This paper from Germany's KfW Bankengruppe looks at how to design and fund financial mechanisms that encourage landowners to manage their resources in a manner that benefits society. The paper reflects on the experiences of KfW in supporting such mechanisms in Latin America, a continent that has been particularly active in developing innovative approaches to conservation. It identifies three major challenges – the institutional requirements of setting up such mechanisms, the sustainability of impacts on the farm level, and the potential to expand environmental impacts by improving cost effectiveness.
