Sustainable Utilization and Conservation through Compensation for Ecosystem Services: Experiences from the Koga Watershed in Northern Ethiopia

Payments for ecosystem services have recently been introduced into the ecosystem management landscape to counter ecosystem degradation. This study examines the experiences of sustainable use and management of watersheds using a compensation for ecosystem service model in the Koga watershed, Northern Ethiopia. The study primarily employed qualitative methods. Thirteen informants, chosen from a group of project implementers, were contacted for telephone interviews, and a document analysis was also conducted. Thematic approaches were employed to analysis the data. The study findings revealed that a project had been introduced to implement an innovative payment/compensation for ecosystem services (CES) scheme to manage watersheds and to alleviate poverty in the watershed. The scheme connected upstream and downstream communities and cooperatives through CES, earning praise for its effectiveness in combating dam siltation and watershed degradation. The initiative also established various enabling conditions, such as capacity building, bylaw formulation, and payment procedures for beneficiary communities. However, the CES scheme still has a long way to go to deliver the anticipated positive impacts on local livelihoods and watershed management. It is believed that a comprehensive legal framework, a stable political and social environment, and sustainable financing mechanisms are crucial for the success of any CES project. Therefore, Ethiopia should strive to meet these requirements to ensure that any future CES projects are designed and implemented sustainably.