402/95 - 12 e PVI Division 402

Environmental Protection, Conservation

of Natural Resources, Dissemination of
Appropriate Technologies (GATE)

Market-Based Instruments
in Environmental Policy in
Developing Countries

Framework for Policy Planning and Institutional

Development in the Environment
Division 402
Environmental Protection, Conservation
of Natural Resources, Dissemination of
Appropriate Technologies (GATE)

402/95 - 12 e PVI

Market-Based Instruments
in Environmental Policy in
Developing Countries

Framework for Policy Planning and Institutional

Development in the Environment

Eschborn 1995
Published by:
Deutsche Gesellschaft für
Technische Zusammenarbeit (GTZ) GmbH
P.O. Box 5180, D-65726 Eschborn

Division 402, Environmental Protection, Conservation

of Natural Resources, Dissemination of
Appropriate Technologies (GATE)

Pilot Project Institutional Development in Environment

Wachsbleiche 1, D-53111 Bonn
Tel.: (+49) 0228 98533-0 / Fax: (+49) 0228 98570-18
E-Mail: gtzpvi@aol.com

Author: Stephan Paulus

Responsible: W. Hamacher, S. Paulus, B. Winkler

Layout: I. Borucki

Printed by: Universum Verlaganstalt, D-65175 Wiesbaden

Foreword

Since the beginning of the Eighties, the Federal Republic of Germany has provided assistance un-
der development cooperation to counterpart institutions in developing countries so as to help solve
environmental problems. To date, however, broader-based approaches in institutional development
and advice in environmental policy planning which aim at developing institutional structures and an
effective range of policy instruments have been the exception rather than the rule. Meanwhile, ex-
perience has shown that the complexity of environmental problems, their multisectoral nature and
the large number of relevant actors all mean that greater consideration has to be given to the insti-
tutional setting. The UN Conference on Environment and Development (UNCED) also stressed the
importance of the environmental policy framework and called for assistance to developing countries
in establishing institutional structures and local capacity to solve the serious problems facing the
economy.

The present paper is a review of types and examples of market-based instruments of envi-
ronmental policy. A common feature of these is that they aim more at the economic self-interest of
those causing environmental problems rather than following regulatory “command and control“ ap-
proaches. Experience to date justifies the assumption that, in principle, market-based instruments
also represent an attractive option for developing countries. However, it is important to counter at-
tempts to attach a certain mystique to individual instruments or types of instruments: instead, the
goal must be to develop a mix of instruments, institutional structures and regulations which is ap-
propriate to the situation and takes into account as far as possible ecological effectiveness, econo-
mic efficiency, political and administrative feasibility and social acceptance. The concepts and ideas
expounded in this paper all derive from the possible role of development cooperation in institutional
development and advice in policy planning in the environment. As a result, the paper is aimed pri-
marily at specialists planning or implementing environmentally related projects in development co-
operation, and is intended to encourage corresponding projects to integrate the development of a
range of effective environmental policy instruments into their activities to an even greater extent. At
the same time, the particular sensitivity of this sector is explicitly recognised by assigning a role to
development cooperation which is more catalytic than formative. The emphasis is on technical co-
operation (TC), without losing sight of contact points and openings for cooperation with other in-
struments of development cooperation. This paper should accordingly also be of interest to experts
and decision-makers from developing countries who are seeking to review the potential of coope-
ration in this sector and who wish to acquaint themselves with the relevant debate status among
German development cooperation institutions.

The ideas expressed here constitute one of the key areas being developed under the supraregional
pilot project “Institutional Development in Environment” which is being implemented by the GTZ
under a commission from the German Federal Government, with the aim of increasing the integra-
tion of participative and process-oriented elements into the promotion of environmental institutions.
Besides a review of the relevant literature and case studies on Benin, Chile, Mexico and Thailand,
the paper draws on the results of an international workshop organised jointly by the GTZ and DSE
in June 1994. We wish to express our gratitude to all those involved, and particularly to the mem-
bers of the “Working Party on Economic Instruments of Environmental Policy” (AG-UI), which has
supported the GTZ in this learning process over a period of years.

Bonn/Eschborn, March 1995

Dr. H.P. Schipulle Dr. W. Morbach

Federal Ministry for Economic
Cooperation and Development
Division 224 (Environmental Protection,
Natural Resources Management
and Forestry)
Deutsche Gesellschaft für technische
Zusammenarbeit (GTZ) GmbH
Division 402 (Environmental Protection,
Natural Resources Management
Dissemination of Appropriate Technologies)
Contents

Foreword I
Contents II
List of abbreviations III
Summary IV

1. Introduction 1

2. Market-based instruments in environmental policy :

types and experience 3

2.1. Arguments for using market-based instruments in environmental policy 3

2.2. Types and examples of market-based instruments in environmental policy 3
2.2.1 Overview 3
2.2.2 Fees and prices 3
2.2.3 Charges and taxes 4
2.2.4 Subsidies and environmental funds 6
2.2.5 Tradable permits and market creation 8
2.2.6 Deposit systems and performance bonds 9
2.2.7 Law of liability 10
2.2.8 Property rights 11

3. Market-based instruments of environmental policy :

policy planning and development cooperation 14

3.1. The context 14

3.2. Institutional requirements 15
3.3. Criteria for analysis and evaluation 16
3.4. Operational planning 17
3.5. Acceptance and feasibility 18
3.6. Approaches and phases 19

4. Environmental policy planning and development cooperation 21

4.1. Policy planning and capacity development in the environment 21

4.2. Target groups and stakeholders 21
4.3. Ownership and process orientation 23
4.4. Levels of advisory services 24
4.5. Political sensitivity and conflict management 24
4.6. Programme approach and entry points 24

5. Contributions of development cooperation in environmental

policy planning 26

5.1. The focus of advisory services in technical cooperation 26

5.2. Advisory role and presence 26
5.3. The range of services under technical cooperation 28
5.4. Cooperation between development cooperation agencies 28

6. Conclusion 31

Selected references 32
Members of the Working Party on Economic Instruments of Environmental Policy 35
Publications of GTZ Division 402 36

II
List of abbreviations

BMZ German Federal Ministry for Economic Cooperation and Develoment

CDG Carl Duisberg Society

CIM Centrum für internationale Migration und Entwicklung

DAC OECD Development Assistance Committee

DSE German Foundation for International Development

FC Financial Cooperation

GTZ Deutsche Gesellschaft für Technische Zusammenarbeit GmbH

IDE Institutional Development in Environment

KfW Kreditanstalt für Wiederaufbau

MBI Market-based Instruments of Environmental Policy

NGO Non-Governmental Organisation

OECD Organisation for Economic Cooperation and Development

PPR Project progress review

SAP Structural adjustment programme

TC Technical Cooperation

ZÖV DSE Public Administration Promotion Centre

III
Summary
Although “command-and-control” concepts
form the core of environmental policy in-
struments worldwide, market-based in-
struments have been incorporated in envi-
ronmental policy in an growing number of
countries. Where – as in most developing
countries – there are serious shortfalls in
implementing environmental policy and, at
the same time, the population’s living con-
ditions are linked particularly closely to the
state of natural resources, the use of mar-
ket-based instruments may be a attractive
option.
Market-based instruments comprise all
price-related and/or regulatory orders
which mobilise the economic self-interest
of resource users and polluters for envi-
ronmental policy purposes. The term cov-
ers a wide range of individual instruments
which can be used for specific problems.
Market-based instruments include envi-
ronment-related fees, pricing policy for
primary commodities and inputs, environ-
mental charges and taxes, tradable rights
and licences, market creation, deposit
systems, rights of exploitation and disposal
and the law of liability. Compared with pure
regulations there are borderline cases
where (depending on the exact constella-
tion) regulatory or market elements pre-
dominate. Overall, market-based instru-
ments are distinguished by the fact that
they provide economic incentives to pollut-
ers to implement efficient measures to
prevent environmental pollution or pursue
a course of sustainable utilisation of natu-
ral resources.
The use of market-based instruments is
accordingly supported not only by envi-
ronmental policy considerations, but also
(and above all) by economic considera-
tions based on the high costs of imple-
menting “command-and-control” concepts
and their environmentally questionable,
long-term structural effects. This does not
mean simply replacing regulations by eco-
nomic incentives, but rather reorienting the
“policy mix” to take account of specific
environmental problems and the economic,
legal and institutional framework. The ef-
fectiveness of market-based instruments
does, however, depend on certain condi-
IV
tions. For example, environmental charges
need a basis for assessment which can be
checked as simply as possible, and which
is clearly connected with the environmental
problems to be curbed with the help of the
charge. In addition, the effect depends,
inter alia, on the intensity of competition,
the potential for technological innovation
and the price elasticity of demand.
There is nothing accidental in the way that
regulatory approaches have dominated
environmental policy worldwide. The rea-
sons can be traced back to the sectoral
organisation and fragmentation of govern-
mental structures, the relative lack of politi-
cal clout of state environmental institutions
and (not least) in the fact that environ-
mental policy as a government responsibil-
ity has so far received little support in pub-
lic debate. Chances for using market-
based instruments improve with growing
awareness of the pressure the problems
are creating and the more evident the pos-
sibility of so-called “win-win” effects be-
comes. Favourable constellations for mar-
ket-based instruments to create benefits in
both economic and environmental terms
arise e.g. in the context of privatisation
efforts, decentralisation programmes,
structural adjustment programmes or
situations where implementation of retro-
spective environmental policy is hitting
financial constraints.
Market-based instruments do, however,
involve significant administrative and/or
monitoring inputs. It is therefore important
to review the institutional conditions care-
fully and to integrate the instruments into
existing structures as far as possible. Crite-
ria for selecting instruments are ecological
effectiveness, economic efficiency, ad-
ministrative feasibility, public costs and
revenue, distributional effects and imple-
mentation. In operational planning, exten-
sive planning and consultation efforts are
required, which in turn call for technical,
legal and administrative know-how. In
terms of implementation and communica-
tions strategies, special attention must be
paid to possible acceptance problems on
the part of those liable for payments
(charges etc) and the general public.

Development cooperation (bilateral and
multilateral) has previously only considered
issues of market-based instruments in
environmental policy in isolated cases (ex-
cept for conditionality, e.g. with regard to
pricing policy) or in the context of training
and upgrading programmes and research
cooperation. Policy planning concepts in
the environmental sector with a longer-
term orientation have been the exception
rather than the rule. However, there is rea-
son to expect that a need for professional
advisory services will emerge in this field in
the future.
With regard to possible advisory mea-
sures, it is useful to distinguish between
the preparatory phase, the phase of plan-
ning and selecting instruments, and the
implementation phase. In each of these
phases there is a different need for advi-
sory services and hence different openings
for cooperation.
Advice in environmental policy planning
must move beyond the narrow focus on
technical assistance to governments. As a
professional service, environmental policy
advice aims to advise decision-makers and
actors involved in the political process in
the governmental and non-governmental
sectors. Actors can be separated into pol-
luters or resource users, those affected by
environmental problems, governmental
and non-governmental environmental in-
stitutions as channels for environmental
policy regulations, and other organisations
and actors with influence over environ-
mentally relevant decisions or the be-
haviour of polluters and resource users. An
exact analysis of the structure of those
involved and the organisational landscape
is thus always required. In a long-term
perspective, polluters and resource users
will be target groups for policy advice.
However, the question of target groups on
the one hand and partners of cooperation
on the other can only be answered on a
case-by-case basis when directly imple-
menting corresponding programmes. Gen-
erally speaking, though, diversification of
partners will be an important element.
Policy planning and institutional develop-
ment in environment can only have sus-
tainable success, if the partners in the de-
veloping countries have a sense of “own-
ership”. When planning and implementing
corresponding programmes this implies
that participative and dialogue-oriented
instruments and processes should be used
as far as possible. Certain aspects - im-
ponderables - simply cannot be foreseen
due to the fact that decision-making proc-
esses in environmental policy are not usu-
ally linear, but rather erratic, repetitive and
dependent on political and economic con-
stellations. This means that policy planning
programmes in the environment must be
process oriented and allow for flexible,
iterative procedures. In addition, such pro-
grammes must be firmly anchored in the
given political context and located at an
appropriate level in the hierarchy.
Market-based instruments are not gener-
ally an autonomous field for cooperation,
but rather an option in projects which are
concerned partly or exclusively with policy
planning or institutional development in the
environment. In principle, there may be a
whole range of project types for a given
context and partner structures into which
environmental policy advice measures
could conceivably be integrated. Opportu-
nities to initiate a dialogue on this with
partners arise inter alia in the framework of
project planning and assessment, policy
dialogue and project progress reviews and
evaluation. Pilot measures can provide an
opening for raising the issue.
Besides technical and institutional ques-
tions, advisory services may also focus on
organisational development as well as
interorganisational cooperation and com-
munication. The specific mix of focal areas
and the distribution of roles between part-
ners and the German contribution must be
adapted for each individual case through
project and operations planning. The
question of the advisers’ role must also be
settled in this context. Forms of process-
oriented advisory services and facilitating
will become increasingly important com-
pared with “classic” adviser profiles, as in
many cases of development cooperation
the function will be predominantly catalytic.
The GTZ, as a TC institution, can offer
services for initiating and identifying policy
advice and institution-building programmes
in the environmental sector; it can also
advise partners in developing countries on
planning corresponding programmes and
assessing feasibility and (as part of the
V
German contribution) it can assist with the
implementation of corresponding pro-
grammes.
A decisive factor is the integration of vari-
ous development cooperation instruments.
Financial cooperation projects also offer
opportunities to promote the use of market-
based instruments. Recently, the KfW, for
example, made financing for power proj-
ects conditional on electricity tariffs cover-
ing at least 65% of costs. Besides such
requirements – whose fulfilment is uncer-
tain – there is the possibility of integrating
components into suitable projects (includ-
ing power, water supply, sanitation and
solid-waste disposal) which ensure longer-
term, back-up advisory services in this
area. Training programmes also offer an
opportunity for cooperation with institutions
such as the DSE and CDG, which have
been offering programmes for various tar-
get groups in the environmental sector for
some time now. The first modules dealing
with issues of market-based instruments
have now been incorporated into some of
these programmes. In the next stage it will
be a matter of elaborating on these com-
ponents and giving them a greater practi-
cal orientation. Political foundations are
also suitable cooperation partners where
the social dimension of environmental pol-
icy is concerned, or when creating plural-
istic fora for discussion or for research
cooperation. The pluralistic institutional
structure of German development coop-
VI
eration offers opportunities in the field of
policy advice (not limited to the environ-
mental sector) which could be utilised
more extensively than in the past, e.g. un-
der country programmes.
Policy planning and institutional develop-
ment programmes in the environment –
particularly where they involve market-
based instruments – make very heavy de-
mands on both, partners in the developing
countries as well as German cooperation
agencies and require staying power. The
risks from political uncertainties and proc-
ess orientation can, however, be limited by
careful initiation, preparation and planning,
substantial orientation towards participa-
tion and possibly also break points. In ad-
dition, policy advice in the environment
should also have other elements besides
the focus on market-based instruments,
giving them the nature of a programme. In
the short term there is no reason to expect
that developing countries will come forward
with full-flegded applications to the Ger-
man Federal Government which deal spe-
cifically with advisory services on market-
based instruments. It is, however, realistic
to assume that it will be possible in the
course of identifying, planning and as-
sessing development cooperation projects
to identify a corresponding need and spe-
cific opportunities for cooperation in neigh-
bouring areas. Such opportunities should
be actively pursued.
1. Introduction
Although the principles of “polluter pays”
and prevention have long been established
in environmental policy, in practice the
emphasis has largely been on repair-
oriented and curative measures. This is
also reflected in the worldwide predomi-
nance of command-and-control concepts
in environmental policy. Experience has,
however, shown that such concepts have
limited reach, and this is increasingly
forcing a reorientation in policy instruments
and hence not least (in both institutional
and instrumental terms) to greater integra-
tion of environmental policy and economic
policy. In a market economy context, one
of the most important requirements for this
is the integration of the environmental di-
mension into the market mechanism in
such a way that the market responds ef-
fectively to them instead of working against
them.
In a broad sense, the term “market-based
instruments of environmental policy” (MBI)
is used to cover all price-related and/or
regulatory instruments which harness the
commercial self-interest of actors (i.e. in-
dustry, farmers, transport users or the po-
pulation at large) for environmental goals.
Although overshadowed by political and
scientific debate, a wide range of market-
based instruments (MBI) have found their
way into environmental policy in a growing
number of countries. In Germany this
applies to the effluent charge at Federal
level and, above all, to the "Länder" (sta-
tes) and local authorities. Other OECD
countries are acquiring experience with
MBI in environmental policy, starting with
so-called "emission trading" in the USA,
and going on to liability laws in Japan and
the deposit on car bodies in Norway. Se-
veral developing countries are also deve-
loping approaches of this kind, e.g. diffe-
rent rates of duty on leaded and unleaded
petrol in Thailand, pollution licences in
Chile and the environmental fund in Tuni-
sia.
In developing countries in particular, there
is a particularly close relationship between
people’s living standards and the state of
natural resources. In times when market
economy principles are gaining ground in
developing countries as well, environmen-
tal policy must get to grips with the potenti-
al and limits of market-based instruments if
it wishes to remain effective and contain
the scale of environmental problems. This
is particularly important in view of the se-
rious shortcomings in implementing “com-
mand-and-control” instruments that have
become evident throughout most develo-
ping countries. Having said this, however,
it is important not to lose sight of the corre-
sponding problems which the use of mar-
ket-based instruments can involve under
certain circumstances.
In developing and strengthening appro-
priate environmental institutions in deve-
loping countries, development cooperation
(DC) to date has limited itself to rather nar-
row aproaches. Although technical coope-
ration (TC) has devoted increasing attenti-
on over the past 10-15 years to institution
building for government and non-
governmental environmental institutions
and organisations, projects have been
predominantly technical and at operational
levels. Financial cooperation (FC) has re-
cently incorporated elements designed to
address issues of long-term viability in
environmental terms as well (e.g. by impo-
sing requirements for covering costs in
electricity generation projects). We can ex-
pect greater demand for assistance in en-
vironmental policy planning, not least be-
cause awareness of ecological issues is
being steadily enhanced in developing
countries within the framework of training
and upgrading programmes and through
research cooperation programmes (e.g.
SIDA, IDRC, World Bank, DSE). This pa-
per is an attempt to define this area of co-
operation more closely, specifically in the
field of market-based instruments, and to
consider the role of DC in the light of the
particular complexity and sensitivity of the
issue.
1
2. Market-based instruments in environmental policy: types
and experience
2.1. Arguments for using market-based instruments in environmental policy
In both industrialised and developing
countries, the application of individual
market-based instruments has always be-
en the result of specific constellations.
These generally involved a mixture of envi-
ronmental and economic considerations.
The difficulties in implementing "command-
and-control" approaches, the high costs (to
both private and public-sector budgets)
and the static nature of curative environ-
mental policy have always been an im-
portant motivation for considering ways to
introduce economic mechanisms into envi-
ronmental policy. There are a number of
factors at work here, such as:
• the enormous cost of monitoring (which
becomes virtually unmanageable in the
SMI sector);
• the disproportionate growth in waste
and effluent disposal costs as the level
of purification required by "end-of-pipe"
technologies rises;
• free residual pollution, which leaves no
incentive to reduce emissions beyond
standards (and results in substantial
external costs, particularly in developing
countries);
• the obstacle to innovation caused by
rigid technical regulations which leave
little scope for integrated and possibly
more cost-effective solutions and fre-
quently go beyond the expertise of envi-
ronmental agencies;
• the economic inefficiency of standards,
which require each individual source of
emissions to meet the same norms irre-
spective of the costs of compliance
(which can vary very widely depending
on the type of plant) and which do not
permit compensatory approaches.
• Other issues arise when the peculiari-
ties of public goods and long-term de-
velopments are considered, for example
arising out of distortions to price me-
chanisms. This type of problem is parti-
cularly frequent in developing countries:
2
Free access to a resource where there
is no possibility of excluding potential
users tends to lead to overexploitation
(e.g. fish stocks, water).
• Where property rights are vaguely de-
fined or uncertain (e.g. for forests,
arable or grazing land), users will tend
to omit or neglect maintenance mea-
sures, contributing to overexploitation.
• Internationally widespread subsidies for
primary fuels, fertilisers and pesticides
are tending to undermine the effect of
ecological regulations and hence their
goals.
• Besides burdening public-sector bud-
gets, undesirable ecological effects ari-
se where fees for public services (e.g.
water supply, sewerage, waste dispo-
sal) are too low to cover costs.
• "Command-and-control" approaches
generally have little impact on the (eco-
nomic policy) framework for economic
growth and structural change, creating
the risk that their initial successes will
be eroded by higher emission and re-
source consumption levels.
Against this background, determining the
“right” set of instruments is a question that
can only be answered on a case-by-case
basis, i.e. depending on the nature of the
environmental problems (type of pollutant
or resources), their sources (e.g. number,
type, geographical distribution), the impact
on people, environment and economy, and
with due allowance for the existing institu-
tional structure and setting. It is, however,
important to avoid giving market-based
instruments an air of mystery through ter-
minological differentiation from “other” in-
struments of environmental policy.
The controversy over the fundamental su-
periority of regulatory instruments or mar-
ket-based instruments has given way to a
pragmatic consensus that it is normally a
matter of developing an effective policy mix
of different and complementary regulatory
and market-based instruments which will
also have a preventive effect. In conside-
ring the advantages and disadvantages of
a given instrument, it is accordingly im-
2.2. Types and examples of market-based instruments in environmental policy
2.2.1. Overview
In the broad sense, market-based instru-
ments involve all price or non-price measu-
res which make use of the economic self-
Overview of market-based instruments in environmental policy
Instruments
Fees, prices
Charges and taxes
Subsidies and funds
Compensation and tradable permits
Deposit systems and performance bonds
Law of liability
Property rights
• environmental fees and pricing policies
for primary commodities and inputs;
• environmental charges and taxes which
are likely to have an environmental ef-
fect as well as a revenue effect;
• subsidies and environmental funds;
• tradable permits and rightes, including
flexible standards and regulatory orders
which result in reduction of abatement
cost by taking into account the differing
costs for different emission sources
(compensation);
• deposit systems and performance
bonds;
• law of liability, where it applies to risks
with environmental relevance;
• tradable property rights, where these
include incentives for sustainable ex-
ploitation.
portant to look at these in the context of the
entire range of (regulatory and market)
instruments.
interest of the polluter to create incentives
to lower costs by preventing pollution or
through sustainable use of natural resour-
ces.
Examples
Prices or subsidies for energy, water, fertilisers and
pesticides, water and effluent treatment fees, refuse
fees, toxic waste fees, road use fees
Emission charges, product charges, exploitation
charges, differential taxation
Grants, tax concessions, special depreciation allo-
wances, customs concessions, concessionary inte-
rest rates, location incentives, environmental funds,
revolving funds, sectoral funds
Flexible standards, pollution permits and certificates,
tradable quotas and exploitation permits
Deposits, e.g. on bottles, packaging, vehicle bodies,
reafforestation bonds, rehabilitation bonds, risk
bonds
Liability for damage and injury, environmental liabili-
ty, liability insurance
Land titles, water rights, concession auctions, deve-
lopment rights, joint commercial exploitation
The notion of market-based instruments in
environment is not amenable to precise
definition. Besides standards and other
clearly regulatory instructions, there are
obvious borderline areas where regulatory
or market elements predominate, depend-
ing on operational details.
2.2.2. Fees and prices
Environmental fees are levied for services
(e.g. effluent or refuse disposal). To avoid
losses on the part of the suppliers (usually
the state) and to ensure adequate capaci-
ty, fees should cover full costs. In practice,
this principle (which requires coverage of
operating, maintenance and capital costs)
is all too frequently ignored for sectoral or
social policy reasons. This is a major pro-
blem in environmental terms, as subsidies
3
remove any incentive to reduce demand
for the services through preventive measu-
res (e.g. reducing refuse).
Particularly important – although mostly
outside the direct competence of envi-
ronmental ministries and agencies – are
subsidies and price controls on industrial
or agricultural inputs, and specifically
energy, water, fertilisers and pesticides. In
many developing countries subsidies on
electricity have been a significant factor not
only in the deficits of state-owned power
generation companies, but also in the lack
of finance for modernising power stations
and failure to exploit potential for energy
conservation in industry, agriculture and
transport. Vast areas of arable land are still
becoming salinated or waterlogged becau-
se farmers are using free irrigation sy-
stems and (often in combination with defi-
cient drainage) overwatering their fields.
Like subsidies for fertilisers or pesticides,
subsidised water rates distort prices and
discriminate against other measures for
maintaining and increasing agricultural
productivity, such as soil cultivation and
conservation. In the long term, this can
lead to declining agricultural productivity,
erosion, groundwater pollution, resistance
etc.
On the other hand, it is particularly difficult
to increase fees and input prices in deve-
loping countries, as this may involve ex-
tensive distributive effects. Effective com-
pensation is difficult because the relevant
tax or social policy instruments are gene-
rally not sufficiently developed, so that
adjustments in this area can only be ef-
fected in stages – if at all. On the other
hand, economic logic favours im-
plementing the first stage (achieving full
cost cover) before the second (e.g. im-
posing charges).

Example of input prices that cover costs

Indonesia spent just under USD 130 million a year up to 1985 on subsidies for pesticides; i.e. up to 82% of
the consumer price. The resulting massive use of pesticides and subsequent development of resistances
led to disastrous plagues of locusts in the 70s and 80s which destroyed large portions of the rice harvest.
Between 1986 and 1988 the pesticide subsidies were abolished in stages, partly for ecological reasons but
partly also for financial reasons. In addition, the use of a large number of pesticides was banned in 1986,
including some of those that had formerly been subsidised. By 1989 the use of pesticides had dropped by
90%, the yield per hectare had, however, increased by 20%. In the meantime, integrated pest control me-
thods are now being promoted.

In China irrigation farming has been promoted since 1949, and today around 75% of arable land is irrigated.
In 1985 the Chinese government started decentralising its irrigation policy and gave provinces greater eco-
nomic autonomy. In the course of these reforms, water rates were raised to the level of operating, mainte-
nance and capital costs, with the result that overirrigation and inefficient distribution decreased. Since 1980
the government has been financing new irrigation systems with loans instead of state grants as a way of
motivating agencies to raise water tariffs.

2.2.3 Charges and taxes de differentiated rates of taxation based on

A characteristic common to both envi-
ronmental charges and taxes is that they
are imposed on the exploitation of the envi-
ronment as a commodity and have both an
environmental and a revenue effect (which
in practice can be more important). Under
German tax law, revenue from charges
must be used for specific purposes, while
taxes can be absorbed in the general bud-
get. Environmental charges and taxes can
be imposed on certain types of emissions,
inputs, exploitation and products, or inclu-
environmental policy considerations.
Compared with standards and norms,
charges have (besides the revenue effect)
the advantage that they create an incentive
for the originator of emissions to reduce
residual pollution below existing limits,
where this is cheaper than paying the
charge.
The environmental effectiveness of levies
is, however, dependent on a series of fac-
tors. The basis for assessment must,
for example, be as simple as possible
(quantity of pollutant, energy consumption,
units of output, possible indirect indicators
such as energy consumption) and there

4
must be a clear relationship to the envi-
ronmental problems to be contained with
the help of the charge. Much depends on
the amount of the charge, which needs to
be based on an estimate of the costs of
preventing pollution which is as accurate
as possible (in some cases, this may also
be extremely difficult). There are also pro-
blems with political decision-making if
changing production output, emission
quantities or environmental quality objecti-
ves require increases in levies.
The burdens of adjustment are divided
between suppliers and consumers, de-
pending on the intensity of competition,
potential for technological innovation, pos-
sibilities of substitution and the elasticity of
demand. This makes it difficult to determi-
ne in advance how far the adjustment will
come from changes in the manufacturing
process and/or constraints on demand (the
problem of accuracy). In practice, charges
are accordingly usually combined with
norms or standards.
Factors favouring the use of emission
charges are:
• clear differences in abatement costs for
different sources of emissions;
• easily identifiable emission sources;
• low-cost methods of monitoring emis-
sions;
• technological potential for reducing
emissions.
•
Product charges are preferable where
• products are manufactured in large
numbers and are easily identifiable;
• existing administrative structures can be
used (e.g. to collect VAT);
• product manufacture, resource exploi-
tation or waste disposal involve emis-
sions whose sources are diffuse and
difficult to document;
• consumers can switch to other pro-
ducts, so that there is a high price ela-
sticity of demand.
The basic advantage of charges and taxes
is that the polluter has the choice of using
the lowest-cost technology and achieving
the optimal degree of pollution abatement
(below the standards).

Examples of environmental charges and taxes

In Germany the discharge of effluents into bodies of water is subject to a levy under the Effluent Charge
Act. The basis for assessment is the quantity of pollutants, calculated from an assessment index com-
prising suspended particulate matter, oxidants, mercury, cadmium, chromium, nickel, lead, copper,
phosphorus, nitrogen, certain halogen compounds and toxicity to fish. The charge affects direct dischar-
gers, mostly local authorities as operators of public sewage treatment installations and major industrial
plants with their own treatment plants. Since 1993 the charge has stood at DM 60 per pollution unit.
Revenue from the charge (c. DM 500 million a year) has been used as dedicated funding for measures
to protect waters. The effluent charge is combined with “minimum requirements” pursuant to the Water
Resources Act.

In Taiwan the government passed a law in 1991 on controlling air pollution which involved a system of
emission taxes on industrial emissions and fuels. The revenue from the tax is to be used for envi-
ronmental protection measures. It is planned to lower or eliminate the taxes as soon as certain emission
standards are met.

Besides its control function, the draft effluent charge legislation in the Brazilian Federal State of Rio de
Janeiro gives priority to funding aspects by using revenue to finance monitoring operations by the envi-
ronmental agency and programmes to conserve water resources. There is a similar situation in Colom-
bia, where the revenue from the charge is to be tied directly to the financing needs of the administration.

As in Germany, leaded petrol has, since 1991, been subject to a higher rate of tax in Thailand than
unleaded petrol. As a result of this tax differential, unleaded petrol currently has a market share in
Bangkok of c. 25 %.

5
Examples of environmental charges and taxes (contd.)

Since 1979 China has been testing a system of charges on a wide range of emissions. However, the
pollution charges (extended to cover the whole nation in 1982) only apply if the legal limit is exceeded.
Even so, the system has resulted in a significant decline in pollution, for example a reduction of 80% in
SO2

In the Scandinavian countries charges are raised on batteries, pesticides and fertilisers. The aim of the
Norwegian charge on fertilisers and pesticides is to provide extra funding for environmental programmes
in agriculture. Almost all OECD countries raise product charges on lubrication oils and disposable
packaging.

The German city of Kassel introduced a tax in 1992 on disposable cutlery, dishes and packaging. The
basis for the tax is the use of non-reusable dishes and packaging if used to contain food and drink sold
for consumption at the point of sale. The rates lie between DM 0,10 and DM 0.50. The new tax was
challenged before the courts, but upheld by the Hesse administrative court in August 1994.

2.2.4. Subsidies and environmental e.g. to concessionary loans, grants, tax

funds
Subsidies have direct relevance to envi-
ronmental policy where they are granted to
measures for environmental protection
and resource conservation. This applies
and depreciation allowances for the use of
environmental technologies, corresponding
customs concessions or subsidies for ap-
propriate technologies such as biogas
plants and wood-saving stoves.

Examples of environment-related subsidies

In Japan there are concessions on depreciation for investments in environmental technology and low
waste production processes. In addition, investments in plants using environmental technologies do not
form part of the basis for assessing taxes on capital assets.

In Thailand there are reduced customs tariffs on imported environmental protection plants, provided it
involves "end-of-pipe" technologies. Similar regulations for eco-friendly process technologies are being
planned. In Indonesia imports of equipment for effluent treatment plants are subject to a concessionary
rate of customs duty.

Under the EU LIFE programme grants are available for 30-100 % of the costs of measures (inter alia) to
protect biotopes and nature, of administrative facilities and services in the environmental sector, for
environment-related educational and information material. The EU THERMIE programme promotes
innovative energy technologies, provided that they involve particular commercial risk, e.g. rational ener-
gy use, new energy sources, and even prospecting and development of petroleum and gas fields).

One example of the combination of charges and subsidies is the Dumoka Bone National Park in Su-
lavesi, Indonesia. As part of the extensive irrigation project, farmers were charged for water: these char-
ges were used not only to maintain and operate the irrigation systems, but also to fund nature conserva-
tion and biodiversity conservation measures, which indirectly contributed to improved management of
the water catchment area.

Seen in purely economic terms, subsidies
like these are a second-best solution, as
they involve a risk of free riders and are
based on general sharing of burdens rat-
her than the “polluter pays” principle. Even
so, such subsidies are a widespread in-
strument for achieving environmental pro-
tection goals. Generally, however, the in-
strument should be designed for a limited
period and constructed so that there is no
discrimination against environmental pro-
tection measures which do not involve
investment (an example of such discrimi-
nation is special depreciation allowances).
Practical experience has shown, however,
that it is easier to distinguish between envi-

6
ronmental protection investment and re-
placement or rationalisation investment in
the case of end-of-pipe technologies than
with integrated approaches.
Environmental funds are programmes
which make available loans to finance en-
vironmental protection and resource con-
servation measures through public or pri-
vate-sector banks. Environmental funds of
this type are refinanced partly from the
national budget and partly from environ-
mental charges, taxes or fines for viola-
tions of environmental legislation. The
funds mostly include an element of subsi-
dy, as they offer loans at interest rates
and/or for periods which are more favou-
rable than normal market conditions. Other
variants avoid concessionary elements and
merely assure firms (and particularly SMIs)
access to credit. Retrofitting and non-
productive investment in end-of-pipe tech-
nologies are often particularly difficult to
finance through commercial banks. Envi-
ronmental funds are a relative newcomer
in DCs, but 21 developing countries have
already implemented them. There are two
basic types of environmental funds:
• The standalone model, where the goal
of the fund is limited to a narrowly de-
fined project (e.g. a nature conservation
area).
• The multipurpose model, which is in-
tended to finance environmental protec-
tion and resource conservation measu-
res within a predefined framework.
The main problems currently facing the
funds are management and governance
problems, undercapitalisation, problems of
delimiting recipient groups, definition of
promotional criteria and financing mo-
dalities.

Examples of environmental funds

The Industrial Finance Corporation of Thailand (IFCT) funds private investment in plants for pollution
control through the "Environment Portfolio”. Since 1991 this has been accompanied by an “Environment
Fund", which originally had a capital stock of c. USD 20 million and also derived revenue from a special
charge on petroleum consumption. The introduction of an environment tax to provide further refinancing
for the Environment Fund is currently under discussion.

The "Fonds de Dépollution" in Tunisia also helps finance industrial investment in environmental protec-
tion. It is funded by public money and loans and grants from international donors. Revenue from fees
and fines goes to the general budget of the ANPE environmental protection agency.

Besides public funding, the "Environmental Pollution Prevention Fund" in Korea is financed by fines
imposed on industrial establishments which have exceeded statutory limits. However, the low level of
these fines means that they have little deterrent effect, particularly since no effort is made to collect the
fines in around 30 % of cases for reasons of “economic feasibility”.

In the Federal Republic of Germany the KfW provides loans at concessionary interest rates for long
periods, inter alia for private sector investment in environmental protection, energy saving, and de-
velopment and production of eco-friendly products. The Federal Environment Ministry (BMU) pro-
gramme "Demonstration Projects in Environmental Protection" offers interest subsidies for model pilot
projects in the environmental sector. The Land Lower Saxony has created an “Eco-fund” to co-finance
private projects such as low energy housing, the development of edible packaging for fast-food pro-
ducts, vocational advanced training and consultancy.

7
2.2.5 Tradable permits and market prevent pollution are those who face the
creation lowest costs in doing so.

Tradable permits and market creation are
rights defined in quantitative terms which
are transferable and can accordingly be
traded in the market. The best known form
of this instrument is the so-called "emissi-
on trading", which is practised in the USA
in connection with air pollution control.
Other models involve trading quotas, sha-
res and rights of exploitation e.g. in fishe-
ries and soil use.
The appeal for environmental policy of
pollution permits is that they enable control
of the total volume of pollution. It is up to
the economic self-interest of the polluters
to decide whether to reduce their emissi-
ons or buy the appropriate licences on the
market. The price mechanism minimises
macroeconomic costs by ensuring that the
polluters who make the greatest efforts to
To avoid a situation where trading in pollu-
tion permits leads to concentration of pol-
lution in specific regions (the so-called “hot
spot” problem), the tradable pollution must
have equivalent impact throughout the
region concerned. Conceivable models
range from those where, for example,
emissions are only tradable within a factory
or industrial zone to those involving trading
pollution rights within conurbations or enti-
re states. In this sector, combinations of
tradable rights and regulations are the
norm. The more narrowly defined the area
("bubble") within which compensation is
permitted and the more exchange is ef-
fected through approval procedures (rather
than free trading), the more the instru-
ments involved approach a system of (fle-
xible) regulation.

Examples of tradable pollution rights and compensation approaches

In the course of implementing the Clean Air Act, tradable pollution permits are used in the USA, varying
in form from state to state (so-called "marketable pollution permits", e.g. for CO, SO2 , SPM, NOx). For
specific geographical areas ("bubbles") quality standards can be set for individual pollutants. The 1993
amended Clean Air Act introduced an annual 1.5% reduction in the standards. Within the "bubbles",
once the ambient air quality limits have been reached, additional emissions are only permitted if the
increase is at least compensated for at some other point ("offset" or "netting"). This is done by purcha-
sing (subject to approval) so-called "emission reduction credits" (ERC), which result in a reduction at
some other point of emissions below the minimum requirements. Besides minimising pollution preventi-
on costs (estimates put annual savings at USD 5-12 billion) the system has the further advantage that
the environmental protection agencies need only set quality standards and monitor emissions, without
having to worry about technical details. The US system does, however, involve substantial administrati-
ve work because of the mandatory approval process. The most extensive form of "emission trading" in
practice to date is found in southern California.

Several US states are also using permit approaches in water conservation and refuse disposal. Other
examples of tradable rights (although only on a limited scale) can be found in the USA and Canada in
the production and use of CFCs and acid rain control.

In Chile the Santiago de Chile region has been using a combination of emission standards and pollution
permits since 1992. The emission standards relate to concentrations of atmospheric pollutants, while
the permits relate to total output for each source of emissions. Permits were granted on the basis of
existing emissions ("grandfathering") and initially are valid until 1998. New emission sources will only be
approved then if they are offset elsewhere by purchasing corresponding permits, although only partial
compensation is required for a transitional period (100% compensation from 1997 onwards). The sy-
stem does not cover small emission sources, although these are still subject to the same emission
standards. Based on the experience to date, the system has proved efficient and administratively mana-
geable, although several issues remain to be resolved (tax treatment of licences, extension to small
emission sources).

8
The following requirements must be met
for using pollution permits:
• ability to measure total emissions for
clearly defined pollutants;
• adequate competition in the permit
market to sustain a functioning price
mechanism;
• ability to set geographical limits on the
market;
• monitoring and control capability which
enables fully comprehensive measure-
ment of actual emission levels.
Conditions favouring the use of permit
approaches are:
• relatively large differences in pollution
prevention costs;
• quality levels are set and/or achieved
and can be converted into emission
quantities;
• additional growth is expected in emis-
sions and the number of polluters;
• the number of polluters is large enough
to ensure a functioning market;
• the environmental impacts within the
designated market are independent of
the location of sources;
• the problem of measuring emission
quantities has been solved.

Examples of tradable user rights

To contain traffic problems in Santiago de Chile, tradable user rights for buses were auctioned for cer-
tain major traffic routes. The basic idea of the system is to cut overcapacity and speed up local public
transport by reducing the number of buses. The system was introduced after legislation in 1991 took the
oldest buses out of service to reduce exhaust emissions. This led to problems in practice because licen-
ces were only needed for certain streets, so that bus operators could get round the system relatively
easily by changing their routes. The transport ministry accordingly intends to extend the system to a
larger number of roads or routes in the next round of auctions.

In practice, the main problems in intro-
ducing permits arise in connection with the
initial allocation. This can be done either
on the basis of emission approvals alrea-
dy issued, or existing use ("grandfathe-
ring"), although this creates the risk of
hoarding and thus entry barriers for new-
comers. Allocation based on fixed prices
involves the problem of finding the correct
basis for charging in environmental terms.
Auctions involve high information costs to
ensure that all polluters have the opportu-
nity to participate, and to establish a func-
tioning market. Legal problems arise in
connection with auctions because they
involve de facto dispossession of existing
permit holders. Determining the duration of
licences also involves weighing the claims
of legal security against the need for envi-
ronmental policy control capability.
2.2.6 Deposit systems and perfor-
mance bonds
Deposit systems have long been in use in
a large number of countries for economic
reasons: More recently, they have been
receiving increasing attention for envi-
ronmental motives, particularly in dealing
with products or materials which can be
recycled or involve special disposal prob-
lems. In principle, deposit systems involve
a refundable charge which gives the user
or consumer an incentive to return articles
or materials.

9
Examples of deposit systems

In Denmark there has been a deposit system for beverage bottles for many years. Many retailers, howe-
ver, complain that this results in costs because consumers return a large number of bottles which were
bought elsewhere ("handling costs"). In 1991 deposits between manufacturers and retailers were raised
significantly above the level of deposits between retailers and consumers. This arrangement was, howe-
ver, partly neutralised by the fact that retailers with a "bottle deficit" charged the consumers the higher
rate, so as to motivate their customers to return the bottle to the same place at which it was bought.

In India the largest bottler of mineral water bowed to pressure from the environmental ministry and intro-
duced a deposit on plastic bottles. These were causing significant waste disposal problems, above all in
tourist centres, because refuse is mostly burned at public waste deposits. The result was the emergence
of informal markets in many areas, where the poor population performed the function of bottle collectors
and transporters.

Deposits systems on packaging and beverage bottles are very widespread (almost all OECD countries
and developing countries like Syria, Lebanon, Egypt.

In Norway and Sweden a deposit system for vehicle bodies was introduced in 1978 which has resulted
in the return and at least partial recycling of 90-95 % of all cars.

Practical problems in implementing a de-
posit system arise in publicising the system
and also in organising payments (pay-
ments or refunds between retailers, ma-
nufacturers, recyclers, and refuse disposal
operators), which require in part a mul-
tistage procedure in which the level of de-
posit can vary. One variant on the deposit
system is the "performance bond". Here,
companies have to pay a deposit which is
refunded (plus some interest) if they com-
ply with certain conditions. If the amount of
the bond exceeds the cost of compliance,
this creates an incentive to comply.

Examples of performance bonds

In Australia performance bonds are used to give strip mining operators an incentive to rehabilitate sites.

Sweden imposes performance bonds on oil tankers to reduce the risk of oil pollution.

In Indonesia a variant on the performance bond was introduced in 1980, under which grants for felling
rights were combined with payment of a deposit which was refundable in the event of reafforestation.
As, however, the value of the deposit pro hectare was well below the reafforestation costs, the charge
was simply passed on without having any effect.

2.2.7 Law of liability is sufficient (liability through fault versus

Legally speaking, the law of liability serves
primarily to compensate parties who have
suffered injury or damage. Traditionally,
this has covered loss of income or assets
and hazard to health or life. For environ-
mental damage which does not come un-
der these categories, liability exists only
where “environmental liability” has been
created. Another factor of great importance
is whether proof of concrete fault is requi-
red for liability, or whether the hazard alone
strict liability). In many developing coun-
tries, however, the law of liability is relati-
vely underdeveloped and there are major
problems in enforcement, for example the
lack of legal assistance for victims, over-
loaded court systems and insolvency of
parties found liable.
Economically, the law of liability can also
have a deterrent effect by creating an in-
centive to limit the risk of environmental

10
damage or accidents owing to possible
claims for damages and the resultant hig-
her cost of insurance or risk premiums.
The requirements to be met if the law of
liability is to have a deterrent effect include:
• damage or injury must be attributable to
the acts of individuals or one or more
corporate bodies;
• damages must be calculable, and in
addition to damage to property and loss
of income it must be possible to sue for
environmental damage (environmental
liability).
To ensure that polluters can be held liable
in every event, the law of liability is gene-
rally considered in combination with man-
datory insurance. This does, however,
weaken the individual incentive effect, as
the risks are distributed among all the insu-
rance policy holders. Another important
factor for risk prevention is whether the
insurance premiums are calculated on the
basis of actual risk or based on indirect
criteria, such as tonnage in the case of oil
tankers.

Examples of liability laws

Japan introduced what is regarded as a pioneering series of legal principles in the 80s. These include
the principle of strict liability, the admissibility of the so-called epidemiological proof of causality instead
of strict scientific proof of the cause of damage or injury, the principle of joint and several liability, and
the principle of the reversal of the burden of proof in favour of the victim. This legal foundation, which
was introduced in the context of the "Minamata" and "Itai-Itai" cases, motivated companies to reach
agreements at local level on environmental protection measures which went far beyond the statutory
minimum requirements.

Based on experience after the Bophal desaster, India introduced a limited form of environmental liability
in 1991 in the "public liability insurance act". Under this, all companies using hazardous substances are
required to take out liability insurance which will pay provisional compensation to victims of accidents
without the need for a court hearing or proof of individual fault on the part of the company or its em-
ployees. Although designed to avoid situations like Bophal, where the victims received no payment at all
for years, the amount of the provisional compensation is relatively modest (the final amount is decided
by the courts).

The Environmental Liability Act of 10.12.1990 in the Federal Republic of Germany introduced elements
of environmental liability which should enhance the self-interest of companies in taking environmental
protection measures. The law establishes liability, regardless of fault, for damage or injury caused by
accidents. A liability insurance policy must ensure that possible claims are covered.

2.2.8 Property Rights • local community, group or private ow-

Property rights over natural resources have
major importance in environmental policy.
A very wide range of combinations of ow-
nership and exploitation rights are concei-
vable, e.g.:
• public ownership and exclusively na-
tionalised or collective exploitation;
• public ownership, with rights of disposal
and exploitation transferred (through
concessions, permits, licences, leases)
to local communities, groups or private
companies and individuals ("public do-
main system");
nership where the state reserves the
right to monitor the nature of ex-
ploitation through to
• unrestricted private ownership.
From the environmental policy standpoint,
ownership and rights of exploitation in wa-
ter (including ground water), air, soil, forest
areas, fish and game stocks are particu-
larly important. Generally speaking, envi-
ronmental policy instruments (with either
regulatory or market orientation) require
prior clarification and assertion of rights of
ownership and exploitation. For example,
state institutions can only impose require-
ments or levies for waste water if the state
has the property right. From an economic

11
standpoint, the question of the tradability of such rights is particularly interesting.

Examples of property rights

37 % of agricultural land in Thailand is not documented in land registers or titles. A further 47 % is sub-
ject to exploitation rights for a limited period only. In many areas, the risk of eviction leads farmers to
neglect investment in soil improvement and erosion protection. Their uncertain legal status also means
that farmers have difficulty obtaining credit, and are frequently forced to resort to the expensive informal
credit market. Often it is more profitable to clear public land than intensify agricultural activities on exi-
sting arable land. The Thai government is implementing a programme with World Bank support which
guarantees farmers inter alia nontransferrable exploitation rights for terms of 5-25 years.

In Papua New Guinea the policy of liberalisation gave rise to the question of introducing private land
ownership. Previously, traditional exploitation rights at village level had existed which functioned well,
including in ecological terms. Instead of introducing land registers and private ownership, the govern-
ment decided to secure the traditional exploitation rights in the "Land Ordinance Act". Mediation proce-
dures and special courts are available to settle disputes. In this system, for example, companies have
to negotiate felling concessions directly with the clans or village councils. Individual families have the
right to cultivate arable land, while ownership is vested in the relevant clan.

In the Indian State of Maharashtra the "Phani Panchayat" model has proved very successful in mana-
ging water catchment areas. In a framework of village self-help organisations, minidams are constructed
and erosion protection measures implemented. Exploitation rights were also agreed among small-scale
farmers for irrigation which set upper limits on the cultivation of water-intensive sugar cane and quanti-
ties of water per hectare. Hectare yields were increased for all farmers under this arrangement. At the
same time, the water shortage has been decisively reduced.

In Benin, uncertain legal relationships and conflicts between traditional and state land codes, reinforced
by the current breakup of state farms, are leading to destructive behaviour towards resources. Faced by
the unresolved issue of restoration and delays in negotiations with the state, former landowners who
were dispossessed in the course of creating state farms have destroyed trees, harvests and equipment
("We will not allow the state to benefit from things that belong to us but are not being returned to us").
The reprivatisation of forest areas under the structural adjustment programme has led to massive pro-
tests in Honduras. In some cases, users set forest fires ("Protest matches").

Problems frequently arise in connection here, enforceable intragroup arrange-

with sustainable use of natural resources:
• Where there is free access to a re-
source and existing users have no way
of blocking out other users (free riders):
this tends to lead to over-exploitation of
the resource, as existing users cannot
rely on other users to share in or even
not disrupt maintenance measures.
• Where property rights are inadequately
defined: (legal) security regarding the
nature, extent, exclusivity and duration
of property rights play a particular role
here. Insecure property rights frequently
lead to neglect of investment in resour-
ce conservation. Often formal rights
compete with informal or traditional
rights, which may lead to conflict over
exploitation.
• In the case of common property sys-
tems, where specified groups (e.g.
village population) use resources jointly:
ments and incentives together with ex-
clusivity of exploitation by the group are
essential for sustainable management
of the resources.
• Where a given exploitation code is
changed (from above) without taking
account of all user groups.
There are many different solutions, and
these cannot be generalised. Depending
on the situation and the resource, one of
the following might prove helpful: private
ownership, the transfer of user rights sub-
ject to conditions (e.g. approval pro-
cedures, quotas, concessions, licences),
increasing legal security (e.g. through land
registers, property rights, tenancy and
agricultural tenancy law etc.), intragroup
arrangements within self-help or-
ganisations or at village level, or strengt-
hening of traditional exploitation rights. In
the interest of sustainable resource use,
however, the property rights must be cle-

12
arly defined, exclusive, enforceable and traditional and "modern" systems – this is
secure. In many developing countries – not the case.
partly because of competition between

13
3. Market-based instruments of environmental policy - policy
planning and development cooperation
3.1. The context
It is by no means pure chance alone that
regulatory approaches have dominated
environmental policy worldwide, while the
use of market-based instruments has re-
mained limited. Barriers to wider use in
democratic systems include relatively short
legislative terms, which often deter politi-
cians from embarking on measures with
long-term orientations. Sectoral or-
ganisation and fragmentation of state
authority, the add-on nature of environ-
mental policy and the frequent predomi-
nance of lawyers and administrative pro-
cedures in government in turn favour dem-
onstrating the effectiveness of envi-
ronmental policy by means of regulations,
bans, spectacular court cases and factory
closures, rather than through “invisible”
incentives. However, where regulations,
bans and controls cannot be effectively
implemented through standards, limits and
sanctions, environmental policy - even with
market incentives - will hardly achieve more
than a symbolic effect. Where state ap-
proval procedures or regulations engender
a system of nepotism and corruption, this
will create additional barriers to the intro-
duction of market incentives. Corporatist
structures in which certain interest groups
are too closely involved with the state are
also inimical to the effective use of market
incentives in environmental policy.
It is always helpful for government envi-
ronmental institutions to have political clout
and healthy cooperation at interministry
level in cases where the use of market in-
centives goes beyond the environment
ministry’s scope of responsibility, as is often
the case with subsidies and price and tax
policies (sectoral and finance ministries), or
when setting land-use rights (agriculture
ministry) or fees (relevant sectoral minis-
tries, e.g. for irrigation, water etc). The
fragmentation of responsibilities relevant to
environmental policy often seriously limits
the scope of action of environmental institu-
tions, with resulting implications for the
structuring of environmental policy instru-
ments.
Reforming the range of environmental pol-
icy instruments is easier where strong envi-
14
ronmental policy as a state responsibility is
already established on a broad base in gov-
ernment structures and firmly rooted in pub-
lic debate. As environment ministries and
agencies are normally comparatively weak
compared with the classic institutions, it
helps the cause of environmental policy
reform, if there are existing or budding
strategic alliances. Particularly important in
this connection are other ministries and
government institutions, although environ-
mental NGOs, pressure groups, trade un-
ions, consumers and the media are also
significant. Success in this field requires a
pressing problem which is apparent to indi-
vidual actors or the general public, together
with a factually-based awareness that such
issues are either insoluble within the
framework of existing instruments or can
only be solved at very high cost.
Another important question is how far mar-
ket economy structures have already been
established in the country concerned, and
whether there is general confidence in the
performance of the market. Where these
requirements are met (or there is at least an
evident trend in this direction), instruments
capable of achieving not only an environ-
mental policy impact but also an economic
effect (so-called "win-win" effects) have a
particularly good chance of success. In this
respect, market-based instruments have
certain advantages over purely regulatory
instruments. There are concrete openings
available through privatisation efforts fa-
vouring cost-covering charges for what
were previously public services (water sup-
ply, refuse disposal etc). Decentralisation
efforts also provide such openings, as gov-
ernment institutions at provincial or local
level are inevitably interested in the greatest
possible autonomy and hence revenue. The
degree of integration in the world market
can also lead to openings, if exports are
endangered by environmental standards in
the EU or other importing countries. One
opportunity for setting cross-sectoral envi-
ronmental strategies are processes in which
countries draw up environmental action
plans or national strategies for sustainable
development. The degree of precision in the
formulation of the environmental policy
goals (and particularly environmental quality
objectives) is an important indicator of the
political will that is crucial for effective de-
ployment of any environmental policy in-
strument. The existence (or emergence) of
environmental framework legislation or a
national environmental strategy can provide
some hints in this area. The more the goals
are stated in operational terms, the greater
the possibility of useful evaluation of exist-
ing instruments, assessment of reform pro-
posals and concrete structuring of regula-
tory and market-based instruments. In
many cases, the debate over objectives –
particularly in public – is limited, as it in-
3.2. Institutional requirements
The introduction and implementation of
market-based instruments involve sub-
stantial inputs in administration and/or
monitoring – they are by no means self-
perpetuating elements of environmental
policy. The additional inputs required (or
savings) compared with regulatory in-
struments depends on the type of in-
strument, its specific design, and how far
the package of instruments fits into existing
procedures and institutional structures.
Before making any decision on introducing
market-based instruments, the existing
institutional structures and their capacities
have to be reviewed.
The basic condition for the use of market-
based instruments is adequate know-how in
the fields of environmental law, economics,
administration and planning in both the gov-
ernment environmental institutions them-
selves and in their surroundings, particularly
in research and consulting organisations.
Another important issue is whether the envi-
ronmental ministry has the primary function
of planning and coordination (“nodal
volves the risk of publicising latent conflicts
of interest and ultimately weakening envi-
ronmental policy (although this process can
perfectly well be fertile and conducive to
consensus). Where, however, politicians
seek to avoid any public debate at all, it can
be assumed that nothing beyond symbolic
gestures is intended, with environmental
policy merely a loose mesh full of loopholes.
In such cases, advisory services on policy
planning have very limited scope, particu-
larly in the area of market-based instru-
ments. This also applies to cooperation at
the implementation level, which will also be
limited in scope under these conditions.
agency” model) but relies on other insti-
tutions for monitoring and implementation
(laboratories, police, state and district-level
authorities, forestry agencies, factory in-
spectorates), or whether it has its own re-
sponsibilities and corresponding decentral-
ised structure for implementation (“en-
forcement agency” model). Another aspect
that needs to be checked is the allocation of
authority between local, regional and na-
tional authorities at various levels, e.g.
whether federal states, provinces or local
authorities can issue regulations, raise
charges, impose levies etc. The vertical and
horizontal distribution of authority is impor-
tant e.g. for introducing tradable pollution
rights, if trading is confined to geographi-
cally limited regions (“bubbles”), which
should coincide with the regional authority
of the relevant institutions. Finally, it is also
necessary to review which disposal and
monitoring systems are available, e.g.
whether water meters or measuring stations
for effluent and exhaust gases are installed
in industrial establishments.
15
Examples of institutional problems in implementation

In 1977 India passed the “Water (Prevention and Control of Pollution) Cess Act”. This involved a (mini-
mal) charge on water consumption, with graduated tariffs depending on the type of use and particularly
on the degree of pollution of the effluent. There is a rebate if measures are taken to purify effluents,
making the charge in part an effluent charge. Indirect dischargers are exempt. The main purpose of the
Act is to create revenue for the severely underfunded State Pollution Control Boards (SPCBs) in the
federal states. The SPCBs, which are responsible for collecting the charges and also bear the adminis-
trative expense, are required to pass on the revenue to the central government budget. The federal
states in turn “shall” (as the Act puts it) finance the SPCBs through grants. Experience has shown that
this is a long, drawn-out process, and does not ensure funding for the SPCBs. As a result, the SPCBs
have little motivation to collect charges throughout their territories.

If the environmental agencies rely on other
institutions for implementation, it is impor-
tant to consider the latter more closely.
Where direct taxes (income or corporation
tax) can only be collected incompletely if at
all, it is unlikely that emission charges or
taxes can be successfully collected. Collec-
tion of product charges or taxes is easier
where indirect taxes can be collected effi-
ciently (VAT, sales tax, product taxes). In
terms of costs, it is usually a good idea to
use existing institutional structures rather
than create new ones.

3.3. Criteria for analysis and evaluation

Besides closer consideration of the general • estimated costs of abatement or preven-

and institutional requirements, it is also
necessary to review the context of the envi-
ronmental problems which environmental
policy is intended to solve. In the case of
emission problems, the following general
criteria for analysis can be used:
• nature and level of hazard of the pollut-
ant(s) including long-term ecological im-
pact;
• legal formulation of the relevant property
rights in water or air and their enforce-
ment;
• state of technical infrastructure (e.g.
monitoring networks, disposal, laborato-
ries);
• state of disposal and degree to which
corresponding services cover cost;
• ability to monitor emissions and attribute
them to polluter;
• availability of corresponding environ-
mental technologies, alternative process
or products, potential for innovation;
tion and their variation by source of
emission;
• number, type, size and regional distribu-
tion of polluters;
• estimated intensity of competition and
flexibility of demand;
• statement and clarity of environmental
policy objectives and priorities (reduction
targets, stabilisation goals, priority of
revenue or control effect etc).
In each case, the potential instruments
must be evaluated and compared with each
other and (particularly) with pure orders or
bans. The relevant criteria are the ecologi-
cal effectiveness, economic efficiency, ad-
ministrative manageability, public-sector
costs and revenue, the effects on distribu-
tion and the feasibility of the instruments.
Where the use of individual instruments
depends on the existence of other regula-
tions, the package as a whole should be
evaluated.

16
Criteria for evaluating environmental policy instruments

Environmental effectiveness,
i.e. the measurable attainment of the environmental policy goals, depending on the environmental
problems involved (e.g. reducing pollution or consumption of a resource). Another point to be con-
sidered is whether there are incentives to reduce emissions below the minimum requirements.

Economic efficiency,
i.e. a comparison between the microeconomic and macroeconomic costs of the various instruments for
a given environmental impact. The review should cover both short-term and long-term considerations
(e.g. cost savings through innovation) and also the question of whether the instrument will focus efforts
at prevention on the points where they are most cost effective.

Administrative feasibility
This is concerned with the modalities of introduction or implementation, their adaptation to existing (gov-
ernment and non-government) institutional structures and the statutory permissibility of the instruments,
e.g. cost of measurement, need for information, demand for trained staff, responsibilities of institutions,
possibilities for decentralisation and self-help potential.

Public-sector costs and revenue,

arising out of the introduction and implementation of the instruments (e.g. costs of supervision, general
administration, services and infrastructure). Directly imputable revenue e.g. from charges, levies or
taxes, should be offset.

Effects on distribution,
i.e. the ability to implement the instruments vis-à-vis the polluters and the population generally, where
different burdens or benefits accrue to individual groups.

3.4. Operational planning

A (preliminary) decision can be reached on • determining the uses of revenue (ear-

the choice of instruments based on context
analysis and comparative evaluation of
various instruments. To give these instru-
ments operational form, further questions
must be settled, a process illustrated here
for environmental charges:
• reviewing existing property rights, stan-
dards, etc;
• determining the type of charge (emis-
sion, product etc);
• determining the basis for assessment
(quantity of pollutant, concentration of
pollutant, use of raw materials, quantity
of output, etc);
• determining the level of charges (based
on average marginal prevention costs or
cost of damage);
• identifying additional needs in terms of
technical infrastructure required for im-
plementation;
• estimating costs of introduction and im-
plementation and revenue;
• determining the group of payers (all pol-
luters, certain groups of polluters, key
regions, manufacturers, dealers etc);
marked or general budget);
• identifying the need for change in exist-
ing laws, regulations or codes;
• determining monitoring, administrative
and collection procedures;
• determining sanctions for violations;
• determining organisational and ad-
ministrative requirements for introduction
and implementation;
• determining transitional periods and
stages in introduction;
• consulting with all involved on the indi-
vidual drafts;
• determining announcement and infor-
mation policy;
• determining indicators for monitoring and
evaluation.
It is not possible to describe the individual
steps in detail here. It is, however, clear that
a substantial amount of planning and con-
sultation is required. In many cases it will
also be necessary to invest in the technical
infrastructure.

17
3.5. Acceptance and feasibility
Anyone intending to implement market-
based instruments of environmental policy
must tackle the problems of acceptance
rooted in the political process and the inter-
ests of individual actors. The introduction of
market-based instruments inevitably in-
volves a substantial amount of communica-
tion and consultation.
The following aspects are important in in-
creasing the acceptance of market-based
instruments among target groups and the
general public:
• Market-based instruments act in ad-
vance of regulations, bans and possible
closures; they accordingly help avoid
breaches and their economic and social
consequences (loss of jobs and produc-
tive capital).
• Several price-related, market-based
instruments (charges and taxes) tend to
act degressively. On the other hand, en-
vironmental problems involve substantial
costs which hit the poor population
groups first and foremost.
• All experience shows that technical
regulations do not lead to the most cost-
effective solution, as they inherently aim
at unproductive end-of-pipe technologies
and neglect the potential for innovation
or savings in integrated preventive tech-
nologies. Wherever possible, proof
should be cited to show that market-
based instruments tend to induce more
cost-effective solutions in relation to
“command and control” approaches.
• Market-based instruments are frequently
seen as additional costs and rejected
accordingly. This can be eased through
“grandfathering” and a stepwise (al-
though reliable) introduction.
• The adaptability of those affected must
be taken into account and promoted in
introducing market-based instruments.
Besides gradual introduction, this can be
18
done e.g. through technological advice,
information on existing methods of pre-
vention (e.g. water conservation possi-
bilities for households, integrated envi-
ronmental technologies in industry),
promoting relevant technological devel-
opments and possibly focused use of
subsidies (limited durations as far as
possible).
• Market-based instruments should be
introduced on the principle of “first things
first”, i.e. in areas where the pressure of
problems is greatest and most evident
despite other environmental policy
measures.
• Environmental reporting should be stra-
tegically expanded so that structural ef-
fects of market-based instruments can
be demonstrated (technological
changes, structural changes etc).
• Acceptance considerations may also
make it advisable to use revenue from
market-based instruments in dedicated
ways, e.g. in environmental funds.
• Wherever possible, strategic alliances
should be sought and exploited, e.g. with
suppliers of environmental technology,
exporters, trade unions, NGOs, scien-
tists etc.
• The actors affected should be involved
in all phases of planning and imple-
mentation.
Acceptance problems affecting the use of
market-based instruments can be solved
more easily where government environ-
mental policy credibly implements the “pol-
luter pays” principle and principle of pro-
phylaxis. “Empowerment” of state and NGO
environmental institutions is to some extent
a requirement for solving acceptance prob-
lems.
3.6. Approaches and phases

It is of course important to take into account
the specific status of environmental policy
debate in the developing country con-
cerned. It can be helpful here to distinguish
between the following phases:
• preparation;
• planning and selection of instruments;
• implementation.
The preparation phase is distinguished by
the fact that debate on the use of market-
based instruments is just beginning. There
is vague interest on the part of individual
decision-makers in using market-based
instruments, without however any concrete
planning. In this phase the following meas-
ures can be useful in order to smooth the
path for a process leading to a revision of
the environmental policy instruments and
possible increased use of market-based
instruments.

Preparatory phase: possible activities

• Commissioning of environmental economic studies by local research institutions and dissemination

of the results (possible topics: expenditure on environmental protection by industry and the public
sector; degrees of cost coverage in public services, evaluation of environmental damage, imple-
mentation problems in environmental policy, environmental impact of growth and structural change,
potential for energy or water conservation, economic evaluation of preventive environmental tech-
nologies, environmental impact land codes, state of funding of state environmental institutions etc);
• Channelling contacts with relevant research institutes in other countries, possibly “twinning”, i.e.
concrete cooperation agreements;
• Information visits to give multipliers the opportunity to acquaint themselves with experience in devel-
oping and industrialised nations with the use of market-based instruments (target groups: decision-
makers and middle management in government environmental institutions, scientists, NGOs, repre-
sentatives of industry, journalists);
• Creating forums for debate and working parties on environmental policy, with the involvement of the
most important actors;
• Organising national and international expert discussions, workshops and seminars in order to pres-
ent models of and experience with market-based instruments;
• Possible advisory services to the planning department in the environmental ministry and linking it to
scientific institutes, NGOs, etc;
• Assisting “local champions”;
• Analysing the environmental impact of economic and sectoral policies;
• Sending multipliers on relevant training and upgrading courses;
• Assisting with establishing relevant curricula and courses at universities in developing countries.

In the planning phase and when selecting
instruments, there are declarations of intent
by the government or important non-
governmental actors to integrate market-
based instruments into the range of envi-
ronmental policy instruments. Measures
geared to preparation, communication and
networking should be continued in this
phase. In addition, there are further techni-
cal issues and responsibilities, the most
important of which are shown below:

19
Phase of planning and selecting instruments: possible areas for advisory services

• identifying priority environmental problems;

• detailed formulation of environmental policy goals;
• reviewing the institutional and legislative framework;
• evaluating the current range of instruments;
• reviewing the requirements for the use of market-based instruments;
• comparing instruments, selecting appropriate instruments;
• operational planning for individual instruments;
• possibly trials under pilot measures;
• identifying the requirements (administrative, statutory, staffing, institutional, technological) for imple-
mentation;
• revising proposals after trials;
• reviewing the impact on distribution and possible compensation measures;
• clarifying feasibility and possible communications strategies.

In the implementation phase there are con- ess and generating the framework condi-
crete plans for using market-based instru- tions needed for implementation. Particu-
ments. The emphasis in advisory services larly noteworthy are:
is on organising the decision-making proc-

Implementation phase: possible areas for advisory services

• organising expert discussions;

• hearing the views of stakeholders;
• inter-ministerial, cross-sectoral dialogues;
• revising drafts;
• creating the framework conditions for implementation (administrative, institutional, legislative, staff-
ing, technical infrastructure);
• creating the conditions for monitoring;
• designing and implementating communication strategies;
• evaluating results.

All the measures and focal points listed
here are intended to illustrate possibilities.
They must be given detailed form and
adapted to local features on the basis of the
specific situation. One element of this in
individual cases must be to decide what the
German contribution will be. As far as pos-
sible, existing local expertise should be
used and enhanced.

20
4. Environmental policy planning and development
cooperation

4.1. Policy planning and capacity development in the environment

In development cooperation practice, assi- ronmental policy planning should be seen

stance in policy planning has always played
a special role. This role has been all the
more important where assistance in policy
planning has moved away from the narro-
wer sense of government-oriented advice to
involving all relevant actors and so increa-
singly taking on a political dimension. Envi-
as an element in what has recently become
known in international discussion as “capa-
city building”, or (to get away from the phy-
sical associations of the term) “capacity de-
velopment in the environment”.

Capacity development in the environment

Generally, “capacity in the environment” is understood as the capability of a country to solve envi-
ronmental problems at national or local level on its own for the purposes of sustainable development. As
an area of development cooperation “capacity development in the environment” (CDE) is concerned with
“technical” improvements (e.g. resource-conserving land use, preventive environmental technology,
environmental information systems) and also supports cross-cutting approaches such as the develop-
ment of institutional structures – “institutional development in the environment” (IDE). This covers both
organisations with relevance for the environment (e.g. ministries, agencies, associations, self-help orga-
nisations) and institutionalised regulation (e.g. legislation, environmental policy instruments and proce-
dures).

The main goals of CDE approaches lie in the following interconnected areas:

• availability of corresponding know-how and trained staff at all levels;

• efficiency, functionality and collective capability of the organisations involved;
• networks and cooperation between the various organisations;
• effectiveness of environmental policy, regulatory mechanisms and integration of environmental con-
siderations into the framework of economic and sectoral policy.

Technical cooperation agencies are pos- government and non-government sectors

sible partners under development coop-
eration for assistance in environmental po-
licy planning, where need has been stated
for the development of local capacity in this
area. As a professional service, this form of
cooperation aims at providing advice to
political decision-makers and actors in the
involved in the political process (direct po-
licy advice) or at helping build up planning
and implementation capacity (indirect policy
advice). The two variants are not mutually
exclusive.

4.2. Target groups and stakeholders

Even more than other areas of cooperation, interests, views and attitudes is a basic
assistance in environmental policy planning requirement for achieving the goals of envi-
face a relatively large number of frequently ronmental policy planning.
opposed actors involved. This means that a
thorough study of the organisations and
stakeholders involved, their positions and

21

Actors and Institutional Structures in the Environment
Affected
People Institutional
Structures
Polluters,
Resource
Users
Environmental
Other Actors
Organisations
Within a given (economic, social, political,
ecological, international) environment, it is
useful to distinguish at least four types of
actors:
• Polluters (e.g. industrial establishments,
road-users, urban households) and re-
source users (e.g. farmers, pastoralists,
rural households).
• People affected by environmental pro-
blems, who may overlap with the pollu-
ters or resource users (e.g. farmers, pa-
storalists, village populations) but gene-
rally constitute other groups (e.g. urban
and rural population relying on surface
water for drinking-water supplies).
• Environmental organisations acting as
implementing agencies or intermediaries
for environment-related legislation,
procedures, standards etc. Depending
on the specific situation, there may be a
very large number of these organisations
because of the frequent high degree of
fragmentation of responsibilities (e.g.
environment ministries, subordinate
agencies, other government and non-
government bodies).
• Other organisations and actors with in-
fluence because e.g. they determine the
framework for economic decision-
making (economic policy institutions) or
determine the state of information and
public opinion (media) etc.
Even this highly simplified overview of the
stakeholders shows that changes in envi-
ronment policy instruments can only hope to
succeed if the most important parties are
involved from the start. The implication of
this for planning and implementing pro-
grammes under technical cooperation is
that detailed information on the structure of
the stakeholders and the organisational
landscape is required in every phase. This
includes analysis of the internal features of
individual organisations and also covers
22
communication links between individual
organisations and actors.
The analysis of the parties involved is clo-
sely related to the analysis of institutional
structures. This term is used here to cover
all formal or informal structures which influ-
ence environmentally relevant decisions by
individual actors (e.g. environmental legisla-
tion, procedures, norms, standards, incenti-
ves, but also including for example religious
values and economic policy regulations).
Knowledge of these relationships and their
interactions is essential for identifying the
relevant actors and organisa-
tions.
The question of which target groups and
partners are most suitable for cooperation
with regard to market-based instruments in
environmental policy cannot be answered in
general terms. Whereas the long-term de-
velopment objective should normally aim at
the polluters/resource users in terms of
seeking to change behaviour patterns (ex-
ample: “small-scale farmers use resource-
conserving methods of cultivation”, “indu-
strial establishments use environmentally
oriented management techniques”), medi-
um-term project goals will concentrate on
the development of institutional structures
between the parties involved, in this case
developing and implementing an appro-
priate range of environmental policy instru-
ments.
Very rarely will the opportunity arise to limit
such programmes or inputs to one partner
organisation. Although responsibility and
overall authority for the environmental policy
instruments generally lie with the environ-
ment ministry, planning and use of market-
based instruments generally require the
involvement of other government and non-
government institutions. Allowance must
also be made for the fact that government
environmental institutions are often
“lightweights”, so that the formation of stra-
tegic alliances is just as important as bund-
ling fragmented responsibility.
Cooperation in policy planning in the en-
vironment should aim at deliberate di-
versification of partners right from the plan-
ning stage. This can (but need not) be for-
malised through diversification of project
executing agencies. Another conceivable
possibility is to locate corresponding pro-
jects at a “neutral site” – i.e. outside the
4.3. Ownership and process orientation
The chance of achieving lasting success
with environmental policy planning and in-
stitutional development in the environment
increases with the partners’ sense of
”ownership”. This does not, however, rule
out the possibility of a passive initial role by
individual institutions (including government
institutions) accompanied by a lack of inte-
rest in involvement with market-based in-
struments. This does, however, require the
existence of individuals or organisations
who can play an effective promotional role
as “local champions”.
For organisations in technical cooperation
this means that techniques of surveying,
analysing and planning should be as stron-
gly oriented towards participation and dialo-
gue as possible. In implementation, it is a
matter of clearly defining roles for local
partners and external contributions. Pure
transfer of expertise will never be enough to
make a policy planning programme effecti-
ve. Again, however, this does not rule out
the possibility that external contributions
could be limited to such questions.
This is borne out by experience in indus-
trialised nations which shows that there can
often be a long interval between the first
(scientific) debate on market-based instru-
ments and their (stepwise) introduction.
Because of the large number of relevant
actors, divergent interests and the comple-
xity of the range of instruments, which is
apparent given the many details or in the
formal project executing organisation.
rules for implementation, the path followed
by the associated processes is not usually
linear, but rather erratic, repetitive and de-
pendent on political and economic constel-
lations.
Besides the question of “ownership” this
means that flexibility and openness of plan-
ning and implementation are crucial.
Process orientation in the sense of mea-
sures incorporating stepwise, iterative plan-
ning and implementation should therefore
be a basic feature of policy planning pro-
grammes in the environment. Such pro-
grammes should be understood and imple-
mented as “joint learning processes”, not
least because of the substantial amount of
information needed. Goals such as “effluent
charge introduced at national level” can at
best serve as a fixed point to be approa-
ched in small steps, particularly as no indi-
vidual partner institution can guarantee ex
ante that these objectives can be met. Re-
sults and indicators from policy planning
programmes in the environment should ac-
cordingly be formulated primarily in terms of
statements on the trend and quality of the
consensus building and decision-making
process (e.g. “media take up the issue of
market-based instruments systematically for
the first time”, “interministerial committee
stresses the importance of market-based
instruments for the first time”, “employers
association issues opinion on the concept of
waste charge” etc).
23
4.4. Levels of advisory services
If it is a matter of designing and imple-
menting a package of environmental policy
instruments or a legislative framework, this
means dealing with a relatively high level in
the hierarchy. In many cases, particularly in
advanced phases, the natural place to lo-
cate corresponding technical cooperation
projects will be at the environment ministry,
as this is generally where responsibility,
overall authority and also usually the role of
“promoter” within the government sector all
lie. Contact with the administrative level is
important, although the direct counterpart at
working level can be a department with
4.5. Political sensitivity and conflict management
Setting aside all pragmatism, the debate on
market-based instruments is conducted in a
(party) political environment. Issues involve
not only ideological differences but also
actual and assumed distributive and com-
petitive effects of market-based instru-
ments, power struggles, the trend towards
inflexibility in bureaucracies, and many
other questions. Policy planning in the envi-
ronment – particularly where this is assisted
by donor agencies – runs the risk of being
4.6. Programme approaches and entry points
There will not be very many policy planning
projects in the environment in the foreseea-
ble future which deal mainly or entirely with
the question of market-based instruments.
For GTZ there are many arguments to anti-
cipate concentration on consultancy needs
in connection with specific aspects of mar-
ket-based instruments and also on integra-
ting advisory services in this field into wider-
ranging approaches of policy planning
which include environmental legislation,
planning, information systems and reporting
etc. Market-based instruments are not ge-
nerally an autonomous field for cooperation,
but rather an option in projects which are
concerned with institutional development in
the environment.
Objectives, activities, their results and the
approach taken by cooperation pro-
24
planning responsibility (policy planning), or a
(national) environmental agency, provided it
has the necessary authority and political
mandate to develop environmental policy
concepts. Another conceivable location is
within corresponding institutions at local
authority or federal state level, if permitted
by the national structure and authority of
local and regional administrations (e.g. in
waste management). In the interest of di-
versifying partners, there should always be
a willingness to cooperate with other orga-
nisations.
coopted into the institution, which would
jeopardise the long-term success of the
efforts. This makes high demands on the
independence, professionalism and credibi-
lity of the advisers, who can only counter
this difficulty through dialogue-oriented
process oriented services, conflict mana-
gement and a view of their function as es-
sentially catalytic and open to joint learning
processes.
grammes in this field depend strongly on
the initial situation and the entry point. A
decision is needed in dialogue with those
involved whether and in what form market-
based instruments can be included in co-
operation. In the follow cases, it is possible
to see how far this is useful and realistic:
• Projects for policy planning and institu-
tional development in the environment.
• Projects for formulating and imple-
menting national environmental action
plans, national strategies for sustainable
development and similar plans.
• Projects in urban and industrial envi-
ronmental protection and environmental
planning.
• Projects in environmental protection and
resource conservation, particularly in ru-
ral regional development, combat of de-
 sertification, forestry management and
nature conservation.
• Government advisory projects, particu-
larly on economic policy (e.g. in the
context of structural adjustment pro-
grammes, promotion of free market
structures, privatisation, tax reform, eco-
nomic planning.
• Environment-related training and up-
grading projects and curriculum de-
velopment.
• Accompanying advisory services in
cases of conditionality imposed by e.g.
the World Bank (macroeconomic stabili-
sation, price policy, cost coverage, etc).
• Technical or financial cooperation pro-
jects in energy and water supply, effluent
and waste disposal, refinancing of credit
programmes, financing of structural ad-
justment programmes etc.
Possible entry points differ depending on
the point in the project cycle. While new
projects offer opportunities for decisions to
integrate assistance in policy planning du-
ring project planning and preparation and
identification, there is less flexibility in on-
going projects. Here, monitoring and eva-
luation and negotiations on extensions pro-
vide an opportunity to raise these issues in
dialogue with partners. It should, however,
be considered whether the given partner
structure (position in the hierarchy, existing
cooperation links) allows a promising initia-
tive in the field of market-based instru-
ments. In addition, policy dialogue by the
German Federal Ministry for Economic Co-
operation and Development (BMZ) and
accompanying pilot measures can create an
opportunity to raise the issue. A basic que-
stion for consideration is how far cooperati-
on between various technical cooperation
projects and possibly also between financial
and technical cooperation is useful and
possible.
Technical cooperation projects at the ope-
rational level which have a primarily techni-
cal character can also incorporate policy
advice in the environmental sector, although
in less formal style. Where the environ-
mental policy framework can affect achie-
vement of the project purpose or the overall
goal, it should be established as an issue.
How far this is possible will, however, de-
pend on the authority and responsibilities in
the partner structure and on access to the
decision-making level.
25
5. Contributions of development
environmental policy planning
5.1. The focus of advisory services in technical cooperation
In the framework of TC projects for policy
planning in the environment, tasks may
arise (depending on need) which go beyond
specialist advisory services or training and
upgrading. Depending on the specific situa-
tion and the project phase, the emphasis
may be on activities in organisation and
management or cooperation and communi-
cations.
• Technical assistance in the area of mar-
ket-based instruments relates to the
needs-oriented transmission of know-
how in the fields of environmental legis-
lation, environmental economics, ad-
ministrative and technical analysis, plan-
ning and implementation, where this is
required for the individual steps. This
also includes training and upgrading
measures in these areas.
• Technical Assistance in organisation and
management functions as a cross-
cutting task in developing and strength-
ening the organisations involved. The
central issue is to identify what potential
and obstacles exist in the individual or-
ganisations to enable them to perform
their functions efficiently. For this pur-
pose, techniques of participatory organ-
isational analysis and development are
5.2. Advisory role and presence
In policy planning projects in the envi-
ronment it is particularly important to define
clearly the role and responsibility of the local
partner structure on the one hand and the
external advisers on the other. This can
only be done on a case-by-case basis, and
depends on the specific complexity of
problems, potential local solutions, partner
structure and other factors. Binding agree-
ments should be reached on this. Basically,
the following forms and intensities of advi-
sory services can be distinguished (these
must be decided on in each individual case
26
cooperation in
offered. Normally, services in this sector
should not be limited to formal project
executing agencies (e.g. the environ-
ment ministry), but cover various or-
ganisations at different levels, where
these play a part in the overall process
and express a need for organisation and
management consultancy.
• Another cross-sectional task is technical
assistance in cooperation and communi-
cation, which aims to strengthen the in-
teraction and network of the actors in-
volved, the organisation of consultation
and decision-making processes and
measures to increase acceptance,
awareness etc. One focus here is con-
sultancy on planning and implementing
communication and conflict-solving
strategies.
The specific mix of key services has to be
adjusted for the specific case in the course
of dialogue-oriented (and iterative) project
and operations planning. In all the areas
listed, it is not only a question of transferring
specialist expertise, but, above all, of ap-
plying participative and dialogue-oriented
planning techniques.
and possibly even for different focal points
in advisory services):
• The role of initiator places much of the
responsibility for the programme as a
whole, i.e. for the input content, process
planning and control, and hence for
achieving objectives and results, on the
external adviser(s). Where this form of
policy planning project in the environ-
ment is desired by the partner structure,
the conditions should be studied par-
ticularly carefully. Basically, this form is
relatively inappropriate for reasons of
 sustainability, as it indicates a low de-
gree of readiness among the partners to
assume “ownership” of the programme
concerned.
• The promoter represents a form of advi-
sory service which involves a relatively
high level of intervention without be-
coming directly involved in line functions.
The promoter provides inputs, proposes
decisions and initiatives for process
planning and control.
• Coaching is the classic role of the ad-
viser who trains and advises partners on
all technical and methodological issues
without filling any line function. This form
also involves a relatively high intensity of
advisory activity and requires careful
clarification of roles and expectations in
order to avoid slipping into other forms of
advisory service.
• Facilitating is largely limited to the spe-
cific provision of know-how. Otherwise,
the adviser acts primarily as a process
consultant for planning, consultation,
communication and decision-making
processes among those involved. He
assumes responsibility for the process
and quality of decision-making but not its
results. To an even greater extent than
with the other types, the facilitator is part
of a joint learning process.
• The loosest form of advisory service is
the sponsor, who provides mainly (finan-
cial) assistance on the basis of agreed
objectives without becoming involved in
procedures and overall project design.
The cooperation partners are solely re-
sponsible for achieving results and ob-
jectives.
The roles outlined here are not clearly sepa-
rated, but are points on a continuum. How-
ever, the distinction can be helpful in deter-
mining responsibilities. The more indirect
and the looser the advisory role is, the more
the issue arises of the local presence of
external advisers. The following types of
advisory services should be distinguished:
• long-term advisers who are present lo-
cally over the entire term of the project;
• intermittent advice, with, as far as possi-
ble, the same individuals returning to the
location over a longer period;
• short-term advisory services, i.e. limited
assignment of short-term experts for
clearly defined tasks.
Depending on the agreed role and re-
sponsibility of the external adviser, the
scope and the type of the tasks involved, it
is necessary to decide on the scale of the
local presence.
Besides advisory inputs (and including part-
ner contributions), funds are provided for
training and upgrading measures, studies,
workshops, pilot measures, equipment and
materials and financial contributions etc.
where they are needed to achieve results.
27
5.3. The range of services under technical cooperation
In the context of environmental policy plan-
ning projects, GTZ offers a package of
services which may be used subject to the
status and commission:
• As part of project identification GTZ
holds preliminary discussions with re-
presentatives of relevant organisations,
“local champions”, etc and may support
initial pilot measures, particularly in advi-
sory services on planning, problem and
stakeholder analysis. Candidates are
field staff in GTZ projects and project
administration services who are familiar
with the issues of market-based instru-
ments. In addition the pilot project on in-
stitutional development in environment
can provide support in selected coun-
tries during its term. A study and expert
fund could also be used in this con-
nection.
• Advisory services in project planning and
project appraisal are a response to cor-
responding ideas or applications by de-
5.4. Cooperation between development cooperation agencies
The institutional separation of financial (FC),
technical (TC), personnel and other forms
of development cooperation is a feature
peculiar to German development policy,
which should not obscure the fact that there
is extensive scope for cooperation. This is
particularly the case since the distinction is
extensively based on formal criteria.
Projects under development cooperation
whose emphasis is on financing are gen-
erally implemented as financial cooperation
projects by the Kreditanstalt für Wiederauf-
bau (KfW) under a commission from the
Federal Government. While technical as-
sistance is not an independent instrument
under FC, there are de facto openings for
cooperation in selected programmes and
projects.
Generally, the economic and environmental
policy framework is also studied as part of
problem analysis and environmental impact
assessment during project preparation, in
order to obtain indications of the need for
strengthening environmental protection
aspects which it may be possible or neces-
sary to take into account in project or pro-
28
veloping countries. During the initial
phase in particular it is useful to resolve
the question of partners and
stakeholders within the framework of an
expanded project appraisal over a longer
period and/or to advise on the develop-
ment of a concept and approach.
• Within the framework of the instruments
described above assisting partner insti-
tutions in the implementation of projects
on policy planning and institutional de-
velopment in environment. In the pre-
paratory phase a large number of im-
ponderables may make it desirable to
resort to the instrument of the “open ori-
entation phase” which makes it possible
to develop an appropriate approach
jointly with partners over a longer period
and to implement initial pilot measures
without making commitments to long-
term cooperation.
• Monitoring and evaluation in the form of
project progress reviews etc.
gramme design. The most immediate pos-
sibility is discussing pricing policy, particu-
larly the elimination of subsidies for environ-
mentally relevant goods such as electricity,
water for drinking and irrigation, fertilisers
and pesticides. Financial cooperation has
been working for many years to reduce
subsidies in these sectors for reasons other
than ecological ones (improving macroeco-
nomic efficiency of allocation, commercial
solidity of the project-executing agencies,
sustainability).
FC has particularly far-reaching oppor-
tunities for influence and advice in structural
and sectoral adjustment programmes which
intrinsically aim at changing policies. The
configuration of such programmes has in
the past generally led to the reduction of
subsidies which are ecologically undesir-
able, creating a better context for the intro-
duction of market incentives in the strict
sense of the term. In addition, economic
policy measures have been agreed to re-
duce state control and create more compe-
tition (inter alia by abolishing state monopo-
lies and promoting the private sector) which
also constitute important conditions for the
use of market-based instruments. Overall,
however, changing environmentally relevant
framework conditions has not been a cen-
tral issue under structural adjustment pro-
grammes, and the potential is far from ex-
hausted.
In the context of investment projects, dia-
logue with partners offers an opportunity to
press for cost-covering tariffs; e.g. in con-
nection with water supply or sewerage
treatment projects, in order to influence
consumer behaviour and increasingly im-
plement the “polluter pays” principle. A
more recent development in resource con-
servation projects is the incorporation of an
element geared to reorganising rights of use
and exploitation in buffer zones. These
measures are mostly expressed as a condi-
tion or implementation agreement in the
loan or financing agreement.
Environmental credit lines and funds re-
present a special form which is creating
incentives through financing institutions in
developing countries to increase envi-
ronmentally oriented investment particularly
by small- and medium-sized businesses. In
practice to date, concessionary interest
rates have mostly been agreed on to facili-
tate adjustments by companies and achieve
mobilisation. It should, however, be noted
that concessionary loans generally only
make sense for old installations, while in the
case of new investments the conventional
approval procedure should be sufficient to
meet local environmental demands.
A further stage of conditionality and hence
another forum for dialogue are the opera-
tional appraisal criteria for power projects
that have been in force in financial coopera-
tion since 1990. These rule out project
funding if tariff subsidies within the electric-
ity sector account for more than 35% or (in
other terms) if less than 65% of the cost is
covered. Otherwise, assistance through
development cooperation is only possible
within the framework of a structural adjust-
ment programme which can incorporate
additional elements with favourable impact
on the environment. As part of the project,
partners have to commit themselves to take
steps to go beyond the minimum level of
65% of costs and to aim at full cost recov-
ery.
As such conditions generally apply to the
future, their fulfilment is not always certain,
particularly since other donors sometimes
waive such conditions. Leaving aside condi-
tionality, a question that could become in-
teresting is how far complementary and
longer-term back-up TC measures can
usefully be combined with FC projects. This
possibility is available not only with power
projects or SAPs, but also with FC projects
in the fields of water supply, sanitation and
solid-waste disposal, forest management,
resource conservation and strip mining,
where, for example, the use of recultivation
bonds could be considered.
For reasons of economic and ecological
sustainability, the aim of such back-up
measures must be to develop jointly with
partners viable concepts for covering costs,
eliminating price distortions and possibly
covering external costs. In the power sector,
this possibility should above all be consid-
ered in countries which tackle supply bottle-
necks almost entirely by expanding gener-
ating capacity while leaving (often more
cost-effective and less capital-intensive)
potential for conservation and substitution
unutilised, not least because of price distor-
tions. To initiate and prepare for such com-
bined FC/TC projects, more systematic use
could be made of policy dialogue by the
German Federal Ministry for Economic Co-
operation and Development (BMZ).
Training and upgrading in particular offers
an opportunity for cooperation with the
German Foundation for International De-
velopment (DSE) and the Carl Duisberg
Society (CDG). The DSE’s Public Ad-
ministration Promotion Centre (ZÖV) in
Berlin has for some years been offering
advanced training programmes via its “Envi-
ronmental Administration” department for
environmental experts and administrators
from developing countries (particularly
South-East Asia and Africa). The various
instruments at its disposal include semi-
nars, training courses, international confer-
ences and the secondment of lecturers and
speakers. The work focuses on “Basic is-
sues of environmental administration, man-
agement and planning” and “Environmental
information”. Recently, training modules
have been developed on the use of market-
based instruments and institutional devel-
opment in the environment: these are in use
in seminars and training courses in both the
Federal Republic of Germany and develop-
ing countries. An interesting future possibil-
ity would be the gradual development of
more specialised advanced training courses
which go beyond an introduction and pro-
vide more practice-oriented expertise and
experience on the design and imple-
mentation of market-based instruments.
29
The CDG is running long-term advanced
training measures both abroad and in Ger-
many. It also offers short-term advanced
training through seminars, workshops,
“catalogue programmes” etc, and the de-
velopment of teaching aids and bursary
programmes. Under the key programme
concerning corporate environmental protec-
tion and environmental management, there
is long experience e.g. in urban and indus-
trial environmental protection and (hazard-
ous) waste management, including in
South-East Asia and Chile. Target groups
include first and foremost experts and man-
agers from manufacturing industry, drawing
on intensive cooperation links with German
industry. Where in the past the emphasis
was on technical issues of corporate en-
vironmental protection, today’s questions
increasingly relate to environmentally ori-
ented corporate management, including the
necessary government framework condi-
tions. It is planned to establish a “Centre for
Industry, the Environment and Develop-
ment” in Berlin; in line with the current state
of the discussion, the use of market-based
instruments will also be integrated into the
programme.
30
In developing countries where there is a
lack of specific qualification profiles of im-
portance in environmental administration for
designing or implementing market-based
instruments, it may be helpful to assign
integrated experts. This is done by the
Centre for International Migration and De-
velopment (CIM).
There are also numerous points of contact
with political foundations and other devel-
opment cooperation NGOs on questions of
policy planning in the environment. This is
particularly true in the preparatory phase,
when it is important to create pluralistic fora
for national policy dialogue, and also include
the participation of political decision-
makers, research cooperation and envi-
ronmental communication.
However, besides the points of contact and
opportunities for cooperation there are also
difficulties arising out of the institutional
pluralism of German development coopera-
tion. Overall, these are outweighed by the
opportunities which could be available
through cross-sectional cooperation in the
field of policy planning and institutional de-
velopment in the environment.
6. Conclusion
Policy planning projects in the environment
have special features because of the many
imponderables and political sensitivity both
in the Federal Republic of Germany and
among partner institutions in developing
countries. Consequently, particular care
must be taken during planning and imple-
mentation to take adequate account of
them.
Where market-based instruments are made
a theme of development cooperation, heavy
demands are made on both the partners in
the developing countries and the German
development cooperation agencies. Devel-
opment cooperation can basically play a
catalytic role here, but this depends on the
willingness to go through a joint learning
process with partners. This in turn requires
staying power.
It is possible in the first phases of coop-
eration (which must inevitably have a long-
term orientation) that success will remain
largely “invisible” and only be demonstrable
with the use of relatively soft “process indi-
cators”. The risks arising out of process
orientation and relative flexibility of results
can be contained. For the foreseeable fu-
ture, particular emphasis should be given to
careful development, preparation and plan-
ning of corresponding projects. It is logical
here to take advantage of the opportunities
of expanded project appraisal and the open
orientation phase under TC. A particularly
important aspect is the combination of it-
erative, participation-oriented planning and
pilot measures which will not only produce
initial partial results, but also contribute
towards building confidence. The overall
cooperation objectives should be broken
down into milestones and partial operational
objectives, with particular importance given
to precise formulation of indicators and
assumptions. The role and responsibility of
partner institutions on the one hand and
GTZ on the other should be precisely clari-
fied. Target break points below the level of
conditionality could be useful in limiting
risks. In addition, policy planning projects in
the environment should have other ele-
ments besides market-based instruments,
giving them the nature of a programme.
There can be no doubt that the institutional
diversity of German development coopera-
tion instruments creates opportunities par-
ticularly where a pluralistic approach to co-
operation is needed (e.g. policy planning
services in the environment). Making use of
these opportunities also requires pluralistic
coordination and contact between the insti-
tutions involved in the Federal Republic of
Germany. Long-term country programmes
elaborated in dialogue between the BMZ
and development cooperation institutions,
with the participation of actors from de-
veloping countries, may make a contribution
towards this.
In the short term, however, there is no rea-
son to expect that a larger number of devel-
oping countries will present applications to
the German Federal Government which
deal specifically with advisory services on
market-based instruments. It is, however,
realistic to assume that it will be possible in
the course of planning and assessing TC
and FC projects to identify a corresponding
need and concrete opportunities for coop-
eration in neighbouring areas. For all the
complexity and intricacy of this subject, this
paper is intended to encourage active pur-
suit of such approaches.
31
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35
$KUJGTGTUEJKGPGPG2WDNKMCVKQPGPCWUFGT#TDGKVFGT#DVGKNWPI

Stand Oktober 1997

Publikations-Nr. Titel Bestell-Nr.

402/93 - 1 d PVI Ökonomische Instrumente der Umweltpolitik: Bedeutung für die P3-001-d
Entwicklung von umweltrelevanten Institutionen im Rahmen der
praktischen EZ vergriffen

402/93 - 2 d PVI Institutionenentwicklung im Umweltbereich - Ergebnisse eines P3-002-d

GTZ-Mitarbeiter-Workshops
vergriffen
402/94 - 3 d PVI Ökonomische Instrumente der Umweltpolitik als Beratungsfeld im P3-003-d
Rahmen der TZ - Systematische Kurzdarstellung der in der Bun-
desrepublik Deutschland angewandten Instrumente und relevanter
Institutionen

402/94 - 4 d PVI Der Runde Tisch als Programm? Möglichkeiten und Grenzen der P3-004-d
Institutionenförderung im Spannungsfeld von Umwelt und Ent-
wicklung

402/94 - 4 e PVI The round table as a Programme? Institutional Development P3-004-e

caught between the Environment and Development - Options and
Limitations

402/94 - 5 e PVI Pollution Prevention Through Market-Based Incentives P3-005-e

Two Case Studies on Thailand

402/94 - 6 e PVI The Use of Economic Instruments in the Environmental Policy of P3-006-e
Chile

402/94 - 7 e PVI The Role of Land Tenure and Property Rights in Sustainable Re- P3-007-e
source Use: The Case of Benin

402/94 - 7 f PVI Le rôle des systèmes fonciers et des droits de disposition pour la P3-007-f
gestion durable des ressources naturelles: Le cas du Bénin
vergriffen
402/94 - 8 d RMSH Dokumentation zum Consulting Workshop - Anwendung von Be- P3-008-d
teiligungs- und Selbsthilfeansätzen in Vorhaben zum Ressour-
cenmanagement

402/94 - 9 d PVI Information, Bildung und Kommunikation im Umweltbereich P3-009-d

402/94 - 10 d RMSH Hinweise auf Schlüsseldokumente für die Anwendung von Beteili- P3-010-d
gungs- und Selbsthilfeansätzen im Ressourcenmanagement
vergriffen
402/94 - 11 d RMSH Beteiligungs- und Selbsthilfeansätze im Ressourcenmanagement P3-011-d
- Ein Positionspapier

402/94 - 11 e RMSH Participatory and self-help approaches in natural resource mana- P3-011-e
gement - A position paper

402/95 - 11 f RMSH Participation et auto-promotion dans la gestion des ressources P3-011-f

naturelles - Document de base

402/95 - 11 s RMSH Participación y auto-ayuda en el manejo de recursos naturales - P3-011-s

Documento básico

36
402/95 - 12 d PVI Marktwirtschaftliche Instrumente der Umweltpolitik in Entwick- P3-012-d
lungs-ländern - Beiträge zur Institutionenentwicklung und Politik-
beratung im Umweltbereich

402/95 - 12 e PVI Market-Based Instruments in Environmental Policy in Developing P3-012-e

Countries - Framework for Policy Planning and Institutional Deve-
lopment in the Environment

402/95 - 12 f PVI Instruments économiques applicables aux politiques de P3-012-f

l’environne-ment dans les pays en développement - Contributions
au développe-ment institutionnel et à l’assistance technique en
matière de politique de l’environnement

402/95 - 12 s PVI Instrumentos económicos y política ambiental en los paises en P3-012-s

desarrollo - Desarrollo institucional y asesoramiento politico en
materia de protección ambiental

402/95 - 13 d RMSH Die Rolle von Anreizen bei der Anwendung von RMSH als Vorge- P3-013-d
hensweise

402/95 - 13 e RMSH Incentives and the NARMS Approach - A hand-out for project desk P3-013-e
officers, consultants and onside project staff

402/95 - 13 f RMSH Le rôle des mesures d'incitation dans l'application de la stratégie P3-013-f
GERNAP - Outil de travail à l’intention des chargés de projets, des
consultants et des collaborateurs de projet

402/95 - 13 s AMREN El papel de los incentivos en la aplicación del enfoque AMREN - P3-013-s
Folleto de información para encargados de proyectos, consultores
y colaboradores de proyectos vergriffen

402/95 - 14 d PVI Umweltinformation und ihr Management P3-014-d

402/95 - 14 e PVI Environmental information and its management P3-014-e

402/95 - 15 d Biodiv Biologische Vielfalt erhalten! P3-015-d

Eine Aufgabe der Entwicklungszusammenarbeit

402/95 - 16 d Lösungsansätze für den technischen Umweltschutz in kleinen und P3-016-d

mittleren Unternehmen in Entwicklungsländern

402/96 - 16 e Approaches to cleaner production in small and medium-sized P3-016-e

enterprises

402/95 - 17 d PVI Mediation / Konfliktmanagement im Umweltbereich und seine P3-017-d

Bedeutung im Rahmen der TZ
Dokumentation eines Fachgesprächs in der GTZ

402/95 - 18 e RMSH Creating Local Agendas P3-018-e

(A) Participatory Appraisal Methods for Interinstitutional collabora-
vergriffen
tion in Integrated Watershed Management - Lessons from a
Colombian Experience
(B) Participatory Planning and Evaluation Methods: Suggestions
for complementary methodologies

402/96 - 19 d PVI Konfliktmanagement im Umweltbereich P3-019-d

Instrument der Umweltpolitik in Entwicklungsländern

402/96 - 19 e PVI Environmental Conflict Management P3-019-e

An environmental policy instrument in developing countries

37
402/96 - 19 f PVI La gestion des conflits dans le domaine de l’environnement - P3-019-f
Instrument de la politique de l’environnement dans les pays en
développement

402/96 - 19 s PVI Manejo de conflictos en el área de medio ambiente - Instrumento P3-019-s

de política ambiental en los países en desarrollo

402/96 - 20 e Environmental Protection in Small and Medium Enterprises in P3-020-e

Developing Countries - Proceedings of the GTZ-workshop

402/96 - 21 d PVI Methodenkompaß - Eine praktische Orientierungshilfe für Pla- P3-021-d

nungs- und Managementaufgaben im Umweltbereich

402/96 - 22 d RMSH Prozeßmonitoring - Eine Arbeitshilfe für Projektmitarbeiter/-innen P3-022-d

402/96 - 22 e RMSH Process Monitoring (ProM) - Work Document for project staff P3-022-e

402/96 - 22 f RMSH Suivi des processus - Un outil de travail pour des collaborateurs P3-022-f
de projet

402/96 - 22 s RMSH Seguimiento de procesos - Una auyuda para personal de proyec- P3-022-s
tos

402/96 - 23 d PVI Indikatoren der Institutionenentwicklung im Umweltbereich - Anre- P3-023-d

gungen und Beispiele für Projektplanung und -management

402/97 - 24 d PVI Umweltrechtsberatung und Institutionenentwicklung im Umwelt- P3-024-d

breich - Schwerpunkte, Methoden, Beratungsressourcen

Weitere Arbeitshilfen:

402/96 - PVI Umweltprojekte durch Kommunikation verbessern P3-901-d

402/96 - PVI Erfahrungen und Ansätze der TZ bei der Unterstützung von Um- P3-902-d
weltaktionsplänen - Dokumentation eines Erfahrungs-austausches
in der GTZ

402/96 - RMSH Prozeßbegleitende Beratung - P3-903-d

Eine Arbeitshilfe für Berater/-innen im Ressourcenmanagement

402/96 - RMSH In Process Consultancy - P3-903-e

A Work Document for Consultants to Natural Resource Manage-
ment Projects
402/96 - RMSH Consultation interne P3-903-f

402/96 - RMSH Asesoramiento a procesos P3-903-s

402/96 - RMSH Toward decentralised Natural Resource Management - P3-904-e

Case study: The village of Balingnar in Burkina Faso

402/96 - PVI Vers une Gestion Decentralisee des Ressources Naturelles - P3-904-f
Cas du village de Balingnar au Burkina Faso

402/96 - PVI Umweltkommunikation in der TZ - P3-905-d

Dokumentation eines Fachgespräches in der GTZ

402/96 - PVI Bibliographie Umweltkommunikation P3-906-d

38
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