environmental valuation and tourist dollars

Spurgeon,James JSpurgeo at gibb.co.uk
Tue Nov 21 09:14:21 EST 2000

In response to some recent issues raised regarding the problem of "tourist
dollar values", I'd like to make the following points:

In an ideal world there would be no need for the contentious placing of
money values on environmental resources like coral reefs. However, like it
or not, we don't live in an ideal world.  We live in a world with scarce
resources where many decisions are taken daily by individuals, businesses
and Governments all of which result in trade-offs.  In the past, those
decisions have generally been based on conventional market-based economic
values. Consequently, economics has been used to justify developments and
resource use without due consideration of the full environmental and social
effects.   As a result, many damaging and unsustainable decisions have been,
and continue to be made.  

This is beginnning to change with the introduction of environmental
economics, environmental valuation and concepts such as "Total Economic
Value" (TEV).  In comparison to economics and biology, environmental
economics is still very much in its embryonic stages. Thus although
environmental valuation techniques are far from perfect, they are
continually improving.  Despite this, no single decision-making tool can
adequately resolve all environmental problems.  Environmental valuation is
thus a powerful tool that should be used alongside others (e.g. EIAs,
regulations, protected areas etc).  It is powerful because it can translate
environmental impacts into monetary values, which, if correctly valued,
speak far louder than qualitative descriptions.  Decision-makers can readily
relate to monetary values, but only if they believe them.  Environmental
valuations must therefore be carried out properly.

Tourist values are only one component of TEV.  At present, they are
generally the most obvious reef value and seemingly the most important in
terms of generating dollars.  However, it is essential to think holistically
about all relevant environmental and social values.  As coral-listers have
indicated, many other coral reef values exist.  It is vital that we gain a
far better understanding of these (direct, indirect and non-use values) and
begin to develop effective mechanisms and sound arguments to capture these
benefits.  This is what the study on sustainable financing I presented in
Bali is helping to address (to be submitted to the Bali proceedings). The
aim is to hopefully apply the principles and methodology developed in the
first phase of the study to three MPA sites next year.  Tourist user fees
are merely the tip of the iceburg.

In further support of using environmental valuation, I am now successfully
using it in EIAs to help justify expensive scheme modifications (e.g. for
port, power plant & pipeline developments) mitigation and compensation
measures, and comprehensive monitoring programmes needed to protect corals
and other marine habitats.  

I am also involved in two national R&D studies for the UK Environment Agency
to develop a better understanding of non-use/passive values (e.g.
existence/bequest/option motives) relating to inland fish stocks and water
levels in rivers.  The studies involve extensive stakeholder analysis and
large scale resource valuation surveys (using the contingent valuation
method).  The ultimate aim is to determine relatively robust non-use values
for use in Government decion-making.  Non-use values are a significant
component of conservation value that are usually ignored.  Our research
demonstrates that strong non-use/passive values are held by both non-users
and users of the resource.  Such values can be estimated in monetary terms
(to a degree) and there are plenty of ways of capturing the value (albeit
sometimes potentially introducing problems of a different nature).

One of the R&D studies is seeking to gain a better understanding of
different categories of resource users.  This will have ramifications for
valuing tourist benefits and for undertaking economic impact assessments of
coral reefs (e.g. with respect to pre-planned and incidental
diving/snorkelling trips and apportioning tourism expenditures).
Unfortunately, in the growing literature on the tourism value of corals,
dubious and incorrect assumptions are often being made regarding links
between coral reefs, tourism expenditures and tourism benefits.  

The point is, environmental economics has a potentially immense role to play
in the future of coral reef conservation if used appropriately.  A number of
excellent examples of using environmental economics for coral reef
conservation can now be found in:

Cesar, H. (Ed.) (2000), "Collected Essays on the Economics of Coral Reefs",
CORDIO, Kalmar University, Kalmar, Sweden. 

With respect to my pre-conference request to coral-listers for information
to help with my sustainable financing study, I'd like to thank those that
provided useful information and contacts.  The response was not
overwhelming, but included: 

*	data on the coral trade in Fiji
*	reference to the sand supply function of corals
*	and reference to:

www.aquariumcouncil.org <http://www.aquariumcouncil.org/>  


"A valuation book by Alan White and Trinidad on the Philippines" 

"Integrated Coastal Zone Management of Coral Reefs: Decision Support 
Modelling" - by Kent Gustavson, Richard M. Huber, and Jack Ruitenbeek,

I hope this helps.

James Spurgeon
Principal Environmental Economist/Scientist
Gibb Ltd
Gibb House
London Rd

Tel:    0118 963 5000
Fax:   0118 926 3888
Email: jspurgeo at gibb.co.uk

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