Privatization of natural resource property rights and expansion of trading schemes

Land reform and the decollectivization of commonly held properties have been major trends in transition economies and developing countries in recent years. Lands that previously belonged to the state or other forms of communal ownership have been allocated to individual owners who obtain property rights for utilization of the land and its resources. These measures are intended to eliminate inefficiencies that existed under centrally planned economies and inequities in distribution in others. At the same time a move to privatize natural resources and environmental services together with the introduction of market trading to improve environmental management has arisen—although on a much smaller scale. For example, individual rights to water and water trading are being introduced in countries such as Chile and the United States and are being considered in several countries in South America and South Asia. Carbon emission reduction credits is another area where trading regimes have been established and which have the potential for considerable expansion depending on the nature of future international agreements to control climate change. In the area of agricultural biodiversity, international agreements on the potential for establishing transfer mechanisms to pay for the conservation of resources, such as the International Treaty on the Conservation and Utilization of Plant Genetic Resources and the CBD have been established, although considerable work still needs to be done on the design and implementation (see Chapters 8 and 9).

The privatization of land and land reform could provide producer incentives for the adoption of biotechnology—to the extent that it contributes towards productivity gains, but impacts on biodiversity are less clear. Where land reform programs involve use of forested lands or previously uncultivated lands for agriculture, then impacts on wild biodiversity are likely to be negative.

The privatization and commoditization of other natural resources and environmental services provide farmers and natural resource owners with more flexibility and may provide them with incentives to provide environmental goods and services, such as biodiversity.

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