E N V I R- O N M E N T D E P A R T M E N T DISSEMI-NATION NOTES TOWARD ENVIRONMENTALLY AND SOCIALLY SUSTAINABLE DEVELOPMENT Number,56 April 1997 Sustaining Natural Resources Through Community Management: A Framework for Action Community management of natural resources can be promoted by providing an incentive environment to help ensure the flow of benefits to communities through the establishment of regulated access and rational management of common property natural resources. Clarification of the rights and responsibilities of community groups and measures to improve market effectiveness provide a necessary foundation for this incentive envinnment. In addition; measures to promote economic rationality for resource use and the provision of tangible incentives are, needed to help motivate community groups. Accordingly, state agencies should help ensure efficient support services and a facilitating atmosphere and that all the necessary elements of the policy framework are integrated to create a favorable incentive enviro*iment for community management. Emerging empirical evidence indicates an This will help motivate community groups to immense potential for collective regulation in establish regulated access to ensure that the supply preventing environmental degradation and of products is governed by the sustainable managing natural resources sustainably. The productive capacity of the resource. Market community management approach holds a special demand should then be reflected in reasonable promise for areas where the pressure on resources prices providing stimulus for increasing has gradually become excessive and unregulated production. The higher the scarcity, the higher will open access use is hastening degradation. The be this stimulus. critical consideration is to determine what policy In addition to policy measures that enable- measures can motivate local communities to collective regulation and improve market institute effective regulation over the access and effectiveness, measures to' promote 'economic use of resources. Ideally, development approaches rationality for natural resource use through and policy options should encourage the interest mechanisms such as user fees are desirable to of community user groups in adopting-the encourage efficient use. Additional incentives collective and rational management of natural may be required to change behavior from present resources. patterns of use-especially where-resource The fundamental premise of collective action conservation or management'demands restrictions is that benefits should accrue to all members of a on extraction. Community groups will also require group committed to collective action rather than efficient support services to make improved to individuals trying to maximize their own technology available and improve their capacity benefits at the cost of other members. Recognition for resource management and establishing of the exclusive rights of community user groups regulation. These broad issues form the essential over the local resources is the first necessary step components of an enabling framework for to ensure that the benefits from rational man- community management of natural resources agement will flow to the community members. (box 1). & This note was prepared by Nihal C. lain, Deputy Conservator of Forests, Udaipur, Rajastfian, India. The author gratefully acknowledges the assis*ance provided for this work by Colin Rees (Division Chief; Land, Waler, and Natural Habitats Diision). John Dixon (Unit Chief; Indators and Ervirovnmental Valuation Unit), and the support of David Cassells (Forest Resources Specialist; Land, Water. and Natural Habtats Dnisisn) all of the World Bank- Copies are available from the Land, Water, and Natural Habitats Divisaon. Environment Department. The World Banik Washxgtwi. D.C 20433, Fax (202) 477-068. Dissemmatiou Notes represett the views of their authors and are not official publications of the WorLd Bank ( Box 1 external users. Nevertheless, it should be ensured Enabling Framework for Action that social-territorial groups control conflicts with other neighboring or traditional distant users. 1. Enabling collective regulation Mutual relationships and traditional use patterns 2. Improving market effectiveness should be given -adequate consideration in 3 ,Promoting economic rationality deciding exclusive rights. Another important role 4. Providing incentives for positive action . 4. Providing eiientivespfort osiivies actionfor the state lies in monitoring community control of resource extraction and management according to accepted regulations. Building the capacity of Enabling Collective Regulation commnunity groups through pluralistic extension approaches and providing greater autonomy and Several successful examples indicate the great legal recognition to adjudicate differences within potential, for community user groups in estab- groups helps in strengthening community regu- lishing effective control and regulation over the lation. However, for resolving conflicts amon,g the use of natural resources and ensuring sus-' community groups, a greater role has to be played tainability. Because acceptability of community by the state and/or other extemal agencies whose regulation is greatly facilitated by effective social legitimacy and impartiality is recognized by the relations, the user groups should be predicated community groups. on social-territorial relationships rather than geographical, administrative or political units. Improving Market Effectiveness, The variety of mechanisms adopted by community groups in different sociocultural The market could be said to be effective where circumstances indicate that the groups should all the actors are fully informed of the various have the maximum possible autonomy in processes and their associated costs as the deciding appropriate mechanisms for the control produce goes from the producer to the final and regulation of resource use and management. consumer and theforces of demand and supply The rights of the community groups should are fully operational. Once the control and include legal access to resources, usufructs and regulation over resource extraction is established, benefits frdm management and the choice of an effective market,would stimulate measures for deciding appropriate management strategies * maximizing production by communities as well within the agreed framework. as private entrepreneurs. Nevertheless, markets The rights of community groups should for most of the natural resource products are always be linked with responsibilities for commonly highly distorted or exploitative,- desirable management outcomes or, in other providing minimal share of the market profit to words, a promise for "good husbandry." The the producers. This is largely due to lack most important responsibility of the community. of appropriate marketing information, infra- groups is to convert "free-riding" into "regulated structure, marketing capabilities, marketing access" which includes protecting the resource research and other regulatory measures. Since the from illicit use. Assuring an equitable distribution rural producers are generally the least informed of benefits among the members, ensuring about the marketing practices, a marketing recovery of the degraded resources and accepting information system geared to the needs of the responsibility for the sustainable management of local communities has immense potential in the resources in the future should also be included motivating the rural producers.. in the responsibilities- Non-conversion of land Market failures alsp result fromn the lack of for other purposes, particularly encroachment by, clarity of rights and responsibilities, unwanted individuals and promises to eliminate destructive regulations and restrictions, incentive or use of the resources in any manner (for example, disincentive measures biased towards certain undesirable induced fire) could be a part of the actors and other inappropriate policy and conditions for "good husbandry." administrative measures. Excessively high The most important role 6f the state lies in subsidies provided to industries and providing legal recognition to the rights of the concessionaires ultimately affect the rural local groups, including the rights to exclude producers. Monopolized purchasing rights for many of the products have also resulted in collection of such user fees by communities for noncompetitive prices. redistribution among themselves for inrdividual Caution is also required in depending too orccimmunity use may offset this limitation. To much on market regulations because of the impact avoid adnministrative problems and make the user of policies in several other sectors on the prices fee-system relevant in 'the local context, the of natural resource products. The impact of responsibility should be devolved to local technological changes, the long gestation periods comrnmunities for deciding the amounts of user for many of the natural resource products, fees, mechanisms of collection and forms of such unpredictable weather and the seasonal nature-of fees and the use of the collected amounts for production also make it difficult to get timely community use or redistribution among the response to d e m a n d and supply fortes. Careful members of the community. User fees could also consideration of all the external factors should be paid as part of the produce, not all the products help in deciding appropriate policy measures to and uses may be included under the user fee net. avoid the adverse impacts of market forces. Providing Incentives for Promoting Economic Rationality Positive Action One_ of the mo§st important reasons of Afavorablepolicyenvironmentprovidesthe excessive exploitation of common property foundation for stimulating sustainable manage- natural resources is the-absence of assuming of ment of natural resources. However, additionAl costs other than the cost of labor and transport. incentives may be required for changing behavior Introducing some form of cost or user charges will from present patterns of destructive use. This is promote economic rationality in use. In response specially important for degraded areas, where to autonomy and user rights granted to local there may be very little to exploit during the communities in return for the assurance of process of recovery and for conservation areas, protection responsibilities, many of the local user where exploitation needs to be severely restricted. groups have started internalizing the cost of In extremely degraded areas, restrictions on protection and soSme other management activities extraction often make it difficult even to meet (box 2). The mechanisms include patrolling people's basic minimum needs. In such cases, through rotational watch by co'mmunity subsidized external supplies, providing alter- members, contributions in kind or cash, user native employment opportunifies and supple- charges and penalty systems. mentation by artificial regeneration measures The mechanism of user fees -has several may be used as effective incentives during the potential advantages such as encouraging early phases of resource recovery. Matching conservative use of resources, correcting market grants linked to performance, could also be an imbalances by its effect on product prices and effective means of providing incentives. increasing the commercial viability of production In c,onservation areas where exploitation on the otherwise fully or partially unused lands. needs to be substantially restricted, the role of The destruction of natural resources under open additional incentives is even more crucial. The access commonly advances with the growth of most commonly used incentive strategies include urban demand centers. Frequently, the areas in providing benefits from ecotourism, creating the vicinity do not remain commercially viable employment opportunities in conservation area because of availability of produce from common management activities or providing other social and state property resources from even farther services. However, often such benefits are areas at much lower prices. Introduction of available only for a short period and the appropriate user charges helps to correct this distribution of benefits is also uneven. situation. One of the options to ensure sustained The institution of user fee mechanisms has benefits to loc-al communities from the several practical problems, particularly for widely conservation of resources could be by providing dispersed natural resources accessed by a large - payment for conservation services and reducing-_ population. Collection of charges from the rural the role of the development agencies to poor having high dependency on local resources monitoring and setting appropriate standarcds. may appear to be a very harsh measure. However, The funds for such payments could come from Box 2 Local Initiatives for Inducing Cost to Resource'Use With the devolution of responsibility to community groups by development agencies or acquisition of self-initiated responsibility by community user groups in recent years, many user groups have instituted a variety of mechanisms which involve sharing of some of the costs of using and managing the resources. * In eastern India, thousands of self-ilnitiated local community groups have started user fee and penalty systems, including contribution in,kind or labor. For detailed information see M. Poffenberger (1996) "Grassroots Forest Protection: Eastern Indian Experiences." Research Network Report Number 7 of Asia Forest Network, March 1996. * In Harda a division in central India, nearly 100 participating local committees collected Rs.1.7 million in just three years through user fees, fines, and other charges. See the details of the Harda case in S. Singh, 1996. "India." In: Ernst Lutz and Julian Caldecott,-eds. Decentralization and Biodiversity Conservation. * Extraction of produce from the rehabilitated microwatershed areas in southern Uttarpradesh in India 'LS regulated by.local communities using a fee system. Some of these communities have also used measures to auction the produce for full cost internalization. The community groups operate a micro-credit system from built up comrnmunity funds. See C.R. Hazra, D.P. Singh, and R.N. Kaul, 1996. Greening of Common Lands in Ihansi through Village Resource Development: A Case Study. Society for Promotion of Wastelands Development, New Delhi. * In Nepal, user fees, membership fees, contribution in kind or labor and system of fines have long been existent and these mechanisms are becoming popular again with the handing over of responsibility to user groups. A recent review provides-evidence of several mechanisms. See D.R. Dahal, 1994. A Review of Forest User Groups: Case Studies from Eastern Nepal. International Center for Integrated Mountain Development, Kathmandu, Nepal. * InThailand, user fees and fines are administered by many local community groups to regulate extraction by members. SeeM. Poffenberger and B. Mcgean, 1993. "CommunityAllies: Forest Co-management in Thailand." Research Network Report No. 2. Southeast Asia Sustainable Forest Management Network, Center for Southeast Asia Studies, University of California, Berkeley." the income derived from the park management of the communities and market rel.ated through a well-managed ecotourism program. It information. Community management of could also be from a tax levied on the dependent resources is essentially a group process and tourist industry or on polluting industries to therefore extension approaches need to be compensate for the greenhouse gas emissions. centered around the groups rather than being Costa Rica provides an excellent example of individually oriented. having set up a special fund for this purpose built Capacity building is a gradual process and from a surcharge levied on fossil fuel. - persistent and intensive efforts are necessary. The state agencies will have to play a greater role in Ensuring Efficient Support Services the beginning by providing and improving State agencies will have to help protect the support services. Involvement of nongovern- rights of local groups and ultimately to establish mental organizations would be helpful in this effective regulation. Quality research and process. Gradually greater involvement of technological improvements may also assist inl private agencies should be ensured particularly promoting suitable measures for improving wherl, in response to clear- recognition of rights production. Extension services a're impor- and responsibilities, communities inten?sify their tant for disse ninating technological information efforts for increasing production and their for better management and improving pro- demand for technological and managerial duction. These services are equally important assistance increases. Support for building the for generating awareness about new policy and capacity of private and nongovernment service incentive measures, the rights and responsibilities providers may also be necessary. ® Printed on 1 00% poet-consumer recycled poper