Think PINC Chiribiquete

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THINK PINC

CHIRIBIQUETE

Financing

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About the Global Canopy Programme

The Global Canopy Programme is a tropical forest think-tank focused on accelerating the world’s transition to a deforestation-free economy. Our team of policy experts, researchers, communicators, and support staff is based in Oxford, and works closely with networks of decision-makers in the inancial sector, corporations, government and civil society across the world. We are dynamic, determined and creative in pursuit of 3 high-level objectives: (1) To grow the forest-friendly economy (2) To end the global market for deforestation (3) To account for impacts and dependencies on forests.

To ind out more about GCP’s work visit www.globalcanopy.org or write to info@globalcanopy.org

About the FCDS

FCDS is an environmental NGO focused on providing technical support to governments, civil society and private sectors in sustainable development strategies and land-use regulation. The FCDS team have experts in different areas such as: anthropology and cultural heritage, protected areas, GIS and mapping, socio-environmental conlict resolution, and management of territorial conlicts.

Citation

Lead author: Alexandra Pinzon

Contributing authors: Angelika Müller, Gleice Lima, Helen Bellield, Jacqueline Wagnon, Nick Oakes, Rachel Pasternack

Please cite this publication as:

Pinzon, A. et al. 2015. Think PINC: Chiribiquete. Global Canopy Programme.

Acknowledgements

We would like to thank the Fundación para la Conservación y el Desarollo Sostenible and Parques Nacionales Naturales de Colombia for their important guidance and feedback in producing this report.

Funding

This report has been funded by Fondo Patrimonio Natural (http://www.patrimonionatural.org.co), Parques Nacionales de Colombia (http://www.parquesnacionales.gov.co), and the Gordon and Betty Moore Foundation (http://www.moore.org).

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The Chiribiquete National Park and surrounding

buffer zones are strategically important areas

for conservation and sustainable land use. These

areas, spanning both the Amazonian rainforest and a key biological corridor leading to the Andes, are under increasing pressure from the expansion

of the agricultural frontier, the development of hydrocarbon reserves in or very close to the areas, and infrastructure development such as hydropower

plants and roads.

Armed conlict has also played a signiicant role in creating environmental pressures in this area.

According to the OECD, land tenure uncertainty for indigenous populations, illegal land grabbing

because of armed conlict and the consequent displacement of more than 8% of the population, have concentrated lands in the hands of a narrow clique of landowners (OCDE, 2014).

Many habitats - including parks and reserves - are located in zones affected by conlict and drug traficking. As a result, these zones sit outside of surveillance efforts and the enforcement of environmental regulations. This is a major reason why, for example, between 40% and 50% of timber is felled illegally and commercialised (OCDE, 2014).

Exacerbating these pressures is the fact that public

expenditure on environmental protection is low in

comparison to other OECD Countries at a similar

stage of development, which prevents authorities from adequately implementing their tasks.

Meanwhile, private expenditure on environmental

protection is only partially monitored and contributions from key sectors linked to

deforestation are not assessed (OCDE, 2014).

1. The Issue

Fig.1 Chiribiquete National Park and buffer zones

To counter this wave of pressure on the areas surrounding the Chiribiquete National Park, the Territorial Sustainable Land Use Plan (TSLUP) is being developed as a means to proactively invest

in natural capital. If this plan is going to succeed

in conserving ecosystems whilst also ensuring that regions can develop in a sustainable way, it must demonstrate that sustainable development is better than business as usual (natural resource extraction, deforestation, etc.). To do this requires making upfront capital investments in sustainable development, and generating a long-term inancial

return that is dependent upon the sustainable use of the land and forest.

This report outlines a series of innovative

inancial mechanisms, which can be used by local stakeholders to raise the capital needed to invest in sustainable development and generate a long term inancial return. It focuses irst on a series of inancial mechanisms that can be used to redirect existing lows of inance, and then looks further into the mechanisms which can be leveraged to raise

additional capital. The report ends by outlining a

Roadmap for the implementation of these inancial

mechanisms.

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3 2. Potential Solutions:

Existing Flows of Finance

2.1 Public-Private Partnerships

An increasing number of global food and

agriculture companies are recognising the risk that

deforestation presents to their business activities. In coordination with civil society and governments,

many of these businesses are now attempting to

mitigate these risks by investing in the sustainable

production of key commodities in their supply chains. This could entail, for example, a consumer goods company, a local NGO and a municipal

government investing in the development of agro-forestry or silvopastoral systems in sustainable use zones, or the conservation of protected areas. This type of multi-stakeholder, collaborative effort is known as a Public Private Partnership (PPP).

A well-known and wide-ranging PPP is the

Tropical Forest Alliance (TFA) 2020. The TFA 2020 brings together governments (e.g. Indonesia, UK), consumer goods companies (e.g. Unilever, Nestlé) and civil society (e.g. CDP) to tackle

the deforestation caused by the production of commodities such as palm oil, soya, beef, pulp and paper.

Some of the companies that have signed up to the objectives of the TFA 2020 are known to be active in

the regions targeted by TSLUP. For example, Nestlé

buys milk from the Caquetá department and is

known to be one of the few multinational companies

active in the Colombian Amazon (Nepstad, 2013).

Two other multinational TFA members, Mondelez

International and Grupo Éxito, are also active in

Colombia, although it is not clear if the products

purchased have been grown in the regions surrounding Chiribiquete National Park.

Among the TFA’s objectives is “working with

smallhold farmers and other producers on

sustainable agricultural intensiication, promoting the use of degraded lands and reforestation” (TFA, 2015). This is similar to the type of activities that would be inanced by TSLUP, and this complimentary overlap could help facilitate the fulilment of the TFA and other sustainability objectives of companies operating in the region. This could also pave the way for Colombian companies to engage with PPP’s in the development of sustainable

commodity production as part of TSLUP.

Alternatively, a consumer goods company may

also form its own PPP, working with third parties

to purchase sustainable and/or ethically sourced

commodities. For example, Starbucks uses the

CAFÉ and Cocoa Practices to verify that its cocoa

and coffee beans are produced in an ethical and

sustainable way (Starbucks, 2015a; Starbucks, 2015b), and Mondelez International buys Fairtrade and Rainforest Alliance certiied cocoa (Mondelez, 2015). However, it is unlikely these partnerships can have the transformative effect needed to move

supply chains towards sustainable production unless strong company-wide or sectoral targets for

sustainability (e.g. the deforestation reduction target set by the TFA 2020), accompany them.

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1 It would be equivalent to approximately USD 7.6 billion using the exchange rate of COP 2392,46 - TRM for

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31 December 2014. 2 Calculations based only in comparison between the resources for 2012 and those for 2013-2014, according to data

from General Royalties System.

3 Embassy of Colombia. 2011. Colombia’s Royalty Reform: Fuelling Fairness, Saving and Equitable Growth

4 Within the new system, some of the better positioned departments have presented proposals for an amount higher than the available resources, while others are behind in the presentation of proposals (UNIMEDIOS, 2013).

2.3 Reform of Land Property Tax

An important source of revenue for municipalities

in Colombia is the land property tax collected from property owners5_{; however Protected Areas and}

Indigenous Reserves are exempt from making this payment (República de Colombia, 1991; República de Colombia, 1988). Consequently, municipalities with Indigenous Reserves and Protected Areas receive less overall revenue as a result.

To mitigate this, municipalities are compensated

for a loss in revenue from Indigenous Reserves (República de Colombia, 1995), but there is no such recompense for revenue lost from Protected Areas. This problem however, is not unique to

Colombia. In Brazil, the National Congress created

the ICMS-Ecológico (ICMS-E) to address the same issue. However, their tax reform compensates

municipalities for both Protected Areas and

Indigenous Reserves. To facilitate this, Brazilian states are required to redistribute 25% of their VAT revenues to municipalities, while states are able to choose how one quarter of these funds (i.e. 6.25% of the total) are spent, based on their own criteria.

Using this legislation, Parana State created their

own environmental criteria in 1991 and applied it to the redistribution of 6.25% of VAT revenues

which compensated the municipalities that had Protected Areas. As of today, sixteen of Brazil’s

twenty-seven states have now adopted some form of the ICMS-E. It should be noted however, that the redistributed funds are not speciically earmarked for environmental protection or sustainable land

use.

In Colombia, a tax reform such as the ICMS-E could be used to compensate municipalities for the loss

of revenue from Protected Areas. Building on the

current process to create a National Rural Cadastre, Colombia could go a step further to formulate criteria based on compliance with territorial

land-zoning. One potential source of revenue could be through reforms to the General Revenue Distribution System (República de Colombia, 1991). However, to ensure this revenue is being used to inance sustainable development, lows of inance must be earmarked (e.g. by hypothecating revenue through a fund).

2.4 Compulsory Investment in

Watersheds

All natural resource extraction projects, or those that have to seek an environmental license and use water directly from a watershed, have to earmark 1% of their total investment in the project to fund the recuperation, preservation and monitoring of the affected watershed (República de Colombia, 1993). However, even when the project proponent (e.g. a mining company) presents an Environmental Impact Assessment (EIA) and an investment

plan for the earmarked funds to the authorities,

departments can only exert control over environmental outcomes through the approval

process and follow-up inspections by local

authorities. Subsequently, this makes the

mechanism prone to corruption and other forms of

weak enforcement. In addition, while environmental risks to watersheds are managed at a project level, investment plans are still needed at landscape

or regional scales to address these risks more

effectively (Chacon & Suarez, 2012). Another issue is that private expenditure in environmental protection is only partially

monitored, and contributions from key sectors are not assessed. This means that no clear information

is currently available about compulsory investment

in watersheds. Compounding these problems

further, compulsory investments in watersheds are not proportional or even related to the

environmental impact of the projects affecting the watersheds themselves (Rudas, 2002).

In the short term, any increase in the investment

directed into watersheds needs enhanced

monitoring and public disclosure, a more equitable distribution of resources, and linking of investments to their environmental impact. In the long term, inance could be channelled into a dedicated fund

administered by regional authorities. This will

require a change in law, but it will also raise the eficiency of investments and increase state control over environmental outcomes.

2.2 Redirection of Royalties

Royalties are a fee, charge or tax on the extraction of non-renewable natural resources, normally minerals and hydrocarbons. Royalties are an important source of income generation in Colombia,

budgeted to reach COP 18.3 billion over the 2015-20161_{period (Gaceta del Congreso 663, 2014).}

However, in 2011 Colombia reformed the royalty system to ensure a more equitable distribution of royalties across sub-national jurisdictions and ethnic groups (República de Colombia, 2012a; República de Colombia, 2012b).

Before the reform, 80% of resources collected from

royalties were concentrated in the hands of only

17% of the Colombian population (Minminas, 2010).

The new system redistributes the resources through all Colombian municipalities and departments, and centralises the control of royalties as a

strategy to halt corruption (Unimedios, 2013).

This redistribution also led to the creation of the

Regional Development Fund to inance projects contributing to social and economic development,

as well as the Regional Compensation Fund which

inances human development and infrastructure in the poorest municipalities in Colombia (Minminas, 2010).

The implementation of this new system has increased the amount of resources allocated to all

the municipalities found within the project area. A

comparison between funds allocated in 2012 and

those allocated for the period of 2013-2014 reveals

that in the worst case scenario, there was still an

increase of around 50% in funding for Solano, while San Vicente del Caguan experienced the largest increase, at 136%2_{. This increased revenue from}

royalties is expected to continue over the next

decade3_.

To access inance from the funds listed above, local

authorities and indigenous communities must

develop a project and present it to the fund, to be assessed on whether or not it should be inanced. All projects must also be aligned with national and regional development plans, such as the Amazon Vision - an initiative to reduce carbon emissions from the Amazonian regions. However, local

municipalities can now use the Contratos Plan of

the National Development Plan to channel royalties and leverage private investment into sustainable development.

Transport and infrastructure dominate the

currently approved projects, with only 6.9% of resources being allocated to agricultural projects and 3.6% to environmental and social development projects (SGR, 2014). In principle, funding for environmental and sustainable land-use projects

can be scaled up, as reforestation and restoration of

ecosystems and the environment are also priorities alongside territorial development goals. However, lack of local capacity to develop projects could potentially hamper the ability of these lows of inance to grow in certain regions. In particular, governments and other stakeholders in poorer regions need capacity building for project proposal design, fund management and alignment of projects with the Amazon Vision4_{(UNIMEDIOS, 2013).}

They will also need improved capacity to monitor

and enforce regulations and regional targets if this

approach is to be effective (OCDE, 2014).

A barrier to scaling-up investment streams has been

the limited accountability of where and how funds generated from royalties are spent. A transparent monitoring and information system is essential to

effectively track the low of inance from royalties, identify priorities (e.g. buffer zones), and monitor the environmental and social impacts of projects.

The new General System of Royalties has set aside

1% of revenues to fund such a system, the SMSCE,

to monitor the collection, consolidation, analysis

and veriication of lows of inance generated from

royalties. To promote transparency, the information

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7 3. Potential Solutions:

New Flows of Finance

5 See https://www.gobiernoenlinea.gov.co/web/guest/home/-/government-services/T4719/maximized 6 Colombia is also considering frameworks to address biodiversity offsets in both marine and freshwater ecosystems.

3.1 Biodiversity Offsetting

Biodiversity offsetting is a way to mitigate the negative outcomes that may result from natural resource exploitation (ten Kate & Crowe, 2014). For example, if a mining company is unable to avoid causing environmental damage, they may choose to offset that damage by paying for biodiversity conservation elsewhere (Forest Trends, 2015). Biodiversity offsetting is usually voluntary, but it can be part of a national political framework or even a requirement, such as in the loan screening process

of banks.

As of 2012, it is mandatory in Colombia for all companies seeking to exploit natural resources to

submit a biodiversity offsetting plan to the licensing agency ANLA (MADS, 2012). The framework for this

process, called the Manual for Allocating Offsets for Loss of Biodiversity, sets an ambitious target of zero

net loss of biodiversity6_{. There are a number of ways}

companies can offset their biodiversity impacts, including inancing the creation or expansion of public protected areas, establishing voluntary agreements and incentives for conservation, and

conducting ecological restoration in priority areas.

However, biodiversity offsetting is not currently

being implemented at scale, primarily because of the low capacity of the regulatory bodies responsible

for screening and approving eligible offsetting projects. To capitalise on existing capacity, a fund with a proven track-record (such as Patrimonio Natural or FundePublico), could be used to develop eligible projects and centrally channel all resources (FundePublico & WCS, 2013).

3.2 Carbon Offsetting

Similar to biodiversity offsetting, carbon offsetting involves a polluter mitigating their impact on the environment by paying another party to conserve greenhouse gas emissions. However, carbon offsetting involves a transaction and the creation of a inancial asset called an emission reduction (ER)

unit. For example, Drummond might purchase ERs

from a forest community that is actively eschewing

deforestation. It should be noted though, that

in Colombia carbon offsetting is voluntary, and

polluters are not purchasing ERs because they are legally obligated to do so.

In the areas surrounding Chiribiquete National

Park, carbon offsetting can be used to direct

investment into projects that avoid deforestation or forest degradation, conserve forests, and sustainably

manage or enhance forests. This grouping is known

as ‘REDD+’ activities, and it can be done at two different scales: the project or the jurisdictional. At irst glance, given the scale of the buffer zones surrounding Chiribiquete National Park, the jurisdictional approach might seem to be the most appropriate (called JNR7_{). However, the rules}

governing JNR require one government in control of the entire jurisdictional zone, whereas TSLUP spans

portions of three separate departments.

An exception to this rule is by deining a jurisdiction in terms of ‘ecoregions’ (VCS, 2014). If the provinces covered by TSLUP are deined as a single ecoregion with a body created to govern it, REDD+ activities

could then be implemented and ERs sold to offset the impact of buyers throughout the world. This approach has not yet been trialled, so no precedent

exists to validate its viability.

In contrast, at the project scale there is a well-demonstrated pathway for directing investment into sustainable land use, conservation, and etc. from large ecosystems that span multiple jurisdictions. Although it would be around ive times larger than any other REDD+ project in the world, a project could be created spanning all of the Chiribiquete

buffer zones as long as it was run by a single

governing entity with the legal mandate to manage

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7 JNR stands for Jurisdictional and Nested REDD+ and was developed by the Voluntary Carbon Standard (VCS).

the entire region (such as Parques Nacionales).

Despite these barriers there are precedents, such

as the Guatecarbon project in Guatemala which covers around 7.5% of the country’s total land area and is managed by the Consejo Nacional de Áreas Protegidas (Carbon Decisions International, 2014). An alternative and more straightforward approach

would be for the departmental or municipal

governments to jointly manage the area and share in the revenue generated. For example, in Zimbabwe the Kariba project spans four provinces in which all four provincial governments are joint administrators of the project (South Pole Carbon, 2013).

3.3 Ecotourism

Ecotourism is a form of travel where visitors pay to see pristine natural habitats (Lindberg, 1997). It

is the fastest growing form of tourism, expanding at three times the rate of any other sector in the

industry (The International Ecotourism Society, 2012).

While ecotourism has long been in existence in South-East Asia and Africa, it is only now gaining

traction in Latin America. For example, over recent years Costa Rica has signiicantly increased its area under nature preservation in order to boost its

ecotourism industry and consolidate its position as

a leader in this sector. It has now even capitalised a conservation endowment fund through ecotourism revenues (Weaver & Lawton 2007).

To grow the ecotourism industry in Colombia,

Parques Nacionales Naturales (PNN) distributes concessions on their land (e.g. national parks) to

leading tourism operators and hotel chains. In 2012, the national parks managed by PNN had nearly 1

million visitors, representing a 19% annual growth rate. Operators pay 10% of their income to PNN, and

the government provides long-term tax exemptions (up to 20 years) for ecotourism businesses (Oxford Business Group, 2015; PNN, 2014).

Ecotourism could be scaled-up in the buffer zones

surrounding Chiribiquete National Park by offering tax incentives to local businesses or by expanding local infrastructure. Perversely however, increased

demand for tourism infrastructure - such as roads

and hotels - can threaten biodiversity and local

communities, as it increases access to and the

habitability of remote areas that were previously challenging to deforest (Drumm and Moore, 2002). Nor are all areas within and around Chiribiquete easy to reach, and some have a signiicant FARC presence as well (Global Post, 2014).

The 2014-2018 National Development Plan proposes

increasing the presence of green businesses in the

Amazonian, Paciic, Caribbean, Central and Orinoco

regions. Green businesses in these areas would

leverage their ecological competitive advantages to develop sustainable economic activities that include ecotourism (DNP, 2014). The region looked at in this report is in an area of inluence across

three National Parks: Tinigua, La Macarena and

Chiribiquete, making it a prime location for these

green businesses.

However, any increase in the ecotourism industry

must be accompanied by regulatory frameworks

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8 UN Framework Convention on Climate Change. 9 This programme is developed by UNDP, UNEP and WRI and funded by the German Federal Ministry for the

Environment, Nature Conservation and Nuclear Safety (BMUB).

3.4 Access to Climate Finance

Climate inance is any funding that is directed

towards climate change mitigation or adaptation.

Over the coming years, it is expected that the Green Climate Fund (GCF) will become one of the major sources of funding for climate inance. The GCF

was created in 2010 under the UNFCCC8_{and will}

provide large-scale inance to reduce greenhouse gas

emissions, including those caused by deforestation and forest degradation in tropical forest countries

(Leonard, 2014).

To access funding from the GCF, countries

will need to meet a series of administrative requirements, including nominating a National Designated Authority (NDA), appointing a National Implementing Entity (NIE) (GCF, 2015), and meeting the GCF’s inancial management, environmental and social safeguards (Brown & Terpstra, 2014). Not all countries currently have the capacity to meet these requirements, so the GCF also provides support through its Readiness

Programme, which has so far channelled USD 400

million to countries for support (BMZ, 2013; GCF, 2013).

At present Colombia participates in the Readiness Programme9_{, but a new institutional framework}

under the authority of the National Planning

Department (DNP)10_{called the Institutional}

Strategy to Articulate Climate Change Policies and Actions in Colombia has been created to access future large-scale funding. In 2014, a Focal Point

from the Ministry of Environment and Sustainable Development was also nominated to align the GCF objectives with Colombia’s strategic priorities,

ensuring the country could access GCF resources in the future.

In addition, Colombia has established an

institutional framework for their overarching project, the Amazon Vision. Under this framework,

the World Bank has granted USD 10.4 million

from the GEF to reduce deforestation in Caquetá and Guaviare - two departments located within the project area (World Bank, 2014). This existing framework could be leveraged to access funding

from the GCF, and channel resources into the implementation of special management areas

under the Amazon Vision. Activities within these

areas could then be regulated and encompass

interventions such as the strengthening of existing

protected areas and biological corridors, the

establishment of buffer zones, or the deinition of

areas for sustainable agricultural practices.

3.5 Conservation Notes

A conservation note is a inancial product -

comparable to a bond - where the proceeds are

channelled towards conservation (TNC, 2014). An

example is The Nature Conservancy Conservation Notes. These notes have low credit risk and are

targeted at High Net Worth Individuals (HNI). Investors are able to choose both the interest rate they will receive every year for their investment - between 0% and 2% - and how long before they

are repaid in full, the maximum being 5 years with the option to renew at the end of the chosen period

(TNC, 2014).

In the case of the Caguan Axis and the North of

Chiribiquete, an instrument like a conservation note could be issued to inance part of the upfront

cost of implementing land-use zoning, or the capital

investments required to grow local green businesses such as ecotourism and organic agriculture (DNP, 2014). However, issuing a conservation note requires a credible issuer (e.g. a bank) who can

manage the resources, repay the debt and report

back to investors. Similar to other mechanisms

proposed here, this could be done through an

existing entity, preferably a national-level inancial institution with a proven track record, such as Finagro or Findeter. However, any entity would need to earmark the proceeds speciically for environmental activities in the zone.

Another option is having a fund (e.g. Patrimonio Natural), issue the bond. A Multilateral

Development Bank (MDB) such as the World Bank could then provide a partial guarantee for the debt,

making the repayment of the bond more credible

to investors11_{. Additionally, the MDB could directly}

issue the bond and channel the resources to be managed by Patrimonio Natural - a framework

currently in use. Alternatively, a new entity could be created to issue the bond, but this would require either a guarantee from another entity or investors with a very high appetite for risk.

Monitoring and safeguard systems must be in place to ensure resources are used solely for the implementation of the land zoning plan, whilst simultaneously measuring the impact of these

investments and linking them to ‘on the ground’ activities. This will not only ensure transparency,

but will also guarantee resources are deployed in a way that catalyses sustainable economic growth in the region.

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14 4. Roadmap:

The Way Forward

In order to implement TSLUP, one or more of the inancial mechanisms described in this report could be deployed. However, to do so will require addressing a set of overarching policy, capacity, and regulatory barriers. Section 4.1 outlines a set of recommendations that can help to overcome these barriers, and

Section 4.2 describes some immediate tasks that local stakeholders can undertake to help to catalyse one or

more of the inancial mechanisms

differentiated tax schemes could be used to

disincentivise certain activities in the

sustainable-use areas of the buffer zones in line with the territorial land-use zoning maps.

Implement a capacity building strategy

The overwhelming majority of royalty funding is

directed towards transportation and infrastructure. To change this dynamic, both stakeholders in

sectors vital to the implementation of territorial land-use zoning (e.g. AFOLU), and in poorer and environmentally critical regions, should receive training in the project development process and in how to draw down inance from royalty funds (e.g. mapping projects onto regional and national strategies, such as the Amazon Vision).

Ensure regional preparedness for GCF funding

Funding from the GCF can be large-scale, and an important catalyser for a sustainable regional

economy. However to access this, the national government would have to link TSLUP to strategic activities in the area. This means that the region would need to have a policy and institutional

framework in place, such as a regional fund with all municipalities represented on the board, an

investment plan that links funding to land use, and an effective monitoring system.

Assess viability of a cross-departmental carbon project

Payment for carbon credit is a viable pathway for accessing inance, but it requires a centralised entity that can manage the project as its implementation is closely linked to the identiication of new or existing regional funds. Because the area is also signiicantly larger than any other existing carbon project, a irst step would be the completion of a viability

assessment.

Access capital markets

A bond or similar type of ixed-income instrument could be leveraged to raise additional capital, and

a new or existing regional fund could be used to

issue said bond. However, once the issuer is chosen it is critically important to deine the portfolio of investments that will be inanced with the proceeds

from the bond, along with how the principal and

interest will be repaid to investors, and what

reporting mechanism will be used for different stakeholders.

Increase ability of ANLA to source biodiversity offsetting projects

Colombia is pioneering the inclusion of biodiversity offsetting in public policy. However, the policy

cannot be properly implemented with ANLA’s current lack of personnel and expertise to source

and assess potential biodiversity offset projects. To overcome this barrier, a team with relevant scientiic experience will be required. In addition, given the high biodiversity content of the Chiribiquete area, this scientiic committee could work closely with local stakeholders in and around Chiribiquete to develop pilot projects as well.

Build South-South learning exchange on ecotourism

In light of Costa Rica’s extensive experience using conservation to promote ecotourism, a Colombia-Costa Rica learning exchange could be developed

to share knowledge on building an ecotourism industry. The exchange could help demonstrate how tourism can be increased without causing

deforestation (e.g. by building roads), but would need to be tailored to Colombia’s unique security context and the likely effect of a positive outcome

from the peace talks.

4.1 Overarching Recommendations

Link finance to land use

A territorial land-use zoning map could be used to prioritise where different types of public and

private lows of inance might be most appropriate, and then facilitate working with inancial providers such as banks to redirect those lows (e.g. focusing

their credit lines for sustainable production in

the ‘sustainable use’ areas of the buffer zones). Compliance with land-use zones, as deined in the

map, could also be utilised to restrict access to

inance for non-compliant producers.

Monitor compliance with land use and finance

If access to inance is linked to compliance with

land zoning criteria, a public system which monitors that compliance and ensures it is being distributed to the right zones for the correct uses is essential. This system could also help assess

whether the investments being made are having the environmental and social impacts expected. Subsequently, by enhancing transparency,

possibilities open up for third parties to assess the

eficiency of project inancing and execution. This

system would be particularly important for three of

the inancial mechanisms proposed: land tax, forced

compensation, and royalties.

Build capacity of local stakeholders

Local government oficials, fund managers, project proponents and other stakeholders should receive training in the development of investable projects, the links between land use and inance, and the monitoring systems which can be used to oversee compliance and lows of inance.

4.2 Next Steps

Assess creation of new, or identify existing, regional fund

Identify the existing funds that could be used to

centrally channel all resources for conservation and sustainable development in the regions. If

existing funds cannot be used, the possibility

of creating a new fund should be investigated.

Either option would make implementation of the

monitoring system relatively straightforward. For the compulsory investment, it would give control of investment priorities back to the regional governments.

Strengthen and grow engagement with PPPs

Working with consumer goods companies that are

already active in the area (e.g. Nestlé), partnerships

can be strengthened to help build local capacity and implement best practice. These producers could then be brought into dialogue with other,

larger PPPs (e.g. the TFA 2020) to access bigger

markets for sustainably produced commodities. This increased access to markets would reinforce

the incentive for other producers to switch to more

sustainable practices and in turn create more demand from the larger, international PPPs. The

new royalties system could then provide resources to projects under the form of PPPs.

Compensate for loss of land tax from PAs & buffer zones

Signiicant areas of some departments are

designated as protected areas, which are not

subject to land tax. Local governments should be

compensated for this loss in the same way they are compensated for indigenous lands. In addition,

10 DNP formulates long-term public policies and possesses signiicant political power to coordinate all the ministries and interested stakeholders involved in climate change (Ross, M., 2012).

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16 5. References

Mondelez, 2015. Sustainable Resources and Agriculture.

http://www.mondelezinternational.com/well-being/sustainable-resources-and-agriculture

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