Economic Valuation

Economic Valuation

The World Resources Institute (WRI) is working with the Buccoo Reef Trust (BRT) and other partners in Belize, St. Lucia, and Tobago, to develop an economic valuation method for coral reef ecosystems that can be applied across the region. The purpose of the methodology is to develop detailed estimates of the value of coral reef related fisheries, tourism, and shoreline protection. WRI is also developing estimates of value for both healthy and degraded coral reefs and is working closely with governments and non-governmental organizations (NGOs) within the three countries to ensure that the study results support improved coastal policy and management planning.

The project is designed to:

  • Increase the capacity to perform ecosystem valuation and to use these estimates in planning and decision-making
  • Make the economic case for better coastal and land management, as well as for increased investment in Marine Protected Areas, so that these are viewed as investments in the future of the country and their economic and societal benefits are maximized
  • Arm NGOs and marginalized resource users with powerful information, enabling them to achieve greater voice in local decision-making.

Findings (June 2008)

The study evaluated the overall annual economic contribution of coral reef-associated tourism and recreation, fisheries, and shoreline protection services.

Coral reef-associated tourism and recreation is estimated to contribute between US$100 and $130 million to the national economy in 2006.

Coral reef-associated fisheries are an important cultural tradition, safety net, and livelihood, with annual economic benefits estimated at between US$0.8 – 1.3 million. Coral reefs also provide shoreline protection services in reduced erosion and wave damage valued between US$18 and $33 million per year. These economic contributions are significant compared to Tobago’s GDP, which was $286 million in 2006. Coral reefs provide other important values not estimated in this study, and these numbers should be regarded as a lower bound estimate.

Recommendations for Tobago

  • Improve coastal water quality through sewage treatment and integrated watershed management.
  • Good coastal water quality is a benefit to both people and reefs.
  • Maintain coastal mangroves, as these filter pollutants and help protect the shoreline from waves and storm surges.
  • Establish an entrance fee to BRMP and use revenue to hire a park manager, maintain boats, and enforce the no-fishing regulations.
  • Track number of snorkelers and divers and manage reef recreation within sustainable limits.
  • Improve mapping of coral reefs and mangroves for Tobago. Monitor reef condition to have timely information on degradation or improvement.
  • Improve fishing survey design, data collection and information management at the Tobago House of Assembly, to allow tracking of fishing effort and catch over time.
  • Use the coral reef valuation methodology and Tool (download via links at right) to track the economic contribution of coral reefs over time—for Tobago or for smaller areas such as the Buccoo Reef.

Problem Statement

Coral reefs are a critical component of the marine environment. Biologically rich coral reef habitats provide important ecosystem services to local and regional economies, including tourism, shoreline protection, and fisheries. As coral reefs degrade, these services are diminished, resulting in economic losses to coastal communities. Despite their importance, nearly two-thirds of the Caribbean’s coral reefs are threatened by human activities. Agricultural runoff, overfishing, dredging, sewage discharge, and the growing pace of coastal development have already degraded important reef systems, reducing their recreational appeal and decreasing fishery production in many places. As a result, fisheries and tourism sectors are not reaching their full potential. Over time, these local and national economic losses could lead to reductions in GDP.

Tools

Tourism Valuation Tool (3.19MB)
Tourism Valuation Tool Users Manual  (209KB)
Fisheries Valuation Tool (2.89MB)
Fisheries Valuation Tool Users Manual  (511KB)

Reports

Coastal Capital – Tobago (424KB)
Coastal Capital Working Paper – Executive Summary  (223KB)
Coastal Capital Working Paper  (1001KB)
WRI (Lauretta Burke) Powerpoint slides  (2.2MB)

Related Links

WRI Project Page