Economic Valuation of Goods and Services Derived from Coral Reefs
Results from the Soufriere, St. Lucia Reeffix Exercise
Table of Contents
• Project Background• Overview of Economic Valuation Techniques• Site Background• Methodology • Results
– Coral Reef Valuation- Tourism & Recreation– Coral Reef Valuation- Fisheries– Benefits Value Transfer
• Discussion• Conclusion & Way Forward
Project Background
• Inter-American Biodiversity Information Network (IABIN)– to promote sustainable development and the
conservation and sustainable use of biological diversity in the Americas
• ReefFix is an ICZM tool that trains participating countries in ecosystem valuation methodologies and management techniques to conserve marine ecosystems and the associated watersheds through integrated park management
Background Methodology Results Discussion Conclusion
Overview of Economic Valuation Techniques
• Economic valuation assesses the goods and services provided by an ecosystem which contribute to the wellbeing of human life (financial, social, biophysical, etc)
• By attributing a dollar value to natural resources, the benefits of conservation and some of the unforeseen “costs” of mismanagement are realised
Background Methodology Results Discussion Conclusion
Overview of Economic Valuation Techniques
• Much of the Caribbean tourism plant exists due to the presence of coral reefs (and associated ecosystems)
• Thus coral reefs health influences the main economic activity of the region however are not taken into account when major policy decisions occur
• By assessing the ecosystem services, the tangible benefits provided by coral reefs to sustain and improve human life can be quantified.
Background Methodology Results Discussion Conclusion
Overview of Economic Valuation Techniques
Coral Reefs
Background Methodology Results Discussion Conclusion
Provisioning Services
Food
Medicine & Pharmaceuticals
Ornamental Resources
Building Materials
Erosion Control
Shoreline Protection
Regulating Services
Cultural Services
Spiritual Values
Knowledge Systems and Educational
Values
Recreation & Ecotourism
Supporting ServicesSand Production
Primary Production WRI 2009
Overview of Economic Valuation Techniques
Background Methodology Results Discussion Conclusion
Total Economic Value
Non-Use Value
Existence Value
Future Use(option/bequest value)
Indirect Use(shoreline protection)
Direct Use
Non-Consumptive Use(tourism & recreation)
Consumptive Use(food)
Use Value
WRI 2009
Overview of Economic Valuation Techniques
Background Methodology Results Discussion Conclusion
Total Economic Value
Non-Use Value
Existence Value
Future Use(option/bequest value)
Indirect Use(shoreline protection)
Use Value
Direct Use
Non-Consumptive Use(tourism & recreation)
Consumptive Use(food)
Overview of Economic Valuation Techniques
Background Methodology Results Discussion Conclusion
Direct Use
Non-Consumptive Use(tourism & recreation)
Consumptive Use(food)
Fishing Tourism Recreation
Site Background
• Soufriere Marine Management Area
• 11 km of coastline• Adjacent marine area to
include – Marine Reserves– Fishing priority areas– Multiple use areas– Recreational areas– Yacht moorings
• Main users include– Fishers (pot, line, seine)– Yachtspersons– Recreational divers– Water Taxis– Wider community
Background Methodology Results Discussion Conclusion
MEDO 2003
Site Background
Background Methodology Results Discussion Conclusion
•Great ecological diversity•Well developed coral reefs•Rich forests
•Economy based on agriculture, fishing and tourism
•Management activities began in the early 1980s in response to environmental and developmental issues
•SMMA was established in 1994
•Successes include managing user conflicts, participatory management processes, and self-financing through tourism activities.
Soufriere coastal area:
Site Background
Background Methodology Results Discussion Conclusion
Significant impacts over the years include:
•Harmful industrial waste released into the river juts 500 metres upstream from the coast
•Heavy sedimentation as result of road construction, and from severe storms notably 1996 and Tropical Storm Debbie in 1994
•Big barrel sponges severely affected but timely intervention saved major parts of reef habitat from suffocation
•Reef fish populations are still under threat and there is urgent need to re-establish declining red snapper population
Methodology
Background Methodology Results Discussion Conclusion
(Brian Zane)
WRI Coral Reef Valuation- Benefits Value Transfer
• Use available Satellite imagery (Google EarthTM)
• Identify, define and measure area of significant land cover types
• Using values from other study sites, apply economic values to current site by unit area (hectares)
Background Methodology Results Discussion Conclusion
WRI Coral Reef Valuation- Benefits Value Transfer
Background Methodology Results Discussion Conclusion
Calculate Areas & Apply Economic Value
Land CoverAve.$/ha/
yrLower Bound
Upper Bound Area (ha)
Total ESV Flow (US Dollars)
Disturbed and Urban Beach $0Beach 88,000 77,000 99,000 8.71788699 $767,174Beach near dwelling 117000 140,000 94000 0 $0Coastal & Riperian Forest 1826 5542 13,000 0 $0Freshwater Stream 1595 1231 939 0 $0Freshwater Herbaceous Swamp 72,787 32000 96000 5.362221 $390,300Grassland/pasture 118 118 118 0 $0Near shore aquatic habitat 16,283 4630 27935 365.2 $5,946,552Coral Reef environ 100,000 1335.694061 $133,569,406Mangrove 37500 4.339961 $162,749Mangrove 500000 200000 900000 0 $0Mangrove restoration 225 216000 0 $0TOTAL $140,836,180
Import & Re-Project Features
WRI Coral Reef Valuation
Background Methodology Results Discussion Conclusion
• Utilise data available from:• Fisheries Division• SMMA• SFCL
• Input values into tool – Estimate of Total Economic Impact is generated
• Values reviewed and adjusted with new data
WRI Coral Reef Valuation- Fisheries
Background Methodology Results Discussion Conclusion
• Commercial Fishing
• Fish Processing
• Local Fishing (consumption, sale, enjoyment)
Sum of revenue generated from:
Fishing
WRI Coral Reef Valuation- Tourism & Recreation
Background Methodology Results Discussion Conclusion
Tourism
Recreation
• Accommodation Sector
• MPA Entrance Fees
Sum of revenue generated from:
• Snorkeling & Boating• Diving• Local Use
WRI Coral Reef Valuation- Fisheries
Background Methodology Results Discussion Conclusion
WRI Coral Reef Valuation- Fisheries
Background Methodology Results Discussion Conclusion
Total Estimated Landings- cost of fishing (wages, operating costs)
Commercial Fishing
Total Estimated Processing Revenue(processing, cleaning)- cost of operations (wages, operating costs)
Fish Processing
Total Estimated Processing Revenue(processing, cleaning)- cost of operations (wages, operating costs)
Fish Processing
TOTAL ECONOMIC IMPACT OF
FISHING
Local Fishing
Fishing for (sale, enjoyment, consumption)
WRI Coral Reef Valuation- Fisheries
Background Methodology Results Discussion Conclusion
Category Value
(US Dollars)
1. Commercial Fisheries
Gross Revenue $2,185,001
Net Revenue $724,900
Transfers to the economy (Wages) $0
Total Commercial Fishing Value $742,900
2. Fish Processing and Cleaning $6,726,766
3. Local Fishing $41,892,157
TOTAL DIRECT ECONOMIC IMPACTS OF FISHING $
WRI Coral Reef Valuation- Tourism & Recreation
Background Methodology Results Discussion Conclusion
Total Estimated Revenue (occupancy rates, room rates, # rooms, % visitors using reef)
- labour, operating costs, tax rates, service charges, leakages
Accommodation
Total Estimated Revenue (# snorkellers, equipment rentals, all inclusive trips)
- labour, operating costs, tax, service charges
Snorkelling and Boating
Total Estimated Diving Revenue (# divers, certifications, equipment, all inclusive trips)
- labour, operating costs, tax, service charges
Diving
TOTAL ECONOMIC IMPACT OF TOURISM &
RECREATION
Local Use
Beach use, reef-associated use
MPA RevenueEntrance fees – collection costs
WRI Coral Reef Valuation- Accommodation
Background Methodology Results Discussion Conclusion
CATEGORY VALUE
(US Dollars)
Accommodation
Percent (%) of accommodation revenue that is reef related 35%
Reef-associated Gross Revenue $13,581,944
Reef-associated Net Revenue (Gross minus costs) $7,877,537
Net revenue remaining in the country (net revenue – leakages) $923,568
Transfers to the economy (taxes, via wages and service charges) $1,086,556
TOTAL Accommodation Value $11,245,856
WRI Coral Reef Valuation- Recreation
Background Methodology Results Discussion Conclusion
CATEGORY VALUE
(US Dollars)
Diving
Gross Revenue $10,647,396
Net Revenue (gross minus cost) $2,661,849
Transfer to economy (taxes, via wages and service charges) $6,175,490
Total Diving Value $8,837,339
Snorkelling
Gross Revenue $1,217,280
Net revenue (Gross minus cost) $304,320
Transfer to the economy (taxes, via wages and service charges) $706,022
Total Snorkelling Value $1,010,342
WRI Coral Reef Valuation- Tourism and Recreation Totals
Background Methodology Results Discussion Conclusion
CATEGORY Value (US Dollars)
1. Accommodation $11,245,856
2. Diving $8,837,339
3. Snorkeling $1,010,342
4. Marine Park $432,741
5. Other Direct Expenditures (vending, water taxis, food sales) $440
TOTAL DIRECT AND INDIRECT IMPACTS $21,526,718
Local Use of Coralline Beaches
Local use from reef recreation
Diving consumer surplus $2,661,849
Snorkelling consumer surplus $304,320
TOTAL ECONOMIC IMPACT OF REEF-RELATED TOURISM AND RECREATION $24,492,887
WRI Coral Reef Valuation- Government Revenue
Background Methodology Results Discussion Conclusion
WRI Coral Reef Valuation- Total
Background Methodology Results Discussion Conclusion
Benefits Value Transfer
Background Methodology Results Discussion Conclusion
• seeks to aid marine space use planning and management in the Saint Lucia
• visual representation of critical habitats, areas important for livelihoods, fishing grounds, space use conflict, etc.
• Data not available at this time
WRI Coral Reef Valuation- Fisheries
Background Methodology Results Discussion Conclusion
• Case study assumes Soufriere & surrounding nearshore reefs provide supporting services to the fished reefs
• No known multipliers • Quality data was limited
– Data from one landing site as only one exists– 220 fishers – non-labour operating costs estimated to be 66% of
fishing value– fisher surveys: 4
WRI Coral Reef Valuation- Tourism and Recreation
Background Methodology Results Discussion Conclusion
• Quality data was limited– occupancy rates were rough estimates (high
room rate properties can skew data)– Some level of unreported entry– Tax revenue dependant on accountability of
operators
WRI Coral Reef Valuation- Strengths
Background Methodology Results Discussion Conclusion
• Facilities dynamic data (allows updating and expansion)• Detailed and allows for categorisation of results• When data is available, outputs of results & corrections are generated instantaneously • Sensitivity analysis as response to
errors in data
• Accounts for often overlooked value of local use • More data improves applicability of results (not general output)• Some level of adaptability
– Can be applied to scenarios where data availability is basic)
WRI Coral Reef Valuation- Weaknesses
Background Methodology Results Discussion Conclusion
• Data gaps increases reliance of local expert opinion
• Requires full cooperation of relevant agencies and is dependent on the quality of their data
• Errors are magnified with some calculations (e.g. fisher surveys)
• Can encourage overconfidence in results if caveats about possible error ignored.
• Results are not visual and not as easy to communicate as the Value Transfer method
Conclusion
Background Methodology Results Discussion Conclusion
• Significant disparity in accommodation and diving as major source of clients emanate from hotels outside of SMMA
• Cruise ship business is significant contributor but is not measured currently
• Important contributions from the informal sector (watertaxis)
• Significant contributions by added value (Fish cleaning)• Sustainable revenue generation for park however it may
be further enhanced with more resources for revenue collection
• Low local use of park
Further Research Options
Background Methodology Results Discussion Conclusion
• Fill necessary data gaps (fish landings, occupancy rates)
• Expansion of study to the include CAMA• Assessment of the regulating services
provided (shoreline protection value)• Reef fish stock assessment• Development of the MarSIS database• Research into carrying capacity of SMMA
Questions?
Background Methodology Results Discussion Conclusion
Top Related