Economic Analysis for Targeting SLM Intervention

By

Mahmud Yesuf

(Based on a Proposal for a Cost-Benefit Framework to Support Pro-SLM Decision-Making in Ethiopia, by M. Yesuf, G.Zeleke, G. Köhlin and G. Björklund)

UN expert group meeting on“Sustainable land management and agricultural practices in Africa:

Bridging the gap between research and farmers”April 16 – 17, 2009, University of Gothenburg, Sweden

Contents of Presentation• Objectives • Working definitions of LD, SE and SLM• Immediate Causes of LD• Major Costs of LD

– On-site Costs– Off-site Costs

• Economic Approaches– Change of Productivity Approach (CPA)– Replacement Cost Approach (RCA)

• Applications of Economic Approaches to ETH• Economic Criteria for SLM Intervention• Targeting SLM Intervention in ETH and Implications

Objectives

i. Outline economic approaches to assess the cost of land degradation or benefit of SLM intervention.

ii. Outline how these economic approaches (CBF) could be used to prioritize SLM intervention using available data in Ethiopia

Working Definition of Land• Land encompasses:

– Soil– Plant– Water – Living organisms

• Land: “the terrestrial bio-productive system that comprises soil, vegetation, other biota, and the ecological and hydrological processes that operate within the system”

• Land degradation is, therefore, the destruction/negative disturbance of all or one of these components and their interrelationships

• Land degradation: “reduction or loss . . . of the biological or economic productivity and complexity of rain-fed cropland, irrigated cropland, or range, pasture, forest and woodlands resulting from . . . processes . . . such as (i) soil erosion caused by wind and/or water; (ii) deterioration of the physical, biological or economic properties of the soil; and (iii) long-term loss of natural vegetation” (UN Convention to Combat desertification)

Land Degradation cont…

LD and SLM– Soil erosion: a particular physical process that causes land and soil degradation, and refers

to the wearing away of the land surface by water and/or wind as well as to the reduction in soil productivity due to physical loss of topsoil, reduction in rooting depth, removal of plant nutrients, and loss of water

– The problem is:– Most cost estimates of land degradation do not distinguish between soil erosion, soil

degradation and land degradation in their analyses. – The fact that different studies estimate different components of land degradation makes

comparison of cost estimates across studies a difficult task.– SLM is defined as the use of renewable land resources, for agricultural and other purposes to meet

community needs, while simultaneously ensuring the long-term productive potential of these resources and the maintenance of their environmental functions

Immediate Causes of Land Degradation

1. Exploitative farming practices

• Steep land cultivation without protection• Soil fertility mining

– Removal of soil organic matter (open nutrient cycle)

• Shortened fallow periods

Common Practices

Conversion of forest and wood land to crop land Harvesting of forest for fuelwood

95% (Urban + Rural) and 99.9% (Rural) of HH energy demand is generated from biomass energy! 81 % from fuel wood, 10% cow dung, 9% crop residue and the rest other

sources

This kind of removal of biomass resulted in: Deterioration in soil chemical and physical properties High soil loss by runoff Reduction in soil productivity

2. Deforestation

– Encroachment of virgin forest areas for cultivation without protection (South and South west)

Remnant forests in sacks: result of lack of alternate energy sources and uncontrolled deforestation

• Free grazing Deteriorates soil physical

properties Destroy soil conservation

measures Remove crop residue

from the soil Detach soil particles

• Very weak grassland/rangeland management

3. Poor Livestock Management

• 30 million heads of cattle (1st in Africa)!

• Free grazing with unbalanced Carrying Capacity

The vicious circle of resource degradation and poverty!

Famine and Poverty Trap!