Ecosystem Assessment, overturns this myth and underlines in graphic detail the importance of ‘nature’s’ natural capital alongside financial and human capital,” he added.