Reforestation of degraded lands is occurring on a limited basis in portions of the Panama Canal Watershed (PCW). In theory, markets for ecosystem services could encourage more extensive reforestation and ensure that reforestation efforts provide more than just timber. The most relevant ecosystem markets for the PCW are carbon sequestration, watershed services, and four biodiversity markets-bioprospecting, certification of biodiversity friendly products, ecotourism, and existence value. This paper examines the possibility for a land owner or land manager to participate in two or more of these markets. Two land use scenarios- native forest plantation and small-holder agroforestry-emerge as likely candidates for participation in multiple ecosystem service markets. These scenarios are examined to determine whether the strength of incentives to provide a bundle of timber and ecosystem services is sufficient to encourage expansion of these land uses with the Panama Canal Watershed. © 2007 The Haworth Press, Inc. All rights reserved.
