CHALLENGE
Governments are increasingly aware that REDD+ frameworks will need to include benefit sharing mechanisms that promote social and environmental safeguards while seeking full and effective participation of indigenous peoples and local communities (as stated in UNFCCC Decision 1/CP.16 adopted at COP16 in Cancun in December 2010). How to design and establish REDD+ frameworks and policies in countries while guaranteeing equitable benefit sharing mechanisms and adequate incentives for REDD+ purposes, however, is less clear and a significant challenge for countries trying to get ready for REDD.

APPROACH
The experience of payments for environmental services (PES) systems set up in Costa Rica, Mexico, and Ecuador in the last decade provide valuable inputs for shaping REDD+ strategies in participating countries in the Latin America and Caribbean region. Costa Rica has implemented a nationwide PES program since 1997; Mexico since 2003; Ecuador since 2008. Between them, these programs are currently helping to conserve over 3 million hectares of forests. Their experience shows how to make PES work, but also -- problems to avoid.

This activity supported by PROFOR will help share technical lessons from PES for REDD+ within the context of a South-South learning exchange initially limited to the REDD+ countries in the region. 

Although the challenges related to the appropriate design and implementation of REDD+ go beyond those of PES schemes, the PES experience in these three countries could provide insights on many of the core elements of a future REDD+ strategy. The lessons fall into five areas: 

1. Participation agreements

2. Equity or social objectives

3. Trade-offs and synergies between multiple (ecosystem) benefits

4. Measuring, reporting and verification (MRV)

5. Sustainable finance and administrative costs

RESULTS

The lessons of payments for environmental services systems set up in Costa Rica, Mexico, and Ecuador were identified and discussed in a participatory fashion, that has gradually created a regional and global community of experts around PES/REDD+ issues.  

In the process, participants identified and captured twenty-nine lessons, now available in reports in English, Spanish and French on this page.

Some of the lessons gathered under the header "Sustainable Finance in PES and REDD+" include for example:

• Diversify funding sources and duration of contracts to reduce risks.
• Enable legislative framework to engage the private sector: Use public funding during formulation, preparation and during first phases of implementation, then a combination of incentives/market funds to attract the private sector.
• Clearly define objectives and baselines, and use adaptive management techniques to improve targeting: Avoid if you can “post-modeling” baselines. Try “ex-ante” baselines if you can. Most PES schemes are now “post-modeling” which is costly and not the best choice.
• Explore options to control administration costs: Strengthen current institutions and technical teams instead of setting new ones or depending exclusively on external consultants 

The sharing of lessons across borders has helped attract interest from other partners such as FCPF and the World Bank Institute and extended the reach and longevity of these lessons. For example, six webinar sessions co-organized by the World Bank Institute and “Finanzas Carbono” attracted about 1,200 participants.

Through outreach and back to back presentations to the participants committee of the FCPF, the policy board countries of UN REDD, the Partners of the REDD+ Partnership, countries of Forest Eleven and Finanzas Carbono, the activity has reached approximately 54 countries including many countries preparing national REDD+ strategies.  Time will tell if countries will make use of PES lessons in the design of their respective REDD+ strategies when they submit their REDD+ preparation plans for evaluation in 2014-16.