2021
INNOVATIVE FINANCING FOR IMPLEMENTING CONSERVATIONAGREEMENTS IN NAMAQUALAND, NORTHERN CAPE, SOUTH AFRICAWITHIN COMMUNAL LANDS: A CASE STUDY

Photo by Green Renaissance

EVIDENCE-BASED POLICYAND DECISION MAKINGFOR CONSERVATIONAGREEMENT PROJECTSAS AN ECOSYSTEM BASED ADAPTATION(EBA)

1. INTRODUCTION
Using nature to help people adapt to climate change iscalled Ecosystem-based Adaptation (EbA). But, nature often
falls victim to inappropriate management practices such as
overgrazing, as well as the impacts of a changing climate- one with warmer temperatures, unpredictable rainfall andmore frequent and intense storms. Most people are awareof changes in their environment, but some need support tounderstand how their actions affect the natural resourcesthat they rely on, and what they can do to help nature help
them adapt.
Who pays for the conservation of natural resources that
communal farmers rely on? Donors, investors, financial
institutions, and the government? Yes, but think out of thebox. Adaptation costs are rising, and provincial and locallevel finances are not geared towards EbA. Financing for EbA
needs to be innovative and explore financial mechanismsthat bring the worlds of finance and conservation together.
What better way to do this than by capacitating farmers tosustain conservation actions themselves?
In Namaqualand, Northern Cape Province, South Africa,
Conservation South Africa (CSA), with the support fromfunding from the Global Environment Facility (GEF) EarthFund, a partnership between Conservation Internationaland UNEP, and the SWITCH Africa Green Grant, capacitatedcommunal farmers to implement conservation actions inreturn for incentives. Conservation actions were basedon what farmers could do to improve their farming, andincentives were designed to support them. Participating
farmers (called stewards) agreed to implement planned
grazing, on their rangelands. CSA agreed to provide livestock
medicines for vaccination and dosing against parasites,
introduce more climate resilient livestock breeds, improve
market access to sell livestock at better prices, and empowerstewards through training. The agreement was captured

in contracts called Conservation Agreements (CAs), andvoluntarily signed by stewards, and CSA.
After implementing the conservation actions, most stewards1
noticed that their rangelands became greener and moreabundant, and were better able to provide fodder for livestockduring droughts, and that their livestock became healthier.
During the CAs, CSA unlocked opportunities for innovative
financing (Box 1) to support the sustainability of stewardship,and ensure that it was impactful and long lasting. Even two
years after the CAs had ended, many stewards understoodthe benefits of continuing with the conservation actions, andwere able to do so through the financing mechanisms thatwere put in place during the CAs. However, to successfully
use the financing mechanisms, stewards needed to know
how to hold effective meetings, keep records, and haveknowledge on accounting and financial management. So,
CSA provided them with the appropriate tools and knowledge
to manage projects as well as apply for funding, to promote
the sustainability of the stewardship programme.
Innovative financing is when funding comes from novel
sources or if funding from traditional sources, likegovernment budgets, or donors, is used in a creative, andunconventional way. Sources of funding for implementing
Conservation Agreements include International Climate
Finance, National or Regional Development Banks, National,
Provincial or District Government Budgets, Traditional Banks,
philanthropic donors and investors, impact investors, as well
as Corporate Social Responsibility investors.

These range on the investment spectrum, from philanthropic
grants to impact loans, and cover multiple touch points
on the economic value chain, from mentoring enterprises
directly, to Co-operative action that is self-sustaining.
In other words, funding can either be directly provided to
stewards, or through NGOs such as CSA. If an appropriate
enabling environment is created, these innovative financing
mechanisms can create opportunities for the economy of aregion to grow hand in hand with conservation. See Box 2
for explanations of these innovative financing mechanisms.
Focus Area: Wetlands and Rangelands in
Namaqualand, Northern Cape Province

NORTHERN CAPE

Steinkopf

NAMAKWABox 1: What is innovative financing for Conservation
Agreements?
This case study focuses on the innovative financing
mechanisms that have been tested to support conservation
actions and benefit nature and stewards in Namaqualand.

NAMAKWA

Leliefontein

1. To assess the impact of the stewardship programme, socio-economic surveys were conducted in 2017, 2018 (after two years of implementing the CAs), and 2020 (two years after the CAs ended), and successes
and challenges were documented during workshops. In 2017, feedback was received from 59% of the stewards. Of the stewards who engaged in CAs by the end of 2018, 52% provided feedback in 2018, and 44%
in 2020.

CASE STUDY | 1

2. FINANCING MECHANISMS FOR INNOVATIVE FINANCING IN NAMAQUALAND

R

CO-OPERATIVE DEVELOPMENT
1.

Co-operative Development organises members into aformal group to allow for collective decision-making andinvestment that supports the farming community as awhole.

ENTERPRISE DEVELOPMENT
2.

ENTERPRISE INVESTMENTEnterprise Development and Granting
a. Government Grants may be provided to co-operatives
to support conservation actions.
b. Small Grants allow co-operatives to invest in
equipment or services to improve livelihoods andsustainable practices.
c. Market access for sale of livestock as an incentive isan important aspect of CAs to support conservation
actions.
d. Loans provide co-operatives or enterprises withfinances to enable them to grow their businesses
while also delivering conservation actions throughtheir business.

3.

Enterprise Investment has direct benefits to capacitate
livelihoods and environmental restoration, so thatpeople do not only rely on farming for income in timesof need, ultimately increasing communal resilience toclimate change.

Box 2: Explanation of innovative financing mechanisms that have been tested to support conservation actions, and their benefits to stewards in Namaqualand.

Photo By Conservation South Africa

Photo By Charlie Shoemaker

Photo By Arthur Cloete

Photo By Erol Eriksson

CASE STUDY | 2

through training, to become more aware of what they can doto adapt to climate shocks such as droughts.
CSA hosted a proposal writing workshop to upskill the SBC
committee managing members on applying for funding for
future projects. In 2018, they were able to successfully apply
for a grant of R25 000 from CSA, to ensure that members weretrained, and able to run the Co-operative themselves. Some
members were mentored in financial literacy, administration,and project management. SBC committee managing
members underwent governance development training, tolearn about their responsibilities and duties in governing theco-operative, and how to communicate effectively.
2.2

Photo By Corle Jansen
2.1

Co-operative development

In 2018, CSA facilitated the registration of the SteinkopfBulletrap Co-operative (SBC) as a formal organisation. The
SBC assists communal farmers (including those that are notparticipants of the stewardship programme) to keep theirlivestock healthy through vaccinations and provide better
access to medicine. This has given them the opportunity tosell their livestock to formal markets at better prices. It alsobrought farmers together to learn from each other, and learn

Enterprise development and Granting

2.2.1
Government grants
There are various avenues in which governmental funding
can support the implementation of stewardship, and canoriginate internationally (for example, from the International
Climate Initiative (IKI) explained in Box 3), or nationally, andbe accessed through Co-operatives, or NGOs such as CSA.
In South Africa, DEFF’s Expanded Public Work Programme(EPWP) Natural Resource Management (NRM), focusses
on restoration activities, like erosion management, andalien invasive clearing, while creating jobs in rural areas.
Previously, CSA had accessed funding to successfully
implement NRM in Namaqualand, focussing on restoration
activities, and incentives for stewards that complimented
the stewardship programme.
For Co-operatives to be able to apply, be successful andimplement government grants themselves, they require goodorganisational governance, and should already have applied
for smaller grants, which indicate their capacity, and ability
to sustain themselves. The Co-operative Incentive Scheme(CIS) is an example of a grant that Co-operatives can apply
for to assist them in starting up by lowering their initial costsof doing business. However, they need to match 10% of thetotal funding provided, and are required to be registered,fully compliant and submit a business plan. Co-operatives
can also apply to the Comprehensive Agricultural Support
Programme (CASP), which supports land and agrarianreform projects through the provision of production inputs,
equipment, training, and employment opportunities.

Globally, the International Climate Initiative (IKI),
one of the most important instruments of theGerman Federal Ministry for the Environment, Nature
Conservation and Nuclear Safety (BMU), funds
activities that support its mandate to mitigate climatechange, and conserve biodiversity. The IKI provided a
grant to the Department of Environment, Forestry, andFisheries (DEFF) to implement the National Climate
Change Response Policy under the Climate Protection
Programme from July 2013 to March 2017. Since
February 2017, its implementation is being funded
under the Climate Support Programme, due to end in
December 2021.
The National Climate Change Response Policy
recognises the potential of Ecosystem-based
Adaptation (EbA) to help communities adapt to climatechange, and envisions the use of EbA to transition toan economy that is able to withstand climate shocks,
and secure the livelihoods of vulnerable people.
Conservation South Africa helps to realise thisvision by creating an enabling environment throughthe design and implementation of actions that help
nature and people.

Box 3: Governmental funding from the International Climate
Initiative (IKI) for the implementation of South Africa’s
Climate Change Response Policy

CASE STUDY | 3

2.2.2
Small Grants
CSA’s SKEPPIES Fund was started in 2006 to provide small
scale funding for businesses that value conservation. It has
shown that local economic development and conservation
can be brought together, by supporting businesses,
teaching people to value nature, and creating employment
opportunities. Linking farming to business captures people’sinterest. Robert Richards’ handmade Kraalbos soap, that can
now be found in hotels, and guest houses, began after the
SKEPPIES fund helped him to buy machinery. Kraalbos isthe first of all shrubs to grow on bare land that has been left
exposed by overgrazing. It helps nature come to life again,
but is poisonous to livestock so farmers used to remove thewhole shrub. Robert’s successful soap enterprise has shown
farmers the economic value of Kraalbos, if they only harvest
the tips of the shoots to sell to Robert as one of the main
ingredients for his soap.

The year before, in the Kamiesberg, CSA facilitated anarrangement between livestock farmers and Nammeat, aprivate sector abattoir. As part of the stewardship programme,
stewards were asked to make some animals available to sellto Nammeat who bring trucks to the community and provide
free meat grading to ensure market readiness. During an
arranged sale in December 2016, 18 Kamiesberg farmers
sold a combined total of 70 animals to Nammeat which
made a total profit of R115 925.

In 2016, the Biodiversity and Red Meat Co-operative (BRC)
successfully applied for a R1 000 000 grant from the Small
Grants Facility (SGF), funded by the Adaptation Fund, in
collaboration with Gondwana Alive (GA). One of the things
that the grant was used for in the Kamiesberg was to makemobile kraals, that were moved weekly, to manage grazing,give plants time to regrow, break up compacted soil, andimprove the land’s ability to hold as much rain as possible.

The examples above show that creating market access forfarmers of different livestock in different locations can be
successful. However, an alternative option, and the preferred
way to sell livestock in Namaqualand, is the speculator
model. Farmers sell their animals directly to buyers which
provides them with quick cash in times of need. Thiscan be a feasible method if farmers have a good enoughunderstanding of how to value their livestock. CSA’s worktaught farmers about livestock condition, average price perkilogram and quality of meat to ensure that buyers do nottake advantage and farmers get the prices they deserve.

2.2.3
Market access
CSA implemented Meat Naturally PTY (MNP) as a social
enterprise to train and encourage stewards to engage insustainable red meat farming practices with the incentiveof improved market access. In November 2017, MNP
trialled the option of market access through an auction in
Steinkopf. Stewards were prepared for the auction throughan information session and site visits to help farmers choose
suitable livestock to sell. The total value of livestock sold was
R191 922, which was slightly less than expected. Feedback
from the participating stewards suggested that this was
not the preferred method for livestock sales at the time.
However, now that stewards had a better understanding of
how auctions work and what is required of them, they want
to attend another auction.

Mobile auctions whereby the markets were taken tocommunities were arranged in two of CSA’s other
Demonstration Sites namely, uMzimvubu in the Eastern
Cape, and Kruger to Canyons in Mpumalanga, and Limpopo.
A total of 633 stewards participated by selling their cattle(whereas stewards in Namaqualand sold small livestock),and earned R10 824 052 in total.

2.2.4
Loans
Loans provide finances which can enable businesses togrow if used appropriately. As part of the grant received by
the BRC from the SGF, livestock breeds that are less costly tomaintain, and better able to withstand climate shocks, suchas Meatmaster sheep and Speckled goats, were introduced.
They reached market ready weights earlier than the otherbreeds, despite the drought, so could be sold at a younger
age, decreasing grazing pressure. Farmers that wanted toparticipate signed Ram Agreements with the BRC. Under
these arrangements, in return for rams, farmers agreed topractice conservation actions as well as sufficient dosing/inoculating and monitoring of their received livestock.
Farmers then had a maximum of 4 years to pay back the
BRC, either in cash or lambs. By December 2018, R6 600 in
cash and 21 lambs, at R1 500 each (which came to a totalof R38 100) was paid, but only by 53% of farmers. Farmers
who experienced poor lambing seasons made arrangementswith the BRC to delay their loan payments. The BRC used
the payments to further support other farmers to convert tomore resilient herds.
It is evident that there is a significant need for moreloan facilities to assist farmers at the local scale. Fromthe example above, loans are shown to be a successful
mechanism that enable businesses to expand, while also
supporting conservation actions and becoming more
resilient to the impacts of climate change.
2.3

Photo By Erol Eriksson

Enterprise Investment

Enterprise investment is the next stage of the continuum
where enterprises are ready for commercial investment
and full return on investment is expected. Conservation
International (CI) is active in Enterprise Investment throughConservation International Ventures (CIV), an investment fundthat provides loans to small- and medium-sized enterprisesthat operate in the forests, oceans and rangelands where
CI works. Whether in sustainable agriculture or forestry,
ecotourism or wild fisheries, these businesses share one
thing in common — a commitment to practices that benefi
ecosystems and human well-being at the same time.
CASE STUDY | 4

A typical example of a CIV investment is Thrive Compost
based in Hogsback in the Amathole District, Eastern Cape
Province, who received R2 000 000 patient capital from
CIV over a 60 month period. Thrive Compost clears alienvegetation and combines it with manure and other inputs
sourced from local farms and businesses. The mixture thenforms organic compost and biochar, which can be used asa soil amendment for both carbon sequestration and soil
health benefits. It is sold to surrounding farms, including

nearby citrus growers, to create carbon sinks and water
retention traps. The investment in Thrive Compost will
enable the company to restore over 220 hectares of vitalwater catchment areas to full run-off capacity by clearing
alien vegetation.
Another example of a CIV investment is a loan that wasrecently provided to MNP to fund restoration. CIV provided
R2 000 000 to MNP at approximately 5% interest rate to

be repaid over 2 years. MNP will use the funding to growits business and deliver its restoration impact by providing
market access to farmers in exchange for sustainable
farming practices as described above. This will enable MNP
to double their operating income from R400 000 per year toR800 000 per year within the next two years. The restoration
incentive is thus being provided by a profit making entity
which can repay loan capital and scale up the impact.

3. CALL TO ACTION
Actions for policy makers, and practitioners to ensure that the appropriate financial management structu es and capacities are in place include the following:

Co-operatives

Enterprise Development

Communication

Support for co-operatives: Continued support for
co-operatives to ensure that members are upskilledon proper governance, and are able to develop andimplement business plans to access finance to continu
conservation actions.

Support for enterprise development: Set up facilities
that provide continued enterprise development support
through mentorship, training, grants and loans to getenterprises ready for commercial investment.

Communication: Use co-operatives as mechanisms forbetter communication and decision-making between its
members, community structures, officials at the Local
and District-levels, relevant government departments
such as the Department of Agriculture Land Reform and
Rural Development and non-governmental organisations.

Capacitate

Incentive

Inclusion

Alignment

Capacitate: Overcome barriers thatprevent farmers from accessing innovative
finance for conse vation, by providing
further training on funding applications,
mentorship for proposal writing, andmanaging grants/funding.

Incentive: Provide access to markets
as an incentive mechanism to support
enterprises.

Inclusion: Create opportunities for work,
experience, and skills transfer in all
aspects of the farming supply chain to
support women, youth, and vulnerable
groups in realising their personal
development plans.

Alignment: Breakdown silos, and alignplans to coordinate resources across all
spheres of government to unlock funds
for conservation from different service
delivery budgets.

CASE STUDY | 5

REFERENCES
Bourne, A., Donatti, C., Holness, S. & Midgley, G., 2012. Climate Change Vulnerability Assessment for the Namakwa District Municipality, s.l.: s.n.
CBD, 2009. Connecting biodiversity and climate change mitigation and adaptation: Report of the Second Ad Hoc Technical Expert Group on Biodiversity and Climate Change. Technical Series No. 41., Montreal: Secretariat of the Convention on
Biological Diversity.
CI, 2020. Can conservation agreements catalyze private sector support for community-led conservation? Lessons learned and recommendations for replication, s.l.: Conservation International.
CoGTA, 2020. District Development Model. [Online]
Available at: https://www.cogta.gov.za/ddm/index.php/about-us/[Accessed 17 February 2021].
Conservation International, n.d. Soap made from super shrub. [Online]
Available at: https://www.conservation.org/south-africa/stories/soap-from-the-bush[Accessed 16 February 2021].
CSA, 2017. Conservation Agreement Socio-Economic Monitoring Survey Data, s.l.: Conservation South Africa.
CSA, 2019. Meat Naturally Initiative 2019 Conservation Stewardship Lessons Learned Workshop Report for the Kamiesberg Conservation Stewardship Site, held at Nourivier Primary School on 26 June 2019., s.l.: Conservation South Africa.
CSA, 2020. Workshop with Steinkopf and Bulletrap stewards on activities post Conservation Agreement implementation, s.l.: Conservation South Africa.
CSA, n.d. Guideline to conservation agreements on communal lands in South Africa, s.l.: Conservation South Africa.
DEA, 2015. s.l.: Department of Environmental Affairs.
Jansen, C., 2017. Biodiversity and Stewardship Initiative Socio-Economic Survey Report – Steinkopf and Bulletrap, s.l.: Conservation South Africa.
Jansen, C. 2017. Steinkopf Trial Auction Report, s.l.: Conservation South Africa.
Jansen, C., 2018a. Biodiversity and Stewardship Initiative Socio-Economic Survey Report – Steinkopf and Bulletrap, s.l.: Conservation South Africa.
Jansen, C., 2018b. Lessons Learned Workshop – Steinkopf and Bulletrap stewards, s.l.: Conservation South Africa.
Jansen, C., 2020. Draft Post CSP baseline survey report, s.l.: Conservation South Africa.
Jim, A., 2019. Meat Naturally Initiative, Namaqualand: A stewardship approach to support landscapes and livelihoods in the Succulent Karoo Hotspot, s.l.: Conservation South Africa.
Lambrechts, J. & Phillips, T., 2019. BRC and livestock adaptation project: Project monitoring and evaluation report, s.l.: s.n.
Matela, S. & McLeod, N., 2017. Rangeland Restoration Model Summary and Toolkit Guide, s.l.: Critical Ecosystem Partnership Fund, Conservation SA, and the uMzimvubu Catchment Partnership Programme.
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(author unknown) Enabling governance and building capacity: Steinkopf-Bulletrap Co-operative (SBC) Proposal for SAG Subgrant, s.l.: Conservation South Africa.

Acronyms

German Federal Ministry for the Environment,
Nature Conservation and Nuclear Safety

EbA

Ecosystem-based Adaptation

DEFF

Department of Environment, Forestry, and Fisheries

BRC

Biodiversity and Red Meat Co-operative

EPWP

Expanded Public Work Programme

CAs

Conservation Agreements

GA

Gondwana Alive

CASP

Comprehensive Agricultural Support Programme

IKI

International Climate Initiative

CI

Conservation International

MNP

Meat Naturally PTY

CIS

Co-operative Incentive Scheme

NRM

Natural Resource Management

CIV

Conservation International Ventures

SBC

Steinkopf- Bulletrap Co-operative

CSA

Conservation South Africa

SGF

Small Grants Facility

BMU

CASE STUDY | 6