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Study looks at positive and negative impacts of biodiversity offsets on local communities

  • Biodiversity offsets enjoy a wide range of support. In 2010, the parties to the Convention on Biological Diversity (CBD) agreed to promote biodiversity offsets as a means for businesses to effectively manage biodiversity issues associated with their development projects, and the IUCN approved a biodiversity offset policy at its World Conservation Congress earlier this year.
  • The efficacy of biodiversity offsets in achieving “no net loss” or even “net positive increase” in wild fauna and flora populations has been the subject of much scrutiny, but the same cannot be said of the impacts of biodiversity offsets on local communities.
  • New research shows that local people might actually be suffering negative consequences from these offsets, however.

Large industrial development projects such as hydroelectric dams, oil palm plantations, and mines have an unavoidable impact on the local environment, which in turn can have huge repercussions for biodiversity.

One strategy increasingly being adopted in order to mitigate the impacts on wildlife and the provision of ecosystem services are biodiversity offsets, in which a company “offsets” the effects of, say, building a mine in a rainforest by investing in conservation actions elsewhere — habitat restoration or investments aimed at slowing the rate of habitat loss in another area, for instance.

The efficacy of biodiversity offsets in achieving “no net loss” or even a “net positive increase” in wild fauna and flora populations has been the subject of much scrutiny, but the same cannot be said of the impacts of biodiversity offsets on local communities. New research shows that local people might actually be suffering negative consequences in addition to a number of benefits from these offsets, however.

Biodiversity offsets enjoy a wide range of support. In 2010, the parties to the Convention on Biological Diversity agreed to promote biodiversity offsets as a means for businesses to mitigate biodiversity issues associated with their development projects, and the IUCN approved a biodiversity offset policy at its World Conservation Congress earlier this year. The International Finance Corporation and other major lenders now require companies to use offsets in order to compensate for the biodiversity impacts of their operations.

But the authors of a study published this week in the journal Conservation & Society say that companies using these offsets, consultancies providing technical support, and lenders like the International Finance Corporation must pay greater heed to the local costs of the conservation actions funded through biodiversity offsets.

A team of researchers led by Cécile Bidaud of Bangor University in the UK spent more than two years studying the impacts on local people of the conservation initiatives intended to offset the biodiversity impacts of the Ambatovy nickle mine in Madagascar, which is a partnership between three companies: Canada’s Sherritt International Corporation, Japan’s Sumitomo Corporation, and South Korea’s Korea Resources Corporation.

The research team carried out focus group discussions to explore the ways in which biodiversity offsets influences local livliehoods. Photo by Cecile Bidaud.

The project will destroy 2,065 hectares (more than 5,100 acres) of natural forest habitat in the mine footprint as well as along a 220-kilometer (about 137-mile) pipeline that transports nickel slurry from the mine to the coast for processing and export. According to Ambatovy, when the mine is fully operational it will produce 60,000 metric tons of refined nickel, 5,600 metric tons of refined cobalt, and 210,000 metric tons of ammonium sulphate fertilizer every year for nearly 30 years.

Ambatovy is one of the largest development projects in sub-Saharan Africa and one of the biggest nickel mines in the world. It represents the largest foreign investment ($6.9 billion) ever made in Madagascar, comprising more than one-third of total foreign direct investment between 2006 and 2012.

The Ambatovy mine is located in rich rainforest habitat that is home to the indri, the largest lemur in Madagascar, and many other endemic species of birds, frogs, and other lemur species. One gecko species is found only within the mine footprint and some other small forest fragments, Bidaud and co-authors note.

Ambatovy claims to have achieved “no net loss” in biodiversity despite having cleared large areas of rainforest for its mine and pipeline. But Bidaud and team found that the conservation initiatives funded by offsets purchased on behalf of the Ambatovy mine can have significant negative impacts on local people, in terms of both standard measures of poverty and more subjective aspects of well-being.

Mongabay’s requests for comment from Ambatovy were not returned.

Ambatovy’s biodiversity offset projects include two types of activities: conservation restrictions and development activities. Bidaud and co-authors write that the Ambatovy team provided the following information in a presentation in November 2014:

“The conservation restrictions focus on preventing seven key activities in their biodiversity offset sites: forest clearing for agriculture, gold mining, poaching, illicit human occupation, timber extraction, non-timber forest product extraction and livestock grazing in protected forests. The company conducts local outreach to ensure the population are aware of the restrictions, employs local villagers to undertake regular monitoring to detect and assess trends in human pressures, and occasionally brings in the local police to enforce the restrictions.”

The Ambatovy mine aims to offset the impact of its mining operations by conserving forest in the region which is currently threatened by agricultural expansion. Photo by Cecile Bidaud.

In order to compensate local communities for their loss of access to forests, Ambatovy’s biodiversity offset projects also include development activities, with different options being proposed to different communities. “Development activities initiated by Ambatovy include: plant nurseries, donations of seeds, fertiliser or livestock (sometimes of novel varieties for the area), dam construction to irrigate rice fields, and training in agricultural or livestock-raising techniques,” the authors write in the study.

Madagascar is one of the poorest countries in the world with more than 90 percent of its citizens living on less than $2-a-day, per the World Bank, meaning rural Malagasy people are heavily reliant on natural resources and ecosystem services for subsistence purposes.

In order to measure the impacts on communities in the Ambatovy offset project sites, the researchers used qualitative methods, such as key informant interviews and focus group discussions, as well as quantitative methods, including household surveys. They found that biodiversity offset projects, both conservation restrictions and development activities, effect well-being in a mixture of positive and negative ways. “However, overall, respondents felt that they had suffered a net cost from the biodiversity offset,” Bidaud and her co-authors report.

“People use resources from the forest for many everyday necessities with 85% of respondents collecting wild products including wood, pandanus leaves, lianas and palms for house construction, other plants for weaving or medicinal use, wild fruits and tubers, or hunting fish and terrestrial animals,” the researchers add. “Wild food is especially important during periods of local food shortage. Wild products were collected for subsistence by 30% of households, for sale by 35% and for both subsistence and sale by 35%, with some households heavily involved in the trade.”

The researchers found that the conservation restrictions were deemed by locals to have a positive impact on the forest and thus to have the potential to make a positive impact on health, via cleaner air, and to provide the basic materials for a good life by affecting water quantity. But the restrictions were also reported to negatively impact freedom of choice and action, with some locals saying that their village was more insecure because people were struggling financially as a direct result of the restrictions and were therefore more likely to steal from others.

Development activities, meanwhile, were also considered by the impacted communities to help provide the basic materials for a good life, though there were negative impacts reported regarding social relations, as conflicts arose around the distribution of benefits.

The Ambatovy biodiversity offset project has funded development activities and local infrastructure such as this irrigation dam in Maroseranana commune. Photo by Cecile Bidaud.

Bidaud said in a statement that inadequate compensation for the very real costs of conservation is a matter of environmental justice, because the poorest people in global society are bearing the costs of development that doesn’t destroy biodiversity. “It also matters because if people don’t get the help they need to develop alternatives to their current livelihoods, the conservation won’t be sustainable,” she added.

Patrick Ranjatson of Madagascar’s University of Antananarivo, a co-author of the study, said that rural Malagasy people affected by biodiversity offset projects are not being properly considered by national and international decision makers: “People living around these biodiversity offset sites are very poor and have little voice politically, they’re needs and concerns therefore don’t get the attention they deserve.”

With illegal mining spreading in many protected areas in Madagascar thanks to a sapphire rush that is currently underway, the researchers behind the Conservation & Society study are also quick to point out that they are positive the issues highlighted in their paper can be resolved.

“Madagascar needs to be able to use its mineral wealth to develop, and well-regulated mines where taxes are being paid are much preferable to the extremely damaging illegal ‘rushes,’” Julia Jones, a professor at Bangor University and co-author of the study, said in a statement.

“I have hope that the mining industry may use the results of this study to reduce negative impacts of local people around their biodiversity offset sites. This is certainly possible — their development projects are generally quite effective. It is just that currently they are too little, too late, and benefit too few.”

Indri lemur (Indri indri) in Madagascar. The ultimate aim of the biodiversity offset is to conserve the wonderful biodiversity of Madagascar’s eastern rainforests, such as the indri, while allowing mining development. Photo by Cecile Bidaud.

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