III. EXISTING INSTITUTIONS AND MEASURES FOR INTEGRATING ENVIRONMENTAL CONCERNS INTO DEVELOPMENT PLANNING AND DECISION-MAKING FOR SUVA CITY
H. Economic incentives and the urban environment
1. Providing incentives for industries that self-regulate
Since economic incentives to achieve environmental objectives are not yet being used in Fiji, this report only discusses their potential use and makes recommendations on their adoption. A brief description of the advantages of such measures is also given. A more detailed analysis on the precise approach to be adopted needs to be formulated. Attempts have been made to do this through the proposed Sustainable Development Bill. Unfortunately, however, the Ministry of Finance has shown little interest in establishing more tangible provisions for economic incentives in the Act.
In order to motivate industries to follow the self-regulation system, certain incentives will have to be provided to complement the ISO 14000 environmental certification. There are several types of incentives that could be investigated.
Direct incentives can either be in cash or kind. They should be conditional on changed behaviour that favours self-regulation. Direct incentives in kind include material goods given to institutions or individuals in return for their efforts that contribute to improving their environmental performance. The incentives are applied to achieve specific objectives (e.g., the level of industrial waste reduction or a decrease the use and clearance of mangrove swamps). Sometimes direct incentives may be given in return for refraining from activities that damage or deplete natural resources. Other kinds of incentives include equipment donated to those responsible for a protected area. Governments may also consider providing special services (e.g., social services and infrastructure) in conjunction with local NGOs for communities that have shown restraint in exploiting certain depleted natural resources that are communally owned. Cash incentives (such as fees, royalties, rewards, grants, income support, subsidies, loans and daily wages) are often used. Care must be taken to ensure that such incentives are linked to improvements in environmental management. The advantage of cash incentives is their flexibility. However, excessive use of that type of incentive can result in the recipients developing a dependency on it; in addition, such incentives are subject to administrative abuse.
Indirect incentives can also encourage self-regulation. They involve applying fiscal, social and natural resources policies related to specific environmental problems, and may involve providing preferential treatment in trade agreements, price support or land tenure. Fiscal incentives are a legal and statutory means of channelling funds towards conservation activities, and involve such indirect measures as tax exemptions or allowances, insurance, guarantees, tariffs and price support. They are also concerned with gathering income to meet public expenditure that supports conservation programmes. Such policies may include the promotion of investment, production and employment related to the sustainable use of natural resources.
Publicity incentives, such as publishing green and red lists of industries, have become popular in a number of developed countries. They have proved to be quite effective in situations where there is a high level of environmental consciousness among consumers. Combined with environmental awareness programmes, that system could be effective in Fiji. Some export-orientated industries are likely to be particularly response to publicity incentives.