Economic Valuation of Coral Reefs in Tobago –

Economic Valuation of Coral Reefs in Tobago – June 13, 2008 Tobago Lauretta Burke World Resources Institute

Trinidad and Tobago Buccoo Reef Trust T&T Institute of Marine Affairs (IMA) Tobago House of Assembly (THA) / Policy Research Development Institute (PRDI) T&T Central Statistics Office (CSO) T&T Environmental Management Agency (EMA) Environment Tobago and SOS Saint Lucia Government of Saint Lucia Regional Partners University of the West Indies (UWI) / Sustainable Economic Development Unit (SEDU) Caribbean Natural Resources Institute (CANARI) Project Partners Include

Financial Support • Macarthur Foundation • Ocean Foundation • Henry Foundation • Munson Foundation • Dutch Ministry of Foreign Affairs • SwedBio • International Coral Reef Action Network (ICRAN) • Buccoo Reef Trust

Beautiful

Valuable

Threatened • Coastal development • Mangrove removal • Sewage • Dredging • Runoff • Tourism • Overfishing • Warming Seas

Influencing Better Management • Economic Valuation is a tool to guide coastal planning, investment and management in the long-term interest of local communities and the country

OPTIONS Development options Enforcement of regulations Capping tourist numbers Investing in pollution control OUTCOMES Revenue streams from tourism Societal benefits from reefs Ecosystem goods and services Evaluating trade-offs

Economic Valuation of Coral Reefs • WRI (with partners) developed a coral reef valuation methodology and implemented valuations for the coral reefs of Tobago and St. Lucia. • The study evaluated the overall annual economic contribution of coral reef-associated • tourism and recreation, • fisheries, and • shoreline protection services.

Ecosystem Services from Coral Reefs

Non-Valued Services Total Economic Value (TEV) would also include: Other Use Values: • Research Values • Option Values (e.g. pharmaceutical) • Carbon storage Non-Use Values • Bequest Value • Existence Value We focus on values that can be reliably estimated using available data

Summary of Values

Valuation Summary Coral reef-associated tourism and recreation – contributed between US$100 and $130 million to the national economy in 2006. Photo: BRT

Valuation Summary Coral reef-associated fisheries– • important for cultural tradition, safety net, and livelihood • provide annual economic benefits estimated at between US$0.8 – 1.3 million. Photo: BRT

Valuation Summary Shoreline Protection Services of Coral Reefs– • avoided erosion and storm damage from waves valued between US$18 and $33 million per year.

Valuation Summary • Tourism and Recreation - US$100 to $130 million in 2006. • Coral reef-associated fisheries - US$0.8 – 1.3 million / year • Shoreline protection services –US$18 and $33 million per year. • These 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.

Coral Reefs – Economically Important to Tobago Valuation can highlight: • Significant contribution to GDP • Taxes paid to government • Jobs and wages dependent on coral reefs • Value of social safety net Supports: • Coastal Planning (shoreline protection analysis) • Evaluation of trade-offs

Economic Valuation applications • Estimate Economic Contribution to GDP • Compare benefits of development / management options • Encourage increased investment in coastal management / MPAs / fisheries management • Identify sources of support for management / policy / protected areas • Set fees, such as visitor fees • Damage assessment $

Tobago-specific examples • Evaluate the costs and benefits of investing in more active management of Buccoo Reef Marine Park • Evaluating the benefits of investment in improved sewage treatment in SW Tobago • Examine changes in fisheries management and the impact on short-term livelihoods versus long-term benefits • Comparing the benefits of consumptive vs. non-consumptive use of sea turtles

Econ Val Project Characteristics • Develop method which is simple and replicable • Rely predominantly on existing, available data • Produce coral reef valuation estimates for two pilot areas (Tobago and St. Lucia) • Estimate likely economic loss due to coral reef degradation

Valuation – Main Components Tourism Method: Financial Analysis (Net revenues plus transfers) Fisheries Method: Financial Analysis (Net revenues plus transfers) Shoreline Protection Method: “Avoided Damages”

Tourism Components • Accommodation • Reef Recreation – Diving • Reef Recreation – Snorkeling • Marine Park Revenues • Misc. Expenses (e.g., departure taxes, visitor expenditure) • Local Use • Indirect economic effects

Tourism Valuation issues • Identifying “coastal” visitors • Quantifying reef recreation • Getting accurate MPA visitation numbers • Tobago-specific data

Tourism and Recreation Valuation Assumptions • 40% of visitors come to Tobago in part due to the reefs.

Tourism Valuation for Tobago

Local Reef Use Survey • Commissioned a survey through the University of West Indies / Sustainable Economic Development Unit / Government of St. Lucia, Department of Statistics • 300 people surveyed in 6 locations in Tobago (Reef - Buccoo, Pigeon Point, and Speyside, and non-reef - Mt. Pleasant, Roxborough, and Patience Hill) • Designed to measure local use of beaches and reefs as well as recreational and subsistence fishing

Fisheries Components • Commercial Fisheries • Fish Processing and Cleaning • Local Use (fishing) • Indirect economic effects • Focus on reef-associated species – snapper, grouper, grunts, squirrelfish, parrot fish, lobster and conch.

Fisheries Valuation Issues • Lack of meaningful data on fish landings • Limited data on sales and exports • Limited data on local use • Focus on economic impact – does not fully capture social values.

Commercial Fishing in Tobago • Estimate derived from two approaches – • reef fish productivity • estimated pot fishing effort • Coral reefs are over-fished Tobago / productivity is declining

a) Reef Fish Productivity • Reef Area: 30 km2(from this project) • Estimated fish productivity rate: range of 2 to 5 MT of fish / km2 of coral reef • Potential sustainable harvest of 130,000 to 330,000 lb of reef fish

b) Landings based on boats • 16 boats doing pot fishing, average 105 trips per year, landing an average of 150 - 200 lbs per trip • This leads to an estimated 250,000 - 336,000 lbs of fish caught.(Comparable to the maximum productivity estimate) • Average Price of pot fish = TT$15 ($2.50 US), leads to gross value of catch of US$630,000 - 840,000.

b) Landings based on boats (cont.) • We assume an additional 15,000 - 20,000 lbs of lobster caught (and US$7 per pound for lobster) so US$106,000 - 140,000 • Total Gross revenue = US$735,000 - 981,000.

Fisheries Valuation for Tobago

Shoreline Protection Services • Innovative method for isolating the role of coral reefs and integrating economics • Map outputs – • Shoreline protected by coral reefs • Areas vulnerable to waves \ storm damage • Relative contribution of reefs to shoreline protection

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

Complex Analysis • IMA developed shoreline protection framework - rules for how much protection the reef affords this coastline situation. • Can be adapted for climate scenarios

Shoreline Protection Analysis (5 Steps) • Identify vulnerable areas • Identify areas protected by coral reefs • Evaluate the relative protection provided by reefs • Incorporate property values • Combine to evaluate potential storm damage avoided

1. 6% of Tobago’s land area rated “vulnerable.

Shoreline Stability Factors (from IMA) • Coastal Geomorphology • Coastal Geology • Coastal Protection Structures • Wave Energy • Storm/Hurricane Events • Coral Reef Index (Reef type, continuity, distance offshore) • Coastal Elevation • Coastal Slope • Coastal Vegetation • Anthropogenic Activities

Stability Factors used in Tobago Analysis • Coastal Geomorphology • Coastal Geology • Wave Energy • Storm/Hurricane Events • Coral Reef Index (Reef type, continuity, distance offshore) • Coastal Elevation Not Available • Coastal Vegetation • Coastal Slope • Coastal Protection Structures • Anthropogenic Activities

Economic Valuation of Coral Reefs in Tobago –