Environment

In the context of a Poverty Reduction Strategy Paper (PRSP), environment and poverty are linked in two major ways: (1) poverty alleviation should not damage the environment of the poor, which would only substitute gains in one area for losses in another, and (2) improving environmental conditions can help reduce poverty. The latter link is the focus of this chapter.

Environmental conditions have major effects on the health, opportunity, and security of poor people. Environmental activities can also provide effective ways to empower the poor. The many links between environmental management and poverty alleviation provide the rationale for systematic mainstreaming of environment in PRSPs and their associated processes.

This chapter aims to help PRSP teams integrate environmental problems and opportunities in their work and consider potential environmental and natural resource interventions in their poverty reduction strategies. The scope of environmental concerns is quite broad. It includes water supply and wastewater disposal, solid waste removal, indoor and urban air pollution, and natural resource issues such as land degradation, deforestation, and loss of coastal ecosystems and fisheries. However, it is important that “environment” does not only bring restrictions and problems to mind. Better environmental management provides many opportunities to build sustainable livelihoods. Natural resources can be put to more productive use to alleviate income poverty.

This chapter has a multisectoral perspective. However, while analysis needs to be multisectoral, many of the resulting interventions can be implemented by individual agencies. These can be responsible for sectoral programs (health, infrastructure, public works, agriculture) and need not be only environmental institutions.

This chapter first suggests that teams working at the country or subnational level begin by analyzing the linkages between poverty and environment. Then desirable but realistic targets need to be set with a focus on the main problems. The next stage is to evaluate possible public actions for reaching those targets on the basis of their expected cost-effectiveness, institutional capacities, and lessons from past experience. Finally, a system for monitoring the outcomes of the interventions must be put in place. The results are fed back into the next-stage analysis, and so on.

Section 11.2 of this chapter provides an overview of the ways in which environmental conditions can contribute to different kinds of poverty. Section 11.2.1 on environmental health gives a working definition of environmental health and disability-adjusted life-year (DALY); sketches a developing country panorama of the overall burden of disease, showing the considerable significance of environmental factors; and makes a case for a multisectoral approach to environmental health.

Section 11.2.2 focuses on environment and economic opportunity and emphasizes that poor people tend to be highly dependent on natural resources for their livelihood. The extent of this dependence may not be revealed by traditional income analysis. Property rights, communal or private, formal or informal, lay the foundation for natural resource utilization. Incentives by way of regulated prices, taxes, and subsidies send important signals to resource users about economic opportunities. Natural resource utilization should be seen not only in the context of limiting access and exploitation, but also from the perspective of sustainable opportunities for poverty reduction.

Section 11.2.3 on environment and security highlights the very significant cost of damage inflicted by natural disasters and how poor people face a relatively higher degree of insecurity because of such disasters.

Section 11.2.4 on environment and empowerment argues that when communities are empowered, natural resources can serve as a foundation for economic opportunity on which social capital can be built. Income-generating schemes can be combined with measures that enhance the environment, but communities are often heterogeneous and may harbor large differences in interests and attitudes.

Sections 11.3 and 11.4 summarize an approach to mainstreaming of environment in PRSPs that has been developed within the World Bank. Section 11.3 outlines an approach to analyzing the links between environment and poverty in order to define priorities both between sectors and within the environmental field. Section 11.3.1 deals with understanding the environmental contribution to poverty reduction. This section raises a set of issues that need to be considered when mapping out this relationship. Section 11.3.2 is dedicated to choosing targets for improvement and selecting the most effective public actions and reviews the prime areas of intervention and cost-benefit as well as cost-effectiveness
analysis of interventions.

Monitoring and evaluating outcomes is the topic of section 11.3.3. The approach taken is one of integration with the overall monitoring and evaluation (M&E) framework for the Poverty Reduction Strategy (PRS). However, careful attention must be paid to the selection of indicators to capture changes in the environmental conditions that most affect the poor. This section offers specific suggestions for the selection of indicators and gives examples of choices for environmental health and natural resources management.

Section 11.4 presents good practice in mainstreaming environment from a review of 25 Interim Poverty Reduction Strategy Papers (I-PRSPs) and PRSPs. While many PRSPs give little attention to environmental matters and links to poverty, it is encouraging that the full PRSPs tend to score better in this respect. The references and technical notes to the chapter provide more details on particular topics.

The chapter therefore follows the basic stages of the approach embodied in the PRS initiative: developing a comprehensive understanding of poverty, choosing the most effective public actions to reduce poverty, and monitoring outcomes and impacts (see figure 11.1). By design, these stages cut across sectors and development themes in order to facilitate the socioeconomic and policy analyses that will guide public action aimed at reducing poverty.

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