Coastal Capital: The Economic Contribution of Belize’s Coral Reefs and Mangroves Emily Cooper / Lauretta Burke World Resources Institute Nadia Bood, WWF-CA November 14, 2008 IYOR – Belize

Financial Support Oak Foundation Oak Foundation Ocean Foundation Ocean Foundation Netherlands MFA Netherlands MFA SwedBio SwedBio Macarthur Foundation Macarthur Foundation

Project Partnership Healthy Reefs Initiative Healthy Reefs Initiative BTB BTB Forestry Dept. Forestry Dept. Fisheries Fisheries PACT PACT APAMO APAMO Galen University Galen University BZ HydroMet BZ HydroMet CCCCC CCCCC WCS WCS FON FON TASTE TASTE TIDE TIDE BAS BAS Hol Chan Hol Chan GreenReef GreenReef TNC TNC UB UB

Overview Project Intention and Purpose Project Intention and Purpose Economic Valuation Method Economic Valuation Method Summary of Results Summary of Results Shoreline Protection Shoreline Protection Tourism and Recreation Tourism and Recreation Fisheries Fisheries MPA Valuations MPA Valuations Policy Recommendations Policy Recommendations

Coral Reef and Mangrove- associated Goods and Services

Photos: WWF/ Italo Bonilla, Julie Stockbridge

Coral Reef and Mangrove- associated Goods and Services nurseries nurseries Photos: WWF/ Gilda ABURTO, Lauretta Burke

Coral Reef and Mangrove- associated Goods and Services Photos: WRI

Coral Reef and Mangrove- associated Goods and Services Photos: WWF

Coral Reef and Mangrove- associated Goods and Services Photos: WRI, WWF

Coral Reef and Mangrove- associated Goods and Services Photos: Krishna Desai, J. Sharp

Coral Reef and Mangrove- associated Goods and Services Photos: J. Sharp, Ferrari

Coral Reef and Mangrove- associated Goods and Services Photo: M. Paz

Project Concept Reefs at Risk in the Caribbean (2004) Reefs at Risk in the Caribbean (2004)

Project Concept Reefs at Risk in the Caribbean (2004) Reefs at Risk in the Caribbean (2004) Pilot analyses for Tobago and St. Lucia ( ) Pilot analyses for Tobago and St. Lucia ( )

Economic Valuation Project Concept 1. Develop method which is simple and replicable 2. Rely predominantly on existing, available data 3. Develop a Tool for valuation and policy analysis

Adapt Method for Belize Extensive barrier reef system Extensive barrier reef system Importance of mangroves Importance of mangroves Focus on MPA network Focus on MPA network

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

Economic Valuation applications Highlight economic contribution to GDP Highlight economic contribution to GDP Compare benefits of development / management options Compare benefits of development / management options Encourage increased investment in coastal management / MPAs / fisheries management Encourage increased investment in coastal management / MPAs / fisheries management Support damage assessment Support damage assessment

Coral Reef and Mangrove Goods and Services Evaluated Tourism and recreation Tourism and recreation Fisheries Fisheries Shoreline protection services Shoreline protection services

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

Interconnected Habitats

Shoreline Protection Shoreline Protection

Interconnected Habitats Shoreline Protection Shoreline Protection Tourism and Recreation Tourism and Recreation Fisheries Fisheries

Summary of Results

Annual economic contribution of coral reefs is between US $270 and $370 million in

- Annual economic contribution of mangroves is between US$175 and $250 million in Annual economic contribution of mangroves is between US$175 and $250 million in 2007.

Valuing Shoreline Protection Services

Shoreline Protection Services Innovative valuation method developed with IMA in Trinidad Innovative valuation method developed with IMA in Trinidad Integrates physical and economic data Integrates physical and economic data Isolates the role of reefs in protecting the shore Isolates the role of reefs in protecting the shore Estimates “damages avoided” Estimates “damages avoided” Adapted for Belize Adapted for Belize Can use Climate Scenarios for adaptation planning Can use Climate Scenarios for adaptation planning

Shoreline Protection Analysis (5 steps) 1. Identify vulnerable areas 2. Identify shoreline protected by coral reefs or mangroves 3. Evaluate the relative stability of the shoreline 4. Isolate role of reefs or mangroves in shoreline protection 5. Estimate potential storm damage avoided

1. Identify Vulnerable Land Definition – within 1 km of coast, under 5m elevation (based on 25 year storm event) Definition – within 1 km of coast, under 5m elevation (based on 25 year storm event) 693 sq. km of land classed as “vulnerable” 693 sq. km of land classed as “vulnerable” 3 % of Belize’s land 3 % of Belize’s land 87% of land within 1 km of coast 87% of land within 1 km of coast

2a. Shoreline Protected by Coral Reefs 70% of coast is “protected” by coral reef 70% of coast is “protected” by coral reef (66% of mainland coast) (66% of mainland coast)

2b. Shoreline Protected by Mangroves Two-thirds of coastline is “protected” by mangroves Two-thirds of coastline is “protected” by mangroves About 50% of mainland coast About 50% of mainland coast Abut 75% of cayes Abut 75% of cayes

3. Evaluate Relative Stability of the Shoreline 1. Coastal Geomorphology 2. Coastal Geology 3. Coastal Protection Structures 4. Coral Reef Index (Reef type, continuity, distance offshore) 5. Wave Energy 6. Storm/Hurricane Events 7. Coastal Elevation 8. Coastal Vegetation 9. Anthropogenic Activities

4a. Coral Reef Share of Shoreline Stability Coral Reefs contribute between 12 and 40% of shoreline stability Coral Reefs contribute between 12 and 40% of shoreline stability

4a. Mangrove Share of Shoreline Stability Where present, mangroves contribute between 10 and 32% of shoreline stability Where present, mangroves contribute between 10 and 32% of shoreline stability

5. Estimate “Damages Avoided” Estimate property values in “vulnerable areas” Estimate property values in “vulnerable areas” Ranged from US$1 / sq ft in “other areas” to US$ 14 – 16 / sq ft along coast in Caye Caulker and Placencia Ranged from US$1 / sq ft in “other areas” to US$ 14 – 16 / sq ft along coast in Caye Caulker and Placencia

5. Estimate “Damages Avoided” Estimate property values in “vulnerable areas” Estimate property values in “vulnerable areas” Ranged from US$1 / sq ft in “other areas” to US$ 14 – 16 / sq ft along coast in Caye Caulker and Placencia Ranged from US$1 / sq ft in “other areas” to US$ 14 – 16 / sq ft along coast in Caye Caulker and Placencia Combine property values in vulnerable areas with percent protection provided by coral reef / mangrove. Combine property values in vulnerable areas with percent protection provided by coral reef / mangrove.

Value of Shoreline Protection by Coral Reefs and Mangroves - avoided erosion and storm damage from waves valued between US$230 and $347 million per year. avoided erosion and storm damage from waves valued between US$230 and $347 million per year. Coral Reefs – US$120 – 180 million / year Coral Reefs – US$120 – 180 million / year Mangroves – US$111 – 167 million / year Mangroves – US$111 – 167 million / year

Tourism Components Tourism Components Accommodation Accommodation Recreation – diving, snorkeling, sport fishing Recreation – diving, snorkeling, sport fishing Other tourist expenditures Other tourist expenditures Cruise visitor expenditures Cruise visitor expenditures Taxes and fees Taxes and fees

Region Belize District Ambergris Caye Caulker Cayo Corozal Orange Walk Stann Creek Placencia Toledo Other Islands Photo: Mito Paz Distinguishing reef- and mangrove- associated tourists

Total Number of Rooms Occupancy Rate Rooms Occupied by Reef & Mangrove Related Tourists:64%

Accommodation ($US million) Hotel Revenues $46.7 – $61.2 Yachts and live-aboards $9.7 – $14.2 Total $ $75.4

Reef and Mangrove Associated Tourism Reef / mangrove -associated:($US million) Accommodation $ $75.4 Recreation $ $46.5 Other Visitor Expenses $31.8 – $44.7 Marine Park Fees$1.3 Taxes and Service Charges$17.7 – $21.3 Cruise Tourism (revenues & taxes)$5.3 – $6.4 Total Direct Impacts$ $195.7

Reef & Mangrove Recreation ($US million) Diving $20.1 – $25.1 Snorkeling $10.1 – $12.6 Sport Fishing $7.2 – $8.5 Other reef/mangrove rec $0.2 - $0.3 Total $ $46.5

Reef and Mangrove Associated Tourism Reef / mangrove -associated:($US million) Accommodation $ $75.4 Recreation $ $46.5 Other Visitor Expenses $31.8 – $44.7 Marine Park Fees$1.3 Taxes and Service Charges$17.7 – $21.3 Cruise Tourism (revenues & taxes)$5.3 – $6.4 Total Direct Impacts$ $195.7 Multiplier1.2 – 1.4 Indirect Impacts$26.1 – $68.9

Reef and Mangrove Associated Tourism Reef / mangrove -associated:($US million) Accommodation $ $75.4 Recreation $ $46.5 Other Visitor Expenses $31.8 – $44.7 Marine Park Fees$1.3 Taxes and Service Charges$17.7 – $21.3 Cruise Tourism (revenues & taxes)$5.3 – $6.4 Total Direct Impacts$ $195.7 Multiplier1.2 – 1.4 Indirect Impacts$26.1 – $68.9

Outstanding Issues Reef use data Reef use data Consumer Surplus Consumer Surplus Future Values / Sustainable Levels Future Values / Sustainable Levels Tourist responses to change in reef quality Tourist responses to change in reef quality

Fisheries Commercial Catch Commercial Catch 1. Export sales through Co-ops 2. Local sales through Co-ops 3. Local sales outside Co-ops Fish cleaning \ processing Fish cleaning \ processing Other benefits Other benefits

Fisheries Commercial Catch Commercial Catch 1. Export sales through Co-ops 75% 2. Local sales through Co-ops7% 3. Local sales outside Co-ops18% Does not include fish caught in Belizean waters and sold in neighboring countries

Economic Contribution: Fisheries Reef / mangrove -associated:($US million) Total Revenues (export + local) Lobster $9.3 - $9.7 Conch $3.1 - $3.2 Finfish $1.6 - $3.8 Shrimp $0.10 Crab$0.02 Total Revenues$35.0 Local fish cleaning$.08 - $.10 Total Economic Contribution$ $15.9

Economic Contribution of Reef and Mangrove Associated Tourism and Fisheries Tourism : US$150 - $196 m Fisheries : US$14 - $16 m ____________________________________ Total Direct Impacts: US$164 - $212 m 13% – 16% of GDP

Marine Protected Areas 18 protected areas (~12 actively managed) 18 protected areas (~12 actively managed) ~115,000 reported visitors in 2007 ~115,000 reported visitors in day per MPA visitor = US$17 m in direct spending by MPA visitors per year. $3.5 – $7 m in indirect impacts. 1 day per MPA visitor = US$17 m in direct spending by MPA visitors per year. $3.5 – $7 m in indirect impacts. Typical government spending per MPA, by comparison, is US$100,000 Typical government spending per MPA, by comparison, is US$100,000 A lot of visitation is going unrecorded (and fees uncollected). 30% or more in some MPAs. A lot of visitation is going unrecorded (and fees uncollected). 30% or more in some MPAs.

Marine Protected Areas: Glover’s Reef Tourists visit from the mainland or stay for a week at a time in of the five on-site resorts to kayak, snorkel, and dive in the reserve. Tourists visit from the mainland or stay for a week at a time in of the five on-site resorts to kayak, snorkel, and dive in the reserve. We estimate that reef-related tourism GRMR contributes US$3.8 - $5.6 million / year to the economy. We estimate that reef-related tourism GRMR contributes US$3.8 - $5.6 million / year to the economy. Fisheries revenues from inside the reserve are estimated at US$0.7 - $1.1 m / year. Fisheries revenues from inside the reserve are estimated at US$0.7 - $1.1 m / year. Without greater support for monitoring and enforcement, Belize’s MPAs will not be able to provide this level of economic benefits into the future. Without greater support for monitoring and enforcement, Belize’s MPAs will not be able to provide this level of economic benefits into the future.

Policy Recommendations for Belize

Belize’s coastal resources are extremely valuable. They are also increasingly threatened. As reefs and mangroves degrade and disappear, the economic benefits they provide will diminish. It is in the long-term economic interest of Belize to:

Plan and Implement Development Sensibly Enforce land-use and development regulations in the coastal zone. Enforce land-use and development regulations in the coastal zone. Minimize the loss of mangroves along the shoreline. Minimize the loss of mangroves along the shoreline. Conduct and thoroughly evaluate EIAs and subsequent compliance plans for development in sensitive coastal areas, such as the cayes. Conduct and thoroughly evaluate EIAs and subsequent compliance plans for development in sensitive coastal areas, such as the cayes.

Invest in Management, Monitoring, and Compliance Reinvigorate the CZMAI and build capacity for monitoring both the state and use of coastal resources Reinvigorate the CZMAI and build capacity for monitoring both the state and use of coastal resources Increase overall investment in MPAs. Improve fee collection and monitoring of visitors. Increase overall investment in MPAs. Improve fee collection and monitoring of visitors. Tighten fishing regulations and invest greater resources in enforcement Tighten fishing regulations and invest greater resources in enforcement

Incorporate Economic Valuation into Planning Processes Incorporate economic valuation into EIAs Incorporate economic valuation into EIAs Include economic impacts in assessing fines for damages to reefs and mangroves. Include economic impacts in assessing fines for damages to reefs and mangroves. Weigh revenues from a growing cruise industry against long-term economic losses from environmental impacts. Weigh revenues from a growing cruise industry against long-term economic losses from environmental impacts. Evaluate distributional effects (“winners” and “losers”) of proposed coastal development projects. Evaluate distributional effects (“winners” and “losers”) of proposed coastal development projects.

1. Coastal natural resources in Belize are extremely valuable 2. Shoreline protection provided by coral reefs and mangroves is a surprisingly high value service (highest of the three) 3. Current investment in coastal management is insufficient to maintain these valuable goods and services at current levels

Thank You! Emily Cooper Lauretta Burke Nadia Bood Photo credit: © WWF / Ítalo BONILLA