Prospects for Payments for Ecosystem Services in the Brazilian Pantanal: a scenario analysis

The present study investigates the prospects for a large-scale implementation of Payments for Ecosystem Services (PES) schemes in the Brazilian Pantanal wetland. Despite increasing environmental threats associated with development pressures and the growing interest of public and private organisations, no PES schemes are currently in place in the Pantanal. Through an exploratory scenario analysis this paper determines the prospects for PES in the area. The findings suggest that a large-scale implementation is unlikely, as this would require much higher levels of environmental awareness among local decision-makers and low substitution rates of ecosystem services by technology. Furthermore, strong socio-economic inequality between inhabitants of the Pantanal lowlands and wealthy farmers of the neighbouring uplands means that potential suppliers of ecosystem services would face very high opportunity costs to participate in PES schemes. The research findings are also relevant to other environmentally sensitive regions experiencing rapid economic growth and weak environmental regulation.