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Environmental Protection: Between Regulations

and Incentives

By Thompson Ayodele

It is widely acknowledged that the environment is life. It is therefore pertinent that protecting the environment is protecting and saving life.

Environmental policy discussions by governments and organizations world over always assume that the only way to advance environmental values or conserve natural resources is to create government programs or adopt new regulations, decrees, laws, and acts. Even imprisonment and fines have been stipulated for violators all to no avail. 

The potential for private initiative to conserve environmental treasures is always overlooked by the government who believe so much in policies and regulations which does not put people and their well-being into consideration.

Where private action has been put to place, it has proved to be superior to government efforts. Private reserves are generally better kept and maintained than government parks and in places where it has been tried, conservation through commerce has been more successful than the species protection embodied in the Endangered Species Act.

Environmental protections through government policies and regulations have not been effective. The environment and its natural resources have not be recognized as goods of important market value. Indigenous people are not recognized as stakeholders; hence they have no urge to protect what they perceive to belong to everybody or government.

Many environmental problems exist because there is a ‘missing market’ for environmental resources or goods, that is,  these goods and resources have no value attached to them because of their abundance and ready availability. Water, forest, animals etc are considered ‘valueless’ by many. However, if there were to be an existing market where environmental goods are traded, appropriate price could be placed on all environmental resources and these will be a proper incentive to conservation or protection and even proper utilization of such goods.

A public good is one that is available to everyone and which cannot be denied to anyone. It is therefore unprofitable for a private individual to invest on its protection because of the impossibility of recovering the cost from other users. There is also no incentive for a user to abstain from consumption since someone else would anyway.

Property rights are thus created to resolve competing claims over resources. Thus if 10 men all graze their cattle on the same piece of land and there are no rules governing how much each men can graze, then, each men has strong incentive to graze as much of the available land as possible. However, if one-man hold a title deed over this piece of land, he has an obvious incentive to look after it and re-invest in it even after overgrazing.

In Nigeria much environmental degradation follows from the attempt by the state to override customary laws or to nationalize resources (e.g. forests and land), which was formerly subject to local customary management.

Government policies should be directed towards private ownership and customary management of reserves and parks rather than government ownership or control. Private ownership is a strong incentive for environmental resources protection.

Government policies, trade restriction on environmental goods and prohibition merely serve as non- incentive to resource management. For example in wildlife conservation, the prohibition on trade ivory greatly reduces the economic value of the specie to the local communities thereby reducing local incentives to engage in and co-operate with conservation and protection efforts.

Commercial utilization of species and resources can provide a substantial economic incentive for conservation. If people realize what they stand to benefit from wildlife, they have an incentive to maintain wild habitat and not convert it to other uses, such as agriculture. Where wildlife does not have value, the zeal or urge to conserve will be optional if not minimal. Secure land tenure, local control or proprietary rights in wildlife and the opportunity to create economic value in wildlife are key elements in sustainable utilization. Trade restrictions are not.

Where local people receive a proportion of the income from hunting, eco-tourism and other economic activities associated with the wildlife with which they share their land, this would prevent illegal activities. As a result, local people have become stakeholders in the wildlife management system and instead of seeing elephants and other wildlife as a threat or pest, they realize that by conserving them they are able to benefit.

People that are wealthy and healthy will see no reason to deforest by agricultural practices, poach or even allow illegal lumbers because they have money to buy what they need. They don’t see reason to cut down trees for firewood or use chemicals to kill fishes in rivers.

The removal of trade restrictions on environmental goods is the most appropriate for the conservation of environmental resources. Government’s environmental policy has continually failed to redress environmental problems. Indeed governments have shown themselves to be imperfect guardians of the natural environmental interest and have often intervened in workings of the market only to make situations worse.

Poverty eradication and wealth creation is the best method of resource management that will make people rely less on the environmental resources for their daily livelihood. The policy implication is clear.

Adeyinka (info@ippanigeria.org) is with the Institute of Public Policy Analysis based in Lagos, Nigeria.