Ecosystem Valuation Background Paper

for Northern Ghana

October 2017

Feed the Future Ghana Agriculture and Natural Resource Management Project

Ecosystem Valuation Background Paper for Northern Ghana

Agreement Number: AID-641-A-16-00010

Authors: Alexandre M. Grais, Gabriel Sidman, Michael Netzer, Therese Tepe, and Timothy Pearson; Winrock International

DISCLAIMER The report was made possible through the generous support of the American people through the U.S. Agency for International Development (USAID) under the Feed the Future initiative. The contents are the responsibility of Winrock International and do not necessarily reflect the views of USAID or the United States Government.

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Table of Contents

Executive summary ...... 1 Ecosystem Services and PES Schemes ...... 1 Ecosystem Services in northern Ghana ...... 1 Potential PES schemes in northern Ghana ...... 2 Design and Next Steps for Ecosystem Services and Payment for Ecosystem Services ...... 3

Introduction ...... 3 Background ...... 3 What are Ecosystem Services?...... 4 What is Payment for Ecosystem Services? ...... 5

Review of ecosystem services in Northern Ghana ...... 6 Ecosystem services in northern Ghana ...... 6 Climate Change regulation...... 13 Recreational and ecotourism ...... 15

PES Schemes for Northern Ghana ...... 17 Carbon and GHG emissions...... 18 Water-based ecosystem services ...... 19 Soil erosion control and enrichment ...... 20 Importance of biodiversity for the provision of aesthetic services and provision of crops ..... 20

Payment for Ecosystem Services in northern Ghana – Design and next Steps ...... 22 Stakeholder Consultation ...... 22 Evaluation of ES with Existing Data and Geospatial Analysis ...... 23 Valuation of ES with Economic Analysis ...... 28

Conclusion ...... 29

References ...... 30

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Acronym List

CREMA Community Resource Management Area ER-PD Emission Reduction Program Document ES Ecosystem Services FAO Food and Agriculture Organization FCPF Forest Carbon Partnership Facility GFC Ghana Forestry Commission GHG Greenhouse Gas GoG Government of Ghana km2 square kilometer MESTI Ghanaian Ministry of Environment, Science, Technology and Innovation NGO Non-Governmental Organization NPP Net Primary Productivity NTFP Non-Timber Forest Product PES Payment for Ecosystem Services PFES Payment for Forest Ecosystem Services REDD+ Reduced Emissions from Deforestation and forest Degradation and the enhancement of carbon stocks SLWM Sustainable Land and Water Management SLWMP Sustainable Land and Water Management Programme SWAT Soil and Water Assessment Tool USAID United States Agency for International Development USAID AgNRM USAID Feed the Future Agriculture and Natural Resource Management Project USGS United States Geological Survey

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EXECUTIVE SUMMARY

With this paper, the USAID Feed the Future Ghana Agriculture and Natural Resource Management Project (USAID AgNRM) seeks to begin a conversation on how to best develop an ecosystem valuation for the Upper West Region, Northern Region, and Upper East Region that integrates ecosystem services’ intrinsic values into daily natural resource management. This paper presents: 1. An overview of ecosystem services (ES) and payment for ecosystem services (PES) schemes. 2. Explores which ES are important in northern Ghana and potential PES schemes for the region. 3. Discusses the next steps to supporting an ES valuation and the PES schemes best suited for northern Ghana. Ecosystem Services and PES Schemes The Millennium Ecosystem Assessment defines ecosystem services as the provisioning (e.g., water resources), regulating (e.g., climate regulation, water quality), cultural (e.g., aesthetic), and supporting (e.g., soil formation) benefits that people obtain from ecosystems (Millennium Ecosystem Assessment, 2005). Although there are intrinsic values to ecosystem services, the impact that economic development has on them is usually considered an externality. Payment for ecosystem services (PES) schemes provide a market mechanism to internalize these externalities, so that a monetary cost can be associated with the carbon that would be emitted and the decrease in water quality that would occur. Factors that ensure the viability of a PES are 1) To define ES well so that it can be valued, measured, and monitored, 2) To identify a buyer (e.g., private company or government program), and 3) To identify the provider (e.g., land owner).

Ecosystem Services in northern Ghana Northern Ghana and all of Sub-Saharan Africa are among the most vulnerable areas in the world to losses of ES and impacts of global climate change. This is partially due to the seasonal and drought-prone semi-arid climate that forms the transition between savanna and the more arid Sahel region, combined with a growing population dependent on subsistence livelihoods (Sheffield et al. 2014; Herrmann et al. 2005).

Currently, two primary reports have been published on ES of northern Ghana. One was compiled by the Ghanaian Ministry of Environment, Science, Technology and Innovation (MESTI) in 2015 and focused on the feasibility of sustainable land and water management activities that could be supported by a PES system. The second was published by Boafo et al. in 2014 and reviewed ES in the rural savanna landscapes of northern Ghana. Using these reports, other studies, and preliminary spatial analysis, we will analyze the most important ES for northern Ghana, to be combined with information from local stakeholders and other experts.

This paper reviews a number of ecosystem services: water-based ecosystem services; ecosystem services to support crops, game and fodder; timber and non-timber forest products; regulation of greenhouse gases; and recreation, tourism and biodiversity.

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Potential PES schemes in northern Ghana While all the ES mentioned above are important for northern Ghana, not all are viable as a PES. For a PES scheme to be viable, there must be a well-defined environmental service, a buyer, a provider, and in many cases, some type of third party regulator. This analysis will review those that are potentially appropriate for PES in northern Ghana (Table 1) based on existing literature and staff expertise.

Table 1. Overview of potential PES schemes in local communities in northern Ghana Ecosystem Service Activity Beneficiaries and Buyer Mechanism Climate regulation Reducing deforestation and Beneficiary: the global community Government through the forest degradation and/or Buyers: World Bank Carbon scheme such as reduction/removals conducting Fund, national governments such REDD+. of Greenhouse Gas afforestation/reforestation as Norway, and to a certain (GHG) emissions activities (e.g., mango, teak and extent the voluntary market. Private voluntary cassia). carbon projects. Provision of Activities in the upper Heavy users of water such as Heavy water users freshwater and watershed that improve or power companies producing providing direct regulation of flow maintain water quality and hydroelectricity, industrial users payment to and water quality. flow, such as reforestation, (e.g., shea processors) irrigation communities based improved agricultural associations, portable water on measurable practices, and improved utilities, and local governments activities such as wastewater that must provide flood area reforested. protection. Regulating soil Activities in the upper Dam operators who must Dam operators erosion watershed that improve prevent sedimentation, industry providing payments prevent soil erosion, mainly and potable water systems that to local improved agricultural practices must treat water for use (e.g., communities based such as those implemented in Ghana Water Company), on activities such the SLWMP. governments hoping to protect as increase of wildlife habitat and recreational cover crops opportunities in water bodies (e.g., Ghana Forestry Commission Wildlife division). Ecotourism as a Within Community Resource Tourists interested in fauna such Revenue from eco- cultural service Management Areas (CREMAs), as elephant, leopard, antelope, tourism sites there often are individual hyena, hippopotamus and a supports the producers employed as variety of primate, bird and protection of rangers and park staff ensuring amphibian species as well as biodiversity. protection from poaching and landscape and cultural viewing. other disturbance to maintain Operators providing tours, higher species numbers. transportation and accommodation. Provision of non- Avoid using shea or moringa Private sector shea and moringa Revenue from the timber forest trees for fuel wood. Manage companies. purchase of shea products forest cover and riparian areas and moringa for water availability and protects these habitat for wildlife pollinators, crops from being including insects. used as fuel wood.

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Design and Next Steps for Ecosystem Services and Payment for Ecosystem Services AgNRM will conduct a thorough stakeholder consultation process to: - Reach consensus on which ES to prioritize; - Develop a greater understanding of ES providers and buyers in northern Ghana; and - Ensure that our efforts build on existing work. Spatial analysis will then be used to map existing ES in northern Ghana, over both space (at the relevant watershed scale for each CREMA) and time (mapping the impact of historic changes in order to understand likely future impacts). This information will be used to measure and monitor ES and provide actionable information on ways to better manage existing ES. This will be important for AgNRM project development and monitoring; will guide long-term sustainable land use planning; and will be essential to evaluating PES opportunities. The spatial analysis will be coupled with an economic analysis to provide more detail on the economic value of these services.

INTRODUCTION

Background The Government of Ghana (GoG) and the United States Agency for International Development (USAID) have long collaborated to address development issues in northern Ghana. Over the last decade, tremendous progress has been made in livelihood development and decreasing food insecurity in northern Ghana. Yet as the natural resources across the north are stressed by climate change, agricultural pressures, and increasing demands for water, food and energy, further advances in poverty reduction and food security require a safeguarding of the natural resource base. The USAID Feed the Future Ghana Agriculture and Natural Resource Management Project (USAID AgNRM) is a five-year program within the USAID/Ghana Feed the Future strategy which seeks to uniquely address issues of environment and natural resource management in northern Ghana. A key aspect to doing so is to understand the value of the ecosystem services (ES) that the landscape provides. The services particularly relevant to this region of Ghana broadly include water, climate, soil and diversity of flora and fauna. These ES contribute to a wide range of development indicators, including those central to the USAID AgNRM project such as household income, increased economic benefits, improved participation in the agricultural sector and in non-traditional agriculture product collection, enterprise development, women’s livelihoods, child health and nutrition, and access to water for domestic and productive uses. In addition to supporting every day livelihoods and food production, ES are often valued for increasing overall resiliency by preventing and buffering communities and households from shocks. Ecosystem services benefit the population broadly, from supply of adequate clean water to pollination services for agriculture and supply of food, and energy and income sources. Therefore, it is important to understand what these ecosystem services are, their linkages to landscape-level NRM, and their value. Seeking to sustainably manage these services can also provide the basis for improved management and governance structures.

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With this paper, USAID AgNRM seeks to begin a conversation on how to support the development of an ecosystem valuation for the Upper West Region, Northern Region, and Upper East Region and to integrate the ecosystem services’ intrinsic values into daily natural resource management by reviewing work already conducted and proposing an approach forward. This paper will be followed by stakeholder consultations, as well as spatial and economic analyses, to refine a set of recommendations to effectively value ES in northern Ghana and to design a payment for ecosystem services scheme for the region.

What are Ecosystem Services? Ecosystem services are things like clean water, air and soil that form the foundation of food production, timber and non-timber resources, nutrient cycling, water availability, and control of the global climate. These services have been typically provided freely by the natural environment, however increasing population pressures and development in many areas of the world are resulting in the degradation and loss of ecosystems, impacting people’s livelihoods, health, and security.

The Millennium Ecosystem Assessment defines ecosystem services as the provisioning (e.g., water resources), regulating (e.g., climate regulation, water quality), cultural (e.g., aesthetic), and supporting (e.g., soil formation) benefits that people obtain from ecosystems (Millennium Ecosystem Assessment, 2005). Table 2 provides an overview of these ecosystem services, all of which have different value -- some are more important in specific areas than others, and some are more spiritual in value, while others are vital for health, security, livelihoods and economy.

Table 2. Overview of Ecosystem Services adapted from Millennium Ecosystem Assessment (Board, 2005) Crops, game and This includes the vast range of food products derived from plants, animals, fodder and microbes. Fiber Materials included here are wood, jute, cotton, hemp, silk, and wool. Fuel Wood, dung, and other biological materials serve as sources of energy. This includes the genes and genetic information used for animal and plant

Genetic resources breeding and biotechnology. Natural medicines and pharmaceuticals. Many medicines, biocides, food Biochemicals additives such as alginates and biological materials are derived from ecosystems. People obtain fresh water from ecosystems and thus the supply of fresh water can be considered a provisioning service. Fresh water in rivers is also a Fresh water source of energy. However, because water is required for other life to exist, it could also be

Provisioning Services considered a supporting service. Ecosystems contribute chemicals to and extract chemicals from the Air quality

atmosphere, influencing many aspects of air quality. Ecosystems influence climate both locally and globally. At a local scale, for example, changes in land cover can affect both temperature and precipitation. Climate At the global scale, ecosystems play an important role in mitigating climate change. The timing and magnitude of runoff, flooding, and aquifer recharge can be strongly influenced by changes in land cover, including alterations that change Water flow the water storage potential of the system, such as the conversion of wetlands

Regulating Services Services Regulating or the replacement of forests with croplands or croplands with urban areas.

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Vegetative cover plays an important role in soil retention. It also holds soil Erosion nutrients in place, improving soil health and avoiding water pollution from agricultural runoff Water purification Filtration of water through soil plays an important role in water purification. Changes in ecosystems can directly change the abundance of human Disease regulation pathogens. Ecosystem changes affect the distribution, abundance, and effectiveness of Pollination pollinators. The presence of coastal ecosystems, such as mangroves and coral reefs, can Natural hazards reduce the damage caused by hurricanes or large waves. Spiritual and Many religions attach spiritual and religious values to ecosystems or their religious components.

Ecosystems influence the types of knowledge systems developed by different Knowledge systems cultures. Ecosystems and their components and processes provide the basis for both Educational value formal and informal education in many societies. Ecosystems influence the types of social relations that are established in Social relations particular cultures. Recreation and People often enjoy the aesthetics of an area and choose to spend their leisure

Cultural Services Services Cultural ecotourism time in those places. Because many provisioning services depend on soil fertility, the rate of soil Soil formation formation influences human well-being in many ways.

Water cycling Water cycles through ecosystems and is essential for living organisms Approximately 20 nutrients essential for life, including nitrogen and Nutrient cycling phosphorus, cycle through ecosystems and are maintained at different

Supporting Services concentrations in different parts of ecosystems.

What is Payment for Ecosystem Services? Although there are intrinsic values to ecosystem services, the impact that economic development can have on ES is usually considered an externality. This means that when a logger cuts down rosewood to sell as timber, the price of that timber is considered, but the carbon Ghana PES Example emitted as a result is not, or when a Currently, the Ghana Forestry Commission is in the process farmer applies fertilizer to a field, the of developing such a program in the country’s High Forest revenue from the improved crop yield is Zone, where cocoa farmers will be incentivized to considered, but the related increase of implement climate-smart cocoa production. If this program nutrients affecting the near-by river’s is successful, the World Bank Carbon Fund will buy the carbon credits generated by the improved land management quality is not. incentivized by this program.

PES schemes provide a market In this PES scheme, the ES identified is the regulation of GHG mechanism to internalize these emissions through the reduction of emissions from externalities, so that a monetary cost can deforestation, forest degradation, and the enhancement of carbon stocks. The buyer is the World Bank Carbon Fund. be associated with the carbon that would The providers are the landowners in the High Forest Zone be emitted and the decrease in water and the Ghana Forestry Commission. quality that would occur. Through different actions such as planting riparian buffers to reduce fertilizer runoff, or avoiding cutting down an area of forest to maintain carbon stocks and mitigate the impact to global climate change, a PES scheme can incentivize

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landowners and other Vietnam PES Example stakeholders to more sustainably manage their ecosystem services. Vietnam created a national PES scheme with a focus on water, in Factors that ensure the viability response to the loss of critical forestlands and other environmental degradation from the expansion of agriculture and unbridled of a PES are 1) To define ES economic development (Winrock International, 2011). Conservation well so that it can be valued, of vital habitats is more likely if forest owners and forest-dwelling measured, and monitored, 2) To communities can be compensated for the true economic value of the identify a buyer (e.g., private services that intact ecosystems provide, including protection of water company or government quality, prevention of soil runoff that increases siltation of program), and 3) To identify the hydroelectric reservoirs, harvest of natural forest products, and the aesthetic appeal of natural landscapes important to tourism. provider (e.g., land owner).These schemes are increasingly part of Vietnam’s national payment for forest ecosystem services (PFES) pilot the global economy, through policy, created the legal framework necessary to collect and distribute government and private sector a portion of the economic value of ecological services provided by programs. Reducing emissions forests. The policy facilitates payments ensuring continuous forest protection and management with accompanying ES, while improving from deforestation, forest the economic condition of local communities providing those services, degradation and the enhancement the provider. The program also created a transparent process based of carbon stocks (REDD+) is an on scientific research that increased market confidence by requiring example of an internationally PFES payments from public utilities, the buyers, based on a reduction recognized PES scheme where in their operating costs. stakeholders are incentivized to better manage and conserve their forest resources, so as to reduce and sequester greenhouse gas emissions.

REVIEW OF ECOSYSTEM SERVICES IN NORTHERN GHANA

Ecosystem services in northern Ghana Northern Ghana, and all of Sub-Sahara Africa, are among the most vulnerable areas in the world for loss of ES, and the impacts of global climate change. This is due to the seasonal and drought- prone semi-arid climate that forms the transition between savanna and the more arid Sahel region of Africa, combined with a growing population dependent on subsistence livelihoods and pervasive poverty (Sheffield et al 2014; Herrmann et al 2005). This means that northern Ghana is highly dependent on preserving ES, and needs to manage its landscapes well in order to be resilient to the impacts of climate change. Thus, this section will review the relevant ES for northern Ghana, especially those that are more or less suited to a PES system.

Two primary reports exist that focus on ES of northern Ghana, one by the Ghanaian Ministry of Environment, Science, Technology and Innovation (MESTI) (2015) on the feasibility of sustainable land and water management activities that could be supported by PES system, and the second published by Boafo et al. (2014) that reviewed ES in rural savanna landscapes of northern Ghana.

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Both of the reports highlight the important of ES in northern Ghana. Boafo et al. (2014) focuses on “provisioning services” finding that 80% of the population extensively uses bush meat, crop and animal production, fishing, fodder, fuel wood, building materials, freshwater and wild plants. It also identified cyclical drought, climate variation, land conversion, overharvesting, and a decline in traditional ecological knowledge as major challenges to the sustainable supply of nearly all of these ES.

Similarly, the MESTI report from 2015, which focused largely on the feasibility of PES, identified four primary ES: 1) water quantity and quality, including the control of flooding, drought, and erosion, 2) carbon sequestration, 3) biodiversity conservation, and 4) aesthetic features relevant to ecotourism. With regard to PES, the report found high potential for carbon sequestration in the short/medium-term, and high potential for watershed protection and productivity over the long term.

From these reports, other studies and preliminary spatial analysis, we distil down what appear to be the most important ES for northern Ghana. This is based on literature; however, further information must be gathered from local stakeholders and other experts on northern Ghana.

Water-based ecosystem services Water is one, of if not the most, important ecosystem service in most of the world, and northern Ghana is no exception. Falling within the savanna zone of Ghana, the northern portion of the country generally has a distinct dry season between November and April, with the wet season falling between May and October (with a peak in September). During the dry season, water can be a limiting factor for the agricultural livelihoods of much of the population and finding a clean and sustainable source of freshwater can be challenging. Furthermore, heavy rainfall events in the wet season have been known to cause damaging flooding in the region, especially for cities and towns on the banks of the region’s three major rivers: The Black and White Volta rivers, and the Oti river.

Water-based ecosystem services can be divided into both provisioning services and regulating services, since they include both the provision of freshwater and the regulation of water flow and quality. Water also has a great impact on soil quality, which is an important supporting ecosystem service for agriculture and food provision.

Water flow regulation The main three rivers in northern Ghana all flow into the man-made Volta Lake in southern Ghana, which is dammed at Akosombo and Kpong (Figure 1). These dams provide hydroelectric power to the country. The Black Volta has the largest watershed of the three (~150,000km2), stretching through Burkina Faso into Mali, but only 22% of the watershed is within Ghana. The White Volta is smaller in total size (~110,000km2), but has a greater area in Ghana with 45% of the watershed within the country. In the East, the smallest watershed of the three is the Oti (~70,000km2) with only 16% of its watershed falling within Ghana.

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The mean annual runoff of the Black Volta is about 3.2km3 per year after crossing into Ghana from Burkina Faso and rises to about 7.8 km3 per year where it empties into the Lake. The White Volta is about 2.2km3 when it enters Ghana and about 8.0km3 at its outlet into the Lake. The White Volta’s flow into northern Ghana is highly influenced by the Bagre Dam upriver in Burkina Faso. The Oti, despite having the smallest watershed, has the greatest flow of any of the three rivers, being about 4.2 km3 per year at the Ghanaian border and 12.7 km3 per year at its outlet into the Lake (Amisigo 2006). The reason the Oti contributes such a high proportion of the total flow into Lake Volta (about 30-40% of the total) is due to the prominence of hilly and mountainous terrain in its watershed. These areas of high slope induce more runoff into the streams than the flatter Figure 1. Major Watersheds of northern Ghana watersheds of the Black and White Volta rivers, where more rainfall ends up re-entering the atmosphere through evapotranspiration or infiltrating into the ground (Figure 2; Gyau-Boakye and Tumbulto 1999).

The provisioning of freshwater for potable water systems, agricultural irrigation and other purposes is a critical ecosystem service in northern Ghana and depends greatly on water supply available in these three key watersheds. Available supply can come from one of two sources: 1) surface water and 2) groundwater.

Surface water regulation Surface water largely comes from rainfall that runs off into the stream network. Annual rainfall totals range between 800-1,200mm per year and tend to increase as one travels south (Figure 3). The rainfall tends to be very concentrated in the wet season, with 75% occurring between July and September (Ofosu-Addo et al. 2008). Due to the semi-arid conditions in the region and the long dry season, most small streams are ephemeral, meaning they do not have water for the entire year.

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There is evidence that stream flow has been decreasing over time in the northern Ghana watersheds due to land use change from savanna grassland to cropland and settlement (Awotwi et al. 2014). This can also be attributed to drought in the northern portions of the watershed (Mali and Burkina Faso), increased groundwater extraction, and increased evapotranspiration due to temperature rises (Gyau-Boakye and Tumbulto 1999). Yengoh et al. (2010) found evidence of a decreasing number of days with rain over time, which corresponds to the predictions of how climate change will impact the region.

Furthermore, changes in land cover is altering surface water regulation, given that natural vegetation tends to both Figure 2. Slope Distribution of Major Watersheds use more water and trap more water for infiltration into the ground leaving less available for runoff. According to the forest loss dataset described in Hansen et al. (2013), the Black Volta is the most forested of the three watersheds (18%) and the Oti and White Volta are less forested (7% and 5% respectively). Most of this forest cover is in the southern portions of the watersheds in Ghana, Cote d’Ivoire, and Togo (Figure 4). Between 2001 and 2014, the Black Volta lost 6,391 ha of forest annually, representing 0.23% of the forest in the watershed, while the White Volta lost 757 ha yr-1 and the Oti 646 ha yr-1, both representing 0.14% of the forest cover in the respective watersheds. This loss of natural vegetation to human-altered land covers, such as cropland and settlement, likely has left northern Ghana’s rivers more susceptible to flooding during the wet season, and with less flow during the dry season that can exacerbate the impact of droughts.

Groundwater flow regulation Because of the scarcity of surface water in areas far from the channels of the main rivers, many villages rely on groundwater for drinking and irrigation purposes (Anayah and Kaluarachchi 2008). Local hydrology is favorable for groundwater extraction due to hydrogeological characteristics that create an expansive shallow aquifer (Laube et al. 2009). Up to 52% of potable water is drawn from groundwater in the region (Ofosu-Addo et al. 2008). Despite the reliance on groundwater, there is evidence that the current extraction rates are far below the limit of sustainable extraction; meaning groundwater could be utilized more extensively for freshwater provision (Laube et al. 2009; Anayah and Kaluarachchi 2008; Ofosu-Addo et al. 2008).

Flow regulation is not limited to ensuring a sufficient supply of water for human use, but also to ensuring that too much water, in the form of flooding, does not cause damage to human property

9 and agriculture. Northern Ghana has suffered several major floods in the last 25 years, including in 1985, 1988, 1993, 1999 and 2007. These floods damaged grain crops, homes, and granaries, and led to the loss of livestock among small-scale farmers (Yengoh et al. 2010). Indeed, floods are perceived to have a very negative influence on utilization of ecosystem services in household interviews (Boafo et al. 2014). Furthermore, there is the prediction and evidence that climate change will lead to more short, intense rainfall patterns despite an overall decrease in annual rainfall totals (Yengoh et al. 2010; Gyau-Boakye and Tumbulto 1999). The flood of 2007 was made worse in the Ghanaian portion of the White Volta watershed by the release of excess water from the Bagre Reservoir in Burkina Faso (Armah et al. 2010).

This highlights an unfortunate situation for Ghana regarding flood and water quality control; the fact that it sits at the base of the watershed means it cannot entirely control its own fate, provided that it is affected by the water management decisions of four other countries. As such, this highlights the need for trans boundary ES and PES cooperation in the Volta basin to ensure decision-making processes consider the viewpoints of all stakeholders involved.

Water quality regulation Even if water is properly regulated and there is sufficient quantity for a population to utilize for drinking and irrigation, its quality must also be managed to ensure that it is not damaging to the health of humans, livestock and wildlife. Water quality is an issue for many northern Ghanaians, considering only 15% of the population has access to proper sanitation and thousands of children die of diarrheal diseases each year (UNICEF 2015).

Surface water quality regulation There is limited data on water quality in northern Ghana, especially as related to surface water. However, a sampling campaign in the Oti river showed very high levels of turbidity, total iron, faecal coliforms and total coliforms, Figure 3 Annual rainfall distribution in northern Ghana making direct consumption by humans unadvisable (Abdul-Razak et al. 2009). These high levels of pollution are likely due to

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inadequate household sanitation leading to faecal matter entering the waterways untreated and the use of fertilizer for agricultural purposes leading to algal expansion.

Groundwater quality regulation Many studies have investigated groundwater quality due to the interest in expanding the use of groundwater resources for consumption and irrigation in the region. In general, these studies indicate that water quality is relatively good with most wells being suitable for potable water use, though some show elevated levels of nitrate, manganese, fluoride, along with heavy metal contaminants near mining sites (Cobbina et al. 2012; Rossiter et al. 2010; Anku et al. 2008).

Provisioning of crops, game, and fodder Figure 4. Forest cover and forest loss in the major watersheds of The provisioning of food is a critical northern Ghana ecosystem service in northern Ghana considering the widespread agriculture and hunting that occurs in the rural areas of the region. Inventories and surveys completed by Boafo et al. (2014) conclude that bush meat, crop and animal production, fish catches and fodder for cattle are all critical ecosystem services for villagers in the region. The study found that over 90% of households in four villages surveyed rely on agriculture for their main form of livelihood. Cultivated crops include yam, cassava, maize, millet, rice, groundnuts, cowpea, tomato, pepper and onion. Interestingly, farm size in northern Ghana is generally small, with an average size of two hectares (MESTI 2015).

Bush meat includes squirrels, bushbucks, great cane rats, and tortoise. Fishing, while confined to areas near perennial rivers such as the Black and White Volta, include tilapia, mudfish, and catfish (Boafo et al. 2014). Hunting of larger mammals has contributed to a regional bush meat market of 400,000 tons per year, while the supply of harvested fish in Ghana ranges from 230,000 to 480,000 tons per year (Brashares et al. 2004). However, results from Boafo et al. (2014) suggest that the supply of bushmeat is declining due to overhunting in some areas. Villagers noted traveling over 16 km from home in groups to hunt due to scarcity closer to their homes. Brashares et al. (2004) suggest that mammal and fish populations have declined over the last 40 years due to overhunting and fishing.

With regard to crops, threats to the provisioning of food is a major challenge in northern Ghana, where food insecurity is more of an issue than in the richer, southern part of the country (Hesselberg and Yaro 2006). Flooding and drought, which are predicted to become more common in the region with climate change, can have devastating impacts on agriculture. The

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flooding in 2007 corresponded with the end of the wet season, destroying crops that were necessary to sustain farmers through the lean dry season; 70,500 hectares were affected by flooding, leading to an estimated production loss of 144,000 metric tons of crops and 50,000 people at risk of malnutrition and food insecurity for 15 months following the floods (Armah et al. 2010). In response, the World Food Program estimated food aid at US$6.6M, and UN appealed for US$12M for relief operations.1

Furthermore, the erosion of topsoil often affects soil fertility, a major supporting ecosystem service for the provision of food through agriculture. This is especially true in areas that are intensely tilled and contain crop rows placed perpendicular to the slope, as top soil can be lost quickly even with low intensity rainfall, leading to a decline in soil fertility and lower crop yields. Promotion of sustainable land and water management (SLWM) practices in the region, such as mulching, ridging, stone lines and bunding have been shown to reduce erosion problems, but wider dissemination is necessary for a meaningful impact at the watershed level (MESTI 2015). Forest and vegetation cover are significant factors reducing erosion and determining the occurrence and severity of flooding by slowing and regulating water as it moves through the system. Some studies have suggested that to improve food security, efforts should also be made to diversify the livelihoods of rural farmers in northern Ghana to reduce dependence on shock- prone agriculture and provide more disposable income (Hatskevich 2011; Hesselberg and Yaro 2006).

In addition to the presence of forest and other habitat types, biodiversity conservation has also been identified as critical in maintaining agricultural production (FAO 2016). Essential functions within the agro-ecosystem include soil micro-organisms around the roots of plants, trees that ensure nutrient cycling, and predators and disease control organisms that regulate pests and diseases. Greater plant biodiversity itself has been shown to reduce the overall occurrence of crop pathogens and fungi. Many staple and tree crops in northern Ghana are susceptible to such pathogens and fungi.

Timber and NTFP In Ghana’s northern savanna woodlands, the matrix of tree and grass cover provide timber and non-timber products. Non-timber forest products (NTFP) include medicinal plants (the primary source of healthcare to residents), roofing grasses, fencing poles, fruits and other tree products such as shea and dawadawa (which are used for a wide variety of household and cooking uses).

Only recently has timber extraction become a prominent activity in northern Ghana due to the harvesting of roundwood, much of which is illegal or occurs around infrastructure development projects using associated permits. It has been estimated that of the total roundwood/timber production in Ghana, as much as 91% is used as fuel wood and for charcoal with only the remaining (9%) used as industrial roundwood (Agyarko, circa 2001).

Savanna areas, and the biodiversity contained within, safeguard existing livelihoods centred around NTFPs, and provide opportunities for new livelihoods. The shea tree (Vitellaria paradoxa) supports a $30 million per year export industry in West Africa (WATH 2004) with a large amount of production originating in northern Ghana. In 2004, over half of the shea

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products produced were used domestically and not exported (WATH 2004), playing an important role in households and local markets.

Shea trees depend on pollination by insects, as often observed and recently concluded in a scientific study (Lassen et al. 2016). In fact, it is estimated that nearly 94% of tropical flowering trees are pollinated by wildlife species (Ollerton et al. 2011 as in Lassen et al. 2016). Protecting the extremely valuable ES of pollination requires habitat protection and cautious fertilizer use, and can be further maintained through the practice of beekeeping. The Lassen study demonstrates positive correlations between shea fertilization and the number of honeybee colonies within proximity. Stingless bees also played a supporting but lesser role in shea pollination.

Activities that enhance income and other benefits derived from productive tree plots such as shea and moringa will directly encourage more active parkland management, maintenance and enrichment (Boffa 2015). Also, shade tolerant crops such as taro, pepper, chili pepper, and eggplant can be planted in the understory (Boffa 2015).

Shea trees, among other locally valued trees, are left standing in agricultural fields and elsewhere. However, as charcoal demand increases in the local area and Accra, harnessing the market value of shea and other tree products is critical to protecting these trees from being felled for charcoal production. It is estimated that about 70% of Ghana’s total supply of firewood and charcoal, projected at about 16 million cubic meters, originates from the northern savanna woodlands (NDPC 2010). Many initiatives, including the USAID AgNRM project, are focused upon improving the shea value chain to realize its full monetary value for local communities so that they protect this important species. Charcoal has a value of its own, and designated lots have been proposed as one of the possible solutions to remove the pressure on tree cover.

In addition to shea, insects, specifically bees, pollinate in whole or in part a variety of food crops in northern Ghana including okra, onion, cabbage, cashew, chili pepper, red pepper, bell pepper, green pepper, papaya, and mango. In addition to pollinating these crops, bees produce honey, which is harvested in these regions and either consumed or sold.

Climate Change regulation The impacts of global climate change are being felt in northern Ghana. For example, the region has experienced pronounced droughts, a shift of the onset of the rainy season from April to May and an increase in dry spells during the rainy season (Hulme, 2001; Laux et al. 2008). A trend that is predicted to become more pronounced, impacting harvests and increasing food insecurity (Laube et al. 2012 and Van de Giesen et al. 2010).

Forests, and live biomass more generally, play an important role in regulating climate change. When forests are cleared or degraded, carbon stored in the trees, non-tree vegetation, roots, deadwood, litter, and soil is released into the atmosphere as carbon dioxide (CO2, a major greenhouse gas). In addition, the forest’s capacity for additional carbon sequestration is lost or reduced. GHG emissions from deforestation and forest degradation are significant, and have been estimated to account for more than 10% of global anthropogenic CO2 emissions (Harris et al., 2012).

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Forest cover in northern Ghana is estimated at 1.5 million hectares (ha) (figure 5) with an estimated 19 million Mg in stored carbon based on preliminary analysis (figure 6). However, the region has experienced land use transitions, including deforestation and forest degradation. Braimoh (2005), identifies the most typical land use transitions in northern Ghana as: • The conversion of about 12% of landscape from grassland to cropland; • The degradation of closed woodland to open woodland (11% of landscape); • The gain in biomass from open woodland to closed woodland (8% of landscape); and • The degradation of open woodland to grassland (6% of landscape). Figure 5. Tree cover in northern Ghana

Moreover, in analysis produced for the Ghana Forestry Commission, Indufor2 assessed deforestation in northern Ghana between 2000 and 2010 at approximately 460,000 ha, resulting in approximately 14M tonnes of CO2e over that time period (Indufor, 2013). Therefore, policies related to reducing emissions from deforestation and forest degradation and other measures to reduce emissions and increase sequestration (REDD+) in northern Ghana have the potential to play an important role in climate change mitigation.

2 Indufor is a forest consulting group that supported the Ghana Forestry Commission in assessing deforestation between using land cover maps for 1990, 2000 and 2010. 14

Recreational and ecotourism The Ghana Sustainable Land and Water Management Programme (SLWMP) has identified tourism as a tool for development in the Western Wildlife Corridor in northern Ghana and, as a result, analysed the potential and drafted a strategy outlining which attractions exist in the area (RESCONI 2015). Based on this initial analysis and stakeholder involvement, the potential to consider revenue from the tourism industry into PES schemes is becoming more of a possibility. The SLWMP drafted strategy identifies tourism potential as dependent on existing biodiverse and culturally significant areas of the north. As the industry develops, and revenue is generated, the beneficiaries with a stake in safeguarding the resources Figure 6. Carbon storage in northern Ghana could create the opportunity to involve the tourism industry in emerging PES schemes.

The study supporting the above strategy outlines that while Ghana receives significant tourist inflows and revenues (annual increases in arrivals have ranged from 5-20% since the mid-80s with 1.2 million tourists in 2012 creating $2.5 billion in revenue constituting almost 5% of GDP), northern Ghana has not yet attracted meaningful portions of these tourists.

However, improved road infrastructure throughout northern Ghana may help to reverse this trend. Better connections in the Western Biodiversity Corridor between Mole National Park, and Gbele Game Reserve and Nazinga Game Ranch may improve tourist interest and desire to see these parks. Gbele Game Reserve itself boasts spectacular biodiversity, including large mammal species and landscapes, and northern Ghana has many historical heritage sites and monuments of interest, including the Salaga Slave Market, Gwollu Slave Defense Wall, and the Larabanga Mosque. Tourists may also experience Ghana’s cultural heritage with visits to local festivals and durbars, shrines, sacred groves, totems, and traditional Ashanti buildings and palaces (RESCONI 2015).

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To further understand tourism potential, the SLWMP report used surveys to understand readiness of international and domestic tourists to travel to these areas in the north. It is relevant to note that two of the more advanced CREMAs in northern Ghana are partially supported by ecotourism; the Wechiau Hippo Sanctuary CREMA and the Moagduri Wuntanluri Kuwomsaasi CREMA. The Wechaiu Hippo Sanctuary CREMA encompasses a portion of the Black Volta River on Ghana’s western border with Burkina Faso while Moagduri Wuntanluri Kuwomsaasi CREMA is on the eastern border of Mole National Park. Both CREMAs have economic activities tied to a series of the above ES that are actively managed to provide payment and support to those who supply the ES (Figure 7). This provides an example of the role tourism has already played in incentivizing Figure 7. Protected areas in northern Ghana sustainable land use management in northern Ghana and the potential for development of other PES related tourism schemes.

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PES SCHEMES FOR NORTHERN GHANA While all the ES mentioned above are important for northern Ghana, not all are viable as a PES. As mentioned in Section 1.3, for a PES scheme to be viable there must be a well-defined environmental service, a buyer, a provider, and in many cases some type of third party regulator. It is also important to make a distinction between government-regulated programs, and private and/or NGO programs. While government programs have more potential for targeted large-scale land use management (the buyer is the GoG and has national or regional interests), private and/or NGO programs are often more site specific, with buyers driven by things like local water quality. In this section we analyze the ES to those that are potentially appropriate for PES in northern Ghana based on an initial literature review. Further information on PES feasibility will be gathered from local stakeholders and international experts.

Currently, there are no direct PES systems in Ghana, however there are some PES-like interventions (MESTI, 2015). These are outlined in table 2, taken from the MESTI (2015) report. All of these interventions focus on water and wildlife protection; all are managed by a GoG institution; and all face challenges involving funding (buyers), stakeholder buy-in (providers), land tenure issues, and overall attitude or skepticism of the program and its benefits.

The MESTI (2015) report identified four viable PES programs: carbon sequestration, biodiversity, water access and quality, and erosion control. However, it is clear that challenges exist related to financing, which lead to low stakeholder buy-in and confidence. Security of land tenure is another issue. Nevertheless, below is a breakdown of ES that could warrant a viable PES scheme

Table 3. PES-like Schemes and Associated Implementation Agencies/Institutions (MESTI 2015) PES-like Description ES Implementing Beneficiaries and Challenges/Barriers Scheme Agency Benefits / Constraints /Institution CREMA: • Wildlife protection • M&E to Wildlife Division • Premium price for • Quantifying and Community – on- and off- prevent of Forestry non-timber forest pricing of the Resources reserves wild fires Commission products (shea services Management • Encouragement to • Minimise nut) • Acceptance – low improve resource siltation of • Employment for motivation due lack management rivers and community of short-term practices water members benefits • 3-stage governance bodies • Policy review • Setting of wild fires structure: local • Provision benefits to land by hunters and non- communities, of water owners/user participating government for wildlife communities (Wildlife Division) and Central Executive Committee (CEC) Integrated • Buffer Zone - River • Regulation Water • Farmers – • Lack of budget for Water bank protection of water Resources incentives to regulatory bodies Resources using tree species flow, Commission, relocate • Land tenure Mgt. in the vegetation Moa, MLGRD, • Alternative • Attitudinal change White Volta and other FSD, NGOs livelihood • Lack of policy Basin habitats – activities strategy prevention • Tourist revenue • Stakeholder collaboration

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PES-like Description ES Implementing Beneficiaries and Challenges/Barriers Scheme Agency Benefits / Constraints /Institution • External source of funding

Forest • Tree • Regulation Forestry Services • Farmers – • Lack of budget for Enrichment planting/growing and of water Division (FSD) incentives to regulatory bodies restocking flow, relocate • Land tenure vegetation • Alternative • Attitudinal change and other livelihood activities • Lack of policy habitats – • Tourist revenue strategy prevention • Stakeholder collaboration • External source of funding

Carbon and GHG emissions Ghana is pursuing a national Reduced Emissions from Deforestation and Degradation (REDD+) program, which is a global PES scheme to curb GHG emission from land use change in order to mitigate the impacts of climate change. Since 2008 Ghana has been developing its REDD+ program through the Forest Carbon Partnership Facility (FCPF), and is currently finalizing its Emission Reduction Program Document (ER-PD). Activities under the REDD+ program are reducing the rates of historic deforestation and degradation that lead to GHG emissions, and increasing carbon sequestration through the protection and establishment of forests. The buyers of the carbon credits under a REDD+ program are the international community with the express goal of reducing GHG emission into the atmosphere to curb global climate change. The seller is the Gog, initiating REDD+ activities that will measurably reduce GHG emission (table 4).

This sub-national REDD+ program represents a major step forward for PES in Ghana, and does not only establish a mechanism for ES accounting of carbon, but also a general framework for other potential PES programs. Carbon sequestration and forest protection can have ES co- benefits that can also be valued under a PES system, for example protecting forest at the top of a watershed can also preserve water access and quality downstream; planting of riparian buffers can reduce sediment and water pollution; and maintaining forests and water quality protects biodiversity.

MESTI (2015) identified the potential for the establishment of tree crops (e.g., mango, teak and cassia) as an alternative to the most common cropping system of continuous maize cultivation. With the right incentives, investment in tree crops, such as shea, could have high potential for carbon sequestration, but also other ES co-benefits for watershed protection.

One of the primary barriers to alternative tree-based cropping systems is the initial investment and lag time between investment and returns. One important step in overcoming the barrier is the adequate evaluation of ES co-benefits that could enable the estimation of the ES benefits (carbon and water quality and access), and therefore establish a value for a PES to both buyers and providers. These PES benefits could also incentivise investments in in tree crops by farmers that are hesitant to invest due to the long period before there is a return on that investment.

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Table 4: Overview of ES - Producers, and Beneficiaries of reduced carbon and GHG emissions ES Producer Beneficiaries and Buyer Climate regulation Local communities that are reducing deforestation The beneficiary is the global community as through the and forest degradation and/or conducting climate change is a global problem. The reduction/removals afforestation/reforestation activities (e.g., mango, buyers have been the World Bank Carbon of GHG emissions teak and cassia). These communities would be Fund, national governments such as Norway supported by the GFC in these activities. and to a certain extent the voluntary market.

Water-based ecosystem services Considerations for large-watershed PES schemes PES schemes related to water-based ecosystem services are best suited at the watershed scale, which can often be challenging to reconcile with political boundaries. This could be the case for large-scale PES schemes in the Volta basin, because they would have to involve international coordination. That said, Ghana, being the downstream country in the wider watershed, would be encouraged to coordinate with its neighbours, especially Burkina Faso, to ensure maintenance of water-based ecosystem services in its main rivers. This would be especially important for surface water flow regulation and quality regulation, since much of the potential and current use of these ES are found in the three main rivers that have the most flow and are perennial. For example, these main rivers are where most of the fishing occurs, and the larger volume rivers have higher capacity for drinking water and irrigation system establishment.

Buyers in a PES scheme might be major users of ES, such as large-scale agricultural landowners or private industry that access the water of these main rivers and depend on regular flow and decent water quality. Other examples are mining companies that need water for their operations; public or private utilities such as irrigation districts or potable water supplies; and hydroelectric dam operations that depend on the regulation of upstream flow.

Sellers in this type of large watershed PES scheme would most likely be regional or national governments that incentivize small-scale landholders to implement watershed improvement practices. Since international schemes are more complex, it is more practical to expect payments to be made within countries or between governments and then distributed through benefit- sharing mechanisms to local partners and landholders. Multiple levels of the scheme may be constructed, where payments at the national level by a government to organizations and citizens depends on payments at the international level between governments.

Considerations for small-watershed PES schemes Small-watershed PES schemes should focus on watersheds within the three major watersheds (Black and White Volta and Oti). These could include the Daka river, which flows between the White Volta and the Oti, and the Mole, Kulpawn and Nasia rivers which are part of the White Volta basin, all of which are almost completely if not completely contained within Ghana. PES schemes focused on these watersheds would allow for more streamlined decision-making since stakeholders are all within Ghana.

Buyers in such a PES scheme could be companies or organizations that use water resources in the watershed of interest, large agricultural landowners, mining companies with a presence in the watershed, or local cooperatives, such as irrigation districts whose members utilize water resources. The regional governments could also play a role in purchasing ES credits, such as the

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Forestry Commission and water utilities. Buyers would need to benefit directly from increases in the ecosystem service and be willing to pay for increases. Examples could include dams willing to pay for reductions in siltation or water treatment plants willing to pay for improved water quality.

Sellers could include small-scale landholders (table 5), cooperatives of such landholders, or local organizations that provide technical or other assistance to farmers. These sellers could implement improved agricultural practices, such as those highlighted in MESTI (2015); prevent conversion from natural ecosystems with high tree cover or grassland/savanna to croplands, pasture or urban areas; or implement activities that encourage the conversion of such altered landscapes back to natural ecosystems (such as reforestation). Some such activities are already taking place in the region as part of the CREMA and SLWMP initiatives.

Table 5: Overview of ES, producer and beneficiary for water-based ecosystem services ES Producer Beneficiaries and Buyer Provision of Local communities that are implementing Heavy users of water such as power freshwater and activities in the upper watershed that improve companies producing hydroelectricity, regulation of or maintain water quality and flow, such as industrial factories, irrigation associations, flow and water reforestation, improved agricultural practices portable water utilities and governments quality and improved wastewater treatment. that must provide flood protection.

Soil erosion control and enrichment PES schemes involving soil erosion control (table 6) should be closely tied with efforts based on water-based ecosystem services, considering that activities that improve or maintain water-based ecosystem services generally achieve soil erosion control as well. Buyers and sellers would be similar to a scheme based on water-based services, given that soil erosion negatively affects water quality, and therefore users such as water utilities and dam operators are very concerned not only about provision of water but also about keeping that water silt-free and of decent quality by preventing erosion in the upper watershed.

Soil erosion and enrichment schemes should take into account the economic feasibility analysis done in MESTI (2015), which shows which agricultural practices, such as mulching, bunds, and ridging have the greatest impact on soil loss, along with which are most economically viable for smallholders.

Table 6: Overview of ES, producer and beneficiary for soil erosion control and enrichment ES Producer Beneficiaries and Buyer Regulating soil Local communities that are implementing Dam operators who must prevent erosion activities in the upper watershed that improve sedimentation, industry and potable water prevent soil erosion, mainly improved systems that must treat water for use, agricultural practices such as those implemented governments hoping to protect wildlife in the SLWMP. habitat and recreational opportunities in water bodies.

Importance of biodiversity for the provision of aesthetic services and provision of crops Biodiversity is defined by the Convention on Biological Diversity (CBD) as the “variability among living organisms from all sources, including inter alia, terrestrial, marine, and other aquatic ecosystems, and the ecological complexes of which they are a part: this includes

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diversity within species, between species, and of ecosystems.” Biodiversity values can be bundled with other PES markets, such as carbon and water, by identifying buyers that will pay a premium for biodiversity benefits. Biodiversity can also be layered with other PES markets by identifying additional buyers for the biodiversity benefits. The above approaches may create a mixture of government and private sector buyers for a public-private PES scheme.

Biodiversity can also be paid for as part of a private good, such as ecotourism. In managing the public good of biodiversity conservation, ecotourism ventures profit from visitors that travel and pay to view sustainably managed areas and wildlife. Tourists also generate demand for other private goods such as transportation, accommodation, and food services, opening up the market to other beneficiaries of biodiversity conservation.

Tourism in the north is actively supported by The Ministry of Tourism, Culture and Creative Arts in their 15-year development plan to increase cultural industries including tourism. Wildlife and ecotourism is also marketed to international and Ghanaian travelers in places such as the Accra International Airport. Increased tourism revenue can be managed to provide economic incentives for sustainable management of these destinations and the specific ES that they provide. Payments from ecotourism can be additive to other PES schemes as explored above, or they can serve to drive the sustainable management of critical areas that provides other ES such as water and carbon.

In addition to PES schemes, literature suggests that traditional, value-based incentives for sustainable management strongly exist in northern Ghana and should be leveraged and integrated with economic incentives harnessed through PES schemes (Robinson 2013). Biodiversity and tourism may be the best entry points to include traditional, value-based incentives for communities/suppliers, along with newly devised economic ones. In other words, economic incentives would allow communities to act more sustainably which aligns with their existing values as mentioned above.

In northern Ghana, sharing of benefits from ecotourism currently supports the Wechiau Hippo Sanctuary CREMA and is an example from northern Ghana that demonstrates how a PES scheme (table 7) derived from ecotourism can support sustainable management through the existing CREMA model. CREMAs provide direct livelihood to both women and men through various activities such as organic shea harvesting and gardening, with tourism revenue going to the CREMA management board to manage the area, including paying rangers and park staff to protect areas from degradation from a myriad of threats. Other CREMA examples exist in northern Ghana where active benefit sharing is occurring, including Moagduri Wuntanluri Kuwomsaasi CREMA and others.

Biodiversity also supports other private goods in northern Ghana (table 7), specifically the shea and moringa tree crops. The current shea industry in northern Ghana is globally known, however there is much room to improve the value chain, and the quantity and quality of shea supplied to global markets, to the benefit of local communities. As this value chain improves, as well as others such as moringa, PES schemes can be used to ensure that the environment continues to support the productivity and quality of shea nuts and other tree crops.

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Table 7: Overview of potential PES scheme including ES, producer and beneficiary for the provision of biodiversity and the cultural service in can provide ES Producer Beneficiaries and Buyer Ecotourism as CREMA communities that collectively manage a Tourists interested in fauna such as a cultural CREMA area. There are numerous throughout elephant, leopard, antelope, hyena, service northern Ghana. Within CREMAs, there often hippopotamus and a variety of primate, are individual producers employed as rangers bird and amphibian species as well as and park staff ensuring protection from poaching landscape and cultural viewing. Operators and other disturbance to maintain higher species providing tours, transportation and numbers. accommodation. Provision of Local communities in northern Ghana, many Private sector shea and moringa non-timber organized into CREMAs, that avoid using shea or companies. forest products moringa trees for fuel wood and manage forest cover and riparian areas for water availability and habitat for wildlife pollinators, including insects.

PAYMENT FOR ECOSYSTEM SERVICES IN NORTHERN GHANA – DESIGN AND NEXT STEPS For the USAID AgNRM project, the evaluation of ES can have multiple benefits, including quantifying the services for a PES scheme, but also is an important step in understanding and implementing more sustainable land use management activities that can improve food security, increase farmer and community security/access to natural resources, and strengthen environmental stewardship. An essential aspect of sustainable land use management and/or PES is clear understanding of what the important ES are and how those ES are gained and/or lost over both space and time as a result of different land use activities.

To support this goal, USAID AgNRM will conduct a stakeholder consultation process to reinforce which ES to prioritize; to develop a greater understanding of ES providers and buyers in northern Ghana; and to ensure that our efforts build on existing work. Spatial analysis will then be used to map ES in northern Ghana, over both space (at the relevant watershed scale for each CREMA) and time (mapping the impact of historic changes in order to understand likely future impacts). This information can be used to measure and monitor ES and provide actionable information on ways to better manage them. This will be important for USAID AgNRM project development and monitoring, guiding long-term sustainable land use planning, and is an essential first step in evaluating PES opportunities. The spatial analysis will be coupled with an economic analysis to provide more detail on the economic value of these services. These three components are described in more detail in this section (Figure 8). Stakeholder Consultation To ensure that the correct ecosystem services are focused on and to better gauge the supply and demand for these ecosystem services, and the potential for a PES system, it is key to undertake a structured consultation process with the primary stakeholders, from landowners (providers of ES), to the GoG, NGOs, and private businesses that are beneficiaries of ES (potential buyers of ES). The consultation process will pull inputs and points of view from local and national

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government, non-governmental organizations (NGOs), and commercial interests. These meetings will bring together representatives from the Forestry Commission (FC), Environmental Protection Agency (EPA), the Water Resources Commission, the Energy Commission, the Wildlife Division, the Volta River Authority (VRA) the Ghana Water Company, Traditional Authorities, the Ghana Tourism Authority, the Volta Basin Authority, representatives from NGOs, representatives from relevant projects, experts from local universities and representatives from CREMAs to ensure that the concepts of ecosystem services (e.g., carbon, water supply, water quality, natural resource products, energy, etc.) are well understood and begin introducing methods used for valuing them. An initial step of this forum will be centered on determining the main services to include in the valuation of ecosystem services and the eventual design of any PES scheme. The consensus, following an initial consultation conducted by two scientists from Winrock’s Ecosystem Services unit3, is that the key ecosystem services to focus on are:

1. Natural resource products such as shea and moringa; 2. Water quality and availability; 3. Fuel wood/charcoal; 4. Vegetation cover to control of soil erosion. An additional ecosystem service that was also considered for further study was carbon sequestration, as it relates to land use change. The ecosystem services team worked with the above-mentioned stakeholders. Available data was also gathered and reviewed to support this study. This data directly informs the geospatial and economic analyses. Evaluation of ES with Existing Data and Geospatial Analysis Spatial analyses are an important component of assessing the current status and threat to ecosystem services across a landscape such as northern Ghana. Such analyses allow for the mapping of ecosystem services; enable a determination of the range of supply and demand of these services across the landscape; and help to predict the changes that may result from different land use activities. Analysis can be done on any size landscape – from the large international watersheds of northern Ghana to the smaller watershed that directly communities of the target CREMAs – though large and small-scale analyses present different advantages and disadvantages. Initial data collection for ecosystem services mapping When beginning a spatial analysis of ES, it is critical to identify and gather as many data sources as possible. The analysis will begin with known global regional and national datasets that currently exist and are pertinent to ecosystem services. These include global datasets of tree cover and forest loss, elevation, protected areas, burned area, and rainfall, which all help to glean information about ecosystem services such as carbon storage and water flow regulation. Existing national datasets will also be gathered, including spatial datasets of biomass per hectare and land cover. Information from government agencies, scientific journals, and technical reports, often at

3 See “Ecosystem Services Unit Trip Report – October 11- October 21, 2016” for further detail. 23

the national or subnational scale will supplement and parameterize spatial data for ecosystem services for which existing spatial data is scarce.

Data has also been requested from stakeholders in Ghana, which may provide critical information for a more detailed analysis. Requested data includes records from rainfall and stream gauges in northern Ghana, data on timber volumes logged, habitat studies for key species and tourism statistics from specific protected areas. These data will be collected throughout the study, and will replace or supplement the existing datasets. If major gaps are identified, limited data collection teams may conduct field campaigns.

What is the problem? Ecosystem services (ES) benefit the population broadly, from supply of adequate clean water to pollination services for agriculture and supply of food, energy and income sources. Therefore, sustainable management of ecosystem services is integral to ensuring better nutrition and food security in northern Ghana. How can the AgNRM project improve sustainable management of ecosystem services?

First Output: Stakeholder Engagement to Second Output: landscape evaluation of Third Output: Economic Analysis of ES important ES at the CREMA and to provide more detail on the economic develop a greater understanding of ES providers in northern Ghana watershed level using ground data, remote value of these services sensing and modelling to map ES in - Inform on what are ES and the role of northern Ghana, support their - With the results from the ES analysis measurement and monitoring and provide land management in sustainable an economic analysis will evaluate actionable information on ways to better development (access to clean water, the monitory value of the ES for manage them different beneficiaries (private and food security etc.) GoG). - Identify what are the important ES Outcome: for different stakeholders? - Well-defined, measurable and Outcome: - Identify who are the providers and monitorable ES in spatially explicit - Economic evaluation of each of the beneficiaries of these ES? map format. A baseline for existing important ES identified as important - What are the potential and barriers ES that can be easily measured for the CREMA to PES and other sustainable land use against. development programs? - Spatially explicit maps that can be - Gather data and build relationships used to estimate the impact on ES of with stakeholders different land use activities - Spatially explicit maps that can be Outcome: used for future land use planning, - Identify what the important ES are and impacts of climate change. and the viability of PES or other - With appropriate ground data, a programs that support the system that can be used to monitor sustainable use of ES at the CREMA changes in ES, validating activates or level . acting as warning system. - Inform the evaluation of ES

Results: A stakeholder driven ES and economic analysis that will value ES at the CREMA and watershed level: - A full assessment that can be used to establish/promote a PES or other sustainable land use development program - A set of tools for measuring the impact of different land use activities on ES for planning, and gauging the impact of climate change - A dataset for establishing a baseline for ES and a tool for measuring against that baseline - A potential system that could be used to monitor changes in ES to validate an eventual PES program, or act as ES warning system at the CREMA level.

Figure 8. Overarching framework of the analysis to support the design of a PES scheme for northern Ghana

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Some ecosystem services can be mapped directly without in-depth analysis, such as biomass and carbon stocks. Others can be mapped using proxies, such as protected area for biodiversity or a mixture of land cover, precipitation, and remotely sensed evapotranspiration to understand water availability. Depending on the data available and the existence of scientifically robust methods to map ecosystem services, certain key ecosystem services may need more in-depth analysis.

Collaboration with USGS for land cover mapping One data need for ecosystem services mapping is a land cover/land use map, which is critical for understanding the current ecosystem situation in northern Ghana. Since ecosystem services primarily come from natural land covers such as riparian forests and savanna grasslands, land cover/land use maps help researchers and stakeholders understand exactly where these services are being generated across the landscape. As one aspect of a partnership with the United States Geological Survey (USGS), the USGS will supply AgNRM with high-resolution land cover/land use mapping for the CREMA areas and parts of their surrounding watersheds. These land cover maps will be an important input into the ecosystem services analysis, especially for the watershed modelling component.

Watershed modeling for in-depth ecosystem services mapping One method to provide more detailed mapping of the supply and demand of key ecosystem services, especially water-based ecosystem services, is hydrological modelling. Watershed-level hydrological models provide a scientific means to estimate different components of the water cycle, including rainfall, runoff, evapotranspiration, and groundwater recharge, not to mention crop growth. Many of these components are aspects of, or are ecosystem services directly, allowing for more accurate mapping of these services across the landscape. The Soil and Water Assessment Tool (SWAT) will be used in this manner on the key watersheds within northern Ghana, incorporating local or regional data on rainfall, groundwater levels, land cover, soils and stream flow to calibrate the model. The model will allow better understanding of how different land cover, agricultural practices, and other land use practices affect the provision of ecosystem services across the landscape. Since detailed water modelling will only be performed on CREMAs chosen for pilot PES schemes, it is important to consider each CREMA and the surrounding watershed, each of which represents unique opportunities and challenges for PES scheme design.

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CREMAs on the Black Volta The three target CREMAs located on the eastern banks of the Black Volta River are within relatively small watersheds, ranging from 250- 1,000 km2 (Figure 9). According to land cover maps developed for Ghana, the watersheds are mostly cropland and grassland (45% and 46% of the watersheds, respectively). The associated rivers to these sub-watersheds that run into the main channel of the Black Volta do not have large catchment areas. Their contribution to the flow of the Black Volta is, therefore, quite small. To evaluate a PES scheme in these CREMAs that incorporates water-based ecosystem services, it is important to understand how these communities access their water -- Are most of the services coming from the main channel of the Black Volta, ground water, or are the small Figure 9. Sub-watersheds of the Black Volta near target CREMAs tributaries providing most of the services? This is relevant because activities to improve ES provision in these small sub-watersheds will have an impact on local ground water, and the smaller tributaries, but will have little impact on the flow, quality and provision of freshwater in the main channel of the Black Volta. However, actions taken in these sub watersheds will have a large impact on the provision of ES within the small tributaries. CREMAs on the Kulpawn and Sissili Rivers The target CREMAs in the White Volta watershed are in comparatively larger watersheds including those of the Kulpawn river (~10,000 km2) and the Sissili river (~12,000 km2; Figure 10). The Kulpawn watershed, which includes the Moagduri Wuntanluri Kuwomsaasi CREMA, is predominantly grassland (74%), although grassland decreased by 6% between 2000 and 2010.4 This watershed is interesting from a PES scheme perspective because MWK sits at the base of the watershed, so the CREMA would have to coordinate with upper watershed communities potentially outside their boundary to ensure actions to improve ES performed in the CREMA were not negated by damage upstream.

4 Ghana Forestry Commission. 2000, 2010 Land Cover Maps, developed by Ghana’s Resource Management Support Centre. 26

The Sissili watershed, which includes the Builsa Yening and Sanyiga Kasena Gavara Kara CREMAs is only about half within Ghana, running north into Burkina Faso. The portion of the watershed within Ghana is 46% grassland and 12% cropland. Forestland within this area fell by 22% between 2000 and 2010 and grassland fell by 10%. This watershed is interesting from a PES scheme perspective because it has one CREMA (Builsa Yening) at the base of the watershed and another (Sanyiga Kasena Gavara Kara) located further up the watershed, allowing for potential interchange of buyers and sellers between the two CREMAs furthering intra-watershed cooperation. However, due to the fact that a large portion of the upper watershed is located in Burkina Faso any PES scheme in this area involving water-based ecosystem services would have to include international cooperation Figure 10. Sub-watersheds of the White Volta near target CREMAs and coordination, which could create complications for design and implementation. Spatial Analysis Across CREMAs This spatial analysis will map ES across the CREMAs and their associated watersheds. It will also map changes in ES over time. For example, the data will show the current carbon stocks across the landscape, plus changes in those carbon stocks that have resulted from historic land use change, and therefore the resulting emission or sequestration. This can then be used to estimate future emission that would occur from different activities. This information is essential for establishing GHG baselines and planning and quantifying emission reduction activities. Land use changes can also be coupled with existing remote sensing data like rainfall and net primary productivity (NPP) to assess water stress and indicators for food production (see figure 11). This can help the project understand the relationship between precipitation, land use and food production, which can help guide and monitor activities for improved water use (e.g., multiple-use water MUS) and land management that will improve sustainable food production.

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Figure 11. Workflow example using existing global data sets to assess impact on ecosystem services

Combining the existing data and remote sensing with hydrological modeling will produce a more in-depth and complete assessment of the ES that are gained and lost over space and time, including erosion, water availability, and impacts on water quality. The ability to map and monitor these ES is again important for USAID AgNRM project development and monitoring, guiding long-term sustainable land use planning, and is an essential first step in evaluating PES opportunities. Valuation of ES with Economic Analysis Along with the spatial component, USAID AgNRM will undertake a detailed economic analysis valuing the ES. The economic analysis will build on this report, literature analysis, national and regional economic statistics and where necessary on-the-ground survey by the USAID AgNRM team. The economic analysis will assess costs associated with different land use decisions. Specifically, the land use transitions studied will include:

• Bare land to fuel wood lots;

• Undegraded forest land to forest land degraded by fuel wood collection;

• Undegraded forest land to conventional agriculture land;

• Conventional agriculture to sustainable agricultural practices.5

5 The baseline scenario is traditional agriculture (i.e. till the land, apply fertilizer, and no rainwater harvest infrastructures). The implementation practices are the ones described in Table 9 of the MESTI SLWMP-PES draft report 28

Under the above land use scenarios, costs considered will include:

• The opportunity costs associated with PES. For example, the foregone income from tree clearance for agriculture and fuel wood where forest conservation is elected to mitigate carbon emissions and prevent excessive runoff silting up rivers.

• The implementation costs associated with, for example, planting trees or protecting ecosystems, or implementing new agricultural practices. The analysis will simultaneously assess economic benefits such as income from fuel wood lots, income from NTPs from protected forests and income from climate smart agriculture.

An additional important component will be to review and incorporate work already undertaken in Ghana, including the Ecosystem Valuation Study conducted by MESTI.

CONCLUSION

From the availability of drinking water to the production of shea butter, the intrinsic value of ecosystem services is woven into the fabric of northern Ghanaian’s daily lives. This report is a first step in assessing the ecosystem services the landscape provides. Section 4, above, delineates the steps that USAID AgNRM will undertake to combine local knowledge with economic and scientific analyses to quantify the impact that different land use decisions have on ecosystem services. The results of these analyses will help CREMA communities, as well as other land users, understand the impacts of land-use decisions from an economic, climatic, biodiversity and hydrological perspective, to allow for more informed decisions that are viable in both the short and long-term.

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