Payments for ecosystem services struggle to adapt to African land tenure realities. East Africa can design a fairer model — if it invents its own.
The idea is appealing in its simplicity: pay farmers and land managers for the services they provide to the planet — carbon sequestration, biodiversity preservation, water regulation. Payments for ecosystem services (PES) have become one of the favourite instruments of environmental policy since the 1990s. Yet, thirty years after the first Costa Rican and European experiments, the transposition of this model to East Africa reveals as many dead ends as it does promises.
A Model Born Elsewhere, for Other Realities
PES were theorised in a very specific context: states equipped with functional land registries, a widespread banking system, and agricultural holdings with clear legal boundaries. In Europe, the European Union's Rural Development Regulation progressively integrated agri-environmental payments from the early 2000s — with mixed results, but a robust administrative framework. In Costa Rica, the PSA programme (Pagos por Servicios Ambientales) launched in 1997 is often cited as a model: it rests on formal property titles and a centralised forestry administration.
These two conditions — formalised land tenure, reliable administration — are precisely what is lacking across much of sub-Saharan Africa. According to the World Bank, fewer than 10% of agricultural lands in sub-Saharan Africa are covered by a formal title deed. In Kenya, Ethiopia, and Tanzania, the majority of holdings fall under customary law, informal leases, or collective statuses that are poorly recognised by the state.
Importing a PES model designed for the Dutch land registry or the Spanish dehesas into this context is like prescribing a treatment without examining the patient.
What Field Experience Teaches Us
That said, East Africa is not without experience. Three programmes deserve careful analysis.
In Kenya, the Mikoko Pamoja project in the Gazi Bay delta is often presented as a community blue carbon success story: fishing communities manage and restore mangroves, sell carbon credits on the voluntary market, and reinvest the revenues into schools and water pumps. The scheme works because it built on community use rights already recognised locally, without attempting to artificially formalise individual property.
In Ethiopia, REDD+ programmes funded by the World Bank and Norway (under the Forest Carbon Partnership Facility) targeted regions such as Oromia. The results are instructive in their limitations: payments were often captured by administrative intermediaries before reaching farming households. An evaluation conducted by the Center for International Forestry Research (CIFOR) found that in several cases, less than 40% of disbursed funds actually reached forest managers.
In Tanzania, the TFCG/MJUMITA programme experimented with a different approach: direct payments via mobile phone (M-Pesa and equivalents), deliberately bypassing formal banking channels. This innovation considerably reduced transaction costs and losses linked to intermediaries. It illustrates that East Africa sometimes possesses an infrastructure — mobile telephony — better suited to its realities than conventional financial tools.
Three Structural Obstacles That Cannot Be Sidestepped
Diagnosing the blockages is a prerequisite for any serious reform. Three obstacles appear consistently in the literature and in the field.
1. Land tenure uncertainty. Without secure use rights — whether individual, communal, or hybrid — a farmer cannot commit to maintaining forest cover or adopting low-carbon practices over ten or twenty years. PES programmes that circumvented this problem through temporary use certificates frequently saw their beneficiaries displaced before the payment cycles had run their course.
2. Incomplete financial inclusion. In 2022, according to the World Bank's Global Findex Database, approximately 55% of adults in sub-Saharan Africa held a financial account — the majority via mobile money rather than a traditional bank. PES models that require a formal bank account mechanically exclude the most vulnerable populations — precisely those whose agricultural practices have the greatest impact on ecosystems.
3. The intermediary chain. Whether through NGOs, state offices, or private carbon credit aggregators, every link in the chain takes a cut. In voluntary carbon markets, it is not uncommon for a producer to receive less than 5% of the final price of a carbon credit sold to a European or North American corporate buyer. This asymmetry is not merely unjust — it strips away any genuine economic incentive for conservation.
The Historic Opportunity for an Endogenous Model
East Africa stands at a pivotal moment. Global demand for high-quality carbon credits is growing strongly — driven by net-zero commitments from companies and governments alike. The agricultural landscapes of East Africa — wooded savannas, mountain forests, coastal wetlands — represent a stock of carbon and biodiversity that the entire world has an interest in preserving.
But this opportunity can easily turn into a new form of green extractivism if the countries concerned simply host programmes designed elsewhere. Several avenues deserve support:
- Secure collective use rights before any payment mechanism is put in place, by recognising customary governance structures as legitimate counterparts.
- Develop decentralised digital registries (such as blockchain-based systems or GPS-mapped community cadastres) to document use rights without going through a lengthy and conflict-prone process of formal land titling.
- Integrate mobile money as a native payment channel, not as a fallback option.
- Cap intermediation fees in carbon standards applied in Africa, following the lead of certain pilot programmes that are beginning to negotiate such caps with standards bodies like Verra and Gold Standard.
- Involve regional universities and research institutes (ILRI in Nairobi, ICRAF — now known as World Agroforestry) in designing measurement, reporting, and verification (MRV) protocols, to avoid dependence on external consultancy firms.
None of these avenues is straightforward. All require political will that national agendas do not guarantee. But they exist, they have been tested at small scale, and they perform better than their imported equivalents.
Rewarding Without Dispossessing
The real test of a fair PES system is not measured by the sophistication of its MRV protocol or the liquidity of its credits on the secondary market. It comes down to a simple question: does the farmer who protects the forest or sequesters carbon in the soil receive enough to make that choice economically rational compared with deforestation or extractive agriculture?
In Europe, answering that question satisfactorily took three decades — and remains contested. East Africa does not have thirty years: the pressure on land is already here, the carbon markets are already here, and design failures are paid for immediately in hectares cleared.
It is precisely this urgency that makes innovation possible. Externally imposed models have shown their limits. The question is no longer whether East Africa can do better than Europe — it is understanding why it must, and quickly.