Study On Payments For Environmental Services (PES) Of Natural Production Forests

Substantial opinion regards cutting natural forests, especially clear-cutting them, as onethat imposes risks to ecological resilience and human well-being. Now these risks could be realbecause Natural Production Forests (NPFs) using rights were distributed to the villagers in theReform of Collective Forest Tenure System (RCFTS) in China recently. Villagers can selectclear-cutting their NPFs to manage pure plantations by economic benefits incentives. So usingeffective economic instruments—Payments for Environmental Services (PES), can be anincentive to encourage owners to retain and take in a sustainable way to manage their NPFs.Why to pay is the primary question, and how much to pay is the key issue of PES scheme. Soafter answered the first question, methods on calculating payments in PES scheme weredeveloped and then to set up the PES scheme in this study.The necessity of applying PES for NPFs. The results showed that there are many raretropical native tree species in demonstration area, Maohui and Dagan village, Hainan Province.The soil hydrology-physical properties, soil chemical nutrient contents of the NPFs aresignificantly better than the typical plantations. So it is necessary to apply PES for NPFs toprevent from altering the NPFs to pure man-made forests.Methods for calculating the payments of five PES patterns:(1)To pay according toopportunity cost: A technic framework was developed with discounted cash flow (DCF),Monte Carlo simulation (MCS) and real option pricing method (ROV) which can be used toaccount opportunity cost. Applying the framework in the demonstration area, Maohui village,the results showed that the payments for environmental services (ES) of NPFs are440to2220RMB hm-2a-1when to select the PES scheme with indefinite period, or2200to5000RMB hm-2a-1and the theoretical maximum is10670RMB hm-2a-1in the limited period scenario.(2)To pay according to the willingness to accept the payments: With a logistic regression modelthe paper analyzes investigation data of demonstration area, Dagan village, based on contingent valuation method (CVM). Results showed that there exists the negative correlation between theprobability that farmers' accept the payments for ES according to the local standard of publicwelfare forests compensation and the proportion of planting income to total family income.The model prediction accuracy is67.9%. Reducing farmers' dependence of planting is helpfulto implement the PES scheme.(3)To pay forestland rent to supply the ES for the public: theresults showed that it should to pay300to1500RMB hm-2a-1for rents of NPFs lands inMaohui village.(4)To ajust payments accompanying with the value of NPFs assets dynamic. Itmeans to treat as the payments as the interest of NPFs assets. Making the payments bymultiplying price of stand volume, stand volumes of each growth period and interest rates ondeposits.(5)To pay according to environmental services (ES) value was also analyzed as anexploratory research. The assessment principles, indicators and methods for evaluation ESwere analyzed in this study. It should be noted that the precondition for applying this approachare widely recognized ES value by the public, and the public has willingness to pay for them.Main contents of the PES scheme:(1)the aim of the PES scheme is to prevent fromclear-cutting the NPFs and altering them to artificial pure forests;(2)to implement with infiniteperiod;(3)the payments should be consistent with the level of local economic development;(4)the local government should to finance the PES scheme;(5)to pay to rural collective orindividuals who gain the tenure of NPFs in the RCFTS;(6)at least70%of the payments shouldto be paid to villagers when the property of NPFs belonging to collective, and total to pay toowners when the property belonging to individuals;(7)to sign up a contract with legally validto ensure the interests of both in the PES scheme.