Abstract:
The National Medium Term Development Plan (NMTDP) 2015-2019 states that the Musi watershed is one of the priority watersheds to be restored. Given the coverage of the Musi watershed covering 3 provinces (South Sumatra, Bengkulu and Jambi), 14 districts and 4 municipalities, the utilization and management of the Musi watershed require synergy between stakeholders, including local governments. This study aims to explore the potential of payments of environmental services of Musi watershed using case study approach and data analysis generally refers to an institutional development analysis developed by Ostrom (2008). The payments of environmental services by downstream beneficiaries can make conservation activities become more attractive option for stakeholders in upstream Musi watershed, even encouraging them to adopt this mechanism. Payments for environmental services should be clear, more than an additional benefit to stakeholders regarding alternative land use. Although the reward of environmental services is not designed specifically to improve the welfare of the community but in the implementation of this mechanism can play a role in improving the welfare of the community in the upper Musi watershed. Payments for environmental services approach to communities that maintain and manage upstream watersheds can play a role in improving community welfare.
