Transcript Document

Proposed Economic Valuation
Methodology for Belize
Daniel Prager and
Lauretta Burke
Economic Valuation of Coastal Ecosystems Workshop
Belize City
World Resources Institute
June 7, 2007
Method Overview
1. Background and Framework
2. Methods and Results
 Fisheries
 Local Use Survey
 Tourism
[Valuation Tool Demonstration]
 Shoreline Protection
3. Inclusion of mangrove ecosystems
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Project Partners
Trinidad and Tobago
Saint Lucia
• T&T Institute of Marine Affairs
(IMA)
• Government of Saint Lucia
• Buccoo Reef Trust
• Tobago House of Assembly
(THA) / Policy Research
Development Institute (PRDI)
• T&T Central Statistics Office
(CSO)
• T&T Environmental
Management Agency (EMA)
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Regional Partners
• University of the West Indies
(UWI) / Sustainable Economic
Development Unit (SEDU)
• Caribbean Natural Resources
Institute (CANARI)
Ecosystem Services from Coral Reefs
Millennium Ecosystem Assessment Framework
Provisioning Services
Regulating Services
-Food: Fish and
Shellfish
- carbon storage,
climate regulation
-genetic resources
-erosion control
-natural medicines and
pharmaceuticals
-storm protection
-ornamental resources
- building materials
Direct Use
Non-use
Values
Option Use
Indirect
Values
Values
Values
Cultural Services
-spiritual and religious
values
-knowledge systems,
educational values
-inspiration
-aesthetic values
-social traditions
-sense of place
-Recreation
Supporting Services
-sand formation -primary production
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Total Economic Value
Total Economic Value
Use Values
Direct Use Values
Non-Use Values
Indirect Use Values
-Shoreline Protection
Existence Value
Bequest Value
Consumptive/Extractive Uses
-Fisheries capture
Non-Consumptive/Non-Extractive Uses
-Tourism
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Tenets of Our Methodology
 Based off of existing data (when possible)
 No expensive surveys used, local use survey
included fisheries, beach and reef use
 Replicable results
 Cross-country comparisons
 Be spatially explicit as possible
 Not measuring non-use values
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Avoiding Pitfalls
• Use net benefits rather than gross benefits
• Include opportunity cost, where necessary
• Only use benefits transfer (data from other
studies) in right circumstances
• Don’t use estimates of small changes for large
changes
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Avoiding Pitfalls
• Be careful of double counting
• Only use national benefits when interested in
national perspective
• Adjust price distortions
• Do a reality check
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Project Overview
Main Components
Fisheries
Method: Revenues minus Costs
Tourism
Method: Revenues minus Costs
Shoreline Protection
Method: “Avoided Damages” approach
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Methodology Components
Fisheries
1. Commercial
Fisheries
Tourism
1. Accommodations
2. Fish Processing 2. Reef Recreation
3. Local Use
3. Local and
Subsistence
Fishing
4. Economy-wide
Effects
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4. Cruise Ships
5. Economy-wide
Effects
Shoreline
Protection
--Avoided Damages
Approach
--Physical
Vulnerability of
shoreline with
economic loss
estimates
Non-Valued Services
Total Economic Value (TEV) would also include:
Other Use Values:
• Research Values
• Option Values (e.g. pharmaceutical)
Non-Use Values
• Existence Value
• Bequest Value
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Value estimates which
are defensible and
policy relevant
Fisheries
Fish Species
• Families of Holocentridae, Lutjanidae,
Scaridae, and Serranidae (Squirrelfishes,
soldierfishes, snapper, parrotfishes, grouper,
sea bass)
• Lobster
• No pelagics
• Not all species fully
dependent on reefs
or mangroves
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Fisheries
Commercial Fishing
Revenue minus Costs
• Price of fish
• Amount of reef-related fish harvested
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Fisheries
Commercial Fishing
Revenue minus Costs
• Cost estimates per boat/outing
• Wage paid to employees
• Boat maintenance
• Other capital equipment costs (nets, fuel)
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Fisheries
Fish Processing
Revenues minus Costs.
-Volume of fish processed
-Volume of shellfish/lobster processed
-Price per unit volume
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Fisheries
Fish Processing
Revenues minus Costs.
-Capital costs
-Equipment costs
-Cost of inputs (fish, shellfish, preservatives)
-Labor costs
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Fisheries
Local Fishing
Value of time spent
fishing and fish caught
-minusCapital costs (nets, lines)
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Fisheries
Economy-wide effects
•
•
•
•
Value of employment
Multiplier – boat builders/fixers
Multiplier – general expenditures by fishers
Social value – community building
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Fisheries
Annual Value
of St. Lucia
Reef Fisheries:
US$ 821,000
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Commercial Fishing Net
Revenue: US$ 474,000
Fish Processing Net
Revenue: US$ 46,000
Economy-wide
multiplier: US$301,000
Local Use:
Additional Value (not yet
calculated)
Local Reef Use Survey
• Commissioned a survey through the University
of West Indies / Sustainable Economic
Development Unit / Government of St. Lucia,
Department of Statistics
• 600 people surveyed in 12 locations in St. Lucia
and Tobago
• Designed to measure local use of beaches and
reefs as well as recreational and subsistence
fishing
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Local Use Survey
Fisheries
Sample Size
Respondents
who fish
Respondents
who sell fish
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St. Lucia
(2006)
300
73 of 300
(24%)
20 spear
fishing
13 (4.3%)
Tobago
(2006)
300
23 of 300
(8%)
7 spear
fishing
2 (.7%)
St. Lucia Local Fishing Estimate
Three Types of Local Fishing Use
Enjoyment
Own
Consumption
Informal
Market
Fishing Trips
20 times / yr
28 Times / yr
52 times/ yr
Annual Value
EC$ 700
EC$ 1,232
EC$ 9,512
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Local Use Survey
Percent
Percent of Local Reef Visitors who Fish
70%
60%
50%
40%
30%
20%
10%
0%
<1000
1000-1999
2000-3999
Monthly Income ($EC)
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4000-4999
Survey Trends
Socio-Economic
• Majority valued leisure time same or less valuable than
work time
• Large proportion of respondents were unemployed
Beaches
• Average of 75% (Tobago) and 90% (St. Lucia) of
respondents visited beaches
• Swimming, BBQ and beach sports most frequent
activities
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Survey Trends
Coral Reefs
• Most respondents had not visited a coral
reef
• Of respondents visiting reef, about half
noticed a change in reef quality and half did
not
• Not all people making use of a coral reef
were aware they were doing so
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Very Rough Beach Tourism Estimate
• Ballpark beach value (per household)
–
–
–
–
~125 hours/yr spent on beach (10.5 hrs/mth)
Annual wage ~ US$7,800/yr
~ US$ 510/household
Based on average beach use, leisure time same
value as work time, average income, 40 hour
work week
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Tourism
Tourism Components
1. Reef-associated accommodations
2. Reef- and Mangrove-associated Recreation
(snorkeling, diving, sport fishing)
3. Cruise ship expenditures
4. Local Reef Recreation
5. Multiplier effect on economy
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Tourism
Accommodations
• Revenue minus Costs
• Foreign- vs. Localowned (“Leakage”)
• Only reef-related stays
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Tourism
Accommodations
Revenues include:
– Hotels * Occupancy Rates * Room rates
OR
– Guests * Guest Expenditure * Length of Stay
Costs include:
– Hours worked * Wage rate
– Fixed Costs
– Operation and Maintenance Costs
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Tourism
Reef and Mangrove Recreation
Revenue minus costs
--Snorkeling
--Diving
--Glass-bottom boats
--Fish charter
--Sport Fishing
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Tourism
Reef Recreation
Revenues include:
–
–
–
–
Snorkeling fees
Diving fees
Reef recreation
Fees paid by cruise lines
Costs include:
– Equipment costs, labor costs, capital costs, taxes paid
(recouped by state), referring fees, import duties
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Tourism
Cruise Ships
Revenue minus Costs
--Number of ships per year
--Docking fee (attributable to reefs)
--Spending on island
--MPA user fees
--Snorkeling/Diving captured under that
component (no double counting)
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Tourism
Cruise Ships
Revenue minus Costs
--Maintaining ports
--Environmental damages
--Additional use of roads, etc.
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Tourism
(Local) Reef Recreation
Value to locals captured by:
-Number of visits
-Hours per visit
-Population
-Average wage rate
Aggregated to total Local Reef Recreation
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Tourism Values
• Components currently included
–
–
–
–
–
Accommodation
Reef Recreation – Diving
Reef Recreation – Snorkeling
Misc. Expenses (e.g., departure taxes, visitor expenditure)
Marine Park
• Components to be addressed
–
–
–
–
Cruise ships
Yachts
Indirect economic effects
Local Use
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Estimated Reef Tourism Use Values
Accommodation
Diving
Snorkeling
Marine Park
Expenditures and
Departure Tax
Total Use Value
CTO Expenditures
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St. Lucia
48.3
4.5
0.8
0.05
20.8
Tobago
17.1
2.1
1.2
N/A
0.87*
74.4
21.3
282.1
248.9**
Unit: Millions US$
*Departure taxes only
**Trinidad and Tobago
Total Valuation Estimates
St. Lucia
Tobago
Fisheries
0.82 (2002-2004)
0.2 to 1.0 (2006)
Tourism
74.4 (2006)
20.4 (2006)
Shoreline
Protection
Total
$100 over 25 years, $4 $135 over 25
per annum
years, $5.4 per
annum
~79
~26
vs. GDP
619 (2000)
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141 (2000)
Unit: Millions US$
Valuation Tool
Purpose: Guide the systematic, methodical
estimation of the value of coral reefs
Guidebook + Calculator = Valuation Tool
How will this work?
•
•
•
•
•
Fisheries and Tourism components
Microsoft Excel based
Tiers of input data
Assumptions supplied with tool (but they must be verified)
Calculates each component discretely
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Shoreline Protection Services
• Evaluate economic value of shoreline protection
provided by coral reefs and mangroves
• Involves physical and economic modeling and
assumptions
• As there are many factors, there is a good deal of
uncertainty around these estimates
• Preliminary framework
• Valuation method - “avoided damages”
Physical Factors
Physical factors affecting the protection afforded by
a coral reef:
•
orientation of the coast (windward / leeward; high
energy or low energy coast)
•
bathymetry / shoreline profile
•
shoreline shape (bay, headland)
•
depth of the reef / geology (type of reef)
•
distance the reef is from land
Risk Factors
• Storm categories and frequency
– Associated wave height
• Elevation
• Coastal Vegetation (mitigation)
• Value of land and property in “at risk” areas
– Homes, hotels, beach faciliites, etc.
Complex Analysis
Work with coastal geologists / coastal scientists at
Institute of Marine Affairs (IMA) to:
• Define typology (categories / characteristics of
reef / coastline settings)
• Develop rules for how much protection this reef
affords this coastline situation.
Work with economists to derive economic estimates
Shoreline Stability Factors (from IMA)
1. Coastal Type / Geology (Resistance)
2. Wave Energy
3. Storm/Hurricane Events (Effects)
4. Grain Size / Gradient
5. Coral Reef (Type, Reef Distribution, Distance from
shore)
6. Coastal Protection (headlands, etc.)
7. Coastal Vegetation (type and distribution)
8. Anthropogenic Activities
9. Elevation
Shoreline Stability Evaluation Framework (from IMA)
Factor
Weight
Very High
(A = 4)
High
(A = 3)
Medium
(A = 2)
Low
(A = 1)
None
(A = 0)
Geology
(Resistance)
3
Cliffed coastline consisting
of igneous, metamorphic
and volcanic rocks
Limestone cliffs
Sedimentary Rocks along
coastline
Beaches
N/A
Wave Energy
2
N/A
< 50 cm
50 cm - 80 cm
>80 cm
N/A
Storm/Hurricane
Events (Effects)
2
Affected by 1-5 TS every
10 years
Affected by at least 5 TS
every 10 years
Affected by at least a
category 1 every 25 years
Affected by at least a
category 3 every 25 years
N/A
Reef Type
1
N/A
Barrier
Fringe
Atoll
No reef present
Reef Distribution
1
N/A
N/A
Continuous
Discontinuous
No reef present
Reef Distance
1
N/A
<500 m
500m -1000 m
> 1000m
No reef present
Grain Size /
Gradient
3
N/A
Coarse grained/ steep
gradient
Medium grained/Moderate
gradient
Fine-grained/gentle gradient
Flat
Coastal Protection
1
Protected by 2 prominent
headlands, Seawalls, Riprap
or Breakwaters
Protected by 2 prominent
headlands
Seawalls, Riprap or
Breakwaters
Protected by one or two
small headlands
No protection by headlands
or coastal protection
structures
Coastal Vegetation
Type
1
Mangroves
Coastal wetlands
Thicket
Runners
No Vegetation
Coastal Vegetation
Distribution
1
> 75 % length of coastline
50% - 75 % length of
coastline
25% - 50 % length of
coastline
<25% length of coastline
No Vegetation
Anthropogenic
Activities
2
N/A
No sand mining, coastal
development or Other
Activities
Either sand mining or
coastal development
Sand mining and coastal
development
N/A
Elevation
3
>3 m above msl
1-3 m
0-1 m
= 0m
< 0m
Factor
1. Identify shoreline protected by
coral reefs and establish degree of
protection provided by reef
Reef Protection
0
Not protected by reef
51%
2
Within 100 m of fringing reef
45%
3
Protected by Barrier Reef
4%
Extensive protection
by coral reef or
mangrove
Source: Belize Coastal Threat Atlas
2. Identify land vulnerable to waveinduced storm damage
6% of Tobago’s land area
rated “vulnerable.
3. Establish likely damage in
vulnerable areas under current
scenario & without reefs
1. Storm regime in area
•
Future storm scenarios
2. Historic data on storm damage along coast
(wave and surge associated)
3. Property Values
•
•
•
Built structures
Land value
Loss of use
Net Protection Value in Tobago
(over 25 years)
• Comparison of damage (loss) with and without
reefs
• Avoided damages of US$135 million over 25
years
– (about US$5 million per year)
• Net benefit from Buccoo reef alone is US$60
million over 25 years
– (about $2.5 million per year)
Shoreline Protection Summary
Land Area (sq km)
Vulnerable Land Area
Tobago
Belize
30,000
294,385
1,900
6%
???
Vulnerable Area Protected by reefs
910
3%
most
Shoreline length Protected by Reefs
49%
Average Property Value (US$)
$22
Property Damage over 25 yr period
(US$ millions)
Loss with reefs
675
Loss without reefs
810
Avoided Damages (25 years)
135
Avoided Damages (annual average)
5.4
most
Plans on Shoreline Protection
Identify groups interested in collaborating
– Government (NEMO, Hydromet, Forestry, Fisheries,
CZMAI)
– NGOs
– Insurance companies?
•
•
•
•
Add Mangroves
Review Approach
Gather data to refine damage estimates
Implement analysis
Incorporating Mangrove Habitats
• Fisheries
• Tourism
• Shoreline Protection
• Other Goods and Services?
Seeking Partners to Collaborate on:
1. Shoreline Protection \ Vulnerability
Analysis
2. National Coastal Fisheries Valuation
3. National Tourism Valuation
4. Partners for valuation of particular MPAs
or atolls
Questions for Breakout Groups
1. Does the methodology as presented adequately
capture the value of Fisheries/Tourism/Shoreline
Protection in Belize?
2. How have these ecosystem services changed
over the last decade? Are these services expected
to improve or degrade?
3. Are there expected changes in the laws or
regulations governing these ecosystem services?
4. What are important data sources for valuing
these ecosystem services?
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Questions for Climate Change Group
1. How will climate change affect the goods and
services provided by coral reef and mangrove
ecosystems in Belize?
2. What groups within Belize are currently
working on reef related climate change issues?
What role could they play in the project?
3. Do existing national or international laws ensure
that the coral reefs are adequately protected from
threats to climate change?
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