public disclosure authorized - world bankdocuments.worldbank.org/curated/en/...faizal parish,...

GEF

Global Environment Facility

Wetlands International - Asia Pacific ETLANDS

INTERNATIONAL

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INCREMENTAL COSTS OF WETLAND CONSERVATION Case Studies in Asia and the Pacific

ISBN: 983-9663-26-7

© 1997 by Wetlands International and Global Environment Facility All rights reserved

Available from:

Publications Department Wetlands International - Asia Pacific Institute of Postgraduate Studies and Research University of Malaya · 50603 Kuala Lumpur Malaysia

This publication should be cited as:

Giesen, VJ. & King, K. (eds.) 1997. Incremental Costs of Wetland Conservation. Wetlands International, Kuala Lumpur, and Global Environment Facility,

Washington, D.C.

Cover photographs:

Green Turtle Chelonia mydas covers her nest before returning to the sea VvwFM/Jack Jackson ·

Adult Silvered Leaf Monkey Presbytis cristata with infant at Kuala Selangor, Malaysia WWFM/Gerald Cubitt

Proboscis Monkey Nasalis larvatus in Danau Sentarum Wildlife Reserve, Indonesia Wetlands ·international/Alain Compost

Sumatran Rhino Dicerorhinus sumatrensis at Sg. Dusun, Selangor, W. Malaysia WWFM/Rodney Lai

The views expressed in the case studies and commentary are those of the authors alone, and not necessarily those of anyone else, including the local communities mentioned in the case studies, the governments and agencies of the region, Wetlands International, GEF, the Secretariat and Implementing Agencies of the GEF, ODA-UK (now DFID), AusAID, the University of Malaya and the many individuals whose kind efforts and advice have made this work possible. Publication of these technical assessments of incremental cost, made by individual authors, does not constitute endorsement of financial eligibility under the Convention on Biological Diversity nor guarantee conformity with the financing policies of any government, financing mechanism or implementing agency

INCREMENTAL COSTS OF WETLAND CONSERVATION ·

Case Studies in Asia and the Pacific

. EDITED BY

Kenneth King Global Environment Facility

AND

Wim Giesen Wetlands International

Wetlands International and Global Environment Facility. 1997

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.. . [t]o build upon the environmental framework negotiated at the

United Nations Conference on Environment and Development in Rio

de Janeiro in 1992, incremental cost analysis is recognised as a valuable

tool for choosing between alternative development options, and

should be given high priority to assist the wise use of wetlands and

the conservation of biodiversity ...

Kuala Lumpur Statement on Wetlands and Development International Conference on Wetlands and Development, 9-13 October 1995

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FOREWORD

PREFACE

CONTRIBUTORS

ACKNOWLEDGEMENTS

ABBREVIATIONS

PART ONE: INTRODUCTION

CHAPTER 1 :

CONTENTS

Biodiversity and the Global Significance of Asian Wetlands

Wim Giesen and Faizal Parish

CHAPTER 2 :

Incremental Costs of Conserving Wetland Biodiversity

Kenneth King

PART TWO: CASE STUDIES IN THE CONSERVATION OF WETLAND BIODIVERSITY IN ASIA AND THE PACIFIC

CHAPTER 3 :

Community Management in Danau Sentarum Wildlife Reserve, Indonesia

Julia Aglionby

CHAPTER 4 :

Fishing Practices in the Wiawi Marine Wetlands, Vanuatu

Valentine Thurairaja

CHAPTER 5 :

Forestry Practices in the North Selangor Peat Swamp Forests, Malaysia

Kanta Kumari

CHAPTER 6 :

Conservation and Land Use in Kuala Selangor Wetlands, Malaysia

Mohd. Shahwahid Haji Othman

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109

FOREWORD

Protecting biodiversity, be it in wetlands or elsewhere, may impose an added burden on countries

already struggling to mobilise financial resources for national development priorities. Our two

organisations, Wetlands International and the Global Environment Facility, formed a working

partnership to further evaluate and extend the application of pragmatic methodologies for estimating

these additional costs.

Wetlands International promotes the development of practical ways to protect and promote the

sustainable use of wetlands and their resources. To that end, it seeks ways to unite local, national,

regional and global partners in activities that integrate environmental concerns into development

and share the burden of doing so in a fair and equitable manner. The GEF provides finance to

developing countries to _address problems affecting biodiversity, climate change, international waters;

and the stratospheric ozone layer .. The GEF operates, on an interim basis, the financial mechanis_m

of the Convention on Biological Diversity.

One of the approaches that establishes clear and strategic frameworks for action that can make a

difference to wetlands and simultaneously provide the basis for cost-sharing is that of "incremental

cost". The International Conference on Wetlands and Development, 9-13 October 1995, recognised

that to "build upon the environmental framework negotiated at the United Nations Conference on

Environment and Development in Rio de Janeiro in 1992, incremental cost is ... a valuable tool for

choosing between alternative development options, and should be given high priority to assist the

wise use of wetlands and the conservation of biodiversity ... ".

GEF staff working on the Program for Measuring Incremental Costs for the Environment (PRINCE)

and the staff of Wetlands International -Asia Pacific - acknowledged by GEF as a centre of excellence

operating in developing countries - were pleased to have the opportunity to work together along

with various research associates on this activity. The case material for demonstrating the applicability

of incremental cost methodology to the preservation of biodiversity in wetlands in the Asia and

Pacific was developed by Wetlands International - Asia Pacific and associates.

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We are appreciative of the enthusiastic response and collaboration of the organisations and individuals

who have contributed their time and effort to this evaluation. We hope that the resulting publication

will be a useful contribution to advancing the effective management and conservation of wetland

areas in Asia and the rest of the world.

Faizal Parish

Executive Director

Wetlands International - Asia Pacific

Mohamed T. El-Ashry

Chairman and CEO


l PREFACE

This book is the product of a collaboration between Wetlands International - Asia Pacific (at the

time, the Asian Wetland Bureau) and the Program for Measuring Incremental Costs for the

Environment (PRINCE), a project financed by the Global Environment Facility. The case studies were

carried out by independent researchers under the direction of Wetlands lnternatio.nal and were first

presented at the International Conference on Wetlands and Development in Kuala Lumpur, 9-13

October 1995.

This work was undertaken to determine how one could estimate the incremental costs of conserving

wetland biodiversity. As incremental cost measures the burden of making development compatible

with environmental protection, estimating this cost is important for making wise choices between

development alternatives and for sharing the costs of environmental protection. In the particular

context of biodiversity, incremental cost has become the basis for international financial transfers to

developing countries under the financial mechanism of the Convention on Biological Diversity, signed

in 1992. Similar mechanisms for sharing the costs of securing regional and local environmental

benefits are also being explored in the region.

To illustrate how such estimates could be made, Wetlands International and PRINCE selected four

cases for study. The cases were selected on several criteria: the adequacy of data on the site, the

availability of high quality researchers familiar with the areas to undertake the studies, and the

ability of the case to illustrate issues of general importance that frequently arise in the estimation of

incremental costs. Such issues include the choice of an appropriate time horizon and system boundary,

the treatment of non-monetisable impacts and subsistence benefits, and limits to the operation of

market forces.

It is our hope that the discussion of such issues in particular settings will help other analysts make

incremental cost estimates that are transparent, credible and useful, and that such estimates in turn

will facilitate wise choices of development path and will inform negotiations on sharing the cost of

environmental protection. Although the cases we chose are in the Asia-Pacific region and are about

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wetland biodiversity of global significance, the methods described here can be applied generally.

Incremental cost is the appropriate measure of the extra effort of accommodating an additional

objective, and estimating incremental cost is particularly useful when the benefits of that extra

effort, such as environmental protection, also accrue to groups other than those that would normally

suffer the cost.

CONTRIBUTORS

JULIA AGLIONBY is an independent consultant. She trained in the biological management of natural resources and in environmental economics before being posted by the UK Overseas Development Administration to work in West Kalimantan, Indonesia, for two years. There, on the

Lake Sentarum Wildlife Reserve Conservation Project, she worked with communities and government agencies to explore how livelihoods could be maintained without threatening biodiversity. Currently she is working with English farmers in and around the Lake District National Park as a land agent.

Address: 3 Wave/I Drive, Carlisle CA 1 2ST, England, UK. Fax: (44-1228) 49494;

Ema11: julia@alanbowe. demon. co.uk

DILIP AHUJA, Environmental Specialist at the Secretariat of the Global Environment Facility, has done extensive work on incremental costs of global environmental protection at GEF and previously at the Center for Global Change, University of Maryland.

Address: GEF Secretariat, 1818H St., NW, Washington, DC 2043, USA.

Fax: (1-202) 522-3240; Email: [email protected]

WIM GIESEN is a wetland ecologist and manager who has worked in Asian wetlands since 1985, first in Indonesia and then in Bangladesh, Cambodia, India and Malaysia. He has concentrated on the conservation and sustainable use of wetland resources, initially while working for international NGOs such asWWF and (especially) Wetlands International, and since 1996 as a wetland consultant. His speci~l interests are wetland biodiversity, wetland products, photography and botany. His recent book on mangrove plants of Indonesia is due to go to press shortly.

Address: Mezenpad 164, 7071 JT Ulft, The Netherlands. Tel/Fax: (31-315) 630316; Email: [email protected]

KENNETH KING, Principal Environmental Specialist and Team Leader for Operations Policy at the Secretariat of the Global Environment Facility, is the Task Manager for the Program for Measuring Incremental Costs for the Environment (PRINCE). He has a Masters in Environmental Studies from the University of Adelaide and a doctorate in science from the University of Sydney. He has published

extensively, and has edited or co-edited books on electric vehicles, climate change, ozone depletion

and energy-environment issues in Asia.

Address: GEF Secretariat, 1818H St., NW, Washington, DC 20433, USA. Fax: (1-202) 522-3240;

Email: [email protected]

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KANTA KUMAR! is a Malaysian natural resources specialist, and has concentrated on forest and

biodiversity issues. At the time of the study, she was at CSERGE, University of East Anglia. She has

published extensively on environmental economics and has consulted for the Economic Development

Institute, Washington, and for PRINCE.

Address: GEF Secretariat, 7878H St., NW, Washington, DC 20433, USA. Fax: (1-202) 522-3240;


FAIZAL PARISH, Executive Director of Wetlands International - Asia Pacific, has been involved in the

conservation of wetlands in Asia and the Pacific since the early 1980s. He established the shorebird

study bureau INTERWADER in 1983, and the wetland. conservation and management NGO Asian

Wetland Bureau (AWB) in 1985. Faiza/ Parish was instrumental in AWB's establishing programmes in

many other countries in the region, and played a key role in the globalisation of the organisation by

linking AWB with the International Wetland and Waterbird Research Bureau and Wetlands for the

Americas on 1 January 1996, to form Wetlands International.

Address: Wetlands International - Asia Pacific, Institute of Postgraduate Studies and Research

(IPSR), University of Malaya, 50603 Kuala Lumpur, Malaysia. Fax: (603) 757- 7 225;


MOHD. SHAHWAHID HAJJ OTHMAN is Associate Professor in Natural Resource Economics at the

Faculty of Economics and Management, Universiti Putra Malaysia. He obtained his PhD in Natural Resource Management and Policy from the College of Environmental Science and Forestry, State

University of New York at Syracuse in 1989. At UPM he teaches principle economics, microeconomics,

forestry economics and economics of non-market goods at the undergraduate level and forest resource evaluation and accounting at the graduate level. His basic philosophy in research is that natural resources, including wetlands, should be conserved and utilised to ensure sustainability. His research interests include forestry sector econometric and policy modelling including demand and supply studies, economics of forest and wetlands management, and - of late - economic valuations of

environmental goods and services.

Address: Department of Resource Economics, Faculty of Economics and Management, Universiti Putra Malaysia, 43400 UPM Ser_dang, Selangor D.E., Malaysia. Fax: (603) 948-2507;


VALENTINE THURAIRAJA has an M.Phil. degree in Environment and Development from the

University of Cambridge, UK, and an MSc from the Asian Institute of Technology, Bangkok. He is

currently an Environmental Specialist attached to the Environment, Agriculture and Physical

Infrastructure Section (ENAP) of the Australian Agency for International Development (AusAJD) in

Canberra, a position that he has held since 1989. He has extensive field experience in biodiversity

conservation in developing countries in Asia, the Pacific and Africa. He has served as a consultant to

international agencies such as UNEP, and has published papers on the economics of biodiversity

conservation.

Address: ENAP Section, AusAID, GPO Box 887; Canberra ACT 2607, Australia.

Fax: (61-6) 206-4870.

ACKNOWLEDGEMENTS

We would like to acknowledge the fine work of these case study contributors; they worked hard to bring their detailed knowledge to bear on an issue of great importance. We especially acknowledge the following for their overall comments and inputs, and help in bringing this publication to a successful conclusion: Faizal Parish, Muralee Menon, Dr. Taej Mundkur, John Howes, Rebecca D'Cruz, Marcel Silvius, Rosie Ounsted and others at Wetlands International; Dilip Ahuja, Mario Ramos and Ian Johnson at GEF; and Kanta Kumari and Raffaello Cervigni at PRINCE. We would also like to thank other participants at the inception and final workshops for their contributions and the Institute of Advanced Studies of the University of Malaya for providing facilities for the project.

Julia Aglionby wishes to thank the residents of Danau Sentarum Wildlife Reserve for their goodwill and understanding; the Government of Indonesia, ODA-UK, and Wetlands International, who provided much of the data for the case study while she was posted with UK-ITFMP; and Pak Bhakri of Bappeda Tk II Kapuas Hulu, Tarigan Sinaga of KSDA, Ade Jumhur, her field assistant, and Pak Mawardi, driver of Tiongkong Bakakak.

Valentine Thurairaja wishes to thank in particular Ernest Bani, Head, Environment Unit of the Government of Vanuatu; Moses Amos, Head of Fisheries Research, Fisheries Department; Chief Timothy Neaphi (Chief of Wiawi); and the villagers of Wiawi for their enthusiasm for the study and for their cooperation and hospitality during field work. He also acknowledges the Australian Agency for International Development (AusAID) for his leave of absence to undertake fieldwork in Vanuatu; Luca Tacconi (UNSW) for suggesting the WMW; Dr. Will Oxley (AIMS), Dr. Franz Arentz (ANU), Stephen Wyatt (FPSP) and Dr. Colin Limpus (QDEH) for assisting with data and costings.

Kanta Kumari wishes especially to thank Tom Crowards, her colleague at CSERGE, for feedback and constructive suggestions during the study; Razani Ujang and the staff of the Selangor State Forest Department for their help and co-operation; and the logging concessionaires, for facilitating field visits and meetings.

Mohd. Shahwahid Haji Othman wishes to thank in particular Mr. Rasainthiran, Mrs. Glenda Nor Ramli and Mr. Rahmat Arshad of the MNS; Mr. Sani and Mr. Vijayakumar of the Department of Fishery; Mr. Shamsuddin of the Department of Forestry; Mr. Khalid and Mrs. Saidah of the Kuala Selangor District Council; Dr. Davison of WWF Malaysia; and Mr. Ahmad Jabbari, Mr. Salleh Mat

and Mr. Jalaludin of Kampong Kuantan.

Kenneth King Wim Giesen

Ulft, The Netherlands June 1997

xiii

AAC

AusAID

AWB

CBD

CITES

DSWR

GB RM PA

GEF

GIS

Gol

GoM

GoV

IADP

ITFMP

IUCN

KSDA

KSNP

MNS

NFA

NPV

NSPSF

ODA

ABBREVIATIONS

Annual Allowable Cut

Australian Agency for International Development

Asian Wetland Bureau

Convention on Biological Diversity

Convention on International Trade in Endangered Species

Danau Sentar'um Wildlife Reserve

Great Barrier Reef Marine Park Authority, Australia


Geographical Information System

Government of Indonesia

Government of Malaysia

Government of Vanuatu

Integrated Agricultural Development Project

Indonesia-UK Tropical Forest Management Programme, Project 5: Conservation

World Conservation Union, Gland, Switzerland

Konservasi Sumber Daya Alam (Authority for Nature Conservation)

Kuala Selangor Nature Park

Malaysian Nature Society

National Forestry Act (Malaysia)

net present value

North Selangor Peat Swamp Forests (Malaysia)

Overseas Development Administration (UK). Now Department for International

Development

PHPA Perlindungan Hutan dan Pelestarian Alam (Indonesian Directorate General of

PRINCE

RM

SP REP

STY

TEV

UNEP

Forest Protection and Nature Conservation, which is responsible for conservation

and forest protection)

Program for Measuring Incremental Costs for the Environment (GEF)

Ringgit Malaysia (1996 exchange rate: RM 2.5 = US$1)

South Pacific Regional Environment Programme, Fiji

Sustainable Timber Yield

Total Economic Value

United Nations Environment Programme, Nairobi, Kenya·

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UPM

WDB

WMW

WRI

WWF

Universiti Putra Malaysia

Wetland Database (Indonesia)

Wiawi Marine Wetlands, Vanuatu

World Resources Institute, Washington, D. C.

World Wide Fund for NatureMiorld Wildlife Federation, Gland, Switzerland

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PART ONE INTRODUCTION

CHAPTER 1 Biodiversity and the Global Significance of Asian Wetlands

Wim Giesen and Faiza/ Parish

CHAPTER 2 Incremental Costs of Conserving Wetland Biodiversity Kenneth King

CHAPTER 1

BIODIVERSITY AND THE GLOBAL SIGNIFICANCE OF ASIAN WETLANDS

Wim Giesen and Faizal Parish

The cost of protecting a wetland and its biodiversity from the adverse impacts of development is an important input into the choice between development alternatives and into negotiations on sharing the cost of such protection. Because the Asia region is now facing critical choices concerning important wetlands, the need to find estimates of these costs is urgent. As the region is vast and geographically varied, wetland biology is diverse; because the people have enjoyed an ancient association with these wetlands, they have learned to obtain from them multiple benefits - natural resources, amenities, and environmental services. But now the very intensity of this association, resulting from population and development pressure, and the fact that wetland values are often overlooked, has threatened the source of these benefits: of almost a thousand wetlands of international significance in the region, 56% are now moderately or severely threatened. From this survey of the region's wetlands, their biodiversity, their benefits to humankind and their vulnerabilities, we have selected a diverse group of important wetlands under critical threat for our case studies. These will illustrate how the incremental cost of development to protect the functions and benefits of wetlands should be compared to the consequences of development that provides no protection.

INTRODUCTION

The Asian region is vast and varied. It stretches halfway around the globe and includes an array of

geographical zones and habitats, varying from the world's highest mountain system (the Himalayas)

to the world's deepest lake (Lake Baikal), from icy northern tundras to the steamy expanses of the

world's second-largest patch of rainforest, and from the arid deserts of central Asia to the world's wettest and most flood-prone regions in the lower Ganges-Brahmaputra basin. The region is also

unique in that it is fringed by more than 20,000 islands, most of which are in the Southeast Asian

archipelagos of Indonesia and the Philippines. Such geographical diversity has led to enormous

biological and cultural diversity throughout the region. The region covers three of the eight natural, bio-geographical realms of the.planet. Its biological diversity is augmented further by the relatively

long period of geological stability, and by the patterns of recurring habitat isolation and rejoining

2 GEF

INCREMENTAL COSTS OF WETLAND CONSERVATION

in island archipelagos, for example due to eustatic sea level movement (Singh, 1995). The tropical forests of the lndomalayan realm are considered to be the "world's forests of grandest structure and probably of greatest richness in both animal and plant life" (Whitmore, 1984), while the world's richest sub-tropical and temperate forests are found in Indochina and the People's Republic of China (MacKinnon, 1995).

While supporting a vast biodiversity, Asia is also densely populated, housing about 60% of the world's population on only 30% of the world's land surface. Historically, Asians have depended heavily on wetland and coastal resources and the region's high population density has resulted in heavy pressures on these resources. Some of the major civilisations of the world have evolved in the river valleys and wetlands of Asia, including more than 5,000 years ago in the Tigris-Euphrates Valley in Iraq (the legendary site of the Garden of Eden), 4,500 years ago in the Indus Valley in India and Pakistan, and in the 6th-12th centuries in the lower Mekong floodplain, site of the powerful Khmer kingdom. Asian wetlands have also ensured the survival of civilisations in China and India, which were founded and still depend on fertile floodplains to support an agrarian culture based on rice and fish. In modern China, India and other parts of Asia, more than two billion people depend on wetland crops (especially rice Oryza sativa) and fish as their main staple and protein source. Only in the relatively remote areas of Asia, such as parts of Mongolia, China and Russia, are wetlands seemingly under-utilised or untouched by human activity. On the whole, Asian wetlands are characterised by their close interaction with human communities and the cultures that have evolved in their proximity.

In this chapter we examine the global significance of Asian wetlands in terms of their biodiversity and briefly examine the benefits that these systems bring in the Asian context. Furthermore, threats associated with the loss of wetland resources and current protection measures are discussed in conjunction with incremental cost assessment as a tool for wetland protection and conservation in the region.

ASIAN WETLAND TYPES AND THEIR DISTRIBUTION

Wetlands consist of a wide range of i~land, coastal and marine habitats that share a number of common features. They are usually defined as areas that are either periodically or permanently flooded, or waterlogged with either brackish, fresh or marine waters. A distinction is made between natural and artificial wetlands, the latter including dams, reservoirs, salt-pans and rice fields - an all-important system in the Asian context. In the case of marine habitats, coastal ecosystems down to a depth of 6 m below low tide levels are also considered wetlands, according to the definition

provided by the Ramsar Convention on Wetlands of International Importance.

Of the 5.7 million km 2 of freshwater wetlands known worldwide, about a third are found in Asia, with the majority distributed throughout the temperate regions (Groombridge, 1992), where vast marshes and peat bogs occur. In tropical Asia the most important wetlands, both in terms of biodiversity and extent, are mangroves and associated mudflats, freshwater and peat swamp forests, and coral reefs. Rivers, lakes and associated herbaceous swamps are also important, in both tropical

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w'ETLANDS 'Pild;iJt.1;1.1~01


and temperate parts of Asia (Scott, 1989). In the central Asian and Middle-Eastern deserts, salt-lakes

or salt-pans and brackishwater marshes are crucial habitats for the maintenance of biodiversity.

Mangroves, mudflats and associated systems

Mangroves are highly productive ecosystems dominated by salt-tolerant trees and shrubs. These intertidal ecosystems are found along many coastlines in the tropics and subtropics, but are best developed in sheltered bays, estuaries, and lagoons, on sediments that are flooded by daily tides and currents. Mangroves, and their associated mudflats, are highly productive and provide a habitat for many rare and endangered species, as well as important spawning and nursery areas for large numbers of commercially important fish, shellfish and prawn species (see the case study on the

Kuala Selangor Nature Park, Malaysia, Chapter 6). An estimated 32 to 40% of world's mangroves occur in Asia (Thurairaja, 1994; Groombridge,. 1992; Ogino & Chihara, 1988), and Indonesia, which formerly had 4.2 million ha of mangrove, is the country with the world's largest remaining expanse (Giesen et al., 1997). The largest contiguous area of mangrove in the world is the Sundarbans, where about 700,000 ha of this habitat straddle the. border between India and Bangladesh (Chaudhuri & Choudhury, 1994; Hussain & Acharya, 1994). The region also supports vast areas of

the world's most diverse sea-grass beds (den Hartog, 1970). Mainly via the detritus food chain, these marine angiosperms support a very productive community of fish and invertebrates; especially molluscs and crustaceans, many of which are of commercial importance.

Coral reefs

Corals reefs typically occur in shallow coastal waters between 30°N and 30°S, where average ambient water temperatures are at least 18°C. Because they require clear waters, they are best developed where surface run-off is low and are commonest along arid coastlines and fringing smaller islands. About 85% of the world's coral reefs occur in the Indian Ocean and Western Pacific region (Groombridge, 1992), and in Asia the most extensive reefs occur along the Red Sea, Persian Gulf, Sri Lanka, Maldives, Andaman Islands, the Philippines and Indonesia. The world's most luxuriant and diverse coral reefs occur in eastern Indonesia and on the islands off Papua New Guinea. These highly complex and diverse ecosystems are known to be very productive, providing breeding, nursery, and feeding areas for many commercially important species of fish, crustaceans and molluscs (see the case study on the Wiawi Marine Wetlands, Vanuatu, in Chapter 4). In addition, in locations where access is easy, coral reefs have much potential for tourism-based activities and

can add significantly to local economies.

Swamp forests

Swamp forests are found where flooding or waterlogging by fresh water frequently occurs. In areas that are permanently waterlogged, organic matter may accumulate over thousands of

years, forming peat and leading to the development of peat swamp forest. Swamp forests with little or no peat are termed freshwater swamp forest. Asia's peat swamp forests, which ·occur

primarily in Indonesia and Malaysia, represent the greatest expanse of this habitat type in the world (see the case studies on the Danau Sentarum Wildlife Reserve, Indonesia, in Chapter 3,

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and the North Selangor Peat Swamp Forests, Malaysia, in Chapter 5). These Southeast Asian peat swamp forests cover nearly 30 million ha compared to only 1 million ha in Amazonia and a negligible area in Africa. Peat deposition usually occurs along subsiding coastlines, and in some areas may form layers 10-15 (even up to 24) m deep. In pristine tropical environments, swamp forests occur naturally on the landward side of mangrove forests, or in seasonally flooded areas along major rivers and on the perimeter of freshwater lakes. Swamp forests, like other tropical lowland forests, are typically diverse and many support rare and specialised plant, fish, reptile and mammal species.

Rivers, lakes and associated herbaceous swamps

Asia's major rivers are some of the world's largest: in terms of volume, the Ganges-Brahmaputra is the world's third-largest, while in terms of length, the Yangtze is the fourth, the Ob the fifth, and the Yellow River the sixth longest in the world. Asia also boasts the world's largest lake - the Caspian Sea (438,690 km2) - and the world's deepest lake (Baikal, 1, 700 m). Most of the great rivers of Asia have extensive floodplain wetlands consisting largely of seasonally inundated lakes and marshes. The Ganges-Brahmaputra floodplain wetlands in northern and eastern India and Bangladesh are an exceptional example of this type of system, providing unique habitats as well as a highly productive resource. Similarly, in China, the alluvial plains of the Yangtze and Yellow Rivers contain the greatest concentration of freshwater lakes in the country and provide similar benefits. In the Asian tropics, floodplain lakes and marshes are most extensive along the Mekong and Irrawaddy rivers and adjacent larger rivers on the main Indonesian islands. Lake Tonie Sap, a major feature of the Mekong River in Cambodia, extends over 13,000 km2 and is the world's largest floodplain lake, providing much of the country's fish. In Indonesia, extensive floodplain lakes and marshes occur along the Musi River and its tributaries in South Sumatra, adjacent to the Kapuas, Barito and Mahakam Rivers in Kalimantan, and along the Mamberambo River in lrian Jaya. China has about 2,500 natural and artificial lakes extending over 12 million ha (Scott, 1989). In all cases, these wetlands are vital to local economies, supporting key fisheries and facilitating transportation. Freshwater lakes can have diverse aquatic plant communities, supporting high productivity and providing wetland benefits such as the removal of nutrients, sediments and toxins. Many floodplain wetlands, especially in temperate regions, are surrounded by vast reed beds which are often of commercial significance. In addition, many wetlands are also used for freshwater supply and transport. The multitude of small, and often very old, artificial lakes in India (locally called 'tanks')

are vital for both biodiversity and local people, forming the main source of drinking and irrigation water in the long dry season.

Marshes, bogs and fens

North Asia, and Siberia in particular, has some of the most extensive wetlands on earth. These consist primarily of tundra ecosystems with their multitude of bogs and fens interspersed with lakes, river valleys, floodplains and estuaries. There are approximately 830,000 km2 of peat bogs and swamps in the former Soviet Union and about 900,000 km2 of marshy ground subject to seasonal flooding (A.J. Whitten, pers. comm.). The Ob floodplain in western Siberia alone covers over 5

million ha and is one of the largest breeding and moulting areas for waterbirds in Eurasia. China

\l'/ETLANDS 17ti'9-1Ji.f ii.if!.fi


has 14 million ha of temperate swamps and marshes, consisting mainly of Larix spp. peat bogs, sedge swamps and other herbaceous swamps (Maxey & Lutz, 1994).

BIODIVERSITY OF ASIAN WETLANDS BY WETLAND TYPE

Wetlands are amongst the most complex ecosystems in the world. There are a great variety of wetland types, and in addition these systems are highly dynamic, changing with seasons and over longer periods of time. The result is that wetlands are biologically very diverse systems. Asian wetlands are considered to be the global centre of diversity for a number of ecosystems or species groups. As is the case on a global scale, it is particularly in the Asian tropics and subtropics that biodiversity is·at its apex.

With its many large estuaries and multitude of islands, the region has a highly varied coastal environment, leading to very high biodiversity in the coastal zone. MacKinnon (1995) estimates that half of the world's marine organisms occur in the Asian-Western Pacific region.

Mangroves, mudflats and associated systems

The region contains the world's largest contiguous area of mangroves (the Sundarbans) and the country with the world's largest expanse of mangroves (Indonesia). It is also the global centre for mangrove diversity and evolution. Of the 60 species of 'true mangroves' occurring in the world, 44 occur in the South Asian and Southeast Asian regions and 38 in the northwestern Pacific, compared to only seven to nine species in the Americas and Africa (Saenger et al., 1983). In terms of plant species, Indonesian mangrove forests are the world's most diverse, with more than 200 plant species either commonly associated with, or exclusive to, these ecosystems (Giesen et al., 1997). Inter-tidal areas have added significance due to their importance for many species of resident and migratory birds such as storks, herons, waders and egrets as well as supporting unique mammals and reptiles, such as Proboscis Monkey Nasalis /arvatus, River Terrapin Batagur baska, Estuarine Crocodile Crocodylus porosus, Bengal Tiger Panthera tigris and the rare Fish-eating Cat Fe/is viverrinus of Southeast Asia. The Sundarbans form the last stronghold of the Bengal Tiger and are widely regarded as the site where tigers are most likely to survive in the wild in the foreseeable future (Hussain & Acharya, 1994).

Coral reefs

About 85% of the world's coral reefs occur in the Asia-Western Pacific region, and unsurprisingly this region also has the most diverse coral reefs in the world in terms of numbers of reef building corals and associated algae, reef fish and marine invertebrates (Groombridge, 1992). The region has some of the world's largest and best developed sea-grass beds, and about half of the approximately 50 sea-grass species known worldwide occur along Asian coasts (den Hartog, 1970). In addition, about one third of the Asian species are endemic. If the Western Pacific is included, the region has two-thirds of all sea-grasses, of which more than half are endemic (den Hartog, 1970). Although there are few sea-grass species, epiphytic algae and marine invertebrates

5

6 GEF


commonly associated with these communities display both high densities and a high diversity. Sea-grass is also the main food for the rare dugong Ougong dugon and certain marine fish and turtles.

Swamp forests

Swamp forests, like other tropical lowland forests, are typically diverse and many support rare and specialised plant, fish, reptile and mammal species. In terms of freshwater ecosystems, the swamp forests of Southeast Asia are not only among the largest and best developed in the world but are also botanically among the most diverse, while exhibiting a high degree of endemism. In Berbak, Sumatra, Indonesia, more than 150 tree species are found in one-tenth of a hectare of swamp forest (Silvius et al., 1984), and with 24 species of palm recorded (Dransfield, 1974; Giesen, 1991) the area also has one of the world's greatest diversity of palms. At another Indonesian wetland, Danau Sentarum in Kalimantan (see the case study on this area, Chapter 3), freshwater lakes and swamp forest cover 80,000 ha 1. Many of the trees and shrubs recorded in this area are endemic. In addition, more than 230 species of freshwater fish have been discovered, including 10 species new to science discovered in the last few years (Kottelat, 1993). Small, black-water swamp forest streams often harbour colourful, endemic fish that have much value as ornamentals and a recent study by Wetlands International - Asia Pacific2 in Peninsular Malaysia revealed several new species with a high value as aquarium fish. It has also recently emerged that peat swamp forests of Sumatra and Kalimantan are very important habitats for the globally threatened Orang Utan Pongo pygmaeus, and may represent some of the last strongholds for this unique species (Meijaard, 1995). Wetlands are also important habitats for the globally threatened Sumatran Rhino Dicerorhinus sumatrensis, which is found in swamp forests of Sumatra (Berbak), Peninsular Malaysia and northeastern Borneo.

Rivers, lakes and associated herbaceous swamps

Gopal (1997) calculated for that for all species of both flora and fauna described in India, about 16% occur in freshwater wetlands; he considers it safe to assume a figure in the order of 15 to 20% in other countries. For some groups, such as fish, it is much higher, and of the known fish species worldwide, 8,400 (40%) are exclusively freshwater species (Gopal, 1997). Certain Asian lakes are important centres of endemism and biodiversity. Lake Baikal is globally significant in terms of its biodiversity and high degree of endemism. About half its 50 fish species are found nowhere else, most of its zooplankton are endemic, and it even has a unique freshwater seal, the Baikal Seal Phoca siberica. The deep, tectonic lakes of Sulawesi, Indonesia (Poso, Matano, Mahalona & Towuti), support fewer species, but these have an even higher degree of endemism, especially among fish and molluscs, of more th.an 80%.

1 This has now been expanded to 137,000 ha by the Indonesian Forestry Department 2 Formerly known as Asian Wetland Bureau.

#ETLANDS

•n1i!·'~'·il'·'to+


BIODIVERSITY OF ASIAN WETLANDS BY TAXONOMIC GROUP

Fish

Worldwide there are about 22,000 fish species, accounting for about half of the world's vertebrates (Groombridge, 1992). Most fish are found in wetlands (rather than in deeper marine waters); 40% are limited to freshwater habitats and the vast majority of the rest are limited to estuaries, coral reefs and shallow coastal waters. About one third of all known freshwater fish occur in Asia, and some river and lake systems are especially rith in species. About 850 fish species are known from the Mekong (Scott, 1989), while more than 230 species have been recorded in the Kapuas Lakes in West Kalimantan. For comparison, there are only about 195 primary freshwater fish species known from all of Europe, 2,000 known from the Amazon, 790 from the Congo (formerly Zaire), 136 from the Nile and about 260 from the Mississippi-Missouri basin (Groombridge, 1992). Asian marine waters are also important for fish biodiversity, as the waters of the northern Indian Ocean and Western Pacific harbour more species than any other region. Many of these are associated with the extensive coral reefs, mangroves and sea-grass beds.

Amphibians

By their very nature most amphibians are totally reliant on wetlands for their survival, especially in their larval stages.· Most of these are freshwater species, but a few (e.g., Rana cancrivora and R.

limnocharis) are also found in brackishwater habitats. In Malaysia there are 158 known amphibian species whilst the Philippines has 63 species, 44% of which are endemic. These figures are even higher for India and Indonesia, which have 206 (53% endemic; Groombridge, 1992) and 290 (35% recorded as endemic in the Indonesian Wetland Database3), respectively. China has 190 species, of which 69% are endemic. Worldwide, only Brazil, Colombia and Ecuador have more amphibian species than Indonesia has.

Reptiles

Several groups of reptiles, notably the crocodilians, turtles and tortoises, are largely aquatic and dependent on wetlands. The largest reptile groups, namely snakes and lizards, are generally terrestrial, although a number of species such as water monitors Varanus spp., water snakes, sea snakes and the Mangrove Snake Boiga dendrophila are adapted to and dependent on wetland habitats.

Birds

Worldwide there are estimated ·to be 9,672 bird species of which about one third are found in Asia. About 1, 100 bird species have been recorded in China (Groombridge, 1992) and 1 ,539 are recorded in Wetlands International - Indonesia Programme's Wetland Database, a figure that on a worldwide scale is surpassed only by Brazil (1,573), Peru (1, 705) and Colombia (1, 721)

3 The Indonesian Wetland Database (WDB) is a computerised database developed in 1990-92 for the Indonesian Directorate General of Forest Protection and Nature Conservation (PHPA), Ministry of Forestry, by the Indonesia Programme of the Asian Wetland Bureau - now Wetlands International - Indonesia Programme. Data entry is a continual process, coordinated with PHPA and implemented by the Wetland Database Unit at Wetlands International - Indonesia Programme in Bogar, W. Java.

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INCREMENTAL COSTS OF WETlAND CONSERVATION

(Groombridge, 1992). Birds are a common feature of wetlands, with many species of migratory

and resident waterbirds confined to these habitats for various stages of .their life-histories. Forested

tropical wetlands such as mangroves, freshwater swamp forests and peat swamp forests get the

best of both worlds by providing a habitat for both waterbirds and species more often associated

with terrestrial habitats. In the wetlands of Berbak Natiorial Park, Sumatra, for instance, 250 bird

species have been recorded to date (WDB, see footnote3), accounting for 41 % of the entire avifauna

of the island. More than 200 Indonesian bird species (about 13% of the total) have been recorded in mangroves (WDB, see footnote3), while on Java van Balen (1989) recorded 167 bird species in

mangrove habitats, which is 33% of the island's avifauna.

Mammals

Mammals are closely associated with Asian wetlands. Several small cats (in particular the Fish-eating

Cat), Otter-civet Cynoga/e benettii and true civets a're found in wetland habitats. Deer, such as

Sambar Cervus unicolor and Rusa Cervus timorensis, and the Water Buffalo Buba/us bubalis thrive

in the swampy grasslands of Southeast Asia. A number of unique species are confined to wetlands.

The Dugong is dependent on the region's sea-grass beds for its survival, and there are several species of dolphin that are restricted to Asian rivers: the Indus River Dolphin Platanista minor of Pakistan

and India, the Gangetic River Dolphin P gangetica of India and Bangladesh, and the Chinese River

Dolphin Lipotes vexillifer or Baiji. Several species such as the Irrawaddy Dolphin Orcael/a brevirostris

are common in major rivers of Southeast Asia or are otherwise restricted to shallow, coastal waters.

Otters are confined to wetlands and the Hairy-nosed Otter Lutra sumatrana of Southeast Asia appears to occur mainly - or perhaps even exclusively - in peat swamp forests. Proboscis Monkeys inhabit

mangroves, and riparian and swamp forests of Borneo, and the world's only species of freshwater

seal, the Baikal Seal, is endemic to Lake Baikal. Wetlands sometimes form the last strongholds for

certain mammals, such as the Bengal Tiger in the Sundarbans, the Sumatran Rhino in swamp forests of Southeast Asia, and the Bornean population of Orang Utan in the island's remaining peat swamp forests.

Invertebrates

While wetlands are rich in plants, fish, birds and amphibians, their main store of biodiversity lies

in the invertebrate world. Invertebrate diversity in wetlands is extremely high, as the majority of

the world's more than 1 million known invertebrate species are either aquatic or predominantly

aquatic. This accounts for the myriad invertebrate groups found in marine habitats, including

sponges, jelly fish, corals, sea-anemones, flat-worms, true worms, molluscs, crustaceans, sea-stars,

sea-urchins and tunicates, as well as those from freshwater habitats such as dragonflies, mayflies,

mosquitoes, water skaters, caddisflies and water beetles. Wetland invertebrate communities have

additional significance, as in many cases the wetland food chain is based on invertebrate biomass.

Much. still awaits to be discovered, even in relatively well-studied parts of Asia such as Hong Kong,

where recent studies have revealed that 10% of marine invertebrates remain undescribed.

\X/ETLANDS ftnjj;hf.jj(.Uf.ii ·


BENEFITING FROM ASIAN WETLANDS

Although wetlands may nurture pest species such as mosquitoes, and may possibly contribute to global warming through methane emissions, overwhelmingly they are seen as providing many benefits to human societies throughout the region and to the global community. Some of these benefits are directly attributable to the biodiversity of these systems, while others can be ascribed to their historical or cultural significance (Davies & Claridge, 1993). Often, however, their relevance is based on the sheer productivity or the functioning of these ecosystems. However, .both productivity and functioning of wetland ecosystems hinge upon the constituents that comprise these systems: the assemblages of species, i.e., their biodiversity. Some of the benefits provided by Asian wetlands at a local or regional scale are highlighted below.

Water supply and storage

Wetlands provide water supplies for individuals, communities, agriculture and industry through direct extraction. Abstraction may be directly from streams and ponds, or from natural swamps such as the North Selangor Peat Swamp Forests (see Chapter 5) and Tasek Bera in Malaysia or Rawa Biru in lrian Jaya. The many thousands of small artificial ponds and dams in India called 'tanks' provide both drinking water and irrigation throughout the long, dry season (Scott, 1989). Lakes provide water for irrigation, for example Lake Ranau in southern Sumatra (Giesen, 1994), or Loktak Lake in Manipur, India (Scott, 1989). Wetlands also recharge underground aquifers, which provide longer term supplies and storage, and, on another level, may supply water to other wetlands lower in the catchment.

Flow regulation

Wetlands act as storage space for excess water and in this way floods may be prevented or controlled. Most floodplains and floodplain lakes play an important role in this respect, such as those along the Ganges-Brahmaputra, Mekong and Irrawaddy rivers. Wetlands such as lakes and floodplain depressions or porous soils such as peat store or soak up excess water which without them would flood downstream areas. In addition, wetland vegetation slows down the flow of flood water, so that it is not all released downstream at the same time. A hydrological model developed for Indonesia's longest river, the Kapuas in West Kalimantan, (Klepper, 1994), demonstrated that the Kapuas lakes absorbed 25% of peak flows, while contributing up to 50% of low water volumes, thus maintaining river flow and facilitating continued river transport.

Prevention of saltwater intrusion

Intrusion of salt water adversely affects many agricultural-crops as well as domestic water supplies. Maintenance of a water table of fresh groundwater is necessary in coastal zones as it actively prevents ·the intrusion of adjacent or deeper salt groundwater. Groundwater extraction for brackishwater fish-ponds and shrimp-ponds in western Sri Lanka has led to widespread saltwater intrusion, and local communities have to travel many kilometres inland to obtain drinking water.

9

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GEF

INCREMENTAL COSTS OF WETZAND CONSERVATION

In addition, river discharges prevent intrusion of salt water upstream, but if freshwater discharge is decreased, salt water may intrude. Abstraction of water from the Ganges at Farakka, India, has led to saltwater intrusion in the dry season as far as 100 km inland, to upstream of Kulna in southwestern Bangladesh.

Protection from natural forces

Coastal and riverine wetlands, particularly forests such as mangroves, prevent erosion of coastlines and river banks by waves, storm surges, and winds. In Bangladesh, areas with a reasonable mangrove belt suffered far less from the floods and storm surges of 1988 and 1991, and replanting campaigns have followed as a result (Khan et al., 1994).

Sediment traps

Wetlands with abundant vegetation slow down the flow of water so that sediments are deposited. Removal of sediments prevents shallowing of waterways, which may lead to flooding and loss of other uses such as transport. On the other hand, sedimentation may lead to the disappearance of certain wetlands, such as shallow, floodplain lakes, which may gradually evolve into swamps and even largely disappear. Large amounts of sediment from the Shillong Plateau in India (with more than 12 m annual rainfall, the world's wettest place) enter the 'Haar' swamps of north-eastern Bangladesh, but are soon deposited and do not enter the major tributaries of the Brahmaputra. Not all systems can cope, however, and the Ogan-Komering rivers of South Sumatra are gradually silting up, shifting flow, anastomozing and increasingly flooding local villages (Giesen & Sukotjo,

1991).

Nutrient traps and toxicant removal

In the same way as described above, nutrients and toxicants can be removed. Jn addition these may also be absorbed by wetland vegetation. In Calcutta, relict riparian wetlands are used to treat the large volumes of (mainly organically polluted) effluents produced by the city, whilst at the same time producing large quantities of fish and vegetables for its inhabitants (Bhattacharyya, 1995).

Natural products

Wetlands provide innumerable natural products for local communities and economically important produce for national economies. In situ examples include timber, fuelwood, peat, fruits, protein in the form of fish, shellfish, eggs, meat and birds, construction materials such as reed, bamboo, rattan, palm fronds, wood, thatch and matting, resins, dyes, poisons and drugs. Ex situ examples include nutrients exported to another site, migratory fish, shrimps, birds and marine mammals. Southeast Asian swamp forests, for example, are important sources of commercial timber, and products such as honey, jelutung (latex of Oyera costulata) and ornamental fish. About 80% of the tree and shrub species of swamp forests of the Danau Sentarum Wildlife Reserve in West Kalimantan are utilised by local communities (Giesen, 1987). Mangroves of the Bangladesh Sundarbans provide a daily income for 300,000 people, and on a yearly basis it is estimated that

WETLANDS "~1id;l}f.ijl.i}dl

BIODIVERSITY AND THE GLOBAL SIGNfFICANCE OF ASIAN WETLANDS

about 1 million people use these forests (Hussain & Acharya, 1994). In Vietnam, on a 3,350 ha mud-flat in the Cua Day estuary, 1,600 tonnes of bivalves and 30 tonnes of Mangrove Crabs Scylla

serrata are harvested manually each year, involving a labour input of 200,000 person days (Nielsen & Pedersen, pers. comm.).

Energy production

Wetlands can provide hydroelectricity, peat, fuelwood, dung, dried plants etc. to meet local and national energy demands. Hydroelectric dams have been constructed or planned at the outlets of nine of Indonesia's 35 major lakes (Giesen, 1994), while mangrove wood or charcoal is often the major source of fuel for local communities in most coastal villages near mangrove forests.

Water transport

Rivers, lakes and coastal backwaters provide some of the most important transport routes for moving goods and people in many Asian countries. In Bangladesh, river transport is the only transportation mode in much of the country during the summer monsoon.

Gene bank

The use of genes from wild species to improve yields and disease resistance in agricultural crops is an important benefit from wetland species. Additionally, in wildlife management and conservation, access to the wild gene pool is needed. About 70,000 strains of rice (Oryza sativa and related species) are recognised (Gopal, 1997), and many of these are known only from their natural, wetland habitats.

Recreation and tourism benefits

Wetlands provide areas of rich biodiversity or outstanding beauty and resources such as coral reefs, fish and birds for pleasure or pursuit.

Socio-cultural significance

Apart from landscapes of aesthetic beauty, wetlands are also associated with religious and spiritual beliefs and activities, and they provide wilderness areas and historical sites of significance. Lake Batur in Bali is sacred to the island's largely Hindu population, and ceremonies are carried out annually. Likewise, the Ganges has a strong religious value to Hindus of India and Bangladesh, who bathe in its waters during annual ceremonies.

Research and education benefits

Many wetlands provide valuable areas for scientific research, type localities and education resources.

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12 GEF


Maintenance of existing processes and natural systems

In effect, wetlands frequently contribute to ecological, geomorphological or geological processes and systems. Local climate and rainfall characteristics are often influenced by natural wetlands.

Carbon sinks

Wetlands provide a global sink by converting inorganic atmospheric carbon (carbon dioxide) to organic carbon by plant photosynthesis. In many wetlands, particularly peat bogs and peat swamp forests, carbon remains sequestered in the peat soil, often for many thousands of years and in some cases for millions of years, resulting in the formation of fossil fuels such as coal. However, when peat soils are drained, burned or mined, or when peat swamps are disturbed, this wetland benefit is lost and the wetland releases carbon to the atmosphere where it contributes to the threat of global warming.

THREATS TO ASIAN WETLANDS

Despite their high biodiversity and their cultural and historical importance for man, wetlands throughout Asia remain under threat. A recent analysis showed that of almost a thousand wetlands considered to be of international importance for socio-economic or biodiversity values in Asia, as many as 56% were considered to be moderately or seriously threatened, while only 15% were not threatened. In addition, only about 10% of these internationally important wetlands are currently totally protected, while a further 15% are partially protected (Scott & Poole, 1989). The loss of wetlands has not been even throughout the region. In the lndomalayan realm, for instance,

. 54.6% of all wetlands and 55.2% of all mangroves have disappeared, mainly because of drainage and conversion (WRI, 1990). Bangladesh, on the other hand, still has vast wetlands (indeed, twothirds of the country is wetland), but virtually all of these have secondary vegetation, much affected by a long period of use by local people. Habitat changes and loss affect biodiversity, and wetlands are often most affected. To quote Denny (1994):

"It is pertinent to note that 66 percent of the continental extinctions are aquatic taxa, which highlights the exceptional sensitivity of the wetland and freshwater ecosystems."

Overharvesting

Wetlands are often so easily affected because in many instances their full values are not considered during development processes. The most common threats to wetlands include overharvesting of resources such as fish, shellfish and timber, pollution, and reclamation for or conversion to agriculture, aquaculture and urban development. In the Philippines, 70% of the former 450,000 ha of mangroves have been converted for aquaculture, mainly since 1968 (Davies et al., 1990), while mangroves in Bangladesh, Sri Lanka, Thailand, Indonesia and Cambodia are currently undergoing rapid conversion.

Deforestation

#ETLANDS ru11;;1;r.111.JJt.11


Deforestation is one of the main changes occurring in the region, and over 70% of the region's natural vegetation cover has been lost and much of what remains is heavily degraded (MacKinnon, 1995). In many Asian countries, more than half of the deforestation has occurred during the past two or three decades. Currently, less than 5% of all lowland forests remain in the Philippines, while in' Pakistan and Bangladesh only 3 % and 6%, respectively, remain of all forests (Braatz et al .. 1992). Deforestation affects wetlands in different ways. First, as many wetlands are forested, clearing leads to direct degradation. Of all the peat swamp forests of Sumatra, for instance, only 9% remained intact as forest by the late 1980s (Giesen, 1993), while in Bangladesh only minute vestiges of the formerly' vast swamp forests remain (Khan et al .. 1994). Peninsular Malaysia had lost 90% of its freshwater swamp forests by 1986, while more than 70% of the original 1 million ha of peat swamp forest had been lost by 1993 (Malaysian Forestry Department, 1993). Indirectly, deforestation affects wetlands by enhancing erosion and increasing rates of sedimentation. Vast amounts of silt are transported by many Asian rivers (e.g., Ganges-Brahmaputra, Mekong), and the Yellow River in China is regarded as the world's greatest earth mover, its river bed rising annually by 75-150 mm, giving rise to increasingly disastrous flooding (Scott, 1989) while creating new tidal wetlands at its mouth. Many lakes and reservoirs in the region are affected by siltation, and some are silting up at alarming rates (e.g., Tondano in North Sulawesi, Indonesia, at 20 cm per year; Whitten et al .. 1987).

Deforestation has direct and significant effects on biodiversity. As forested wetlands are cleared, habitats are lost - or at least fragmented, degraded and reduced in size. This affects species that require mature forest stands (e.g., epiphytes, birds nesting in hollow trees and arboreal species) or large areas of intact forest (e.g .. large mammals, trees occurring at low densities) for their survival.

·it is hardly surprising therefore that species such as the White-winged Duck Cairina scutulata and Storm's Stork Ciconia stormi are on the brink of extinction, as both require mature forest stands

for nesting, and occur naturally at low densities. As deforestation continues, species endemic to these habitats are subsequently lost. The endemic Javan Lapwing Hoplopterus (Vanellus) macropterus, for example, has become extinct in recent decades, after mangroves and freshwater swamp forests that used to line Java's north coast were converted to rice fields and fish ponds: Siltation, often the result of deforestation, affects all forms of wetland biota. For example, in the formerly very rich Lake Chilka4 , India's largest lagoon and first Ramsar site, siltation and salinity changes following deforestation of the catchment led to the disappearance of numerous aquatic species. The most affected taxa were fish, molluscs and sponges, but the effects were not the same for all taxa, as aquatic weeds in Lake Chi\ka have proliferated and aquatic bird life seems to

be stable, if not increasing (Ram et al .. 1994).

logging

Unsustainable logging practices still threaten vast areas of forest and their biodiversity. The case

study on the North Selangor Peat Swamp Forests (Chapter 5) provides an excellent example of how

unnecessary degradation and loss of unique species such as the Sumatran Rhinoceros can be avoided with fairly simple measures at low incremental cost.

4 Alternative spelling: Lake Chilika.

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INCREMENTAL COSTS OF WETLAND CONSERVA710N

Poor conservation

There are a number of issues that complicate the conservation of Asian wetlands. First, more than 80% of all remaining wetlands of international importance in South, East, and Southeast Asia (120 million ha excluding rice-fields) are in just seven countries: Bangladesh, China, India, Indonesia, Myanmar, Papua New Guinea and Vietnam (Scott, 1989), all of which, except India and Myanmar, have standards of law enforcement (pertaining to the environment) that are classified by MacKinnon (1995) as "poor." Second, conservation of marine habitats and wetlands lags far behind efforts to conserve forests, and is complicated by special problems of ownership, land use and control (MacKinnon, 1995). The case study on Danau Sentarum Wildlife Reserve (Chapter 3) highlights the dilemmas faced by authorities responsible for enforcing protection, such as local community access rights to land and water resources.

Population

Most of the threats to wetlands are linked to the pressures of increasing human populations on biological resources. Because wetlands are very productive habitats, much of the human population is concentrated in and around them and most people depend directly or indirectly on wetlands' biological resources. The Wiawi Marine Wetlands case study (Chapter 4) shows the intricacies of multiple use of marine resources such as marine turtles, reef fish and ornamental shells, and the threat of biodiversity loss that emerges from unsustainable use. If wetlands ceased to exist, how would the present human populations survive and how much greater would the pressure be on non-wetland biological resources? These are the kinds of issues that need to be raised when considering the value of wetlands and the incremental costs of their conservation.

INCREMENTAL COST ANALYSIS AS A TOOL IN .WETLAND CONSERVATION

In simple terms, the incremental cost is the additional cost of choosing the biodiversity-friendly means of achieving a development goal rather than the lowest cost means. (King, 1997; see Chapter 2.) Analysis of incremental costs is a tool for wetland conservation. As seen above, there are so many benefits derived from Asian wetlands, either directly or indirectly, that in many if not most instances it would be more advantageous for countries to invest in protection of these important natural resources, either for strict conservation purposes or development based on sustainable use. A study of the incremental costs of biodiversity conservation in these cases would make this clear and help to identify cost-effective options for the redirection of funding to reduce the overall costs of development.

However, as the four case studies indicate, the short-term hurdle to be overcome may be too great to off-set the perceived long-term benefits, and as a result interventions remain unfunded.

In some cases, these incremental costs can be financed by international sources. At the United Nations Conference on Environment and Development (UNCED) in Rio de Janeiro in 1992, the developed world agreed in. the Convention on Biological Diversity to finance the "agreed full

#ETLANDS llJdi-V'·iU·Hr.11


incremental cost" for implementing certain actions in developing countries to safeguard biodiversity

of global significqnce (Pearce & Barrett, 1994).

The Global Environment Facility (GEF) operates the financial mechanism of the convention in the interim and has mobilised funds for the incremental costs in four focal areas: Biodiversity, Climate

Change, International Waters and Ozone Depletion. Wetland biodiversity has received particular

attention because of the significance of these areas, both for conservation and as a resource.

Two principles are important with regard to the financing of the incremental costs. First, there must be global significance in the biodiversity being conserved. As indicated above, the biodiversity of

Asia's wetlands is high and there are large numbers of unique species and sites. Forested wetlands

and coral reefs stand out for their particular significance, but it is easy to detect numerous

conservation 'hot spots', either countries such as Indonesia, China and Myanm·ar, or particular sites

such as Lake Baikal in Russia and the Matano-Towuti lake system in Sulawesi, Indonesia.- ·

Second, the cost of the intervention proposed for the conservation of the wetland biodiversity must be more than the 'baseline' situation. In practice, this means that national sou.rces of financing

should be used to conserve biodiversity to the extent that this produces national benefits through

which costs can be recovered.

In the immediate future, GEF funds will remain a very important tool for safeguarding the global environment in general and Asian wetlands ·in particular. In the long run, however, it is hoped that

national governments will realise the real benefits to be gained by conservation and sustaina.ble

utilisation of the region's vast storehouse of wetland biodiversity.

REFERENCES

Bhattacharyya, S. (1995) - East Calcutta Wetlands: A relict riparian system utilized for waste recycling. In: J.R. Howes (ed.), Conservation and Sustainable Use of Floodplain Wetlands. Proceedings of the Workshop on the Conservation and Sustainable Use of Floodplain

Wetlands, Calcutta, December 1993; pp .. 81-83. Asian We.tland Bureau, Kuala Lumpur, Publ.

No. 113, 123 pp. Braatz, S., Davis, G., Shen, S. & Rees, C. (1992) - Conserving Biological Diversity A Strategy for

Protected Areas in the Asia Pacific Region. World Bank, Washington D.C., Technical Paper

No. 193, 66 pp.

Chaudhuri, A. B. & Choudhury, A. (1994) - Mangroves of the Sundarbans. Volume One: India. IUCN Wetlands Programme, IUCN, Bangkok, Thailand, 247 pp. ·

Davies, J. & Claridge, G. (1993) - Wetland Benefits. The potential for wetlands to support and maintain development. AWB, IWRB & WA, Kuala Lumpur, xi + 45 pp.

Davies, J., Magsalay, P.M., Rigor, R., Mapalo, A. & Gonzales, H. (1990) - A Directory of Philippine Wetlands; A Preliminary Compilation of Information on Wetlands of the Philippines. Vols. 1

& 2. Asian Wetland Bureau, Philippines, 230 + 444 pp.

den Hartog, C. (1970) - Sea-grasses of the World. North Holland Publishing Company, Amsterdam

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16 GEF


& London, 275 pp. Denny, P. (1994) - Biodiversity and wetlands. Wetlands, Ecology and Management 3: 55-61. Dransfield, J. (1974) - Notes on the palm flora of central Sumatra. Reinwardtia 8(4): 519-531. Giesen, W. (1987) - Danau Sentarum Wildlife Reserve: Inventory, ecology and management

guidelines. WWF/PHPA, Bogor, 284 pp. Giesen, W. (1991) - Berbak Wildlife Reserve, Jambi. Sumatra Wetlands Project, Final Draft Survey

Report No. 13. PHPA/Asian Wetland Bureau, Bogor, Indonesia, 26 pp.

Giesen, W. (1993) - Striking a balance between development and conservation in Sumatra's peatand freshwater swamps. Presented at 'Technical Pre-seminar on Lowlands Development and

Management', Min. of Public Works & JICA, Jakarta, 28-29 September 1993, 19 pp.

Giesen, W. (1994) - Indonesia's major freshwater lakes: a review of current knowledge, development processes and threats. Presented at the Meeting on Conservation and

Management of Tropical Inland Waters: Problems, Solutions and Prospects, Hong Kong 5-9 September 1991. Mitt. int. Ver. Limnol. 24: 115-128.

Giesen, W. & Sukotjo (1991) - Conservation and Management of the Ogan-Komering Lebaks, ·South Sumatra. Sumatra Wetlands Project, Final Draft Survey Report No. 8. PHPA/Asian

Wetland Bureau, Bogor, Indonesia.

Giesen, W., Wulffraat, S., Scholten, L. & Zieren, M. (1997) - Field Guide to the Plants of Indonesia's Mangroves. Samara Publishers, London. Wetlands International - Indonesia Programme and

ISME, Samara Press, Cardigan, UK, 450 pp. (in press) Gopal, B. (1997) - Wetlands and Biodiversity: how to kill two birds with one stone. In: W. Giesen,

(ed.), Wetlands, Biodiversity and Development. Proceedings of Workshop 2 of the International Conference on Wetlands and Development, Kuala Lumpur, Malaysia, 9c 13 October 1995.

Wetlands International, Kua.la Lumpur.

Groombridge, B. (ed.) (1992) - Global Biodiversity. Status of the Earth's Living Resources. Chapman & Hall, 585 pp.

Hussain, Z. & Acharya, G. (1994)- Mangroves of the Sundarbans. Volume tWo: Bangladesh. IUCN,

Gland, Switzerland/Cambridge, U.K., 257 pp. Khan, M.S., Haq, E., Huq, S., Rahman, A.A.. Rashid, S.M.A. & Ahmed, H. (eds.) (1994) - Wetlands

of Bangladesh. Bangladesh Centre for Advanced Studies & Nature Conservation Movement, Dhaka, 91 pp.

King, K. (1997)- ·Incremental costs of conserving wetland biodiversity. In: W. Giesen, (ed.), Wetlands,

Biodiversity and Development. Proceedings of Workshop 2 of the International Conference

on Wetlands and Development, Kuala Lumpur, Malaysia, 9-13 October 1995. Wetlands

International, Kuala Lumpur.

Klepper, 0. (1994) - A Hydrological Model of the Upper Kapuas River and the Lake Sentarum

Wildlife Reserve. Draft Report, Asian Wetland Bureau - Indonesia & PHPA, Bogor, 48 pp.

Kottelat, M. (1993) - Technical report on the fishes of Danau Sentarum Wildlife Reserve and the

Kapuas Lakes area, Kalimantan Barat, Indonesia. Prepared for Asian Wetland Bureau, Bogor,

Indonesia, 97 pp.

MacKinnon, J. (1995)- Analytical status report of biodiversity conservation in the Asia-Pacific region.

In: J.A. McNeely (ed.), Biodiversity Conservation in the Asia and Pacific Region. Constraints

and opportunities. Proc. Regional Conf., Manila, 6-8 June 1994. ADB, Manila, pp. 49-106. Malaysian Forestry Department Peninsular Malaysia (1993) - Forestry Statistics Peninsular Malaysia.

Kuala Lumpur.

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Maxey, ·C. & Lutz, J. (eds.)(1994) - China. Biodiversity Conservation Action Plan. GEF/UNDP & National Environmental Protection Agency, Beijing, 106 pp.

Meijaard, E. (1995) - The Importance of Swamp Forest for the Conservation of Orang Utan (Pongo pygmaeus) in Kalimantan, Indonesia. Paper presented at the International Symposium on

the Biodiversity, Environmental Importance and Sustainability of Tropical Peat and Peatlands.

Palangkaraya, Central Kalimantan, Indonesia; September 4-8, 1995, 14 pp.

Ogino, K. & Chihara, M. (1988) - Biological system of mangroves. A report of East Indonesian

Mangrove Expedition 1986. Ehime University, Japan, 181 pp.

Pearce, D. & Barrett, S. (1994) - Incremental costs and biodiversity conservation. GEF Working

Paper, GEF - HP3.

Ram, R.N., Rao, K.V.R. & Ghosh, A. (1994) - Ramsar sites of India. Chilika Lake, Orissa. World

Wide Fund for Nature, India, New Delhi, 69 pp.

Saenger, P., Hegerl, E.J. & Davie, J.D.S. (1983) - Global status of mangrove ecosystems. IUCN

Commission on Ecology Papers No. 3, 88 pp.

Scott, D.A. (1989) - A Directory of Asian Wetlands. IUCN, The World Conservation Union, Gland,

Switzerland and Cambridge, U .K., xiv & 1181 pp., 33 maps. Scott, D.A. & Poole, C.M. (1989) - A Status Overview of Asian Wetlands. Based on the Directory

of Asian Wetlands. IUCN/Asian Wetland Bureau, Kuala Lumpur, 140 pp.

Silvius, M.J., Simons, H.W. & Verheugt, W.J.M. (1984) - Soils, Vegetation, Fauna and Nature Conservation of the Berbak Game Reserve, Sumatra, Indonesia. RIN Contributions to

Research and Management of Natural Resources, Arnhem, The Netherlands, 146 & xv pp. Singh, S. (1995) - The Biological Value of the Asia-Pacific Region. In: J.A. McNeely (ed.), Biodiversity

Conservation in the Asia and Pacific Region. Constraints and opportunities. Proc. Regional

Conf., Manila, 6-8 June 1994. ADB, Manila, pp. 35-48.

Thurairaja, V. (1994) - Coastal resources development options in the Southeast Asia and Pacific regions: Economic valuation methodologies and applications in mangrove development.

Maritime Studies 79: 1-13. van Balen, S. (1989) - The terrestrial mangrove birds of Java. In: I. Soerianegara et al. (eds.), Proc.

Symp. on Mangrove Management: its ecological and economic considerations, Bogar, Indonesia, 9-11 August 1988. BIOTROP Special Publication No. 37, pp. 193-205.

Whitmore, TC. (1984) - Tropical Rain Forests of the Far East. 2nd Edition. Clarendon Press, Oxford,

U.K., xvi & 352 pp. Whitten, A.J., Mustafa, M. & Henderson, G.S. (1987) - Ecology of Sulawesi. Gajah Mada University

Press, Yogyakarta, Indonesia, 777 pp.

WRI (World Resources Institute) (1990) - World Resources 1990-91. Oxford University Press, New

York.

17

CHAPTER 2

. ' :

INCREMENTAL COSTS OF CONSERVING WETLAND BIODIVERSITY

Kenneth King

Although the concept of incremental cost has long been used in economics, finance and business to help decisio_n-makers choose between alternatives, it is only since Agenda 21, the Convention on Biological Diversity, and the Global Environment Facility gave it prominence that it has been systematically applied to environmental decision-making. Here the motivation is mainly to· provide a basis for international financial transfers that would compensate developing countries forthe extra burden that protection of the global environment would place on their economic development. There is an urgent need for a measure of this extra burden, but despite the essential simplicity of the incremental cost idea, there have been some unique analytical and practical challenges fn its application, particularly for biodiversity protection. The case studies in this volume were selected to confront these particular challenges, and the results show how they were addressed. Although the original motivation for incremental cost analysis was to meet GEF financing requirements, the analysis is also a useful reinforcement for the incremental reasoning that · underlies effective prnject design, integrates biodiversity concerns into development, facilitates stakeholder participation, suggests· new ways to finance environmental action, and promotes international cooperation for the protection of global biodiversity.

INTRODUCTION

An understanding of the concept of incremental cost is important for protecting biodiversity and promoting sustainable development. This is true not just because incremental cost is formally required as the basis upon which international financial transfers must be made for the protection of globally important biodiversity but, more importantly, because it promotes a strategic approach for effective action, integration with sustainable development, and international cooperation.

Incremental cost"is a well-established concept. It is the cost of a decision to do one thing instead of another. In particular, there is an incremental cost for protecting the biodiversity in a wetland. Here, it is the additional cost, relative to a baseline c·ourse of action affecting the wetland, of a decision to adopt another course of action instead, namely one that not only meets the original

national priorities but also protects biodiversity.

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There are cases where the national benefit of protecting biodiversity is less than the cost of doing so. Protecting biodiversity in such a case would impose an additional burden on the development budgets. This is why, in agreed cases, the global community is willing to finance the incremental costs incurred by developing countries. Recognising this, the Earth Summit called on GEF, which mobilises additional resourc~s to cover global environmental benefits, to finance the agreed incremental costs of relevant activities under Agenda 21 1. The restructured GEF does so2, and in relation to biodiversity, follows the requirements of the Convention on Biological Diversity3.

Wetlands International - Asia Pacific and the Global Environment Facility (GEF) collaborated in a series of case studies to apply the concept of incremental cost to biodiversity conservation in wetland areas in the Asia and Pacific r~gion. Although in all the case studies biodiversity of global significance is at risk, the sites were selected on the basis of the methodological issues to which they were likely to give rise and the availability of data and skilled researchers in the region to undertake the field work and analysis - not for the priority of their biodiversity nor for the urgency of the threat, as would be the case in actual projects proposed for funding. The main purpose was to demonstrate a practical approach to incremental cost estimation in diverse settings.

CASE STUDY SITES

The following case study sites were selected from many potential sites:

Danau Sentarum Wildlife Reserve

The Danau Sentarum Wildlife Reserve (DSWR) in West Kalimantan, Indonesia, was selected as an example of the costs of making the transition to sustainable development through addressing underlying causes in a situation that is constrained by a number social factors. The transition would help protect a unique ecosystem that has evolved on an expansive floodplain under the selective pressure of dramatic fluctuations in annual rainfall, an area that is rich in biodiversity with many endemic species of plants and fish. The broad development goals could be derived from the Basic Forestry Act of 1967, which sets out the role and function of wildlife reserves and the need for sustainable management. But the attainment of these goals is limited because of unofficial settlement, communal differences in livelihood, and commercial pressures. These, through proximate causes such as burning, fish poisoning, and overharvesting, are depleting the natural capital and threatening the diversity of biological resources. Sustainable development will be possible only if underlying causes of poverty are also addressed, which means developing sustainable livelihoods that do not encourage overharvesting. Julia Aglionby, in Chapter 3, looks at the incremental costs to doing this and the limits to recovering costs from beneficiaries.

1 Agenda 21, chapter 33, paragraph 33.16 (a) (iii) 2 GEF Instrument, paragraph 2. (GEF, 1994) 3 Convention on Biological Diversity, Article 20.2.

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'Bil9;'fril'·'i'·'i INCREMENTAL COSTS OF CONSERVING WETlAND BIODIVERSITY

Wiawi Marine Wetlands

The Wiawi Marine Wetlands (WMW), on the island of Malekula, Vanuatu, were also selected as a case study on the incremental cost of making the transition to the sustainable use of biological resources in a situation where economic activities in the surrounding area also threaten the ecosystem. In this study, the biological resources are several endangered species of marine turtle that are under threat from overharvesting and habitat destruction. This case concerns the removal not only of barriers to sustainable development but also of the causes of habitat loss - in this case the forestry practices that would lead to erosion, siltation of the bay, and consequent harm to the coral on which the turtles depend. The costs of protection must be estimated in a system that is wide enough to incorporate all the causes identified, including those in the surrounding productive landscape. This case study, undertaken by Valentine Thurairaja, is described in Chapter 4.

North Selangor Peat Swamp Forests

The North Selangor Peat Swamp Forests (NSPSF) site, on the west coast of Peninsular Malaysia, was selected because it shows the importance of cost savings associated with conservation activities and because studies at the site over many years have yielded a rich trove of data: This site is important in its own right and also as a crucial support system for other ecosystems. It is a stock area for fish, and the northeast corner is part of the habitat for the Sumatran Rhinoceros Dicerorhinus sumatrensis. The case study, apart from being a useful demonstration of incremental cost ideas, might therefore be able to support the preparation of a project to protect the rhinoceros. The broad development goals for the site could be inferred from the National Forestry Act, under which the NSPSF are set aside as production forest to be managed for sustained timber yield, and from the aims of the adjacent rice producing scheme that was consolidated in 1978 with World Bank support. At that time the swamp was recognised as vital to the viability of the agricultural scheme because of the role it played in water storage, water supply, flood mitigation and regulation of the ground water table against saline intrusion. Is it now possible to adjust the way the NSPSF are logged in order to protect global biodiversity while still respecting these broad development goals? If so, what incremental cost would the adjustment place on economic development? This case study is presented by Kanta Kumari in Chapter 5.

Kuala Selangor Nature Park ··

The fourth case study site, the Kuala Selangor Nature Park (KSNP), Malaysia, was selected as an interesting example of a retrospective analysis and of the opportunity costs of land. The KSNP is part of.an extensive coastal belt of mangrove forest and intertidal mudflats on the west coast of Peninsular Malaysia. From the global environmental point of view, it is important as the link in the migratory chain throughout Sout1'1east Asia for waders and as shelters for other wildlife such as shorebirds and Silvered Leaf Monkey Presbytis cristata. The study is a retrospective look at a decision in 1987 to- locate housing elsewhere than on the site and at the consequential changes in the productive landscape adjacent to the park. Malaysia may have incurred incremental costs as a result cif this decision, although implicitly it would seem that these would have been less than the perceived but intangible domestic benefits from conservation, recreation, ecotourism, scientific

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study and education that followed after the park was gazetted. Further incremental costs for specifically global environmental benefits have yet to be incurred for actions that go beyond this baseline to introduce the threatened Milky Stork Mycteria cinerea onto the site for ex situ protection. This case study is reported by Mohd. Shahwahid in Chapter 6.

APPROACH

The GEF (GEF, 1996) incremental costs approach was used in the case studies. In this approach, the concept of incremental cost is adapted from its well-established context of project economic analysis and business planning to the global environmental arena where its use is mandated by international environmental conventions - including the Convention on Biological Diversity - and by the GEF. The approach is used to estimate incremental costs that are an input to project design, selection and financing (King, 1994).

In its simplest form, the estimate of incremental cost can be made from a standard matrix of increments such as that shown in Table 1.

Table 1: Matrix of Increments

Global Benefits

Domestic Benefits

Costs

Baseline

Threaten (or destroy) the wetland biodiversity

DB

CB

Alternative

Remove the threat

DB

CA

Increment (A-B)

Preserve the wetland biodiversity

0 (When the same development objective is met)

IC= CA- CB

The interpretation of this matrix is straightforward. We start with ·the currently expected future course of events B, termed the 'baseline' (or 'baseline strategy' if it is really a conscious plan). This involves a technically feasible, economic, environmentally and s0cially acceptable, and financeable development path. The link to national priorities is thus direct. We suppose that the country proposes an alternative way A to meet essentially the same national priorities, but in a manner that simultaneously preserves biodiversity as well, even though. this is not domestically of high enough priority to protect. The cost of this alternative is CA. We generally suppose that CA exceeds CB because the country is expected to meet its own national priorities in the least costly way; had

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'til9;'i'·'''·'i'·'I INCREMENTAL COSTS OF CONSERVING WETLAND BIODIVERSITY

CA been less than CB one would normally suppose that the country would prefer this course of action right from the beginning.

The case studies test whether this approach can be applied practically and usefully in the context of biodiversity, despite many assertions to the contrary (mainly on rather general grounds that 'biodiversity benefits are special' or that 'there is no point where domestic benefits stop and global benefits begin'). This test is made by demonstration, and several conceptual and practical challenges had been expected. For example, would it be possible to devise a reasonable, coherent, plausible baseline B? How would one accommodate the fact that in many proposed interventions A, the domestic benefits are hard to keep identical to those obtainable in B? How can one use estimates of incremental cost when the costs and cost savings in many biodiversity activities accrue to different actors?

RESULTS

Applying the incremental cost approach and using the results was always expected to be more difficult in biodiversity than in other fields of global environmental protection. Incremental cost studies of climate change mitigation, for example, can make use of baselines that have already been established for other purposes, such as for energy planning. In that field, incremental methodologies can make use of well-developed tools for power system planning and project cost-benefit analysis. Furthermore, there are only a small number of sophisticated, often centralised, organisations to deal with - energy utilities, government agencies promoting renewable energy, and large private sector suppliers. Unfortunately, the advantages in the climate change field are generally absent in the field of biodiversity conservation. Here, baselines still need to be constructed from national plans, the system needs to include many different activities and actors, and methodologies need to be developed or adapted on a caseby-case basis. Ways need to be found for dealing with multiple decentralised affected groups, such as community groups, non-government organisations, the diffuse agricultural community and. affected utilities such as water suppliers. Biodiversity conservation is linked not only to the large productive sectors of the economy - a feature it shares with other global environmental protection - but also to indigenous groups, subsistence farmers and conservation constituencies.

The results of the case studies highlight special challenges concerning baselines, alternatives, system boundaries, domestic benefits and costs.

BASELINES

Implementability

A baseline must, at a m1n1mum, be internally consistent, technically feasible, financially affordable and environmentally and socially acceptable. It should, in short, be a plausible outcome

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in the absence of global environmental considerations. The DSWR study raises precisely this issue: the plausibility of the baseline. So it makes a realistic assessment of the implementability of development goals and plans for the area. There are several 'reality checks' that could be applied in situations like this. One of the most potent is just transparency: a comprehensive elaboration of the baseline. Often when the full consequences of an assertion are spelled out, inconsistencies and unforeseen environmental and social consequences become apparent. A second check is on the availability of financial resources for the baseline activities - this is often a corrective for overambitious targets. In the productive area of the economy there are some corrective incentives for the proposing country: an overambitious baseline would require the mobilising of greater domestic resources to pay for non-incremental costs, while an unambitious plan could result in incremental costs that are more negative. The more difficult area is the smaller one that encompasses pure conservation activities, where it is difficult to know what the government would be willing to pay for 'baseline' nature protection apart from precedent. The KSNP case explores this.

Suboptimality

The NSPSF and DSWR cases both describe expected trends that are economically suboptimal. The first analytical challenge concerns the transition from this expected trend to domestic resource sustainability, a transition that would be economic for the country. While such a transition would help to protect biodiversity, it might be insufficient. In NSPSF, for example, it would be necessary to go beyond the adoption of sustainable logging in order to protect the habitat of the Sumatran Rhinoceros, and in DSWR it would be necessary to forego higher fish yields obtainable from exotic species in order to protect endemic fish species. Two analytical approaches to this situation have been suggested. The first is to expand the analysis to include three courses of action: the expected course of events or 'current trends' (T), the sustainable development 'baseline' (B), and the globally environmentally friendly 'alternative' (A). Moving from T to B would have negative incremental costs, since B is the most desirable outcome. However we see later that the incremental cost analysis can highlight both the barriers to and the financial requirements of the transition. Moving from B to A will involve positive incremental costs. The WMW case, for example, explicitly looks at the current trends and the difficulties of moving to a baseline defined in terms of sustainable development of specific biological resources to the extent these are important economically (as commercial or subsistence resources) and only then at the costs of making a further investment in the diversity of those resources, specifically through a turtle conservation programme. The second approach is to propose a realistic baseline that goes beyond the trend, the expected course, or the business-as-usual outcome but falls short of economic perfection in recognitio.n of financial, institutional or

political constraints. This approach will be open to similar interpretations, because the overall incremental cost would be a mixture of negative incremental costs (reflecting the increased benefits of protecting natural capital) and positive incremental costs. The DSWR case takes this approach, and defines the baseline in terms of a continuation of trends including conservation efforts.

ALTERNATIVES

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Just as the baseline identifies the threats to biodiversity or the actual causes of current loss, so the alternative should address the threats and remove the causes. Few projects to date have actually made this link explicit; capacity-building and enforcement measures are often offered as the universal solutions irrespective of the specific causative factors and the agents of change. One of the main benefits of incremental cost analysis is that it requires that this link be made explicit.

Linking to the cause of biodiversity loss

There are certain general features desired for all proposed alternatives: they should address causes and threats, treat these comprehensively and achieve the global environmental objective at least cost.The NSPSF case is particularly useful in demonstrating all of these, addressing the threat posed by both the harvest regime and logging method and seeking, from alternative solutions, the one that is least cost while still meeting safety requirements (tramline method with reconditioned trams). In both DSWR and WMW the alternatives could be linked to the causes they purport to remove, e.g., alternative livelihoods to the underlying cause, poverty, of biodiversity loss in DSWR and to overharvesting of turtles and unsustainable forest management in WMW. In nature conservation projects, it is often a competing use of land that threatens biodiversity loss: in the KSNP case, the alternative is an alternative site to the one that was in fact reserved as a nature park, and it is this choice that imposed incremental costs on residents. Future costs in this case will be related to an alternative comprising specific measures for the reintroduction and ex situ management of the Milky Stork.

SYSTEM BOUNDARIES

The analysis should capture the main causes and impacts so it is sometimes necessary to expand the system boundary beyond the ecological area under immediate threat to include these.

Social causes

The surrounding areas are important in the DSWR case because of the open access to the resources from people outside the reserve and in the WMW case because marine resources are harvested by villages neighbouring Wiawi. The system boundaries in these case were wide enough to include these causes.

Economic caus.es

The WMW case also shows why the system boundary may need to be expanded beyond the project area to encompass an economic sector as well: in this £ase forestry, a threat identified in the baseline. Distant forestry practices, even if sustainable from the point of view of forest management, may not be sufficient to prevent the erosion that threatens the ecosystem with siltation. Forest management must be included within the system analysed, because these causes must also be addressed in the alternative. This case shows clearly why it is often insufficient to limit oneself to

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considering the ecosystem, the protected area and the related 'conservation' activities: there is a need to consider economic activities impinging on the ecosystem as well.

Economic impacts

The NSPSF case shows why the system boundary may need to be expanded beyond the project area to take account of costs savings that result from adoption of the alternative. In this case, protection of the wetland generates benefits for the adjacent rice-growing areas and the avoided costs need to be taken ·into account. Ultimately, a sustainable solution that involves some cofinancing from beneficiaries may be suggested by this analysis. The KSNP case expands the system boundary in perhaps the most surprising 'non-conservation' way. Although the objective is conservation in the nature park and it is necessary to look at costs there, the real costs of the decision to preserve the land as a nature park also relate to the alternative: the activities that perforce now take place elsewhere. In this case, the majority of the incremental costs happen to be the increased transport costs attributed to residents travelling from the township that would otherwise have been at the park site!

DOMESTIC BENEFITS

Of all the elements in the analysis, the role of domestic benefits is perhaps least well appreciated. The overriding reason for identifying domestic benefits in the incremental cost approach is to check that proposed alternative strategies do not compromise the country's development but deliver at least the same level of domestic benefits expected from the baseline course of action. This requires that the benefits of A and B be identified and matched.

Valuation and monetisation

It may be necessary to value domestic benefits in order to show that the baseline is economically rational, but otherwise valuation and monetisation are not relevant to the incremental cost estimation. This is actually a great advantage, because theoretical disputes and uncertainties about value can spoil the chances of reaching reasonable agreements about cost sharing. Incremental cost analysis, by remaining at the level of cost and cost savings, is expressed in ways that make changes in budget priorities understandable and negotiable among stakeholders. Where an important domestic benefit is identified, the approach is to expand the system boundary and to identify avoided costs in the actual setting rather than to use a benefit valuation technique. The NSPSF case shows this well: the benefit of water purity is treated in terms of the future costs of purification that can be avoided through the investment in forest.

Domestic benefits constant

Where the alternative delivers essentially the same level of benefits, the analysis of the costs is straightforward. In the KSNP case, for example, it does appear that both courses of action would have delivered comparable benefits in terms of housing services, cockles, prawns and crabs, forest

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rehabilitation and. ecotourism. In the WMW case, domestic benefits are actually reduced in the short term during a transition from current unsustainable practices to a baseline of sustainable development, but could increase in the long term. No change in domestic benefits was identified for going beyond the sustainable baseline to protect turtles specifically, although one can imagine that this alternative could open up new ecotourism opportunities.

Avoided financial costs

Analysis is more complicated where the alternative delivers concurrent domestic benefits as well as global benefits, and here the analytical treatment varies according to the situation. Easiest are the situations where future costs will be avoided. The shift to the tramline method of logging in the.NSPSF case would disturb waterways less and reduce water treatment costs for supply from the Main Canal. Therefore it is appropriate to expand the system boundary to include water treatment in both the baseline (where it is a clear national priority and has identifiable costs) and the alternative. The avoided costs of water treatment are important in discussions about the financing of the incremental cost, as Kumari shows.

No national priority

Sometimes an action taken primarily for biodiversity reasons will yield an incremental domestic economic benefit, but one that alone would be insufficient to justify the costs of the action. That is, the activity giving rise to the benefit could not have been justified in the baseline. A possible case of this may be future work to introduce the Milky Stork in the KSNP; while this introduction would add some educational and scientific benefit to. Malaysia, it may not be plausible to assume that the country can justify these costs just to expand scientific and educational opportunities in this way.

Separable benefits

There are situations where the activities yielding the increased domestic benefit go beyond what is strictly necessary to achieve the global objective. For example, once the Kuala Selangor Nature Park has been set up and the actions to preserve biodiversity taken, new domestic opportunities present themselves. These include expanded ecotourism opportunities for watching fireflies and for educational camps. The costs and benefits of these activities are separate from those needed to protect the biodiversity. This provides an important lesson for future biodiversity protection projects: counter-intuitively, the costs of biodiversity protection may not always be associated with seemingly 'conservation-related' activities at all. In this case, .the real conservation costs were the costs of transport from a township somewhere else, not those of ecotourism or of conservation. centres.

Necessary link to global benefits

An underlying cause of biodiversity loss in DSWR is poverty. Only alternatives that include actions to improve subsistence benefits - such as alternative livelihood .projects and alternative income

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generating schemes that lead to higher fish yields - could sustainably remove the threat of overharvesting. It is therefore expected that domestic benefits in the alternative will exceed those of the baseline strategy.

COSTS

There are some interesting questions arising on the cost side as well.

Distributional issues

Private and social costs may diverge; and costs and cost savings may be borne by different groups. In the NSPSF case, loggers may incur costs while society as a whole is better off. This raises (but does not solve) issues about project design. Should the private loggers be compensated at all - should not the 'polluter pays principle' apply? Could the gainers (the water supply authorities) offset part of the costs of the losers (loggers)? One could also imagine a scheme whereby the water authority purchases an easement over the forest that limits the activities there, or buys the right to log which. it then transfers with restrictions. In DSWR, the situation is reversed with government agencies having to meet additional costs of management, while private groups acquire additional income. In fact DSWR is even more complex because there are two distinct communities which have different practices and which have made different investments, so that the costs of change will be borne differentially. Although the transition to sustainability will have an overall negative incremental cost, the costs may be positive for some groups. The advantages of using incremental cost analysis here are that it can suggest ways to redistribute some of the gains in the interests of devising a transition that is self-financing and therefore sustainable and replicable, and that it can suggest new project components to overcome barriers to the transition such as institutional changes. In some cases, it may even be justifiable for the international community to compensate individual groups where the administrative or political difficulties of redistribution can be shown to be too high.

Valuation

Some costs cannot be valued easily (e.g., subsistence labour). Subsistence labour was an issue in DSWR, where an attempt was made to value it. In the WMW case, this component was identified but essentially ignored. It may be necessary to treat it as a special distributional issue.

Attribution of incremental cost to global objectives

It is normally assumed that the baseline and the alternative actions are the least cost means of achieving their objectives under their respective constraints. In the NSPSF case, an explicit attempt was made to identify different means (new and reconditioned equipment) to show what effect this had on the attribution of costs. If the least cost means protects the biodiversity, this alternative is the relevant one for purposes of attributing an incremental cost to this objective. If an alternative other than the least cost means is actually adopted (i.e., a still more costly one) then a further

W'ETLANDS lti•&-iff.iji.J~f.ii


incremental cost is incurred, but this should then be attributed to whatever additional goal is being satisfied (e.g., technology transfer, employment generation, or other additional domestic benefits and opportunities).

THE VALUE OF INCREMENTAL REASONING·

Incremental reasoning, the basis of incremental cost analysis, has a general importance far beyond just satisfying some formal requirements for financial transfers. The incremental reasoning that underpins the cost calculus has strategic implications for protecting the global environment. Although these implications are quite general, they can be visualised quite easily in the specific context of conserving wetland biodiversity. Incremental reasoning can help implement this programme in the following ways:

Project design

Perhaps the most important consequence of following a strict discipline of incremental reasoning is not the issue of cost or financing at all but ensuring the effectiveness of the activities proposed. By emphasising the understanding of the 'baseline course of action', incremental reasoning helps to focus on the underlying causes of biodiversity loss. The described alternative (which can later be costed incrementally with respect to the baseline) helps to clarify that the identified causes will be removed in any proposed complementary or substitute activity. Surprisingly, this simple strategic approach is not always very explicit; many biodiversity projects appear to be groups of conservation components that are 'good activities' (training, capacity-building, ecological surveys, enforcement measures etc.) but which are not proposed in reference to any baseline. Without any clear baseline, there is no assurance that the proposed alternative will suffice (or was even required). The DSWR case focuses on causes of the biodiversity loss such as poverty and population pressures within the reserve, which establishes a criterion against which to judge the effectiveness of proposed alternatives - and which suggests further investigations for resolving uncertainties about these matters. Without this focus, 'conservation activities' might continue without causing a move from the baseline.

Cost allocation

Even without considering who should finance environment protection, it is useful to know, in a technical sense, what costs are attributable to adding an environmental objective or constraint on development. This is cost allocation. This knowledge helps one propose projects that are costeffective, Le., that can deliver the environmental objective at the lowest cost. For example, the NSPSF case drew attention to the fact that there are at least two alternatives (reconditioned versus new equipment). It is a technical question whether the cheaper one would suffice to protect the habitat but, if it would, the extent to which this lower cost alternative exceeded that of the baseline - the incremental cost - can be allocated to habitat preservation (and associated watershed protection); in turn, it is the extent to which a higher cost alternative exceeded that of the lower cost alternative that must be allocated to additional, non-conservation goals. In the KSNP case,

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some activities may be related thematically to conservation (ecotourism, science education) but

are not causally related to conservation of specific habitat or species. In these cases, the costs of those activities cannot be allocated to conservation and have to be judged in relation to ecotourism revenues or science education budgets. The incremental cost framework can be used in many situations, not just to allocate costs to global environmental objectives versus domestic economic priorities but also in situations where those who bear the costs are not those who benefit from the activities.

Equity

Most importantly, incremental reasoning helps guarantee that developing and other recipient countries do not have to shoulder any additional burden for national development through their commitments to protect biodiversity in the global interest. This is done in several ways. One is by identifying positive incremental costs that could be reimbursed in full, such as those of maintaining less productive endemic rather than exotic fish stock. Another is by showing that even when incremental costs are less than local cost savings, there are one-time expenditures that can help the country make a transition to financially and environmentally sustainable development - expenditures on activities to remove barriers such as the lack of appropriate markets for environmental services, of cost recovery mechanisms, of information etc. In all cases, the incremental cost framework is built on the requirements that the national priorities are respected (this is how the baseline is constructed), that domestic benefits are maintained in the globally environmentally friendly course proposed (this is how the alternative is constructed), and that the full incremental costs are revealed.

Increasing the transfer of resources

Ironically, it is possible to transfer financial resources for a broader range of environmentally effective activities on an incremental cost basis than on a full cost basis .. First, consider the full cost activities. Many activities are funded internationally at full cost because they are regarded as not economically justified at the local level, e.g., activities for protecting a nature reserve, capacity building, ecological surveys, studies, enabling activities and government regulation and enforcement of biodiversity measures. These 'full cost' activities have, at least implicitly, baselines of zero activity and zero cost,

and as such they are trivial examples of the incremental cost approach (where the incremental cost happens to be the full cost). While the incremental cost approach thus includes these 'full cost'

activities anyway, it also includes many others. For now consider activities that are 'strictly' incremental,

such as modifications to development activities in the productive sectors of the economy for the full

cost of which grant finance would be clearly inappropriate. (In the case studies, there are examples

of productive sectors of the economy for which a 'strictly' incremental cost approach is appropriate: logging, turtle harvesting, fishing and building houses.) As opportunities to modify development activities fall naturally under incremental cost financing, the scope of effective and financeab/e activities is greatly enhanced.

Mobilising new and additional funds

Mobilising grant money is difficult in today's financial climate. But by demonstrating an adherence

W'ETLANDS 't'i9;i~f.iil.1Jf.ii

INCREMENTAL COSTS OF CONSERVING WETLAND BfODIVERSITY

to incremental cost financing it will be easier to mobilise 'new and additional' resources. If it were also to finance any non-incremental costs, GEF would effectively be a fund for regular development as well, possibly substituting for other sources of financing that may available for that purpose. In this hypothetical situation, such non-incremental cost funding would not improve the global environment but merely substitute GEF grants for the ,regular loans, development aid, budget

allocations and cost recovery that normally finance development projects. Instead, showing that the grants. 'purchase' identified global environmental benefits beyond those expected otherwise strengthens the case for mobilising new and additional resources.

Integrating biodiversity and development·

Incremental reasoning helps integrate biodiversity concerns into economic development. Full cost financing, typically for small, free-standing conservation projects, keeps conservation separate from sustainable development. However, wetland protection often requires activities outside the designated wetland areas: the case studies provide examples of the integration of wetland biodiversity concerns into the management of production forests, alternative income generation schemes and the regulation of fishing practices. Since it would be impossible and clearly inappropriate to finance the full costs of economic activities such as logging, fishing and agriculture from environmental budgets merely because these activities had been designed in an environmentally friendly way, incremental reasoning becomes essential. Having a clear framework for treating these economic activities, one can open up the possibility of environmental financing that would otherwise be dismissed as impracticable. Incremental cost analysis opens the door to co-financing sustainable development; rather than limiting all environmental activity to full cost (but typically small-scale) conservation action.

Transparency and openness

Although the framework for incremental cost can never yield precise measurements of incremental cost, it does provide a technical basis for a stakeholder discussion of project design and cost. Negotiations among stakeholders can be structured so that there is a reasoned and transparent basis for decisions on project selection, costs, impacts, cost savings ·and so on. A party that was unhappy with the incremental cost estimate or allocation could appeal to additional sources for data on or justification for its assertions about baselines, the cost of alternatives, and the extent of any supposed cost savings. The analysis in the NSPSF case, for example, suggests possible areas of negotiation: the crucial technical assertion that the logging methods depleted or fragmented the habitat in ways that endangered the rhino, the causal link to water purity, the range and costs of

the various alternative techniques that could be proposed, and the costs of existing logging techniques

and water purification that would be avoided under the proposed alternative. Since compensation

or cost allocation may depend on the estimate of incremental cost, one would be able to identify where there are possible conflicts of interest in data estimation (baseline costs), to suggest

additional sources for data (costs disclosed in or consistent with public documents, such as annual

reports, produced for other reasons), or to propose where studies from uninvolved parties would be useful for resolving critical uncertainties. In the DSWR case, one could ask how plausible the baseline is: would falling harvests led to a timely exodus of population from the reserve, making this a selfregulating system? How does one assess the reasonableness of government agency budgets for the

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alternative proposed, especially if additional requests are likely to be considered by bilateral assistance

rather than government itself?

New financing modalities

Ultimately, for financial sustainability of environmental action, it will be necessary to close the loop on financing so that costs of action are recovered from those who benefit, at least from those who

benefit financially. The NSPSF case suggests a way that may have escaped attention otherWise: could not budgets for water supply be applied, cost-effectively, to watershed preservation instead of to higher costs of water purification downstream? Institutional custom makes this a radical departure into unfamiliar territory4 . One could also argue that the polluter should pay - in which case the incremental cost is just the cost of meeting reasonable environmental standards - but the incremental cost would be a factor to be taken into account when such standards are mandated. In the DSWR case, conservation activities may open new possibilities for commercial development of the ornamental fish market. By what mechanism can the incremental costs of appropriate conservation activities be reliably financed out of the incremental revenue from this activity?

New areas of application

Incremental cost analysis, rather than project cost-benefit analysis, is particularly useful where the costs of action fall to one group while the benefits are enjoyed mainly by others. The costs of wetland conservation may impose costs on a local community or government agency, while the benefits of protecting a spawning ground may accrue to commercial fisheries and the benefits of biodiversity protection to the global community. The incremental cost in these cases is a point of reference for designing cost sharing rules among the beneficiaries. Although the case studies here were motivated by the need to share costs for action to protect biodiversity of global significance, the same techniques could prove useful in other settings as well. Examples are: switching baseline expenditures for water purification through watershed protection; sharing the costs of international environmental action among affected states for reducing pollution in or harvesting rates within international lakes and rivers; sharing costs between states and the central government in a federation where responsibility for environmental action is divided; financing costs incurred by one local

community group for environmental benefits shared by a neighbouring subsistence community;

and devising instruments for financing costs borne by one generation for wetland benefits accruing to future generations.

4 A previous example of this turned up in another PRINCE case study, in the Sierra de Santa Marta region of Mexico (Cervigni, 1995).


REFERENCES

Cervigni, R. (1995) - Incremental Cost of Protecting Biodiversity in the Sierra Santa Marta Region, Mexico. Mimeo. Program for Measuring Incremental Costs for the Environment. Global Environment Facility, Washington, D.C.

GEF (1994)- lnstrumentfor ihe Establishment of the Restructured Global Environment Fadlity. Global Environment Facility, Washington, D.C.

GEF (1996) - Incremental Cost. GEF/C.4/lnf. 5. Global Environment Facility, Washington, D.C., April 1996.

King, K. (1994) - Incremental Cost as an Input to Decision-Making on Global Environment. In: Incremental Cost Training Program (April 1994). Global Environment Facility, Washington,

D.C.

33

PART TWO CASE STUDIES IN THE CONSERVATION OF WETLAND BIODIVERSITY IN ASIA AND THE PACIFIC

CHAPTER 3 Community Management in Danau Sentarum Wildlife Reserve, Indonesia Julia Aglionby

CHAPTER 4 Fishing Practices in the Wiawi Marine Wetlands, Vanuatu Valentine Thurairaja

CHAPTER 5 Forestry Practices in the North Selangor Peat Swamp Forests, Malaysia Kanta Kumari

CHAPTER 6 Conservation and Land Use in Kuala Selangor Wetlands, Malaysia Mohd. Shahwahid Haji Othman

CHAPTER 3

COMMUNITY MANAGEMENT IN DANAU SENTARUM WILDLIFE RESERVE, INDONESIA

Julia Aglionby

The Danau Sentarum Wildlife Reserve in West Kalimantan, Indonesia, is in an expansive floodplain where the extreme annual fluctuation in water level has contributed to the evolution of a unique ecosystem with rich biodiversity The biodiversity is under threat from forest burning, poisoning of the waterways, overfishing, river damming, illegal logging and the introduction of exotic species. Biodiversity would be protected if the resources of the area were managed sustainably by the community, but a number of barriers currently prevent this - poverty, lack of information and poorly defined property rights. This case study illustrates a number of the features of incremental cost analysis and funding: constructing plausible baselines, addressing underlying rather than immediate causes of biodiversity loss, avoiding the need to monetise biodiversity values, difficulties in recovering costs from beneficiaries, and attributing the costs to global objectives.

BIODIVERSITY AND THE DANAU SENTARUM WILDLIFE RESERVE

The Danau Senta rum Wildlife Reserve (DSWR) is located just north of the equator, 700 km up the Kapuas River from Pontianak, the provincial capital of West Kalimantan, Indonesia (Figure 1 ). It is in an expansive floodplain where the dramatic annual fluctuations in water levels have contributed to the evolution of a unique ecosystem with a rich biodiversity. The area was proposed as a wildlife reserve of 80,000 ha in 1982 in order to protect the habitat of the highly valued red variety of the

. Asian Arowana Scleropages formosus, although this fish is still threatened. Since then international

attention has been drawn to the area, and in 1994 DSWR was designated as Indonesia's second wetland of international importance under the Ramsar Convention. Soon after this, in early 1995,

the extension of the reserve to over 125,000 ha was approved by the provincial government1. This extension ensures that upland areas seasonally critical for certain animals are protected and that a

complete continuum of vegetation is found within the reserve.

DSWR is low lying. Over 28,000 ha are seasonal lakes that are full of water for up to ten months

of the year and then completely dry for the two remaining months, leaving a lake bed on which annual grasses grow. The depth of water fluctuates by 10-12 m over a year, which buffers the

1 In 1997 this was extended to 137 ,ODO ha.

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INCREMENTAL COSTS OF WE71AND CONSERVATION

flow of the River Kapuas. In the wet season a flow equal to a quarter of the peak enters the lake system, reducing flooding downstream; conversely, in the dry season water flows out of the lakes, reducing water intrusion into the Kapuas delta and thereby protecting the drinking water supply for Pontianak (Klepper, 1994).

N .....

.---·-·-·-·;-.~ . ,., ' ... .... " . ·-.,_ .... ,·

WEST

KALIMANTAN Central Kalimantan

Figure 1: Danau Sentarum in West Kalimantan, Indonesia

COMMUNITY MANAGEMENT JN DANAU SENTARUM WILDLIFE RESERVE, INOONESIA

This environment, a swamp forest intersected by a series of lakes and waterways, is unique. Not surprisingly, a number of endemic species, particularly plants and freshwater fish, have. evolved there. It is the habitat for the internationally (CITES) protected fish, Asian Arowana; a population of the Proboscis Monkey Nasa!is /arvatus, possibly the largest inland population in Borneo (Sebastian, 1994); the recently rediscovered Crocodylus raninus, which had not been sighted for more than a century; two other species of crocodile; many snakes, lizards, turtles and tortoises; over 220 fish species (including 12 new to science; Widjanarti, 1995); and over 230 bird species. DSWR and its adjacent peat swamp forests are also important for Orang Utan Pongo pygmaeus, and this area may harbour a significant and possibly viable population (E. Meijaard, pers. comm.).

The waters of DSWR have a -low nutrient status due to the peat soils around the reserve, which are similar to those found in the Amazon blackwater flooded forests (Panayoutou & Ashton, 1992)_ This gives the waters their characteristic eerie black colour, and many fish are dependent on plant tissue and detritus for their food intake. The link between the health of the forest and of the fish population is therefore direct and strong. The swamp forest that dominates the reserve is shorter than dipterocarp rainforest and less diverse, but a high degree of endemism occurs due to the unique niche the trees and shrubs occupy. In the extension of the reserve on the hills there are lowland forest trees up to 45 m at crown level dominated by dipterocarp species, and it is to these areas some of the larger mammals such as the Clouded Leopard Neofelis nebu/osa flee as the waters rise.

LIVELIHOODS AND BIOLOGICAL RESOURCES

There are two main community groups who live in or around the reserve: the Islamic Melayu and the Christian Dayak. These communities depend on the reserve's biological resources: their main activities include fishing, hunting, some shifting agriculture and harvesting, and their patterns of work and recreation reflect both the seasonal changes and their traditional knowledge and beliefs. The centre of DSWR has been settled by Melayu, who have developed a unique, water-based lifestyle to cope with the seasonal changes in water levels in the reserve - any visitor is immediately struck by the inventiveness of their environmental adaptation in an area where there is dry land for only 2-3 months a year. The Dayak practise swidden agriculture and fishing based on long tradition and closely linked to spiritual beliefs. (For example, the use of poisons to catch fish also features in ritual ceremonies.)

The lakes of the upper Kapuas have been fished for at least several hundred years and probably much longer, although much more intensively in the last 50 years. The dry season is the major fishing season because the lakes dry up, concentrating the fish in ponds and rivers. Many of the species are caught by the local population, who subsist 90% on fish. In addition, some fish are caught for the aquarium trade, or reared in cages - although this too can affect natural fisheries -and the annual receipts of local communities from fishing exceeds US$2.9 million annually_

Hunting of turtles and tortoises is intensive, with 50 tonnes being exported each year to Sarawak just a few kilometres to the north. Hunting of monkeys, crocodiles and other species, however,

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now tends to be opportunistic due perhaps to the decline in these populations.

Within the reserve, shifting agriculture is limited to a few areas. This is because the soils are infertile and the rise in the water level is unpredictable, which makes time spent planting and tending a

crop a waste if the area floods before the crop is ready to harvest. All the villages are remote, and

government facilities such as schools and health clinics are limited.

Although most income comes from fishing, many other resources are harvested for both subsistence use and for sale. Timber is used to make houses both for those in the reserve and for those in the

neighbouring towns from which these people originally came. Rattan is harvested to make fish traps and to sell to logging firms who use it to tie together log rafts. A more sustainable form of forest harvesting is the collection of honey, but this makes up only 1 % of total income from harvested products.

Altogether, in 1994 over 6,500 people lived permanently within the reserve, and in the dry season approximately another 2,000 come from surrounding areas. Of the 39 villages within the reserve, 34 comprise Melayu communities, who are Muslim, three comprise lban, a Dayak people who are now Christian, and two are mixed. The annual income has been estimated at US$1, 150 per family. This is US$230 per person for a typical family of five, or about a third of the average GNP per head for Indonesia (Aglionby, 1995a).

UNDERLYING CAUSES OF BIODIVERSITY LOSS

A decline in the natural resource base is threatening both the ecosystem and the livelihood of those depending on it. This decline is a result of underlying causes: poverty, lack of information and poorly defined access rights.

Poverty

Low income levels prevent families planning resource utilisation with a long-term outlook because

they are worrying about making enough money to buy food for the next day's meals. (In DSWR even the staple, rice, has to be bought with receipts from other resources.) When fish catches are low and these basic needs cannot be met, people are often forced to harvest resources in an

unsustainable pattern, e.g., by selling raw rattan to logging companies or selling timber to

outsiders. Through meetings in every village it is clear that even when people know that they are undermining their future livelihood they feel they have no choice but to continue their harvest rates.

A study of income and expenditure was undertaken in order to help ensure that any proposal to

conserve biodiversity would be socially sustainable. It was found that over the course of a year

income at US$265 per productive person covers basic subsistence requirements of $221 but leaves only US$44 for schooling, health care, clothes, family occasions etc. But even this meagre level of

income is maintained through unsustainable resource use.

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As important as the aggregate income is the monthly variation in income. One current response is overharvesting. Any conservation proposal would have to address the issues not only of low

average income but also of financial management. •

Undefined access rights

The people of DSWR are illegal residents, although most of the communities are unaware of this because they had had usufruct rights for hundreds of years and had settled the area before it was gazetted as a wildlife reserve in 1982. They believe that they have full usufruct rights based on their historical rights when the area was divided into different sultanates and when, more

recently, DSWR and the surrounding area were divided into utilisation zones. Each village has its zone, which is managed by a locally elected head fisherman with responsibility for enforcing the traditional law, 'hukum adat', on resource harvesting. However hukum adat is losing its power as communities are influenced by the outside, and as government by the state replaces that by elders.

Related to this issue is the problem of the carrying capacity of DSWR. Although firm evidence to

show that the carrying capacity has been exceeded is not available, it is clear on the ground that resources are under increasing pressure. Limiting access is difficult because all waterways in Indonesia are open access and people who live outside the reserve may come on a seasonal basis. Some clear policy on the issue of access needs. to be made which incorporates the demands of

local communities but ensures that biodiversity is conserved.

Lack of information

Many government officials and local communities do not realise that as a unique ecosystem and

store of biodiversity DSWR needs special management. There is a lack of information, for example, about the impacts of a dam on DSWR. Similarly, awareness needs·to be maintained among local communities that while burning the forest may make it easier to catch Asian Arowana fish it will also reduce the quality of the area as a fish habitat and reduce the availability of forest products such as timber, rattan and honey.

THREATS TO BIODIVERSITY

These underlying causes manifest themselves through more immediate_ threats to biodiversity, such

as forest burning, poisoning of waterlivays, overfishing, river damming, logging (which is both illegal

and excessive) and the introduction of exotic species. Together these threaten the conservation of

biodiversity at all levels: ecosystem, species and genetic

Forest burning

During the dry season, the incidence of burning in DSWR can be high and the longer the dry season the higher the number of fires and extent of the burning. Data available to date from imagery and field surveys show that up to 20% of the reserve has been burnt, and it seems that the rate

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of burning has increased over the last 20 years as a result of population inqeases. Some fires have been deliberate and others accidental. There are two main reasons for deliberate burning: the first

is swidden cultivation and the second is to make it easier to set up nets to catch fish. It is thought that the main object of this is the highly valued Asian Arowana fish (Luttrell, 1994).

As well as causing a loss of forest resources such as wood, rattan and honey, burning reduces aquatic productivity, as the aquatic system is dependent on detritus and other plarit material for its

primary input. A decline in fish yields is therefore likely to occur.

Overfishing

Ninety percent of the 39 head fishermen interviewed said that fish yields had declined over the

5-year period 1989-1994. Local fishermen blame the decline in fish stocks on the use of intensive fishing gear, poisoning incidents, an increase in population and the impacts of upstream logging on water quality. It is likely that fish stocks are being mined - although calculating sustainable yields is notoriously difficult, particularly in a multi-species environment such as DSWR, and the Fisheries Service statistical data on these matters are incomplete.

The issue of usufruct rights arises here because under national law all waterways are open access. Although individual villages have divided up the reserve into areas in which they have authority to regulate fishing, this partitioning does not prevent fishermen coming in from outside. Such fishermen simply have to follow the law of that area and ask permission from the head fisherman. Only in rare instances do villages limit the number of outsiders fishing in their work area. This pattern of utilisation dates back from when all villages in DSWR were seasonal and people came to fish from the towns on the Kapuas. Those who have settled in the reserve in the last 60 years maintain strong connections with these towns, and the outsiders who now come seasonally to fish are often their relatives. Limiting access would therefore be socially difficult.

Particular pressures on fish stocks arise from the use of the 'jermal' net, a free-standing net that funnels the fish into a chamber. These fine-meshed nets are most commonly used to catch small fish used as feed for the carnivorous Snakehead fish Channa micropeltes, which is reared in cages.

Four thousand tonnes of fish are required as feed annually, which is probably an unsustainable catch level if compared with those in other freshwater bodies (Aglionby, 1995b).

Poisoning of waterways

The use of natural poisons (e.g., tuba, made from the roots of the climber Oerris e!iptica), which

stun fish and are not residual, is a traditional fishing technique among Dayak communities. In recent years the use of commercial poisons (such as potassium cyanide and the insecticide, Thiodan) has become more widespread and the environmental impacts of these are much more severe.· 1n one instance, in August 1994, fish caged 30 km from the site of poisoning died and total losses to the

communities within DSWR exceeded US$150,000. The long-term impacts on the environment have yet to be assessed, but it is likely that some types of poison will be transmitted through the food chain, affecting birds and mammals.

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COMMUNITY MANAGEMENT JN DANAU SENTARUM WILDLIFE RESERVE, INDONESIA

Poisoning is due partly to the friction between the two community groups in the area. The Dayaks traditionally fish only once a year using natural poison, while the Melayu have over time used more intensive fishing gear (of which the Dayaks do not approve). The Dayaks may therefore continue using poison because the Melayu are using small mesh nets, or because they can increase their commercial sales of fish. Local government recently addressed this problem ·by brokering an agreement between the two communities. However, the adjustment period was short and many fishermen have not adhered to the agreement because much of their capital was invested in the newly outlawed nets.

River damming

On a number of occasions over the years a proposal has been made to dam the Tawang River, the major river linking DSWR with the Kapuas River. One of DSWR's major functions is to buffer the flow of the River Kapuas, and the Department of Public Works has proposed that this natural function could be enhanced by constructing .a dam across the major outlet of the area. This would protect the supply of fresh water to Pontianak in-the dry season, when intrusion of sea water is a problem. However, the environmental impacts would also be severe, because trees do not grow.if continuously submerged. The forest would die, causing a decline in the productivity of the aquatic system, which is dependent on inputs from plant material. Such a dam would also be very costly.

Illegal logging

Logging is more common when fish yields are low because it provides an alternative income source. Although local communities are allowed to fell timber for their own use, the high cost and large number of chainsaws (91 were observed in DSWR) suggest that there may also be commercial logging. There is also evidence of over-logging: the lack of large trees and the distances that one has to travel to find timber. Apart from threatening the biodiversity of the tree flora, this overlogging threatens the understorey and epiphytes and the terrestrial and aquatic fauna that depend on the trees for food or shelter.

DEVELOPMENT AND CONSERVATION

Broad development goals

Indonesia's development strategy stems from the 1945 Basic Law (Presiden Republik Indonesia, 1945), which forms its constitution, and from Pancasi/a, Indonesia's 5-point ideology. Together these guide all policy decisions and are the basis for both the 25"year, long-term plans and the 5-year development plans (Repe/ita). The year 1994/95 was the first of the second 25-year plans as well as the start of the sixth 5-year plan, Repelita VI. The four foci of Repe/ita VI for the Kapuas Hulu Regency, in which DSWR is located, are: • Improving the standard of living and reducing the poverty gap; • Increasing stability and law and order; • Developing natural resources through the improvement of human resources; • Increasing the awareness of communities to participate in development activities.

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Conservation

The constitutional basis for the management of Indonesia's forests is found in the nation's Basic Law of 1945 article 33, which states that the earth and the air and all the richness found in them are under the authority of the state and to be used for increasing the prosperity of its citizens. DSWR is classified as forest land and hence comes under the authority of the Department of Forestry. This is clarified in the Basic Forestry Act of 1967 (Presiden Republik Indonesia, 1967), in which the function and role of wildlife reserves are outlined, and is further refined in Act No. 5 1990 concerning the Conservation of Living Resources and their Ecosystems (Presiden Repub/ik Indonesia, 1990). This act emphasises the need for sustainable management of ecosystems to ensure the improved welfare of current and future generations of Indonesians.

Article 15 of that act states that wildlife reserves are created for the preservation of plant and animal species' diversity and as life support systems, while article 17 details that the permitted activities within the reserve are research and development, science, education, limited recreation a·nd activities that support enhanced breeding. It is therefore clear that, aside from the global benefits that are reaped from such conservation, conservation both of biological resources and biodiversity is on Indonesia's national agenda.

Indonesia's sixth 5-year development plan for forestry, running from 1994/95 to 1998/99, is now available in draft form (Repe/ita VI Kehutanan). This sets out the basis for development at the start of Indonesia's second stage of Long Term Development (1994-2018) and contains many statements supporting sustainable utilisation of resources and conservation of biodiversity. For example, "Indonesia's forests function as a storehouse or available reserve of gene plasm which is very rich and very useful for national development," and "forest development ... should take account of the function of the forest for the conservation of species and ecosystem diversity," (author's translations).

Within the period covered by Repe/ita VI Kehutanan, it is intended to increase the area of conservation areas to 19,000,000 ha (an increase of 900,000 ha), to evaluate current .legislation concerning conservation areas and to develop models of ideal wildlife reserves. Other proposals address forest burning and increased training for forest rangers.

This shows the high profile of sustainable of forest management within national legislation and development plans. This is understandable given that over 60% of Indonesia's land mass is covered by forest (RePPProt, 1990) and that wood products are the third largest export earner. Indonesia is also acutely aware of its international importance for biodiversity. In the early 1990s the National Planning Agency (BAPPENAS) headed a committee to develop a Biodiversity Action Plan (National Development Planning Agency, 1993). This plan stresses the national economic importance of biological resources, and observes that 40 million people (21 % of the population) are directly dependent on biodiversity and that it is the rural poor who are most dependent. It also notes that Indonesia has many commercially significant species. The plan pushes for a review of existing legislation to improve the management of biodiversity.

w'ETLANDS 11til9;1Jf.jii.J}f.ii

COMMUNITY MANAGEMENT IN DANAU SENTARUM WILDUFE RESERVE, INDONESIA

Global environmental objectives

DSWR was acknowledged as a site of global importance when it was designated as Indonesia's second Ramsar site in 1994. Within Indonesia, the high profile of DSWR is linked to its being one of the last remaining habitats of the highly prized red variety of the Asian Arowana aquarium fish, which is listed on Appendix II of CITES. Specifically, the global biodiversity benefits that are the objective of conservation efforts in DSWR are:

Swamp forest Protection of one of Southeast Asia's remaining primary swamp forests, which contains many endemic plant species (Giesen, 1995). The forest is threatened by burning, river damming and excess logging. The first and most severe threat to the swamp forest is burning. Although burning may be part of the natural ·cycle, the current levels almost certainly exceed those to be expected in the absence of human habitation in the reserve. (Further work on the time series patterns of the burning is beginning but it is too early to report results.) In ecological terms burning results in the loss of primary vegetation thus creating an environment unsuitable for animals, which either die, leave the reserve or are forced to live at higher densities thereby increasing pressure on remaining habitats. The waters of DSWR range from pH 4.0 to pH 5.0 and nutrient levels are low, thus primary production from plankton is very limited and aquatic herbivores are dependent on primary input from forest-generated material including detritus. The relationship between burning and aquatic productivity is therefore strong and positively correlated, with increasing burning causing a continuing decline in fish populations, threatening the existence of some species, particularly those that show negative dispensation (Neher, 1990). This will also have repercussions for animals, such as piscivorous birds, that depend on fish resources, leading to a general breakdown and possible collapse of the ecosystem. The second threat is damming, which would have a similarly catastrophic effect on the swamp forest because the d~y season would be considerably shortened and may even disappear. The main growing season is when the trees are out of the water, particularly for seedlings which are completely submerged for most of the year, so if the water levels are artificially maintained at a high level the growth rates of old trees would decline and all seedlings would die (Klepper, 1994). This is true both for woody and rattan species. Third, another cause of forest loss is illegal logging, local residents and outsiders cutting to meet their individual timber needs for boats and houses. -

Proboscis Monkey Conservation of the largest inland population of Proboscis Monkey (Sebastian, 1994). Proboscis Monkeys are endemic to Borneo, with their most common habitat being mangrove

swamps and riparian and swamp forests. Mangroves are coming under increasing pressures from coastal developments and thus inland areas such as DSWR will become more important as Proboscis Monkey habitats. These primates are herbivores and swamp forest dwellers, thus any degradation of the forest as predicted above, which would occur if there. were no interventions, will have a negative impact on the existing population. As there is nowhere for them to migrate to, if the habitat becomes fragmented populations will fall below the minimum viable level.

Endemic fish populations. Conservation of the world's third most diverse lake fish population, with over 220 species, 17 of which are endemic (Widjanarti, 1995). Overfishing would be the most direct cause of decline in fish populations, but the loss of the swamp forest habitat would also

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contribute. In the baseline (see below), overfishing would continue and probably accelerate as yields reduce and ever more intensive fishing techniques are used, as well as a growth in cage culture of the carnivorous Snakehead. These influences would be exacerbated by the introduction of new species such as tilapia (Oreochromis mossambicus & 0. nilotica), which would outcompete local species, as happened in Lake Toba, Sumatra, and in Lake Victoria, Kenya, where massive extinction was caused by the introduction of Nile Perch. Restocking with exotics is likely, as this has already occurred on several occasions, e.g., with Sepat Siam (Trichogaster pectoralis) in the 1950s and Nile Tilapia (O. nilotica) in 1993.

BASELINE STRATEGY

The baseline strategy is 'business as usual', an expected continuation of the 1982-1992 trends for 1992-2002. This is a laissez-faire strategy whereby DSWR remains the low profile reserve it was during the 1982-92 period and hence does not attract any significant funding from local government· or line agencies. The net result for the period 1992-2002 is a continuation of the environmental degradation that occurred in the previous decade, with the major threat to the biological resource base being the unsustainable exploitation by communities living within and around the reserve.

The Indonesian Government's agency for conservation and forest protection is Perlindungan Hutan dan Pelestarian Alam, or PHPA. In 1992/93, PHPA's total budget for conservation was US$8 million, about 50 cents per hectare of protected area. DSWR is only 0.7% of Indonesia's protected area system therefore the total it could expect is small and certainly less than 0.7% of the US$8 million because a sizable proportion of the money is needed for management at central government level. The PHPA activities assumed for this baseline strategy are set out in Table 1.

Apart from PHPA, other line agencies have responsibilities in the reserve, especially the Fisheries Service. According to Giesen (1987), the resources available to the Fisheries Service seemed lower in 1986 than in its heyday in the 1960s, and the run down of facilities was likely to continue. Attempts to boost fisheries production would include increasing the fish cage culture with the

introduction of exotic species such as tilapia. Attempts at restocking the lakes might have occurred and again it is likely that exotics would have been used. The damage to the native fish fauna as a result of these exotics is likely to be severe. Concerning the regulation of fishing gear, it is unlikely that any significant action would be taken or that existing regulations be enforced, thereby increasing the use of fine mesh gear and causing a decline in yields. ·

Other government agencies with programmes in the reserve are the Department of Education and the Department of Health, and their activities are grouped under the local government category in Table 1. In addition, local government administration would continue to send out reminders to communities that they must guard against forest burning and waterway poisoning, and should boil water during the dry season. These efforts may increase standards of living and so perhaps increase residents' time horizon but one cannot assume that this will slow resource extraction.

#ETLANDS l;ili·'f'·'l'·'if.ii


Government activity would be minimal. In any case, because the communities are not officially allowed within the reserve, attention to their development requirements may be deemed inappropriate. This also means that none of the villages have official village ('desa') status and thus are not eligible for subsidies available to poor villages.

Table 1: Activities under the Baseline Strategy ·

Government Department

D-G Forest Protection and Nature Conservation

Fisheries Service

Local Government

ALTERNATIVE STRATEGY

Activities in 1992-2002 under the Baseline

• Station two guards, one in the reserve one in a neighbouring town

• Provide one longboat and outboard motor for enforcement

• Carry out limited extension work and collect data • Issue licences for fishing gear • Provide one 40HP and one 9.9HP engine

• Introduce exotic species • Provide limited health care and education facilities • Carry out limited extension work to reduce burning &

poisoning (district officers)

An alternative to the baseline strategy is urgently needed because the ecology of DSWR and the economic resource are severely threatened. There may even be a critical stock level below which the ecosystem will suddenly collapse, although it is hard to know for certain because of the lack of information on the population dynamics and ecology of the fish species (Kottelat, 1993). In the baseline strategy described above, only the proximate threats to biodiversity loss - mere symptoms of the underlying causes - would be addressed. Sustainable conservation requires that

the underlying causes be addressed, and this is what the proposed alternative would attempt The

underlying causes are poverty, undefined access rights, and lack of information.

Addressing underlying causes

The underlying causes can be addressed by the following actions.

Alternative livelihoods and income generation Biodiversity is unsustainable partly because of poverty and uneven cash flow, which encourage a short time-horizon towards resource exploitation.

The alternative strategy must therefore at least maintain income levels. Because it would be

45

46 GEF


.] necessary to reduce harvest levels to maintain sustainability, the strategy calls for alternative income

· gene~ation activities, especially those that provide income during the lean season and/or add value

to primary products to maintain income.

Defining access rights To define access rights, data and decision-making processes are required. First, the alternative calls for the collection of field data that would be processed to make thematic maps. to inform communities. By presenting information on the reserve as a whole, such maps woulcil raise residents' awareness of its importance and explain conservation issues to village decision makers. To do this, the databases would be digitised and included in the Geographical Information Systef;n (GIS) that is being established under the UK-funded ITFMP (Indonesia - United Kingdom TropiGal Forest Management Programme). On this GIS, decision makers would be able to see the local management system, both the spatial data on the DSWR management zones and the local legal system that governs the use of natural resources. Second, the alternative calls for government agencies and communities leaders to discuss the most appropriate structure for managing DSWR. For example, villages could meet periodically in groups (perhaps twice a year) to discuss common issues.among themselves and, more formally, with PHPA field staff. Implicitly, this would also give official acknowledgment to the role of local leaders, to the traditional law, hukum adat, in the management process, and to residency of the communities in DSWR. Together, this would define

quasiTofficial access rights.

Information Although many of the activities in the alternative strategy would provide the critical missiMg information, a more direct awareness raising programme would also be necessary. One way could be a monthly DSWR newsletter, containing news and views on both the strategy and on conservation and current activities generally, through which information could be provided .to a broader audience. One particular proximate threat, burning, would be addressed through a KSDA (Konservasi Sumber Daya Alam - the authority for nature conservation and PHPA's provincial branch) fire training programme in which a corps of men in key villages receiye theoretical and practical training in fire prevention and control.

Activities

One ipecific proposal for such an alternative strategy is a 10-year project for joint management

of th~ reserve by the community of over 6,000 Melayu ·and Dayak residents and a range of goverinment agencies. This proposal grew out of a project of the ITFMP, which started in 1992 and

, ran until 1997. This project ('Project 5') actually prepared such a participatory management plan,

and can be regarded as the first phase of the alternative strategy. The second phase, also of five years, would be its implementation.

Phase 1 - Planning Initially, data were collected both as a basis for management planning and to increase awareness of government officials, traders and local communities. Biophysical data were collected and some socio-economic research was undertaken. The latter was conducted using Rapid

Rural Appraisal (RRA) techniques and recorded the current system of management, including the spatial division of resources among communities and the role of traditional law in the management process.

\

#ETLANDS l:ili-i}f.'i'·'if.ii


The management plan has a number of important features. First, it integrates conservation with development. Second, it is participatory. Note, however, that the consultation and consensus needed to resolve differences, provide reliable information and bring about sustainable conservation can make participatory management a slow and costly process. But it is essential for changing community practices and incorporating enviro.nmental concerns into agency planning. Third, it makes use of local and traditional knowledge, so it would benefit from generations of trial and error and be more readily implemented by local communities. And fourth, it covers activities at many different levels: field, regency and province and (when necessary) central government. Workshops an~ interagency dialogue at the provincial and regency levels of local government have already initiated integrated conservation and development planning, income generation projects, a co-operative and improved health and education facilities. To provide an institutional structure for integrated planning, a provincial steering committee has been established to assist integrated policy development.

The activities of this project are summarised in Table 2, which lists activities carried out by government agencies, and Table 3, which lists those in the field.

Phase 2 - Implementation A number of structures will be needed to implement the plan, such as: the community management structure, with strong links to KSDA's forest rangers; a structure for marketing and supporting the income generation activities (such as a co-operative, a nongovernmental organisation, or a non-profit making trading organisation). Additionally, for financial

sustainability, mechanisms for mobilising resources and recovering costs would need to be explored, possibly including:

• • • • •

taxes on products harvested in the reserve; levies on foreign research institutes; sale of concessions for tourism, biochemical prospecting etc; subsidies for regencies with protected forests; profits from the field-level trading organisation to fund reserve management.

47

48 GEF


Table 2: Alternative Strategy - a) Government Activities

, Government Age.ncy :

D-G Forest Protection and

Nature Conservation

Local Govern"ment

Fisheries Service

Department of Industry

Department of Cooperatives

Department of Agriculture

Activities

• Six forest guards seconded, four guard posts built

• Fuel and maintenance costs for one car and two speed boats provided in Phase 2

• Two 9.9HP and one 40HP outboard motors purchased

in Phase 2

• Reserve newsletter costs covered and general infor-

mation leaflets printed in Indonesian and English

• Uniforms and typewriters provided for head fishermen

• Funds provided for Pontianak management

• Three yearly coordination meetings held at Regency level

• Three workshops held over the life of the project

• Two mobile health clinics funded

• Three new primary schools established

• Rubbish disposal programme started • Investment in infrastructure to encourage tourism

• Police post established and staffed at the field centre

• District Officers funded for extension work • Buy-back programme for small-mesh nets started

• Two restocking programmes with local species established

• Accurate statistics collected on fish yields

• One 40HP and one 9.9HP outboard motor bought • Regular extension work undertaken • Development of fish leather programme

• Training in production and marketing of fish crisps

• Basket weaving programme established

• Training for communities in management provided

• One central cooperative and five branches established

in the reserve

• Training in management and bookkeeping provided

• Support continued to cooperatives in towns surrounding

the reserve

• Variety trials in three villages

• Irrigated agriculture demonstration plot in area just outside the reserve

• Extension work about livestock nutrition and welfare

W'ETLANDS 'U'ii;i~t.1;1.J}f.ii


Table 3: Alternative Strategy - b) Field Activities

i Phase i

Phase 1:

Planning

1992-1997

Phase 2:

Implementation

1997-2002

Activities i • Three full-time consultants

• Short-term consultants

• Field Centre constructed

• Three local awareness officers recruited

• Biophysical and socioeconomic data collected

• Basic institutional management structure implemented

• Management plan written

• Income generation activities established

• Findings disseminated

• One full-time consultant

• Short-term consultants

• Awareness Officers responsible for field activities

• Field-based trading unit established

• Increased lobbying for improved financing

• · Support of income generation projects devolved to respective government agencies

• Training for Indonesian staff and local community members given

INCREMENTAL COSTS ANO BENEFITS

The focus of this analysis will be on economic costs and benefits that can be valued in monetary

terms, but in addition political and social issues need to be considered in designing the alternative

strategy. These are of particular importance for addressing underlying causes of biodiversity loss.

Domestic benefits

The baseline. and alternative strategies yield different domestic berJefits because of differences in

biological resource base, which i~ sustained only in the alternative strategy.

Direct Use Benefits The benefits of using the extracted products-were estimated from field data.

For consistency, all products have. been valued at _the swamp gate. Data are available for fish for

consumption, ornamental fish, the Clown Loach Botia macracanthus, fish reared in cages, timber, .swiftlet.nests, turtles and tortoises, honey and rattan. This is summarised_ in Table 4.

49

50 GEF


Table 4: Annual Gross Benefits 1994/95

Lake and river fishing Fish cages Ornamental fish Wood Turtles and tortoises Honey Rattan Swiftlet nests

Total

Rp

2,905,800,000 1,800,000,000

505,000,000 356,085,000

56,000,000 50,000,000 54,800,000

136,900,000 5,864,585,000

US$

1,285,752 796,460 223,451 157,560 24,779 22, 124 24,248 60,575

2,594,949

The data were collected mostly through semi-structured interviews over an 18-month period in the field, though in some cases (as with the ornamental Clown Loach fish) survey forms were used and filled in by head fishermen. The weakness of these data is that they relate to one season only, so in order to detect trends of resource use villagers were asked how yields of fish, honey, rattan and wood had changed over the past five years. A summary of their response is given in Table 5 · and from this it is clear that yields are falling.

Table 5: Belief in Declining Yields

Proc;luct Number of villages Proportion of villages agreeing : :

responding that yields have declined. i

Fish 30 90%

Honey 28 93% Wood 32 91% Rattan 30 80%

Apart from the lack of time series data on yields, there is also a shortage of ecological data that could be used to predict the effects of the impacts of the continuing trends on yields, i.e., burning, overfishing and poisoning. It is therefore necessary to make some assumptions about the change in yields from 1992-2002. SEADD (1991) states that the natural ecosystem of DSWR would have irreversibly declined by 2000 if no action were taken to protect it, but is not clear whether domestic benefits from the harvesting of natural resources would also decline to zero. This seems unlikely: although the natural ecosystem would have been irreversibly degraded, some adaptation is likely, implying a less productive but not completely barren situation.

W'ETLANDS 'Bil!·'l'·'l'·'if.ii


In the baseline it is assumed that yields and income decline by 5% annually; this is assumed because

the change in yields from DSWR is small in national terms, and market prices are not significantly

affected. The alternative is designed to protect biodiversity without reducing total domestic benefits;

in fact it has to ensure that income rises because the current subsistence level does not allow

communities to have the long-term planning horizon needed for conservation. After initially

declining in the first three years of the management project - used mainly for data collection -yields are expected to increase. From 1995, the increase is an estimated 5% a year.

Extraction Costs Net benefits are the gross direct use benefits (Table 4) less the costs of extraction.

Extraction costs were estimated from a survey of 150 families and are summarised in Table 6. Local

communities often comment that yields have declined despite increased investment in fishing gear

and longer hours spent fishing, In modelling the costs it has therefore been assumed that in the

baseline local costs would increase by 5% a year from 1992. In the alternative, costs increase by 5%

from 1992-1995, again because the first three years of the alternative are spent in data collection

and planning._From 1995 it is assumed that costs would remain constant. They would not, however,

be spent on the same equipment as in the baseline because the alternative changes the emphasis

from direct extraction to processing. Costs for fishing gear and chainsaws would decline but what is

saved would be spent on needs for secondary processing,

Table 6: Annual Extraction Costs for Resource Harvesting (1994/95)

Item

Fishing gear

Fuel

Chainsaws

DSWR residents spending per family No. resident families Seasonal users spending per family No. seasonal families

Residents spending per family Seasonal users spending per family

No. chainsaws in DSWR

Cost of second-hand chainsaw

Life of a chainsaw (years)

Rp

520,000

1315 285,000

300 Sub-total

720,000

240,000 Sub-total

91 800,000

5 Sub-total

Total

US$

230

126

340,300

320

110 453,800

6,400

800,500

51

52 GEF

INCREMEIVTAL COSTS OF WETLAND CONSERVATION

Unquantified Domestic Benefits The analysis did not include unquantified benefits. Including them would have made the alternative strategy even more attractive economically, but, because the beneficiaries are many and unknown, costs cannot easily be recovered and so unquantified benefits do not materially change the estimation of the incremental costs. Some of them are expected to be the same in both strategies, and hence are not incrementally important even if they are absolutely important (such as water supply, flood control and waste absorption). See Table 7.

Table 7: Some Unquantified Domestic Benefits

Type of Benefit

Medicinal

plants

Water supply and transport

artery

Flood control

Waste absorber

Domestic share

of the global

benefit

Description

There has been an increase in the provision of modern health care to DSWR but the use of

traditional therapy is still high and the traditional healers or 'dukun' use a wide range of

plants for their treatments. Under the baseline, as the forest continues to be destroyed by

fires and over-exploitation so the availability of these plants will decline. The value of these

plants has not been calculated because data are not available, but it would be a combination

of the cost of replacing traditional medicine by modern facilities and the loss of productive

labour through sickness.

One of the benefits of DSWR is the provision of clean water for washing and drinking all year round except at the height of the dry season when water quality is poor, particularly in large villages. The other benefit is the value of the rivers as a transport artery for residents,

traders and logging companies. This is due to the hydrological characteristics of DSWR and is not expected to differ between the two alternatives, hence is not valued.

DSWR plays a critical role in controlling the flow of the Kapuas River because during the wet

season water flows into DSWR and is stored there until water levels in the Kapuas drop, when water flows out of Danau Sentarum. This performs two functions: the first is the

reduction in flooding downstream of DSWR during the wet season, while the second is the

reduction in the intrusion of sea water in Pontianak. The latter severely restricts the availability

of drinking water, meaning that it has to be trucked into Pontianak from further upstream.

This value of this function is not likely to differ between the two strategies.

The waterways of DSWR. are a general rubbish dump both for human and other types of

waste. Although the population density within the reserve (6 people/km2) is slightly higher

than the average for the regency (5 people/km2), it is still relatively low and most rubbish is

absorbed. This value of this function is not likely to differ between the two strategies.

There would be some value to Indonesia in the conservation of the biodiversity, including

the use of the wildlife habitat for scientific and educational purposes, knowledge that the

biodiversity was still extant and the assurance that the biological resources would be sustained

for future generations.

#ETLANDS

lti'idi'·'''·'if.ii COMMUNITY MANAGEME/fr IN DANAU SENTARUM WILDLIFE RESERVE, INDONESIA

Off-site benefits One benefit whose value can be estimated is that of DSWR as a breeding and nursery ground for fish caught out of the reserve. Although information on the taxonomy of fish in DSWR is fairly complete, information on their ecology is lacking. It is therefore difficult to know the role of Danau Sentarum in the life-cycle of fish that are caught in waterways surrounding the reserve and what would happen to fish yields outside the reserve in the baseline. In the baseline, DSWR's role as a nursery ground would decline as the forest disappeared and the water quality fell. These off-site benefits are maintained in the alternative and occur as a result of conserving the global environmental benefit - biodiversity.

There are over 1,700 fishing families in the towns along the R. Kapuas south of DSWR. Data from two of these towns reveal that their annual incomes from fishing are US$440 per family and it can be assumed that perhaps half of this income is from fish dependent on DSWR for part of their life cycle. The same assumptions for decline in benefits will be used as for the on-site benefits from fishing. With respect to the costs .of fishing, that portion used to catch fish from DSWR is assumed to be US$86 per family per year (half their annual costs).

Costs

Labour Costs No-one in DSWR is employed: they are all private operators working together as family groups., The cost of labour was therefore estimated as that of alternative employment meeting basic requirements for subsistence. This is US$66 a month for a family of five, and there _is an average of 3.6 productive members per family, therefore the minimum daily income is US$0.60/day. Most communities in the rural areas of West Kalimantan live at a subsistence level so that this seems a reasonable figure to use for the opportunity cost of labour.

Government Costs The costs of implementing the baseline and alternative strategies have been estimated on the basis of the activities of each government agency using standard government costs. The baseline, a continuation of 1982-92 trends, includes spending by PHPA, local government and the Fisheries Service only. Their activities (Table 1) incur the costs shown in Table 8. The alternative includes a broader range of government institutions (Table 2) and. activities (Table 3), because the strategy is to encourage local government and line agencies besides PHPA to have an active role in reserve management. Therefore, by 1995/96, they were starting to budget for activities in DSWR following a series of workshops arranged by the project. These workshops stressed the need to improve the welfare of those resident within and around the reserve in order to lengthen the time horizon with respect to resource utilisation, rather than taking the old approach that no attention should be paid to local communities, in the hope they would move out of the reserve. The costs are summarised in Table 9, and were estimated with reference to line agency outline budgets for the current 5-year planning stage and their specific budgets for the financial year

1996/97.

53

54 B

GEF


Table 8: Baseline Costs

I Year Forestry Local Fisheries Small· Co-ops. Agric, DSWR Total r (PH

1PA) govt. industry . mngt.

I project r

1992/93 17,699 30,973 885 49,558 1993/94 4,425 30,973 885 36,283 1994/95 4,425 30,973 9,735 45,133 1995/96 17,699 30,973 885 49,557 1996/97 4,,425 30,973 885 36,283 1997/98 4,425 30,973 885 36,283 1998/99 4,425 30,973 . 5,310 40,708 1999/00 4,425 30,973 885 36,283 2000/01 8,500 30,973 885 40,358 2001/02 8,500 30,973 885 40,358 NVP@10% 56,785 209,350 15,794 281,928

Table 9: Alternative Costs

)·Year Forestry Local Fisheries Small Co-ops. Agric. DSWR Total (PHPA) govt. industry mngt.

I project

1992/93 66,372 30,973 885 635,354 733,584 1993/94 38,518 30,973 885 844,624 915,018 1994/95 38,518 30,973 9,735 829,507 908,734 1995/96 38,518 30,973 885 221 221 929,600 1,000,419 1996/97 38,518 79,646 27,655 1,770 1,327 11;052 702,400 861,913

1997/98 55,000 45,000 23,230 1,700 1,327 16,593 450,489 593,409

1998/99 60,000 50,000 23,451 3,500 1,327. 24,889 441,640 604,808

1999/00 65,000 90,000 30,310 3,500 2,200 14,000 450,490 655,500

2000/01 70,000 55,000 23,673 5,000 2,200 14,000 441,640 611,513

2001/02 70,000 60,000 32,743 5,000 2,200 14,000 441,640 625,583

NVP@10% 351,868 315,852 97,434 10,699 5,735 51,560 4,420,436 5,253,584

One item left out of these costs is the salaries for the civil servants because these are funded centrally

and do not appear in provincial or regency budgets. All additional staff needed will be from support

staff and hence the cost will be small. Supplements to their salaries received when visiting and

working in the field are included, however, and usually these are much larger than their salaries.

Increments

'V'/ETLANDS

1Tt11!-1i'·'i'·'if.ii COMMUNITY MANAGEME!ff IN DANAU SENTARUM WILDUFE RESERVE, INDONESIA

The net present values for the costs and benefits values given above are summarised in Table 10

below.

Table 10: Incremental Costs and Benefits (Net present values for 1992/93 to 2001/02 in 1993/94 US dollars, discounted at 10%p.a.)

Global Environmental Benefits

Direct Domestic Benefits On-site residents Fish for consumption; cag·ed fish; ornamental fish; timber; turtles & tortoises; rattan; honey Off-site residents Fish Relocation costs

· Sub-total

Indirect Domestic Benefits Medicinal plants Fresh drinking water, transport artery Flood control Waste absorber Domestic share of global benefits (education, science, assurance of sustained benefits for future generations, existence value)

Direct .Costs On-site residents Fishing; fish rearing; timber .. extraction; rattan harvesting; honey collecting; turtle hunting

Off-site residents Fishing

Sub-total

Indirect Costs Relocation costs Flood control Government agencies Basic costs DSWR management project ' Sub-total ·

Total Costs

Baseline

Degradation of the primary swamp forest; and likely extinction of the population of Proboscis Monkeys and the endemic fish species of DSWR.

$16,350,000

$1,880,000 $0

$18,230.00

$5, 100,000 (operational costs)

$6,750,000 (labour)

$1,860,000 $13,710,000

$100,000

$260,000 $0

. $360,000

$14,070,000

Alternative

. Protection of the primary swamp forest, the population of Proboscis Monkeys and the endemic fish species of DSWR.

$20,590,000

$2,550,000 $470,000

$23,610,000

Unquantified

Unquantified

$4,720,000 (operational costs)

$6,440,000 (labqir)

$1,770';poo $12,930,opo

.. : ~' ... -

$0

.,$760,000

$4,oio,ooo $4,7~il.ooo

$17,71Q,000 ~~ .

Increment

Protection of the primary ·swamp forest, the ·population of Proboscis Monkeys and the endemic fish species of DSWR.

'"

'.

$4,240,000

$670:00 . $470,000

$5,380,000

Increase No change

No change No change

Increase

-$380,000

-$310,000

-$90,000 -$780,000

$100.00 · No Increment

$500,000 $4,020,000 $4,420,000

$3,640.000

55

56 GEF


INTERPRETATION OF THE RESULTS

Given the uncertainties, one should not place too much faith in the exact numbers produced by the incremental cost analysis. The real advantage of this analysis, however, is that it forces one to be explicit about one's strategy and that it provides a context within which to discuss the financing of the required conservation activities. For DSWR, the case highlights the strategic question: what will our proposed participatory management project (the 'alternative') actually do to conserve the swamp forest and preserve the endemic species of the reserve (to meet the 'global environmental objectives' we set ourselves), not merely absolutely but over and above what we would have expected to happen anyway (the 'baseline')? This is a difficult but important question, yet if we can

answer it we have, almost incidentally, a framework for estimating how much more that is going to cost (the 'incremental cost' of the alternative activities over the baseline activities).

From Table 10 we can glean that: i. in the first row, the baseline strategy will not protect the primary swamp forest, the population

of Proboscis Monkeys, or the endemic fish species of DSWR, whereas the alternative would; ii. in the second group of rows, if we took the actions in the alternative the domestic economic

benefits would be more than US$5 million greater over the 10-year period 1992/93 to 2001/02 than they would have been had we relied on the baseline actions, perhaps considerably more so given the additional indirect benefits;

iii. in the third group of rows, the alternative's costs would exceed those of the baseline by US$4,420,000;

1v. taking into account the reduced extraction costs in the case of the protected reserve compared to those in the baseline, the alternative's costs would exceed those of the baseline by US$3,640,000;

v. overall, the costs of the alternative net of the increased economic benefits it yields would be lower than the net costs of the baseline by US$1, 740,000.

Strategy

One set of issues is technical. Does the alternative strategy provide the protection required? Despite

its reasonableness, no detailed socio-ecological modelling yet provides a definitive answer to this.

An unresolved question, for example, is the interaction of the proposed strategy with the population of the reserve. The population in the reserve might decline under the baseline strategy, once the costs of extraction rise and the harvest yields fall, because families would move out in search of

economic opportunities. While a lower population would then put less pressure on the resources,

other things being equal, an impoverished population is more prone to harvest unsustainably. The

population might increase in the alternative, because the natural increase would not be offset by emigration from the reserve, and the increased yields coupled with the open access of DSWR might also encourage harvesting by outsiders. So the impact of the increased yields and income generation schemes cannot be forecast very accurately.

Another issue is economic. How well have the economic declines in harvest and rises in cost been

modelled? The 5% annual change scenarios were based on recent observations and expert judgment, but some sensitivity analysis is required to show how critical these assumptions are. ·

Financing

W'ETLANDS 'tiii;ii'·iii.if f.ii

COMMUNITY MANAGEMENT JN DANAU SENTARUM WILDLIFE RESERVE, JNDONESIA

Overall, the project appears economic in purely domestic terms, i.e., it is not necessary to invoke

specifically global benefits to justify the actions economically as the incremental cost (US$3,640,000)

is less than the incremental domestic benefit (US$5,380,000). On this basis, one might expect Indonesia

to finance it The case study, however, illustrates a number of reasons why this is problematical.

Multiple actors First is the large number of actors (multiple government agencies at different

levels and distinct community groups comprising individual villages). The extraction costs are directly

related to the harvest benefits, so that reductions in these costs in the alternative are easily appropriated by the harvesters. Other costs are borne by government agencies and are incurred to generate

results for a wide group, including off-site and future beneficiaries. It would be administratively

difficult to devise an efficient and fair mechanism for recovering these costs from beneficiaries.

Uncertainty of future benefits The second, related to the technical and economic issues above, is the uncertainty of future benefits. Although the benefits are great, their exact size and distribution cannot be known with certainty, making this seem an economically risky proposition. Sensitivity

analysis of the incremental costs shows that if the alternative merely maintains yields, the overall

incremental costs will exceed the incremental domestic benefits. In Table 11, the results are shown for changes in assumption, five percentage points different from the case shown in Table 10.

Table 11: Sensitivity Analysis

Assumptions Incremental benefit

Reference case

B: 5% decline in yields

A: 5% increase in benefits

B: 10% decline in yields A: 5% increase in benefits

B: 10% decline in yields A: No increase in benefits

B: 5% decline in yields

A: No increase in benefits

B = Baseline Strategy; A= Alternative Strategy

Costs are NPV in 1993/94 US$

Discount rate 10% p.a.

$5,380,000

$6,550,000

$3,960,000

$2,810,000

Incremental cost

$3,640,000

$4,580,000

$4,580,000

$3,840,000

57

58 GEF


Link between domestic economic benefits and biodiversity conservation The third reason is that

increasing the domestic benefits is in any case technically necessary for securing the biodiversity; a

strategy where domestic benefits are held constant would not succeed.

Time profile of incremental costs The fourth reason is that the incremental costs are typically

incurred early, whereas the incremental benefits are achieved later. This means that there is an initial problem in financing the incremental costs, even though over time the domestic benefits more than

compensate for this expenditure. The NPV is a summary that hides this time structure. For the

alternative strategy for DSWR, the incremental cost has exceeded the incremental domestic benefits

in the first five years (1992/93 to 1996/97 - Phase 1 ), but in the next five years (Phase 2) the incremental

cost will be lower than the incremental benefits (Figure 2).

1,000,000

·. :-..... ' Year

1993/94 1994/95 1995/96 1991;,(97 ". 199l798, 1998/99 1999/00 2000/01 2001/02

(1,000,000)

(1,500,000)

(2,000,000)

(2,500,000)

Baseline 5% decline Alternative 5% increase


··,,, '' .............. __________ _

------------

---



Figure 2: Net Incremental Cost of Conserving the Biodiversity of DSWR

CONCLUSION

W'ETLANDS 1tiii-1Jf.iii.i~f.ii

COMMUNITY MANAGEMENT JN DANAU SENTARUM WILDLIFE RESERVE, INDONESIA

This case study of Danau Senta rum Wildlife Reserve illustrates a number of the features of incremental

cost analysis and funding:

i, baseline trends cannot readily be inferred from plans alone or from available data and social

ecological models;

ii. moving away from unsustainable trends may require deliberately raising the economic

benefits accruing to indigenous populations in order to address the poverty underlying the

biodiversity loss;

iii. avoiding the need to monetise biodiversity value, which is controversial and uncertain, in

favour of making inferences on the more tangible costs of alternative strategies;

iv. even when biodiversity conservation is economic in purely local economic terms, it may be

difficult to fund conservation by recovering costs from the multifarious beneficiaries, because

the benefits are often subsistence in nature and because the link between the funded actions

and the benefits is often long-term or indirect; and

v, the domestic benefits of conservation are less certain than the costs and these benefits tend to

be realised later than the costs are incurred, making it difficult to make a convincing case for

funding biodiversity conservation from domestic budgets.

REFERENCES

Aglionby, J. C. (1995a) - Aspek Ekonomi Sumber Daya Alam di Kawasan SMDS. In: Proceedings

Lokakarya Pengembangan Suaka Margasatwa Oanau Sentarum Pontianak 25-26 Januari

1995. ODA/PHPA/AWB Pontianak, Indonesia. Ag I ion by, J. C. (1995b) - The Economics and Management of Natural Resources. In: Oanau Sentarum

Wildlife Reserve, West Kalimantan, Indonesia. A Collection of Papers. ODA-Ministry of

Forestry.

Giesen, W. (1987) - Oanau Sentarum Wildlife Reserve; Inventory Ecology and Management

Guidelines. WWF Indonesia, Bogar, Indonesia.

Giesen, W. (1995)- The Flooded Forests and Blackwater Lakes of Danau Sentarum Wildlife Reserve,

West Kalimantan, Indonesia. AWB (Indonesia) - AWB (Malaysia) IPT, University of Malaya,

Malaysia. ITFMP Report 127.

Klepper, 0. (1994) - A Hydrological Model of the Upper Kapuas River and Lake Sentarum Wildlife

Reserve. PHPA-AWB. ITFMP Report No. 60.

Kottelat, M. (1993) - Technical Report on the fishes of Danau Sentarum Wildlife Reserve and the

Kapuas Lakes area, Indonesia. AWB-lndonesia, 97 pp.

Luttrell, C. (unpublished) - Forest Burning in Danau Sentarum. PHPA-AWB.

National Development Planning Agency (1993) Biodiversity Action Plan for Indonesia. Jakarta,

Indonesia.

Neher, P.A. (1990) - Natural resource economics. Conservation and exploitation. Cambridge, UK.

Panayoutou, T. & Ashton, P. (1992) - Not By Timber Alone. Island Press.

Presiden Republik Indonesia (1945) - Undang-Undang Dasar Republik Indonesia, Jakarta.

59

60 GEF


Presiden Republik Indonesia (1967) - Undang-Undang Nomor 5 tahun 1967 tentang Ketentuan

Ketentuan Pokok Kehutanan, Jakarta.

Presiden Republik Indonesia (1990) - Undang-Undang Nomor 5 Tahun 1990 Tentang Konservasi

Sumber Daya Alam dan Ekosistemnya, Jakarta.

SEADD (1991) - Project Memorandum. Indonesia/United Kingdom Tropical Forestry Management

Project. Sub-Project 5: Conservation SEADD ODA, Bangkok.

Sebastian, A. C. (1994) - A Preliminary Investigation of the Proboscis Monkey Population in Danau

Sentarum Wildlife Reserve, West Kalimantan, Indonesia. PHPA-AWB ITFMP Report 61.

Widjanarti, E.H. (1995) Keanekaragaman fauna ikan di Kawasan Suaka Margasatwa Danau Sentarum,

Kalimantan Barat. Disampaikan pada Seminar Biologi XIV dan Kongres Nasional Biologi XI,

24-27 July 1995. Universitas l_ndonesia, Depok, 13 pp. (paper presented at a national seminar)

Widjanarti, E.H. (draft) - A Checklist of Freshwater Fishes of Danau Sentarum Wildlife Reserve and

Adjacent Areas, Kapuas Hulu, West Kalimantan. PHPA-AWB, Bogar.

CHAPTER 4

FISHING PRACTICES IN THE WIAWI MARINE WETLANDS, VANUATU

Valentine Thurairaja

The Wiawi Marine Wetlands in Vanuatu is a fringing reef where the threatened Green Turtle Chelonia mydas and the endangered Loggerhead Turtle Caretta caretta nest and feed. The turtles in this habitat are threatened by overharvesting, by collection of eggs, by overharvesting of the Trochus Trochus spp. and Green Snail Turbo marmoratus on which they feed, and by clear-felling the Wiawi forested catchment which will silt the wetland and smother Trochus and Green Snails. Vanuatu will incur incremental costs in removing the barriers to more sustainable use of the components of this biodiversity and in constraining its logging methods. This case study illustrates three particularly interesting features. First, because current trends are unsustainable, just moving to sustainable development will incur a cost and cause a loss of benefits in the short term as harvest rates are reduced, even though this action, is of economic interest in the long run. Second, going beyond 'mere' sustainable development to protect not only the biological resources for their subsistence value, but also the diversity of those resources, will impose incremental costs that exceed any increase in domestic benefits. Third, costs are incurred both within the ecosystem under threat and in the economic sector that adds to that threat: namely, forestry These costs need to be taken into account when devising a financially sustainable solution.

BIODIVERSITY AND THE WIAWI MARINE WETLANDS HABITAT

In the Pacific Islands, six species of sea turtle play such an intimate role in the culture and identity of the islands that they have acquired 'flagship' status: the Green Turtle Chelonia mydas, the Hawksbill Turtle Eretmochelys imbricata, the Leatherback Turtle Dermochelys coriacea, the Loggerhead Turtle Caretta caretta, the Olive Ridley Turtle Lepidochelys olivacea, and the Flatback Turtle Natator depressus. Yet all could be extinct within a few breeding cycles. This is due mainly to overharvesting of eggs and juvenile and adult turtles, and to commercial trade in turtles and their products. Unsustainable harvests, combined with very slow breeding - turtles take 20 to 50 years to start laying eggs and only one in a thousand hatchlings survives long enough to breed -threatens the existence of these unique creatures. In a major international conservation effort, 1995 was declared the 'Year of the Sea Turtle' by 26 countries in the region.

61

62 GEF


The ecology of Vanuatu is similar to that of the rest of the Pacific region and the area is an important turtle habitat In particular, the island of Malekula and the adjacent Maskelyne .islands are listed as being of regional and international importance for the conservation of marine turtles (Thorsell, 1989; UNEP/IUCN, 1988). Recent surveys by the South Pacific Regional Environment Programme (SPREP, 1991) and the Vanuatu Environment Unit (1994) have confirmed and recorded the feeding and nesting sites of the Green, Hawksbill, Leatherback and Loggerhead Turtles. IUCN lists the Green, Hawksbill, Loggerhead and Olive Ridley species as endangered, and all are included on CITES

Appendix I.

The Wiawi Marine Wetlands (WMW; known locally as Nagha Mq Pineia) - on the west coast of the island of Malekula, Vanuatu (Figure 1) - are extremely significant as turtle nesting habitat compared to other known nesting sites in Vanuatu. It is a habitat for a nesting and feeding population of the threatened Green Turtle and the endangered Loggerhead Turtle. Furthermore, the smallness of the nesting population of Loggerheads may well mean that this is the only recorded nesting habitat for Loggerheads in Vanuatu. The Olive Ridley and the Hawksbill Turtles have also been sighted by villagers (Tacconi, 1995a). Wetlands such as WMW are considered as marine wetlands under the Ramsar Convention, and a recent report on A Global Representative System

of Marine Protected Areas (GBRMPA/World Bank/IUCN, 1995) has proposed marine protected area status for the island of Malekula.

WMW comprises a fringing reef (i.e., a coral structure attached to the mainland or to continental high islands), associated reef flats, a bay, littoral zones including a nesting beach, the terrestrial beach forest and forested catchment areas. The fringing reef extends seawards to an average of around 202 m from the beach and the total extent of the reef is about 1.9 km2, or approximately 190 ha. The reef and its adjacent mainland coastline are flanked by a forested catchment of 1,060 ha drained by two streams discharging water into the reef and sea.

The Wiawi reef zone is a rich source of reef fish for subsistence consumption, and supplies important commercial resources in the form of Trochus shells, Trochus spp. and Green Snail Turbo marmoratus

for the villages of Wiawi, Wiel and Wiliekh .

The turtle nesting zone extends from the reef edge to 100 m inland from the shoreline, taking in

the turtle nesting beach area and the surrounding distinct beach forest vegetation found parallel

to the coast, from the village of Wiawi to Wiliekh.

The area is under customary ownership, which extends to both terrestrial and reef areas. Access to resources is controlled by the Chief of Wiawi (Wiawi had six households in 1995) and customary land owners. Significantly, the people of two other villages (Wiel, 52 households, and Wiliekh, 15 households) also have access to harvest marine resources such as Green Snail and Trochus, and to establish gardens and plantations within the forested catchment. These two villages are also included in this study of the WMW area as they are major resource users1. '

1 Assuming an average household size of five, the estimated total population of the Waiwi area is 365.

#ETLANDS 1 t'i!;i}f.iit.iff.ii


166° 168°

14°

16°

<;).

VANUA LAV~A .... .

i '·

AMBAE

\

MAEWO

~· r ~··

'· . . i

Wiawi Marine Wetland ~ A.MBRYM

~ '!' 'oo

I\,.. EPI~.

. '(J

~·<;I

0 100

160° 180°

VANUATU~: •• , SAMOA

~ .. ·.' '\!,;.' TONGA

NEW CALEDONIA

,,

160°

\.NEW ZEALAND

180° ' 168°

170°

N

t 14°

16°

18°

ERROMANGO

FUTUNA

•,

ANETTYUM

~170°

..

20°

Figure 1: Location of the Wiawi Marine Wetlands, Vanuatu

63

64 GEF


THREATS TO BIODIVERSITY

Logging threat to turtle habitat

One or the main short-term threats to Vanuatu's turtle population and its coral reefs is increased siltation due to logging of watersheds (Done & Navin, 1990). In the long term, destruction of the corals will reduce protection and erode the nesting beaches.

Forests cover 427,000 ha, more than a third of Vanuatu, although the commercially loggable area is 116,640 ha and the area suitable for large-scale logging is only about 64, 759 ha. While the forestry sector contributed around 4% of GDP in 1991, timber exports have grown strongly since then. Between 1991 and 1993, volumes quadrupled and the value tripled. The volume of logging permits now seems well in excess of the sustainable yield, estimated at between 38,000-52,000 m3/year, depending on the range of species harvested. For example, in January 1994, it was reported that licences for logging 152,000 m3/year had been issued and that additional licences, which could have doubled the volume, have since been approved (Duncan, 1994).

Malekula holds an estimated 300,000 m3 of commercial timber (Tacconi, 1995a). In December 1994, the Government of Vanuatu reissued a logging licence to a logging company to harvest a maximum annual volume of 35,000 m3 and a minimum volume of 15,000 m3 . A second logging company has been negotiating with the Government for an additional logging licence. An annual harvest of 35,000 m3 means that all merchantable timber would be exhausted in about eight years. Logging operations carried out at the minimum annual harvest of 15,000 m3 would extract all the merchantable timber of the island in 20 years (Tacconi, 1995b). In either case, logging would appear far from sustainable.

Slope conditions in the Wiawi catchment area would make logging a major threat to WMW because of the resulting soil erosion and siltation. The Wiawi forested catchment is steeply sloping down to the beachfront. It is drained by two streams discharging water, one near the village of Wiliekh and the other near the village of Wiel. Since the area receives a rainfall of 1,200 mm/year, this results in a high discharge of water along the beachfront. Any large-scale clearfelling of the Wiawi forested catchment would seriously silt the area and smother the coral reef area, killing corals and commercial stocks of Trochus and Green Snails, and reducing the feeding habitat of the marine turtles. Logging would also increase the frequency and intensity of flooding, damage nesting sites, and wash away turtle eggs. At the time of fieldwork (September 1995), there was no logging in the Wiawi area although adjacent forests were being mapped for logging. Representatives of logging companies had held negotiations with the customary land owners there and had offered logging contracts, although the customary owners had until then declined.

Harvesting threat to populations of turtles and the species on which they feed

Turtles The people of Vanuatu have subsisted on turtles for hundreds of years, and the taking of limited numbers of turtles for food and traditional local uses continues today. Although the meat, eggs and shells of both the Green and Hawksbill Turtles are used only locally (SPREP, 1995) and are

#ETLANDS 'Bi'idit.tit.i}f.ii


not commercially traded, the high harvesting rates will cause the country's turtle population to become extinct within a few breeding cycles.

The threat to the turtles has to be understood in terms of the concentration of nesting sites. The ecological linkages between Wiawi's marine wetlands or fringing reefs and the turtle's life cycle are fundamental to the conservation of the species. These ecological linkages are particularly strong in the Loggerhead and Green Turtle species because of their feeding habitat and inter-nesting habitat. The feeding habitat comprises tidal and sub-tidal areas, including coral and rocky reefs, sea-grass meadows and algal turfs on sand and mud-flats, and the inter-nesting h<!bitat comprises reef areas adjacent to the nesting beach where turtles return at approximately 2-weekly intervals during a critical period in their breeding cycle. Recent genetic studies (Limpus, 1993) have revealed that the populations of these turtle species are fairly isolated, and that populations from different sites do not interbreed. Hence, different nesting turtle populations are unique, and if they are completely harvested from one site they will become extinct (SPREP, 1995). Most females return to the same small beach both for their successive clutches of eggs within a nesting season and also for successive nesting seasons (Limpus, 1993). This means that local overharvesting of turtles cannot be compensated for by populations nesting elsewhere, and will lead to local extinction. In Wiawi, the Environment Unit (1994) turtle surveys of 1993 and 1994 identified two concentrations of nesting sites: Neier Beach and Petavoi Beach.

The threat to the turtles also has to be understood in terms of the two distinct populations that the author identified within each breeding group of Green and Loggerheads: a nesting population and a feeding population on the reefs (which do not nest in Wiawi). The feeding population is unlikely to mate with the nesting population during the inter-nesting period, when the nesting population use the reef area as an inter-nesting habitat. Threats to both the nesting population and the feeding population need to be evaluated. Although the feeding population may not have a role in the breeding cycle of the nesting population at the WMW site, it may have a breeding role in nesting populations of other sites. However, in Wiawi it seems that the threat to the nesting population is the more serious. Interviews with the Chief of Wiawi and the villagers indicated that the harvesting of female turtles, eggs and hatchlings is a common practice, but that (unlike in the Maskelyne 1,slands in south Malekula) there is no organised hunting of turtles on the reefs, nor do the villagers go out in canoes to spear turtles.

The seriousness of the threat to the nesting populations is due to the small numbers of turtles and the high rate of harvesting, the result of increasing population of the villages and (as noted

by Tacconi, 1995a) the apparent lack of any controls or enforcement of fisheries regulations on the harvesting of turtles and eggs in the Wiawi area. Based on the data collected, it is estimated that there is an annual nesting population of only 100 Green Turtles and 10 Loggerheads (C. Limpus, pers. comm.). If the present trend in turtle exploitation continues, the turtles and eggs will be overharvested, leading to the total extinction of the nesting population.

Trochus Turtles feed on Trochus and Green Snail, both of which are under threat. The natural distribution of Trochus is dependent on the presence of coral reefs. Trochus inhabits shallow, sunlit waters, rarely being found deeper than a few metres, and is easily targeted by experienced divers.

65

66 GEF


It is particularly susceptible to overharvesting and can be depleted in a short period of time (Bell &

Amos, 1993). Trochus shells are collected by hand on the reefs by rural fishermen diving using

goggles or face masks. The main Trochus fishing islands are Malekula, Epi, Tongoa and Efate. Trochus

shells are purchased by shell factories producing button blanks for the high quality garment industry,

and are exported to Japan, France, Hong Kong, Singapore, Taiwan and Korea. Up until 1995 there

were five shell factories in operation, and the high prices offered for Trochus made it highly profitable

for fishermen to over-harvest and sell it to shell factories. Stock surveys carried out by the Fisheries

Department in 1990, 1991 and 1992 indicated that stocks were rapidly declining (Bell & Amos,

1993). In response, the Government of Vanuatu introduced a quota system for the shell factories and placed an upper limit of 75 tonnes of raw shells per year (Sant, 1995). In September 1995,

the author visited a shell factory in Port Vila (the capital of Vanuatu), and was informed that this

was the only one in operation at that time and that the other factories had closed because they

could not get enough shells.

Vanuatu's Fisheries Regulations prohibit the taking, harming, possessing, selling or purchasing of

any Trochus which is less than 9 cm in diameter when measured across the base. However, the

minimum legal size is poorly enforced in rural areas where Trochus is collected, which is leading to

a rapid decline in stocks. Tacconi (1995a) reports that the stocks of Green Snails and Trochus are

in rapid decline in the reefs of the Wiawi area and will be extinct in a few years if current harvesting

rates continue.

Green Snail The Green Snail is a gastropod occurring on reef crests and deeper slope areas similar to the habitat of Trochus, although it ranges deeper than Trochus to at least 20 m. Green Snail is

used generally in the mother-of-pearl industry, primarily for inlay in woodcrafts but also for jewelry and the clothing button industry (Sant, 1995). Since 1987, only worked material (in the form of button blanks) has been permitted for export.

The main protection for the Green Snail in Vanuatu is the regulation on the minimum size, set at 15 cm basal length (diameter). The Green Snail cannot be exported from Vanuatu without the permission of the government - there is a maximum penalty of V100,0002 (about US$900)

for illegal harvest. The high proportion of Green Snail caught below the minimum size indicates

the poor level of enforcement, and the sharp decline in the harvest (from 44 tonnes in 1991 to

7.5 tonnes in 1992) shows the extent to which stocks of Green Snail have declined (Bell & Amos,

1993).

System boundary

The scope of the analysis of the costs and benefits should be large enough to capture all the important threats above. The system boundary for this case study therefore includes all the

following:

Social interactions The village of Wiawi and two other villages of Wiel and Wiliekh, adjacent to the

2 V=Vatu

\l'/ETLANDS l:il!;l}f.ill.J~f.ii


area, which have resource harvesting rights. Attempts at resource management should therefore include all three villages to ensure effective management and cooperation.

Ecology The turtles and their habitat.

' Economic sectors The activities in the immediate forested catchment area, upon which this habitat (including the reefs and the beaches) depends. Any conservation effort must therefore include preventing degradation of the catchment.

CURRENT TRENDS

Before analysing the costs of possible solutions, consider first the trends.in ecological destruction over (say) the next 15 years and the costs of resource extraction.

The limited land, coastal and reef areas of Vanuatu are under pressure from growing populations and rising material expectations. Since independence in 1989, economic development has been slow and uneven. Modest real economic growth (2-3% per annum) is based on construction activity for an expanding public investment programme, steady tourism income, increased logging, and slightly stronger commodity prices (Fallon, 1994). Although there has been an improvement in basic education and health indicators, real income per capita is .lower than it was a decade ago and rural populations have extremely low cash income (Fallon, 1994).

This rural population subsists on fishing and forest products, but harvesting threatens to deplete not only globally significant biodiversity but also locally important resources. The overharvesting of turtle eggs and turtles poses a serious threat to the continued supply of these delicacies for villagers, commercial harvesting rates have far exceeded the natural supply of Green Snails and Trochus shells, and commercial timber stands are being sought by logging companies that have harvesting rates in Malekula well in excess of the sustainable levels. The reason for such overexploitation is that it maximises the short-term financial returns to the government agencies, commercial logging companies and commercial traders of Trochus and Green Snails, and the subsistence benefits to residents of the area who over-harvest turtle eggs and meat, at the expense of long-term sustainability.

This can be seen by looking at the costs and benefits of a continuation of the recent (1990-1995) trends for the 15 years following the field work in 1995. Over this period, continued exp,loitation of turtles, eggs, Trochus and Green Snails at the recent rates and logging would result in a gradual decline in natural capital stock. This decline could be followed by a sudden irreversible collapse of the stocks. (See Table 1 for overall trends.)

Timber Clearfelling operations on the forested catchment could exhaust the 230 ha commercial timber stand within two years. This would lead to increased soil erosion and the siltation of the river and the reef, smothering the coral. As the coral begins to die, it will reduce the yield of Trochus and Green Snail which use the reef as their habitat. (Overharvesting will further accelerate

67

68 GEF


this decline in yield.) An annual reduction is likely, and a decline of 20% after the second year is

assumed. Clearfelling, through the resulting siltation, also affects various reef fish and shell fish

somewhat. The reef fish and shellfish yields could stay the same for up to ten years before declining

(by an estimated annual rate of 2 %) as the effects become permanent.

Fish and non-timber forest resources Current subsistence harvesting of mixed reef fish, shellfish and non-timber forest products will probably continue whatever strategy is adopted for conservation.

An attempt is made to value subsistence production of mixed reef and shellfish. It is also assumed

that occasional cutting of individual trees for house-building or canoes will continue. This type of ad hoc direct use of timber will not cause any damage to the ecosystem. Subsistence use is essential for

the survival of the local population.

Turtles About ten turtles are taken a year by the villagers during the nesting season between

September and January. Given that there are about 100 Green Turtles and 10 Loggerheads in the

nesting population, these species will be harvested to extinction in a few years.

Although the Government of Vanuatu has recently started to decentralise powers to the Provincial

Governments (Decentralization and Local Government Regions, Act 1of1994), it is doubtful that

Provincial Governments can generate the revenue to sustain services to rural areas. They will

continue to rely heavily on Central Government grants to finance their development activities. On current trends, the Malampa Provincial Council is unlikely to spend any significant amount in Wiawi

(1995-201 O).

Table 1: Current Trends

Resource

Forestry

Trochus

Green Snail

Mixed reef fish and shell fish

Turtles and eggs

Trend

Total commercial timber logged and exhausted in two

years

Annual reduction of yield by 20%

Annual reduction of yield by 20%

Constant yield for first 10 years and decline by an

annual reduction rate of 10% thereafter

Overharvested to extinction (not included in

estimation)

The costs and benefits3 are estimated in Tables 2 and 3, on the above assumptions, and those of

Appendix 1.

3 A iield study was carried out in the Wiawi area with the assistance and support of the Environment Unit, Government of Vanuatu. The estimation is based on data collected during a field survey of the area in September 1995. Data were collected mainly through semi-structured interviews with the Chief of Wiawi and other customary owners and with the people of the two other villages of Wiliekh and Wiel, who also have access to the biological resources of the area. The Environment Department made available all relevant data on turtle monitoring carried out in Wiawi and access to reports. Extensive interviews were held with the Environment Unit, Department of Fisheries and the Department of Agriculture. Discussions were also held with the Malampa Provincial Council. A visit was made with the assistance of-the Department of Fisheries to a Trochus and Green Snail factory processing shells for the production of button blanks in Port Vila, capital of Vanuatu. Interviews were held with the operator of the factory. The interviews were supplemented by discussions with experts attached to Australian academic and research institutions.

'V/ETLANDS lt'iij-iff.Jii·lif.ii

FISHING PRAcnCES IN THE WIAWI MARINE WETLANDS. VANUATU

Table 2: Costs on Current Trends (Vatu)

Year Forestry Trochus Green Snails Fisheries

95/6 29,900,000 2,400 2,560 0 9617 29,900,000 1,920 2,040 97/8 0 1,540 1,640 98/9 1,220 1,320 99/0. 980 1,040 00/1· 780 840 01/2 620 680 02/3 500 540 03/4 400 420 04/5 320 340 05/6 260 280 0617 200 220 07/8 160 180 08/9 140 140

09/10 100 120

Notes:

Shellfish

0

Government I 434,996 434,996 434,996 434,996 434,996 652,494 652,494 652,494 652,494 652,494 869,992 869,992 869,992 869,992 869,992

This does not include subsistence labour, the value of which is hard to estimate. See Table 1 for assumptions and

Appendix 1 for details.

NPV of costs in 1995/96, discounted at 10% p.a., is V62.00 million ($543,850).

Table 3: Benefits on Current Trends (Vatu)

Year

95/6 96/7 97/8 98/9 99/0 00/1 01/2 02/3 03/4 04/5 05/6 06/7 07/8 08/9

09/10

Benefits

55,044,950 54,561,618

2,035,051 1,833,181 1,671,992 1,538,846 1,437,992 1,355,857 1,291,446 1,236,729 1,093,400

964,613 856,513 760,245 673,771

Notes: See Table 1 for assumptions and Appendix 1 for details

NPV of benefits in 1995/96, discounted at 10% p.a., is V113.87 million ($998,840).

70 GEF


On current trends, there will be high benefits in the early years but these will rapidly decline over the years. This means that the country is liquidating its natural capital assets and destroying. its economic base, hence losing the ability to maintain economic benefits in perpetuity or sustainability. At the same time, the process of ecological degradation will also set in. For example, the first 15 years have yielded benefits of V114,014,950 or US$1,000, 131 in NPV terms. However, should the current trends continue for another 15 years (2010-2025), it will yield only an additional V731, 731 or US$6,419 in NPV terms, demonstrating a rapidly annual reduction trend in yields. It can be shown that if current trends continue beyond 2025, yields will decline further and approach zero. Closely following the destruction of the economic base is the gradual degradation and eventual collapse of the ecosystem and biodiversity of the area.

The current trends show the key constraints that need to be removed to achieve sustainable development.


To devise a feasible plan for conservation of the endangered turtles, it is necessary to understand the overall development goals of Vanuatu and its conservation strategy.


The broad development goals provide the starting point for a country's conservation strategy, because this strategy should respond to current environmental trends in ways consistent with these goals. The strategy would include the preservation of biological resources, such as turtles, and e·nvironmental services, such as control of erosion, to the extent these provided benefits to the population. As such it would maintain at least the quantity if not the diversity of these resources.

Vanuatu's broad development goals are described in the National Development Plans. The Third National Development Plan (1992-96) states that "although Vanuatu is a least developed country, the government is committed to economic growth and development which has minimal negative environmental impact" (Republic of Vanuatu, 1992). The plan identifies the natural resource sectors - agriculture, livestock, forestry and fisheries - for further development.

Conservation Strategy

Widespread environmental degradation is not yet severe, but potentially serious problems threaten. Vanuatu can take preventive action now before remedial action is required. Planning for environmentally sustainable development suggests that the rate of use of marine resources be controlled, or stocks enhanced, so that replenishment equals or exceeds withdrawal, that fishing and logging practices be modified to protect the environment, and that land use be intensified so that further expansion into forest and marginal land is slowed or stopped. These principles have in fact been incorporated in the Vanuatu National Conservation Strategy (Vanuatu, Govt. of, 1993), one of the first of its kind in the South Pacific.

W'ETLANDS lti I ij ;I Jf.i I i.IJf.i I


In relation to the particular problems in the WMW, the Fisheries Department recently began conserving and managing turtle hatchlings ex situ, to increase survival rates and to study growth patterns. It has already set up a small nursery for Hawksbill hatchlings and has also recently approved a larger Hawksbill nursery, the Tuku Tuku Ranch Young Turtle Project, which will be set up at Tuku Tuku Bay as a head start programme (Fisheries Department, 1995). There are no plans

at present to establish a nursery or hatchery for the endangered Loggerheads or hatcheries to protect eggs (as is common in countries like Malaysia, which has a large nesting population of turtles). The Government of Vanuatu is, however, keen to combine the ex situ efforts with appropriate in situ efforts at conservation.

Biodiversity conservation would require the cooperation of customary owners in habitat and species management. Barriers to this include customary resource ownership, lack of information on endangered species and lack of enforcement of key resource management legislation.

Legislation and Enforcement

From a biodiversity conservation perspective the two important legislative measures to regulate marine resource management are:

• The Fisheries Act 1982 - which allows the Minister of Fisheries to implement fishery conservation measures and controls on collecting coral and aquarium fish and to protect turtles and marine mammals and

• The Fisheries Regulations 1983 - which sets size limits on Trochus, Green Snail, bubu shells, lobsters and coconut crabs and sets quotas on Beche-de-mer and restrictions on coral and turtles.

Further, the nests and eggs of all species of turtles are fully protected; the trade or export of Hawksbill shell is prohibited. However, the consumption and sale of turtle meat is not regulated (Tacconi, 1995a). The killing of adult turtles is permitted in Vanuatu (Bell & Amos, 1993).

The Vanuatu Conservation Strategy (Vanuatu, Govt. of, 1993), however, recommends stricter measures to enforce existing size limits and that the regulations be strengthened by additional provisions to set quotas according to the status of the resource within individual regions.

BASELINE STRATEGY: SUSTAINABLE DEVELOPMENT ONLY

Consider a conservation strategy for the WMW that would meet Vanuatu's broad development

goals at the lowest cost.

Any conservation effort should be made with the agreement of the customary owners as it

would involve modifications to harvesting practices and access, restrictions on resource use,

71

72 GEF

INCREMENTAL COSTS OF WETLANO CONSERVATION

stricter enforcement of resource-use legislation, and strengthening of both and government and community institutions. This is the approach adopted for the conservation of the WMW marine wetlands through the preparation and implementation of sustainable resource management plans for forestry, Trochus and Green Snail resources. However the conservation of turtles in Wiawi is not a sufficiently high national priority as they do not generate commercial benefits or revenue.

A baseline strategy of restricting harvests within sustainable levels would ensure the continuation of the domestic economic and subsistence benefits. This would include fisheries management (for Trochus and Green Snail), and forest management. The government would incur costs in preparing management plans, community education, enforcement and monitoring.

Activities

Timber Such a strategy could permit environmentally sound, selective logging by means of small portable saw mills, or 'chain saws' (see Box). Due to the patchy nature of the forest in Wiawi and the number of mixed commercial species, this type of operation is considered as the most suitable. If the operation is managed well with adequate training, it could yield sustainable incomes with only minimal environmental damage. Although the cutting capacity of these portable saw mills is 3 m3/day in well managed operations, the actual logging extraction is much lower (around 1.25 m3/day in Vanuatu). The costs of silvicultural treatment and enrichment planting (to the original density of 10 m31ha) to maintain sustainability would be attributed to this strategy. This logging cycle will provide a sustainable stream of benefits.

Trochus and Green Snail The management plans for Trochus and Green Snail would use the 'closed season' and stricter enforcement of the minimum legal size as the main control measures. Closed seasons need to be enforced for two years after harvesting has been permitted for a year. This should maintain current yields. (See Table 4 for the costs of this strategy.)

Benefits under the baseline strategy

The implementation of resource management activities will ensure that a stream of domestic benefits from forestry and marine resources will be maintained in perpetuity. (However, they are not designed to conserve the turtle species.) (See Table 5 and Appendix 2 for assumptions under which the benefits can be estimated, and Table 5 for the estimated benefits of this strategy.)

w"ETLA~DS IUili-i}t.1;1.1~01


Box: Portable Saw Mills

Small saw mills have been promoted in Vanuatu since 1989 as a means of maintaining the forest environment and providing for rural development. Portable saw mills used i~

Vanuatu, and elsewhere in Melanesia and the South Pacific, are designed to cut good quality timber at a site in or near the forest Locating the sawmill close to the trees reduces the need for expensive movement of large logs. It enables only Hie smaller, higher value sawn timber to be transported long distances. This in turn reduces the need for heavy logging' machinery and roads, and the large capital input that this entails (Wyatt, 1994).

The sawmill is equally suitable for both hardwoods and softwoods (although the former are slower to cut), and is appropriate for working in tropical forests where there is a wide variety of tree species (Wyatt, 1994). Portable sawmills range in size from standard chainsaws to large machines that must be transported by truck. Jn Vanuatu, two types of portable sawmills are in operation: a chain sawmill and a small sawmill powered by a small petrol or diesel engine. It is estimated that in Vanuatu there about 12 portable sawmills in qperation. These are also found in the island of Mafekula (Wyatt, pers. comm.).

The sawmill may have the capacity to cut 2-3 m3/day (Wyatt, 1994). In reality however, the actual timber extraction is much lower - around 1.25 m3/day in Vanuat.u. Inadequate training is one of the key factors. in the low output of portable sawmills. Similar figures have be~n registered for Papua New Guinea, where these sawmills are mucl:i more widely used.

ALTERNATIVE STRATEGY: SUSTAINABLE DEVELOPMENT WITH TURTLE CONSERVATION-

If the intention is to go beyond 'mere' sustainable development that has economic or subsistence benefits to also conserve biodiversity (specifically turtles), some additional activities will be necessary and this will add to the cost. This alternative is the preparation and implementation of an Integrated Resource and Conservation Strategy (IRCS) that ensures both the conservation of turtle species and at least the same domestic benefits obtained in the baseline (i.e., from forestry and marine resources). The baseline plan for managing forest and marine resources sustainably would have to be enhanced with additional activities for conserving the turtles.

The author judges that the following additional ·activities would be needed: marine surveys, zoning and management plans, a turtle hatchery (for protectiOn of eggs and to increase survival rates), a nursery (holding facilities for baby hatchlings for scientific studies), community education and training, and guidelines for sustainable harvesting that protect at least 70% of the eggs laid

. -

73

8 74 GEF


(Limpus, 1993). Details of a Turtle Conservation Plan are given below:

Table 4: Costs of the Baseline Strategy .(Vatu)

Year Forestry Trochus Green Fisheries Shellfish Government: Fishery and Snails Forestry salaries l

95/6 6,496,271 2,400 2,560 0 0 579,995 96/7 6,496,271 0 0 289,998 97/8 6,496,271 0 0 289,998 98/9 6,496,271 2,400 2,560 289,998 99/0 6,496,271 0 0 289,998 00/1 6,496,271 0 0 434,996 01/2 6,496,271 2,400 2,560 434,996 02/3 6,496,271 0 0 434,996 03/4 6,496,271 0 0 434,996 04/5 6,496,271 . 2,400 2,560 434,996 05/6 6,496,271 0 0 579,995 06/7 6,496,271 0 0 579,995 0718 6,496,271 2,400 2,560 579,995 08/9 6,496,271 0 0 579,995

09/10 6,496,271 0 0 579,995

Notes: See Appendix 2 for assumptions.

Table 5: Key Assumptions for Estimation of Benefits of the Baseline

Activity ~ssumption ! '

Forestry products Existing commercial timber stand exhausted in 12 years (portable saw mills). Enrichment planting and silvicultural treatment to maintain constant yields in areas logged.

Trochus Cycle of harvests and closed seasons under management plan to sustainably manage Trochus. Harvesting year followed by 2 years of closed seasons.

Green Snail Cycle of harvests and closed seasons under management plan. Harvesting year followed by 2 years of closed seasons.

Mixed reef fish and shell fish Constant yields maintained.

\l'/ETLANDS IHll!·l~l·llM~HI


Table 6: Benefits of the Baseline Strategy (Vatu)

Year Forestry Trochus Green Snails Fisheries Shellfish

95/6 8,740, 152 300,000 1,280,000 896,850 128, 100 96/7 8,740,152 0 0 896,850 128,100 97/8 8,740, 152 0 0 896,850 128, 100 98/9 8,740, 152 300,000 1,280,000 896,850 128, 100 99/0 8,740, 152 0 0 896,850 128,100 00/1 8,740, 152 0 0 896,850 128, 100 01/2 8,740, 152 300,000 1,280,000 896,850 128, 100 02/3 8,740, 152 0 0 896,850 128, 100 03/4 8,740, 152 0 0 896,850 128, 100 04/5 8,740,152 300,000 1,280,000 896,850 128,100 05/6 8,740,152. 0 0 878,913 125,538 06/7 8,740,152 0 0 861,335 123,027 07/8 8,740,152 300,000 1,280,000 844, 108 120,567 08/9 8,740, 152 0 0 827,226 118, 155

09/10 8,740, 152 0 0 810,681 115,792

Turtle conservation plan

An important component of any marine turtle conservation plan is the maintenance of quality nesting habitats and protection of the eggs, hatchlings and the nesters, all of which are threatened in WMW

Costs of the Alternative Strategy In designing a proposed alternative, it must be observed that the same or similar domestic benefits obtained in the baseline are obtained. This would mean that

harvesting of forestry, Trochus, Green Snail, mixed reef fish and shellfish must be allowed to continue in perpetuity or at sustainable levels.

However, managing harvests in a sustainable manner is not sufficient to protect the turtle species.

This is because of a lack of scientific information on the population and behaviour ofturtles, absence

of community training and education, monitoring and knowledge of precise conservation planning

for nesting and feeding populations of the turtles. The overall costs of this strategy are given in Table

7 on the assumptions of Appendix 3. The alternative strategy assumes the same benefits as the

baseline (Table 6).

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INCREMENTAL COSTS OF WETLAND CONSERVAnDN

Table 7: Costs of the Alternative (Vatu)

Year Marine Analysis & Community Evaluation of Scientific Environment Monitoring survey & planning education & programme interpretation, Fisheries & community social training and nursery, and Forestry education mapping handover hatchery salaries

95/6 9,629,600 6,478,400 730,000 434,996 0

96/7 7,680,000 1,753,000 434,996 0

97/8 730,000 434,996 0

98/9 730,000 434,996 0

99/0 2, 180,000 730,000 434,996 0

00/1 730,000 0 289,998

01/2 730,000 289,998

02/3 730,000 289,998

03/4 730,000 289,998

04/5 730,000 289,998

05/6 730,000 289,998

06/7 730,000 289,998

07/8 730,000 289,998

08/9 730,000 289,998

09/10 730,000 289,998

Notes: Some government costs will be borne for continuing community education and training and in establishing,

managing and monitoring management plans and harvesting practices. Government costs are 6 person weeks

for the first 5 years, and 4 person weeks for the next 1 O years, for monitoring only.

Scientific interpretation, nursery and hatchery facility: Hatchery facility implemented in Year 2. Two labourers

work all year round every year.

Turtle nursery will comprise 1 O holding tanks that will hold up to 100 newly hatched baby turtles.

INCREMENTAL COST

The overall costs and benefits of the different courses of action can be compared in a matrix of increments (Table 8). Note that there are increased costs in implementing the domestically economically optimum (sustainable development) plan and (in the short term) reduced benefits. Moving beyond this economic optimum to conserve turtles (the alternative) will impose further (incremental) costs.

w'ETLANDS fttig;i.!i.fil.IJf.!i


Table 8: Matrix of Increments for Wiawi Marine Wetlands (Vatu)

Item Current trend . Caseline activity Alternative (C) (B). . activi~y (A)

Global benefits Turtles Turtles Turtles (extinction likely) (extinction likely) . (survival likely)

Domestic benefits 113,867,805 86,526,485 86,526,485

Domestic costs 61,998,865 57,920,806 92,566,895

Notes: NPVs calculated for the period 1995/96 to 2009/1 O at 1995/96 using 10% p.a.

Data from Tables 2,3,4,6, and 7.

Increment (A-B)

Turtle survival

0

34,646,089

It must be noted that traditional custom and practice make a significant contribution to biodiversity protection and resource management in Vanuatu (IUCN, 1993). For example, seasonal custom 'taboos' and 'reserves' in certain areas such as in some marine wetlands help safeguard dugong, fish and turtles. It must also be noted that under the customary system if one person does not make use of the land or resource someone else can, .and this will encourage a 'harvest now' behaviour (Fallon, 1994).

ISSUES

The study shows that the concept of incremental costs can be operationalised for biodiversity conservation projects, and can provide a framework for discussing a number of issues:

The appropriate baseline

The study shows that sustainability and economic least cost need not be the same thing. At the assumed rate of discount, domestic economic benefits obtained from current trends actually exceed those under a sustainable development strategy, at least over the period of the study (1 5 years). Perhaps the current trends are a more reasonable approximation than the sustainable development strategy to a least-cost (i.e., baseline) strategy, which would affect the estimate of incremental cost? To what extent can Vanuatu finance sustainable development? Even if this were in the national interest, it may not be financeable because of poor balance of payments and the pressing need to finance social and economic development, which may force the country to allow exploitation of resources beyond sustainable levels in order to finance development

Another alternative strategy

During the fieldwork.it was observed that the people of Wiawi. and the Government of Vanuatu

77

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JNCRErJENTAL COSTS OF WETLAND CONSERVATION

were making preparations to take even further steps and establish WMW as a protected area. This

re-zoning would mean that commercial harvests of timber, Trochus, and Green Snail would not

be permitted. The incremental costs of this proposal can be found using the same method. Since the harvests_ will reduce, maintaining domestic benefits in this alternative so that they would at

least equal those in the baseline means examining a broader range of substitute income generating

schemes. It would be reasonable to include in the costs of an alternative strategy (establishing a marine park) the costs of developing new enterprises (e.g., ecotourism) to replace the commercial

benefits otherwise obtainable in the baseline.

Incidence of costs

There Is no doubt that the Wiawi customary owners and other resource users of the villages of

Wiel and Wiliekh will bear costs at the local level, while the benefits are also shared by the global

community. Attention will be needed to ensure that the alternative results in an appropriate distribution of alternative income opportunities at the local level, for fairness and social sustainablilty

of the strategy.

Financing options

It may be useful to look at any precedent or current practice of compensating local people for

foregone commercial opportunities in setting up similar protected areas in Vanuatu. Since the land

is legally owned by the customary owners in Vanuatu and in Wiawi, the government has neither the power nor the political will to declare a protected area. In these circumstances the government

has adopted other means to establish protected areas by way of leasing the land from customary land owners. The Department of Lands may offer between V100-500/ha/year. In the case of a protected area in Erromango the foregone royalty payments from logging were offered as the value of the lease (Tacconi and Bennett, 1995).

REFERENCES

Bell, L.A.J. & Amos, M.J. (1993) - Republic of Vanuatu Fisheries Resources Profiles. FFA Report,

93/49, Forum Fisheries Agency, Honiara, pp. 114-116.

Done, T.J. & Navin, K.F. (1990) - Vanuatu Marine Resources: Report of a Biological Survey Australian

Institute of Marine Science, Townsville, Australia.

Duncan, R. (1994) - Melanesian Forestry Sector Study. International Development Issues, No 36,

AIDAB, Canberra, Australia.

Fallon, J. (1994) - The Vanuatu Economy: Creating Conditions for Sustained and Broad Based

Development. AIDAB, Canberra.

Ferraris, R. (1994) - Economic Development in Pacific Island Countries and Implications for Wetland

Protection and Use. Paper presented at the Regional Workshop in Wetland Protection and

Sustainable Use in Oceania, Port Moresby, Papua New Guinea.

Fisheries Department (1995) - Tuku Tuku Ranch Young Turtle Project Proposal. Fisheries Department,

Government of Vanuatu, June 1995.

\l'/'ETLANDS

'Hil9dif.il'·'}f.i+ FISHING PRAcnCES IN THE WIAWI MARINE WETLANDS, VANUATU

GBRMPA/World Bank/IUCN (1995) - A Global Representative System of Marine Protected Areas,

Volume IV. Environment Department, World Bank, Washington, 42 pp.

IUCN (1993) - Environmental Synopsis Vanuatu. IUCN, Gland, Switzerland.

Limpus, C. J. (1993) - Conservation of Marine Turtles in the Inda-Pacific Region. Final Report,

Conservation Strategy Branch, Queensland Department of Environment and Heritage, December 1993, Brisbane.

Republic of Vanuatu (1992) - Third National Development Plan 1992-1996. National Planning and

Statistics, Port Vila, Vanuatu.

Sant, G. (1995) - Marine Invertebrates of the South Pacific: An Examination of the Trade. Draft

TRAFFIC Species in Danger Report, TRAFFIC Oceania, Sydney, Australia.

SPREP (1991) - South Pacific Biodiversity Conservation Programme. GEF, UNDP, SPREP, Apia, W. Samoa.

SPREP (1995) - 1995 Year of the Sea Turtle Media Pack. Regional Marine Turtle Conservation

Programme Apia, Western Samoa, March 1995.

Taccon. (1995a) - Proposal For the Establishment of the Nagha Mo Pineia Protected Area, Wiawi

Vil/age,. West Coast Malekula. Wiawi Village Community, UNSW/ACIAR Project No: 9020, March 1995.

Tacconi, L (1995b) - Participatory Conservation in Malekula Island -Vanuatu (Draft Report), Vanuatu Forest Conservation Research Report No: 10, UNSW/ACIAR Project 9020, Canberra, August 1995,

Tacconi, L. & Bennett, J. (1995) - Biodiversity Conservation: The Process of Economic Assessment

and Establishment of a Protected Area in Vanuatu. In: Development and Change 26 ·(1995): 89-110,

Thorsell, J, (1989) - Threatened Species and Missing Links: Protecting the Biodiversity of Oce.ania.

In: South Pacific, Conference on Nature Conservation and Protected Areas (4th 1989 Port

Vila), SPREP, Apia, pp, 53-67, UNEP/IUCN (1988) - Vanuatu. In: Coral Reefs of the World: Central and Western Pacific. Volume 3,

Compiled by the IUCN Conservation Monitoring Centre, Cambridge, UK, pp, 311-318. Vanuatu Environment Unit (1994) - Report on Turtle Survey of Wiawi, Malekula Island. Environment

Unit, Government of Vanuatu, Port Vila. Vanuatu, Govt of (1993) - Vanuatu Conservation Strategy ·Government of Vanuatu, Port·Vi\a, 16

pp. .,

Wyatt, S, (1994) - Can Sawmills Save the Forest? A Vanuatu Case Study, In: Pacific Economic Bulletin, pp, 62-66.

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B 80 GEF


Appendix 1: Current Trends in WMW

I : Benefits Other. costs ' l i

Forestry • Total of 2,300 m3 harvested in • Hardwoods - cost of production years 1 and 2 = V28,000/m3

• FOB Price = US$400/m3 • Royalty = V1 ,500/m3

= 400 x 114 = V45,600/m3 • Subtract 30% of 1,500

• Hence, cost of production = V28,500/m3

Trochus • Total of families harvesting Trochus • 80 kg per household takes 8 days = 73 • Production per household

• Percentage harvesting Trochus = 1 O kg/day = 21 % = 15 families • Fee = V20/day

• Harvest per household = 80 kg

• Hence, total harvest in Year 1 = 15 x 80 = 1,200 kg

• Selling price = V250/kg

• Hence, revenue in Year 1 = V300,000

• Yearly reduction in harvest = 20%

Green Snails • Total of families harvesting Green • 40 kg per household takes 8 days Snail= 73 • Production per household

• Percentage harvesting Green Snail = 5 kg/day = 22% = · 16 families • Fee = V20/day

• Harvest per household = 40 kg

• Hence, total harvest in Year 1 = 16 x 40 = 640 kg

• Selling Price = V2,000/kg

• Hence, revenue in Year 1 = V1 .280,000


-#ETLANDS IUijd;l}f.iii.J}f.ii

FISHING PRACTICES IN THE WIAWI MARINE WETlANDS, VANUATU

i i j

Fisheries

Shellfish

Benefits

• Total annual subsistence production = 5.979 Mt.

= 5,979 kg

• Selling price = V1 50/kg


• Production is assumed to be constant for the first 10 years


• Total annual subsistence production =· 854 kg

• Selling price = V1 50/kg


• Production is assumed to be constant for the first 1 O years

• Yearly reduction in harvest

= 10 %

Government costs:

Other costs

• Zero cost

• Zero cost

Cost is based on staff salaries for 4 people (Environment Unit) = V3,877,000

1 week's subsistence for 1 person = V53,860 Hence,· cost for 1 person week = 3,877,000/4/52 + 53,860 = V72,499.4

For years 1-5

Forestry, Fisheries and Agriculture send 1 person for 2 weeks, i.e., total 6 person-weeks For years 6-1 0

Forestry, Fisheries and Agriculture send 1 person for 3 weeks, i.e., total 9 person-weeks

For Years 11 - 15

Forestry, Fisheries and Agriculture send 1 person for 4 weeks, i.e., total 12 person-weeks

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Appendix 2: Assumptions on the Baseline Strategy (Sustainable Development)

Forestry

Trochus

Benefits

• Portable Sawmills can cut 1.25 m3

per day • Labour is available 1 O days per

month = 1.25 x 0 x 8 assuming labour is available 20 days of the month and 8 months a year = 200 m3/year

• Number of years in which 2,300 m3 will be completely logged = 2,300/12 = 11.5 i.e. Timber exhausts in approximately 12 years

• Hence, annual production = 2,300/12 = 191.67 m3

• FOB Price = US$400/m3 = 400 x 114 = V45,600/m3

• Henc~annual revenue = 191.67 x 45,600 = V8,740, 152

• In this alterna_tive, reforestation with enrichment planting and silvicultural treatment to the original commercial timber density of 10 m3/ha occurs. Since a constant harvesting level is maintained, there is a constant revenue of V8,740, 152.

• Total of families = 73 • Percentage harvesting Trochus

= 21 % = 15 families • Harvest per household = 80 kg • Hence, total harvest in Year 1

= 15 x 80 = 1,200 kg • Selling price = V250/kg • Hence, revenue in Year 1

= V300,000 • Under the Marine Resources

Management Plan, harvesting occurs in one season followed by 2 closed seasons.

Other costs

• Operational cost of production = V12,500/m3 (Wyatt, pers. comm.)

· • Economic rent = V19,600/m3

• Reforestation charge = V1,793/m3

• Hence total annual cost per m3

= V33,893 • Hence total cost

= 191.67 x 33,893 = V6,496,271 • There is a one-off capital cost of

V200,000 in the first year only. Hence, the cost stream is V6,696,271 in the first year, and V6,496,271 in years 2-15.

• 80 kg per household takes 8 days • Production per household

= 1 O kg/day

• Fee = V20/day

\l'/ETLANDS rp,;9.1Jr.111.1Jt.11

FISHING PRAcnCES IN THE WIAWI MARINE WETLANDS, VANUATU

Green Snails

Fisheries

Shellfish

Benefits

• Total of families = 73 • Percentage harvesting Green Snails

= 22 % = 16 families • Harvest per household = 40 kg • Hence, total harvest in Year 1

= 16 x 40 = 640 kg • Selling price = V2,000/kg • Hence, revenue in Year 1

= V1 .280,000 • Under the Marine Resources

Management Plan, harvesting occurs in one season followed by 2 closed seasons.

• Total annual subsistence production = 5.979 Mt. = 5,979 kg

• Selling price = V150/kg • Hence, revenue in Year 1

= V896,850 • Production is assumed to be

constant for the entire duration of project.

• Total annual subsistence production = 854 kg

• Selling price = V1 50/kg • Hence, revenue in Year 1

= V128, 100 • Production is assumed to be

constant for the entire duration of the project.

Government costs:

Other costs

• 40 kg per household takes 8 days • Production per household

= 5 kg/day

• Fee = V20/day

• Zero cost

• Zero cost

Cost is based on staff salaries for 4 people (Environment Unit) = V3,877,000

1 week subsistence for 1 person = V53,860 Hence, cost for 1 person week = 3,877,000/4/52 + 53,860 = V72,499.4

Input is from Forestry and Fisheries Departments only In Year 1 input of 2 persons for 2 weeks from each of the departments for planning), i.e. total 8 person-weeks For years 2-5: Forestry and Fisheries send 1 person for 2 weeks (4 person-weeks) For years 6-1 O: Forestry and Fisheries send 1 person for 3 weeks (6 person-weeks) For years 11-15: Forestry and Fisheries send 1 person for 4 weeks (8 person-weeks)

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Appendix 3: Assumptions on the Alternative Strategy

AUS$1 equivalent to Vatu 80

Benefits:

These are identical to those of the baseline

Other costs:

1. Marine survey and social mapping (Year 1) = AUS$120,370 = V9,629,600

2. Analysis and planning (Year 1) AUS$80,090 = V6,478,400

3. Community education and training (Year 2) AUS$96,000 = V7,680,000

4. Evaluation of programme and handover (Year 5) = AUS$27,250 = V2,180,000

5. Scientific interpretation and hatchery Hatchery facility

Two labourers at the rate of V1 ,000/day for the whole year Hence, in Year 2 = 1,023,360 + 730,000 = V1 ,753,360

= V1 ,023,360 in Year 2 = V730,000

Years 1, 3 ........... 15 V730,000

6. Other costs as incurred iri the baseline

Government costs:

For years 1-5, Departments of Environment, Fisheries and Forestry each put in 2 person weeks = 6 person weeks= V434,996

Years 6-15 monitoring only = 4 person weeks = V289,998

To this, the government costs incurred in the baseline are also added.

CHAPTER 5

FORESTRY PRACTICES IN NORTH SELANGOR PEAT SWAMP FORESTS, MALAYSIA

Kanta Kumari

The forest management practices that would protect habitat in the peat swamp forests of North Selangor would be more costly than current practices. Although they fragment the forest habitat, canals are used to move logs because they are the least costly way to do so. To prevent disruption to the biodiversity and, in particular, to enhance the survival prospects of the endangered Sumatran Rhinoceros Dicerorhinus sumatrensis there, logs could instead be moved by the more costly tramline method. If this were done, loggers would of course incur an incremental cost (RMO. 19 million a year if reconditioned tramline equipment were to be used and RM0.39 million if new). But, less obviously perhaps, the Public Works Department and the Forest Department would actually save costs they would

. otherwise incur for, respectively, treating water for domestic use (RM0.48 million a year) and rehabilitating the forest (RM1 .50 million a year). This case illustrates a common but important situation: although the incremental costs of biodiversity protection measures are less than the cost savings they produce, the measures are not taken because the cost savings would not accrue to those who would incur the costs.and no market or cost recovery mechanism exists to exploit the economic opportunity.

BIODIVERSITY AND THE ENVIRONMENT OF THE PEAT SWAMP FORESTS

The North Selangor Peat Swamp Forests (NSPSF) are on the west coast of Peninsular Malaysia, and

extend over 72,816 ha (Figure 1 ). These peat swamp forests lie adjacent to the biggest single

agricultural investment in the state, the Integrated Agricultural Development Project (IADP), a rice

producing scheme consolidated in 1978 (Figure 2). The World Bank in its appraisal of the scheme recognised that the peat swamps were critical for the viability of the !ADP scheme because of their

role in water storage and supply, and they attached great importance to government assurances

that the peat swamps would be protected as Forest Reserves, rather than drained (IBRD, 1978).

Official status

The State Authority endorsed this position in 1990 when it gazetted the area as 'reserved forest'

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86 GEF


under the National Forestry _Act (1984, amended 1992; Government of Malaysia, 1992). Prior to

their status as Forest Reserves, the forests were classified as Stateland forests, and had been subject

to logging for more than 30 years. Logging in Stateland forests is not subject to the more stringent

rules that apply to reserved forests, and consequentiy the forests were very degraded ecologically.

O 60 km

~

~ Sungai Karang and Raja Forest Reserves

--- International Boundary

~·~· State Boundary

MAP 1 : PENINSULAR MALAYSIA AND THE NORTH SELANGOR PEAT SWAMP FORESTS

Figure 1: Peninsular Malaysia and the North Selangor Peat Swamp Forests

'W""ETLANDS 1:1;;;1;1.1;1.JiH+

FORESTRY PRAcnCES IN NORTH SElANGOR PEAT SWAMP FORESTS, MALAYSIA

Section 10(1) of the National Forestry Act (Government of Malaysia, 1992) requires each Forest Reserve to be delineated according to specific functions and services (protective and productive) in an effort to provide for multiple-use management These functions include, among others, timber production, soil protection, flood control, water catchment and wildlife preservation. The entire NSPSF have been set aside as production forest, where the key operative rule is maintaining a sustained timber yield, being managed according to rules and regulations defined by the Forest Department

Natural and modified characteristics

Peat swamps form where there is permanent freshwater waterlogging and anaerobic conditions (Coulter, 1959). There is considerable scientific evidence that these forests have· ah important regulating or controlling function within the hydrology of entire catchments, and in their natural condition they have been deemed to act as a balancing reservoir, smoothing the pattern of outflow during periods of heavy rainfall and drought (Andriesse, 1988). Four distinct hydrological benefits can be identified at the site: provision of domestic water needs for the adjacent agricultural community, agricultural water supply, flood mitigation and regulation of the water table, thereby protecting against saline intrusion from the coast (IBRD, 1978; Low & Balamurugan; 1989; Prentice, 1990; Kumari, 1995a). Nevertheless, despite the crucial water catchment services provided by the NSPSF, these forests have not been officially recognised as performing this function under the Forestry Act (Kumari, 1995b), the entire area having been set aside as production forests.

The major rivers in the vicinity of the NSPSF are the Bernam River to the north, and the Tengi River, which traverses the swamp forests from east to west These two rivers are linked by an artificial canal referred to as the Feeder Canal (Figure 2). The natural drainage density is very· low, but a large number of drainage canals have been dug by logging companies in recent years to allow for the movement and transportation of logs out of the peat swamp forests (Chan, 1989; Pons et al., 1989; Kumari, 1994).

87

88

STRAITS

OF

MELA KA

lll/iJ IADP

g Forest Reserve

GEF


0 10km

SELANGOR

STATE

Figure 2: Study Site and Integrated Agricultural Development Project

Fauna

\l'/ETLANDS l:ilidi'·i''·'i'·''

FORESffiY PRACTICES IN NORTH SElANGOR PEAT SWAMP FORESTS, MALAYSIA

The peat swamp forests have the unique biodiversity associated with these ecosystems, being rich in aquatic fauna (especially fish) and certain species of birds (see Chapter 1 ). Intensive surveys of the freshwater and the other aquatic fauna in the blackwaters of the study site and adjacent areas revealed a very high biodiversity, including several new species and new records (Davies & Abdullah, 1989; Ng et al., 1992). A total of 101 species of fish were recorded, representing approximately 40% of .the known fish species of Peninsular Malaysia. In addition, species which had previously been recorded as rare were recorded in large numbers, suggesting .that peat .swamps represent an important stock area for conservation of fish

species. The surveys conducted at NSPSF show them to be fairly rich in the diversity of their fish fauna, contrary to the general scientific assumptions regarding peat swamps. Ng et al. (1992) argue that the continued existence of the fish fauna alone would be enough to justify the conservation of this key habitat. The survival of these fish species is severely threatened by the current method of logging owing to the increased siltation of the river system and general habitat · disturbance.

Certain birds (e.g., the Rufous-tailed Sharma Copsychus pyrropygus, and certain flycatchers and babblers) are particularly abundant in peat swamp forests. Primate surveys reveal that there is a great deal of local variation in faunal population densities, which means that there is a need for representative samples to be conserved in several areas (Marsh, 1981). Marsh & Wilson (1981) observed that primates in peat swamps were particularly vulnerable to the effects of logging, especially the fragmentation of habitat that follows from canal excavation.

Sumatran Rhinoceros

The two-horned Sumatran Rhinoceros Dicerorhinus sumatrensis, the most primitive and smallest among the five living species in the Rhinocerotidae family (van Strien, 1974), is one of the most endangered mammals in the world. Indonesia and Malaysia have already received a US$2 million grant from the GEF1 to implement the conservation strategy for the rhinoceros (GEF, 1994).

Any activity that enhances the survival probability of Sumatran Rhinos in Malaysia will complement the accepted and endorsed goal of rhino conservation. The northeastern corner of the NSPSF is

contiguous to the Sungai Dusun Wildlife Sanctuary, a totally. protected area specially set aside for in situ conservation of the Sumatran Rhinoceros (Figure 2). There is also a special ex situ breeding

programme for the species at the Sanctuary, where six rhinos are held in captivity: five females and one male, although there has so far been no successful copulation. Nevertheless, the in situ and ex situ programmes are still seen as complementary strategies to achieving the overall objective of

rhino conservation in Malaysia.

Further work is needed to determine the current importance of the combined Sungai Dusun and

1 Project No. RAS/94/gG32/A/G/99

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NSPSF rhino population to the survival of the species (e.g., to compare the population of these two areas to the global population and to determine the viability of the populations). Earlier work by Strickland (1967) and Zuber (1983) had confirmed that at that time part of the core range area of the rhinoceros within the Sungai Dusun Wildlife Sanctuary extended into the northeastern corner of the peat swamp forests, which four to six rhino used as part of their home range (Zuber, 1983).

What is clear is that the logging canals break up the rhino habitat. And while it may appear otherwise, because rhinos cool themselves by wallowing in mud, canals are not beneficial for cooling. This is because logging canals, exposed by lack of tree cover, do not provide the shade preferred for wallowing.

Production forests and biodiversity

Evidence was compiled by Kumari (1995c) to demonstrate that logged-over forests do indeed make a very important and valuable contribution to biodiversity conservation, both in their own right and as a crucial support system to protected areas, especially where the latter are not very large. Production forests could not serve as critical centres for the conservation of biotic diversity, but neither should they be dismissed as areas with no potential to contribute to biodiversity conservation.

Timber harvesting often has disruptive, even devastating, effects on the flow of the other goods and services that the forest can provide. But if harvesting is conducted carefully, it is possible to ensure the continuity of many of these environmental functions, including hydrological and recreational services and carbon sequestration. Improved harvest practices in the NSPSF through the adoption of reduced impact logging could help conserve biodiversity.

Kumari (1995c) argued that the biodiversity value of these forests can be preserved through improved management practices. The argument is to integrate biodiversity conservation with sustainable forest management. This is especially significant in Peninsular Malaysia, where twothirds of the forests legally set aside as Permanent Forest Estate are to be managed as production forests, and in the NSPSF, which have been entirely set aside as production forest.

CURRENT FORESTRY PRACTICES

There would be incremental costs in shifting forestry practices from the baseline to an alternative practice. Defining the baseline explicitly is critical because it directly affects the calculation of incremental costs. Assessment of the baseline may be helped by considering current and historical trends in forestry management at the site. In this context it is important to understand the dynamics of logging, the main extractive activity in the NSPSF, as it is critical in determining the overall state of the forest habitat. Two features are of utmost importance when describing logging activity: the timber harvest regime and the method employed during logging. These features also threaten biodiversity since logging is the main perturbation within the forests. Each of these will be discussed in turn, with particular reference to the NSPSF.

W'ETLANDS 'PO%Vf.'lt·V'·''

FORESTRY PRACTICES IN NORTH SElANGOR PEAT SWAMP FORESTS, MALAYSIA

Timber harvest regime

The key operative rule within production forests is that of maintaining a sustained timber yield

(STY). The rationale underlying STY is that the harvest rate should not exceed the growth rate for

commercially desirable species. In practical terms this translates into two key criteria: the annual

allowable cut (AAC) and the official cutting limit (girth) for commercial trees. The AAC represents

the maximum extent of forest to be harvested annually under a particular stipulated log cycle,

where the latter represents the number of years before the forest is mature enough to be logged

again. The AAC is derived by dividing the total available forest area by the log cycle. To ensure that there is sufficient stock of mature trees for the next round of logging, a Selective Management

System is employed in the production forests of Malaysia, requiring the girth of trees harvested to be

greater than or equal to 45 cm diameter at breast height.

Table 1 presents key harvest information for the NSPSF for 1995. The recommended log cycle for

peat swamp forests in Malaysia is 55 years, assuming that rehabilitation and restoration activities are

carried out. If, however, these activities are not carried out, the log cycle would be longer and the

AAC smaller. In the ideal case, for the total extent of 72,816 ha at the NSPSF, the annual allowable

cut would be approximately 1,324 ha. Currently at the NSPSF there are six (outstanding) concessions operating, each relating to a block of about 200 ha/year (until the year 2000), giving a total annual

cut of 1,200 ha. This is less than the AAC of 1,324 ha. Fairly strict controls are exercised to ensure

that the minimum girth limits are observed during logging.

Table 1: Logging Information for the North Selangor Peat Swamp Forests (1995)

Total extent of the NSPSF

Log-cycle Annual Allowable Cut (AAC)

Current number of logging concessions Annual extent logged under each concession

Total annual extent logged Girth size logged

72,816 ha

55 years 1,324 ha 6 200 ha

1,200 ha ~ 45 cm dbh

A brief look at the logging history of the area would demonstrate whether or not compliance

with these conditions is sufficient to meet the management objective of STY. Prior to the NSPSF

being gazetted as reserved forest, their status as Stateland forest meant that much less control

was exercised during logging. Stateland forests are not subject to the conditions of .AAC and

minimum girth size of trees for harvest. Although the management situation seems to have

improved since 1990, logging history indicates that at the time that the forests acquired reserved

status they were already in an ecologically impoverished condition (Prentice, 1990). Indications are

that unless definite rehabilitative _action is commer:iced immediately the forests may progressively

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degenerate. Although the requirement for such rehabilitative action is incorporated within the management plans, it has yet to be implemented. In summary, then, compliance with the key conditions of AAC and minimum girth cutting under current management practices are unlikely in themselves be sufficient to achieve the goal of STY. This is further compounded by the gradual

shift in logging methods towards those which are less environmentally benign.

Logging methods

Logging in peat swamp forests poses special problems because of the water-logged soil, which cannot withstand the high pressure exerted by the logging equipment typically used in dryland forests. Consequently, special methods have evolved for logging in these forests. The logging operation is divided into two phases, namely, extraction and transportation. The extraction involves the felling of trees and their transfer to a common hauling point. Felling in the NSPSF is

done with a hand-saw after which the felled log is transferred to the hauling point using a traxcavator, a modified bulldozer specially suited to peat swamp forests. As these traxcavators move across the forest floor, they topple vegetation along their path and compress the peat, thereby retarding subsequent forest regeneration. The logs brought to the hauling point have to be transported to the nearest road system from which they can be taken by trucks to sawmills. Two modes of transportation are used to take the logs to the edge of the forest: canals and tramlines. Each of these is described briefly.

Canals (or 'drains', as they are sometimes called), extend from the log site to the edge of the forest or to the nearest river, and are constructed by the loggers themselves. First, the forest along the path of the proposed canal is cleared, after which the peat is dug out and the spill piled along the edge of the canal on either side. The traxcavator (used for log extraction) is used for these operations. The width of these canals varies from anywhere between 2. 5-5 m (8-1 5 ft). Together with the spillage on either side of the canal, the total width of the disturbance to the peat swamp forest ranges from 3-5 m (15-25 ft).

Tramlines also extend from the log site to the edge of the forest, and as the concession moves further into the forests they are extended along the same path. The width of a tramline track is about 1 m (3-4 ft), and the clearance on either side a further 1 m (3 ft), giving a total width of

disturbance of up to about 3 m (10 ft). The wood for the tramline construction comes from the

forest itself and the tracks are normally lifted after use and laid down in new logging areas.

Locomotives operated by mini generators sit on the tramlines, transporting the logs to the edge

of the forest. These locomotives are also used to transport the workers in and out of the forest.

Currently both canals and tramlines are used in the NSPSF, but the latter are slowly being phased out with increasing use of canals, which are cheaper for the logging contractor (as outlined below).

Damage to the forest using tramlines is relatively localised and drainage patterns are not significantly affected. Subsequently, there are fewer regeneration problems, and silvicultural and treatment costs should therefore be less. In comparison, damage to the forest and forest floor from canals is much

more extensive and often irreversible, with regeneration being made impossible by the soil structure

within the canals having been inverted and piled along the sides.

W'ETLANDS

ltilhUf.h'·'ff'' FORESTRY PRACTICES IN NORTH SElANGOR PEAT SWAMP FORESTS, MAlAYSIA

The method used during logging, and in particular the combination of practices, has important implications on the sustainability of the overall system. The logging method has the effect of altering

not only the habitat structure and the rate and type of regeneration but also the effectiveness of

hydrological services provided by the forests. The increased use of canals for log transportation has

resulted in a greater dissection of the peat swamp forests, and hence an increasing amount of

habitat fragmentation. Table 2 provides a summary of the intensity of effects of the different logging methods used in peat swamps.

Table 2: Effects of Logging Methods on Peat Swamp Forests

Logging method Logging Silvicultural Timber Hydrolo~y Other Overa11··j costs costs stand & habita adverse status j

damage modif!cation effects

Traxcavator

+ tramline* M/H M/H M/H M/H M/H S/U

+canal* UM H H H H u

·Winch

+ tramline* M/H UM M L L s +canal* UM M/H M M/H M/H u

Notes:

• The effects of the logging methods are graded as low (L), medium (M) and high (H). • The <;iverall status gives some qualitative indication as to whether the overall resultant habitat will be

unsustainable (U) or sustainable (S).

• Winches, long metal chains operated through a small generator, are a relatively environmentally benign

way of extracting logs. However, these have been almost completely phased out because of the potential

dan_ger to loggers during operation. The information here is for comparative purposes only; the option is

not discussed further.

* traxcavator +tram line =alternative practice; traxcavator + canal·= current/baseline practice,

Source: Kumari (1995a)

PROJECTiON OF CURRENT MANAGEMENT PRACTICES

The logging situation at the NSPSF, which was unsatisfactory before 1990, has improved somewhat:

the extent of forest now subject to logging complies with the allowable annual cut, and the

minimum girth harvest limits are generally observed. This compliance, however; must be interpreted

with the caveat that the unsatisfactory ecological condition at the site due to its long history of indiscriminate over-harvesting means that unless remedial and rehabilitative actions and

programmes ·are commenced immediately, any steps toward stabilising the harvest rate may be

only partially successful. This problem is further exacerbated by the destructive methods of logging

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that are commonly employed within the swamp forests. Evidence exists which indicates the real and potential dangers to the continuity of the hydrological services that these forests provide, if these indiscriminate practices of timber extraction continue (Kumari, 1995a). Furthermore, the increased fragmentation of the peat swamp forests through continued construction of canals is likely to result in an alteration of the habitat, threatening the long-term conservation of peat swamp forest species

such as the Sumatran Rhinoceros, the fish species, and overall biodiversity. There is prima facie evidence that continuation of 'current' practices will result in further, possibly irreversible, degradation of the ecosystem and with it a loss of biodiversity (Kumari, 1995a). However, efforts to adopt reduced impact logging methods do not as yet constitute a national priority.



A total of 4.75 million ha of forests have been set aside as Permanent Forest Estate in Peninsular Malaysia, of which up to two thirds will be managed as production forests for timber (Kumari, 1995b). As described above, the North Selangor peat swamp forests have been designated as production forests where the operative rule is one of maintaining 'sustained timber yield', although actual practice is often deficient in this area. The National Forest Policy (MPI, 1992) further requires all specific management rules to be consistent with .the broader goal of 'sustainable forest management', although the rules and priorities for achieving this broader goal are less well defined.

Sustainability as a concept has been defined in various ways, but there is no definition of sustainability that does not imply maintenance of the productive potential of the asset base. Thus, sustainable forest management is interpreted here as the adoption of a management system such that the productivity of the ecosystem, and the goods and services that accrue from it, be nondeclining over time. This would also achieve enhanced global environmental benefits (see above). To achieve sustainability, therefore, in production forests requires restoration activities and enforcement of reduced impact logging, especially, stringency with regard to the logging methods,

to be undertaken simultaneously. Besides general engineering rules which have to be complied with during logging, specifications on the methods employed during logging are not currently regarded

as an urgent or important domestic priority.

The call for safeguarding of global biodiversity benefits as required under the CBD can be formulated

as an activity through the adoption of improved logging methods. The argument here is that if harvesting is conducted 'carefully' it should be possible to ensure the continuity of many

environmental services that the forests provide, as well as reduce the adverse impacts of logging on biodiversity. At the NSPSF this would contribute to meeting the demand for timber, both for domestic

use and export, as well as ensure water supply to the communities downstream. The current method of logging and management at the NSPSF is the baseline practice and the adoption of the benign

method of achieving the same amount of logging is the proposed alternative. The alternative practice would emphasise the use of tramlines instead of canals for log transportation. The additional costs

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FORESTRY PRACTICES JN NORTH SElANGOR PEAT SWAMP FORESTS, MAlAYSIA

of achieving improvements, over and above those that will be incurred under the baseline practice, would be estimated as the incremental costs, Each of these practices will be discussed in turn,

BASELINE STRATEGY

Selection of the baseline is important because it is the basis upon which incremental costs are

estimated. The baseline is the way the country could reasonably be expected to address the above developmental goals and priorities, There are formidable problems in defining the baseline because, in reality, national conservation strategies tend to be a mixture of both ideals and what is feasible,

The situation at the NSPSF is dynamic, and several steps are being undertaken to comply with the development objective of STY, although there are still shortcomings which need to be addressed, The information here reveals that there are three major threats to biodiversity within· the NSPSF: over-harvesting of timber, inadequate restoration of previously felled areas, and the method of timber extraction. The first has been addressed by the Government of Malaysia, the second will

be addressed by the baseline strategy, but the third will be addressed only in the alternative strategy. Nevertheless, for practical purposes, the current situation will be taken as the baseline with the caveat that rehabilitative forest treatment is an urgent priority which should not be delayed any further if the domestic development goal of STY is to be achieved (and maintained). Thus, in the present context, the baseline refers to anticipated activities and actions rather than current practices: one which has moved away from previous unsustainable practices, but which has not yet reached the full baseline requirement of sustained timber yield and restoration activities, In the analysis which follows, the baseline practice is taken·as that which uses canals and traxcavators for logging, and is assumed to comply with the domestic goal of STY (Table 2).

ALTERNATIVE STRATEGY

An alternative strategy is chosen in preference to the baseline strategy in order to achieve defined global biodiversity objectives, Although the combination of winch and tramline is probably the most environmentally benign combination of logging in the biodiversity context, the alternative proposed here is one which retains the traxcavator for log extraction but advocate_s a shift to tramlines for log transportation (Table 2). The rationale for this is that winches are dangerous to operate and, furthermore, the necessary skills are rapidly being lost with the retirement of older workers. Within practical constraints, tramlines (with traxcavators) represent the least-cost option of meeting both

domestic and global environmental objectives. This is the crux of the alternative management practice

that would enhance the survival of the peat swamp forests and contribute to the survival of species

entirely dependent on this habitat, such as endemic plants and fish, and species that are increasingly dependent on this habitat, such as the Sumatran Rhinoceros, (The irony here is that the alternative

strategy is not an untried one, but one which is being phased out because it is not the least-cost

option forthe loggers given the institutional framework within which they operate.) The incremental costs of shifting to the tramline option are estimated for two situations: first, through the use of

reconditioned equipment and second, through the use of new equipment

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INCREMENTAL COSTS

The incremental cost matrix for the peat swamp forests of Selangor is shown in Table 3. In this matrix, only those components for which there would be incremental costs (or costs avoided) in shifting from the baseline to the alternative forestry practice are shown. Although the analysis here is confined to cost accounting, the benefit matrix is included for comprehensiveness. The costs are derived for two categories of stakeholders: private individuals (in this case the loggers) and society (national). This distinction is made because it is important to demonstrate explicitly who incurs the costs and to whom the cost savings accrue. The matrix describes the main activities within the baseline and alternative forestry practices. The incremental cost is estimated as the difference in cost between these two options.

A distinction must be made between domestic benefits and additional domestic benefits that happen to be generated concurrently with the global benefits when shifting from the baseline to the alternative practice. Results from a previous valuation study of these peat swamp forests demonstrate that the adoption of the alternative practice would yield concurrent domestic benefits (such as reduced treatment cost for domestic water, more assured supply of water for agriculture), whilst the continued practice of the baseline practice would undermine these concurrent domestic benefits (i.e., would manifest as disbenefits//osses - see Kumari, 1995a). Furthermore, the benefits (or disbenefits) of the forestry practices within the NSPSF extend beyond the physical boundaries of the site itself. As a result, the establishment of system boundaries for this estimation of costs should take these externalities into account.2 The single most important group of beneficiaries of these concurrent domestic benefits is the agricultural community who live and farm downstream of the peat swamp forests. This community will have a more assured domestic and agricultural water supply if the shift is made to the alternative forestry practice. The occurrence of these concurrent domestic benefits represent cost savings in shifting from the baseline to alternative forestry practices.

Consideration of concurrent domestic benefits represents a refinement of the incremental cost methodology, enumerating 'as far as possible' all associated costs including any reductions in costs (cost savings) arising from a shift to the alternative practice.

2 Project No. RAS/94/gG32/A/G/99. A more complete treatment may require that the system boundary include the entire hydrological unit. Substainability of peat swamp forest resources of NSPSF is also affected by land use practices in adjacent areas (e.g., draining and burning). If these effect? are as great as logging operations (in terms of altering hydrology) they may need to be included in the analysis.

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FORE5rRY PRACTICES IN NORTH SElANGOR PEAT SWAMP FORESTS, MALAYSIA

Table 3: Matrix of Increments for the North Selangor Peat Swamp Forests

Item

Global

benefits

Domestic

benefits

Domestic costs

Incremental

costs

Stakeholder

Global

Private

Social

Private

Social

Baseline (B) activity

Aquatic fauna

(endangered)

Production forests

biodiversity (fragmented)

Rhino population

(extinction likely)

Timber

Rattan

Bamboo

Fish

Recreation

Timber extraction

Forest rehabilitation

Water treatment

Alternative (A) activity

Aquatic fauna

(protected)

Production forests

biodiversity (proctected)

Rhino population

(survival likely)

Timber

Rattan

Bamboo

Fish

Recreation

Timber extraction

Forest rehabilitation

Water treatment

In this study the cost accounting is confined to the domestic cost activities.

Estimation of costs: data and approach used

Increment

IGB1

IGB2

IGB3

0

0

0

0

0

IC1>0

IC2<0

IC3<0

Sum of

incremental

costs IC

above

Information on all the relevant economic costs (and costs avoided) of the baseline and alternative

activities was collected through interviews with loggers and Forest Department officials. Specifically,

the cost of harvesting timber and the cost of procuring and constructing the infrastructure using the

logging methods under each of the options were estimated. Data on the cost of forest rehabilitation

(i.e., silvicultural costs, enrichment planting costs, treatment etc.) were also collected and analysed for each option. In order to take account of the main concurrent benefits as discussed above, the

avoided baseline costs (or cost savings) of producing these additional benefits were identified. In

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particular, reduction in treatment costs of domestic water brought about by the adoption of the 'environmentally friendly' alternative forestry practice needs to be estimated. The information for this was obtained from the Water Supply Department and a private treatment plant located at the study site. The manner in which the cost estimates for each component of the matrix in Table 3 is derived is described below.

The costs for the logging activity and forest rehabilitation components under the baseline and · alternative practices are first derived on a per hectare basis. The estimation of costs for both these activities (logging and rehabilitation) relate to the same area of forest, i.e., the rehabilitation activities are carried out after logging has been completed. These costings were subsequently multiplied by the extent of forest logged annually (i.e., 1,200 ha) to get the total annual costs for the NSPSF.

The treatment costs for domestic water are a function of the logging practices at the NSPSF because these practices have a direct effect on the turbidity and amount of suspended matter in the water. Since it is difficult to ascribe the quality and quantity of water abstracted to any specific part of the study site, these costings are accredited to the site as a whole. The cost estimation of this is made easier in part by the fact that all the water abstracted passes through a single treatment plant along the Main Canal. The annual treatment costs are estimated for the total volume of water treated each year for both the alternative and baseline logging practices.

The estimated costs of the baseline and alternative activities are then synthesised and presented as a matrix to display the incremental costs of shifting from the baseline to the alternative logging

practice. These incremental costs are then shown as net present values (NPVs). In deriving the NPVs,

all projections are conducted for a 10-year period using an annual discount rate of 8%, which is the rate used for forestry projects in Malaysia (World Bank, 1991 ). These present values are expressed as aggregate costs for the entire project area, for the project period of ten years. The project period is taken as ten years because the main actors on the forest scene are the loggers, and logging concessions at the present time do not generally extend beyond a decade. The calculations are done in Malaysian Ringgit (RM), which at 1996 exchange was about 2.5 to the US$. All results are rounded off to the nearest RM 10.

Results

The costings of each activity will be addressed individually before discussing the implications of the overall incremental costs incurred in shifting from the baseline to the alternative logging practice.

Private Logging Costs Information from two loggers interviewed at the NSPSF (one of whom used the baseline method of logging and the other the alternative method) was compiled to estimate the operating and capital costs of logging under each strategy. The use of either strategy comprises several activities, such as felling and transportation of logs, operation and maintenance of equipment, and providing contingency funds (Table 4, part B). The annual operating costs under these two options are quite similar, estimated at RM 1,230/ha and RM 1,300/ha for the baseline and the alternative respectively.

W'ETLANDS IHiid;lf f.jit.i}f.ii


The alternative practice incurs additional capital costs from the procurement of locomotives and the construction of the tramline (Table 4, part C). These capital costs were estimated for two

situations: first, where the logger uses reconditioned locomotives and tramlines (i.e., shifting them from previous log sites) and second, where the logger has to purchase new locomotives and construct new tramlines. The set-up costs of using reconditioned tramlines and locomotives were

estimated from previous concessions at RM 100/ha, compared to the cost of building new ones, at RM260/ha. These costs are incurred at the start of each year. The information used to derive these estimates is provided in Appendix 1.

Logging costs are the sum of operational and capital costs. In the case of the baseline option there are no major capital costs, and the annual logging costs remain at RM1 ,230/ha. The annual logging costs for the new and reconditioned tramline alternatives increase to RM1 ,560/ha and RM 1,390/ha, respectively. The aggregate logging costs over the entire area logged (1,200 ha) within the NSPSF are also shown in Table 4 (part A). These annual aggregate costs were estimated at RM1 .48 million under the baseline option; and at RM1 .87 million and RM1 .67 million for the new and reconditioned tramline options.

Table 4: Logging Costs for the Baseline and Alternative Practices

(Operational and Capital Costs)

4A. AGGREGATE LOGGING COSTS

Baseline

Operation and maintenance RM 1,230/ha/year costs (from 4B below)

Capital costs (from 4C below) -

Total logging costs RM 1,230/ha/year

Alternative (new)

RM 1,295/ha/year

RM263/ha/year

RM 1,558/ha/year

Alternative (reconditioned)

RM 1,295/ha/year

RM99/ha/year

RM 1,394/ha/year

Aggregate logging costs (x 1200 ha)

RM1 .48 million/year RM1 .87 million/year RM1 .67 million/year

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48. OPERATIONAL LOGGING COSTS

I I

Baseline RM/ha/year Alternative RM/ha/year !

I

Canal construction & labour 850 Labour costs and 750 costs transportation of logs

Transportation of logs 180 Transportation of workers 120

Maintenance of traxcavator 100 Maintenance of locomotive 325 & tramline

Contingency 100 Contingency 100

Total operational costs 1230 Total operational costs 1295

4C. CAPITAL COST FOR THE ALTERNATIVE LOGGING PRACTICE

I New tramline Reconditioned tramline : RM/ha/year (RM/ha/year) I

Main tramline construction 33 10

Temporary tramline 110 0 construction

Locomotive 120 80

Total capital costs 263 99

Note: For details see Appendix 1 .

Forest Rehabilitation Costs There are also direct costs to society of inputs into forestry

management. This is undertaken by the Forest Department, and includes several key activities such

as pre-felling inventory, post-felling inventory, silvicultural treatment and enrichment planting.

Because rehabilitation at the NSPSF is not yet underway, estimates from the Forest Department are

based on activity in dryland forests. The more difficult terrain of peat swamp forests, coupled with

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FORESTRY PRACTICES IN NORTH SELANGOR PEAT SWAMP FORESTS, MALAYSIA

the impoverished state of the NSPSF, suggests that rehabilitation in these forests will be more costly than in dryland forests. The Forest Department estimates these costs to be at least 20% higher. Estimated annual costs for the main rehabilitative activities (Table 5) are about RM2,200/ha for the baseline method of logging. The aggregated costs for the total extent of forests logged each year (1,200 ha) is RM2.63 million.

Reduced disturbance of forest under the alternative strategy should correspondingly require less intensive rehabilitation. Kumari (1995a) estimated that the damage to habitat would be about 20% when tramlines are used for log transportation, but 50% when canals are used. As a corollary to this, the costs of activities associated with rehabilitation (e.g .. silviculture, enrichment) were estimated here to be a conservative 20% lower than the baseline. Costs of pre-felling and postfelling inventorying were not expected to change with a shift in logging practice because these represent routine activities which would have to be conducted in either case. Estimated in this way, Table 5 shows the rehabilitation costs to society as reduced by RM400/ha to approximately RM 1,800/ha under the alternative practice of using tramlines. Although the earlier analysis suggested that rehabilitation and remedial activities need to be conducted over the entire area, the forest rehabilitation costs considered here are confined to the extent of forests logged annually. The aggregate costs under this alternative practice are RM2.15 million for the total extent logged in one year. The rehabilitation costs are not expected to differ whether new or reconditioned tramlines are used, and hence the aggregate costs of the activity will be taken to be the same in both cases.

Table 5: Cost Savings for Forest Rehabilitation and Domestic Water Treatment

SA. FOREST REHABILITATION COSTS TO SOCIETY

Item Baseline Alternative ·I Pre-felling inventory (RM/ha/year) 85 85

Post-felling inventory (RM/ha/year) 85 85

Silvicultural and enrichment planting (RM/ha/year) 1,250 1,000

Treatment (RM/ha/year) 750 600

Management and administration (RM/ha/year) 25 25

Total rehabilitation costs (RM/ha/year) 2, 195 1,795

Aggregate rehabilitation costs (RM/year) 2.63 million 2.15 million

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58. DOMESTIC WATER TREATMENT COSTS

Item Baseline Alternative

Daily volume water abstracted (m3/day) 27,273 27,273

Annual volume abstracted (m3) 9.95 million 9.95 million

Treatment cost (RM/m3) 0.50 0.35

Aggregate treatment costs (RM/year) 4.98 million 3.48 million

Domestic Water Treatment Costs to Society As mentioned earlier, there are additional domestic benefits under the alternative logging method as compared to the baseline: these are concurrent to the benefits such as biodiversity conservation. Within the scope of this study it was not possible to identify all the domestic benefits; this will be confined to benefits in terms of reduced water treatment costs for the domestic water abstracted from the Main Canal of the NSPSF.

Interviews with engineers at the local Water Supply Department showed the treatment costs at the site to vary from RM0.35-0.50/m 3 of water, and it is at the higher end of the range if turbidity and siltation of the waterways increases and at the lower end of the range if the water is treated only for natural coloration by the peat swamp forests. It is assumed here that with the shift to the tramline method, there would be less disturbance to the waterways and this should reduce the treatment cost to the lower end of the range. A total volume of about 27,273 m3/day (6 million gal/ day) is abstracted for use. The annual treatment cost is reduced from RM4.98 million to RM3.48 million in shifting from the baseline to the alternative management practice (Table 5). As for forest rehabilitation costs, domestic water treatment costs are not likely to differ whether new or reconditioned tramlines are in place.

Synthesis of Results Table 6 summarises the incremental costs of shifting from the use of canals to the use of tramlines. The results indicate that the private logger incurs incremental costs in making the shift from canals to tramlines for transportation of logs. The estimated overall incremental cost for the private logger is RM0.39 million/year if new tramlines and locomotives have to be procured. On the other hand, if the logger is already in the business of using tramlines, the availability of reconditioned equipment reduces the annual incremental costs to less than half, to RM0.19 million (Table 6). The manual skill necessary for the construction and handling of these locomotives has not been valued, but is an added consideration which may further increase the incremental cost if the project is initiated from scratch.

#ETLANDS lf{iii;i~f.il'·'if.ii

FORESTRY PRACTICES JN NORTH SElANGOR PEAT SWAMP FORESTS, MALAYSIA

Table 6: Aggregate Incremental Costs in Shifting Forestry Practices (RM million) ·

· Stakeholder Activity Baseline Alternative I

New

equipment

Private Timber 1.48 1.87

extraction

Social Forest 2.63 2.15

rehabilitation

Water 4.98 3.48

treatment

Incremental -1.59/year

costs

NPVof -9.8

incremental

costs

Negative incremental costs implies cost savings

NPV = present value (10% discount rate, 10 years)

Increment Alternative Increment

Recond.

equipment

0.39 1.67 0.19

-0.48 2.15 -0.48

-1.50 3.48 -1.50

-1.79/year

-11.0

I Table:

[

'

4

5

5

Malaysia could make substantial savings from the shift to the alternative strategy. Two explicit savings were estimated (Table 5). The reduced impact through logging with tramlines would require less intensive rehabilitation by the Forest Department, saving an annual aggregate of RM0.48 million. The shift to tramlines also reduces the aggregate treatment costs by RM 1 .50 million annually (Table 6).

The incremental savings exceed the incremental cost net by RM~ 1.59 million, if using new equipment, and RM-1.79 million, if using reconditioned equipment (Table 6).

Sensitivity Analysis to Cost Estimates To test the robustness of the results to the various rnst estimates used, a sensitivity analysis was conducted. The incremental costs were re-estimated, shifting the costs of the key activities within the alternative forestry practice by 20% either way, for both the new and reconditioned equipment options for all the parameters collectively, and then individually (Table 7). The results are quite robust and ±20% shifts in the cost do not alter the general result that incremental costs remain lower than the savings. It is only when treatment costs are increased by 50% that incremental costs exceed savings (and then only marginally).

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INCREMENTAL COSTS OF WETLAND CONSERVATION·

Table 7: Sensitivity Analysis

Sensitivity.

a) All parameters -20% Base case +20%

b) Logging costs -20% Base case +20%

c) Forest rehabilitation costs -20% Base case +20%

d) Domestic water treatment costs -20% Base case +20%

(+50%)

DISCUSSION

New equipment

Reconditioned equipment

Notes

RM million/year

- 1.27 - 1.sg - 1.g1

- 1.67 -1.5g -1.51

- 1.4g - 1.5g ~ 1.6g

- 1.2g - 1.59 - 1.89

(+0.15)

- 1.43 - ug - 2.15

- 1.83 -1.7g -1.75

- 1.6g - 1.7g - 1.8g

- 1.4g - 1.79 - 2.og

(-0.05)

The incremental costs remain lower than savings with an overall 20% shift in costs estimates.

The incremental costs remain lower than savings.

The incremental costs remain lower than savings.

The incremental costs remain lower than savings. The costing of this activity is most sensitive to changes in logging practice, since the treatment costs are a function of the turbidity and

.. sedimentation produced by changes in ·~ logging practice. If the treatment costs

.... under the alternative option are reduced by only 50% of those envisaged, we see that the incremental costs using the new equipment are marginally higher than the savings, whilst those using reconditioned equipment are marginally lower.

The above.analysis indicates that the incremental cost framework can be operationalised. Its specific application to 'biodiversity' is not without problems, but the issues and challenges are not insurmountable. For example, there are methodological issues in defining the baseline strategy

within national development goals, e~pecially in dynamic situations. Furthermore the 'global benefits' to be derived from a project are project specific.

#ETLANDS 'Hili-IJt.1;1.J}f.i+


This study demonstrates that the incremental cost of shifting from the baseline to the alternative , practice is not fixed, but is a function of the dynamics of the adopted forest activity. The present

value of the incremental costs from the shift in forestry practice would require RM- 8, 167/ha if the logger had to acquire new equipment, but if reconditioned equipment were available for use then the incremental costs is RM-9, 167 /ha (from Table 6). That incremental costs are lower than economic savings suggests that Malaysia would benefit from this shift

There are two main stakeholders: the private loggers and the downstream community. This issue of incidence and compensation needs to addressed explicitly if improved biodiversity conservation is to be achieved. In this case, it is the private logger who incurs the incremental cost of shifting from one forestry practice to another, while it is the Forest Department and the. Public Works (including water) Departments that obtain the savings from this shift.

The study has demonstrated that it is not financially viable for the logger to shift to the tramline option. In the case of the NSPSF, the logging process means that at any one time the incremental cost would oscillate between a range of values which in this case was estimated as RM0.19 million to RM0.39 million. The private loggers have no incentive to make this shift to the alternative strategy, especially since it does not constitute a national goal, priority, or regulation.3 Even in the case where it is financially less of a burden to do so (i.e,, through the use of reconditioned equipment, for loggers who already operate a tram line), shifting to the alternative method appears to be in conflict with other 'domestic equity' goals. Over the years the modus operandi of the Forest Department has been to issue short logging tenures and as far as possible to different agencies or individuals, so as to achieve a more equitable distribution of concessions. This, however, directly conflicts with the feasibility of ensuring a shift to the alternative practice, as new concessionaires would be unwilling to invest in an option that is more expensive and for which they do not possess the required skills.

One way is for incentive packages. The transfer of funds to cover the incremental cost of the relevant technology or the conservation measure represents the full compensation required on an aggregate basis. However, any such f_unding would be closely tied up with the tenure of logging concessions.

Another way, which would also help shift to the alternative logging practice, is through the redistribution of cost savings. This could be done through the creation of a domestic water-use scheme which goes into a fund, and which could be used to support the shift to more sustainable logging practices. The logistics, both administrative and institutional, are likely to be complex because forests and water are natural resources which fall under the jurisdiction of different

agencies.

3 National policies and regulations do not specify "tramlines" but do specify "sustainable timber yield," (STY), If it could be argued technically that the hydrological ,disturbance caused by canals undermines sustainability, tramlines would be one way to ensure STY and they would then be part of the baseline.

105

106 GEF


REFERENCES

Andriesse, J. P. (1988) - Nature and Management ofTropical Peat Soils. FAO Soils Bulletin 59, Rome.

Chan, H.T. (1989) - A Forestry Action Plan for the North Selangor Peat Swamp Forest. AWBNl/WF

Malaysia, Kuala Lumpur. Coulter, J.K. (1959) - Peat Formations in Malaya. Malayan Agricultural Journal 33: 63-81.

Davies, J. & A. R. Abdullah (1989) - Freshwater Fish Survey of the North Selangor Peat Swamp.

Asian Wetland Bureau Publication No. 46. AWBNl/WF-Malaysia, Kuala Lumpur.

GEF (1994) - Indonesia and Malaysia. Conservation Strategies for Rhinos in South East Asia. Project

Document. November 1994, UNDP, New York.

Government of Malaysia (1992) - National Forestry Act (1992). Government of Malaysia.

IBRD (1978) - Malaysia: Appraisal of the Northwest Selangor Integrated Agricultural Development

Project. Report No. 1757b-MA. World Bank, Washington, D.C.

Kumari, K. (1994)- Sustainable Forest Management in Peninsular Malaysia: Towards a Total Economic Valuation Approach. Ph.D. thesis. University of East Anglia, Norwich, United Kingdom.

Kumari, K. (1995a) - An Environmental and Economic Assessment of Forest Management Options:

A Case Study in Malaysia. Environment Department Paper No. 026, October 1995, World

Bank, Washington D.C. Kumari, K. (1995b)- Is Malaysian Forest Policy and Legislation Conducive to Multiple Use Management

of the Forest Resource? Unasylva 183, Vol. 46: 51-56.

Kumari, K. (1995c) - Mainstreaming Biodiversity Conservation: A Peninsular Malaysian Case. International Journal of Sustainable Development and World Ecology 2(3): 182-198.

Low, K. S. & Balamurugan, G. (1989)- A Preliminary Hydrological Investigation of the North Sela·ngor

Peat Swamp Forest. AWBNl/WF-Malaysia, Kuala Lumpur. Marsh, C.W. (1981) - Primates in Malayan Peat Swamp Forest. In: M. Nordin, A. Latiff, M. C.

Mahani & S. C. Tan (eds.), Conservation Inputs from Life Sciences. Faculty of Science, University Kebangsaan Malaysia, Bangi, Malaysia, pp. 101-108.

Marsh, C.W. & Wilson, W. L. (1981) -A Survey of Primates in Peninsular Malaysian Forests. Final

report for the Malaysian Primates Research Programme. Universiti Kebangsaan Malaysia and

University of Cambridge.

MP! (1992) - National Forest Policy 1978 (revised). Ministry of Primary Industries, Kuala Lumpur.

Ng, K.L., Tay, J.B., Lim, K.P. & Yang, C.M. (1992) - The Conservation of the Fish and Other Aquatic

Fauna of the North Selangor Peat Swamp Forest and Adjacent Areas. AWB Publication No.

81. AWB, Kuala Lumpur.

Pons, L. J., Prentice, C. & Aikanathan, S. (1989) - A Preliminary Assessment of Two Peat Swamps in

Selangor State, Peninsular Malaysia, in Relation to Their Optimal Use. Asian Wetland Bureau,

Publication No. 30. AWB, Kuala Lumpur.

Prentice, C. (1990) - Environmental Action Plan for the Northern Selangor Peat Swamp. Asian

Wetland BureauNl/orld Wide Fund for Nature Malaysia, Kuala Lumpur.

Strickland, D.L. (1967) - Ecology of the Rhino in Malaysia. Malayan Nature Journal 20: 1-17.

van Strien, N.J. (1974)- The Sumatran or Two-horned Rhinoceros Dicerorhinus sumatrensis (Fischer).

Medede\ingen Lambouwhogeschool, Wageningen, Nederland.

World Bank (1991) - Malaysia: Forestry Sub-sector Review. Report No. 9775-MA. World Bank,

Washington D. C.

W'ETLANDS 'U'ii·'~f.\ii.iif.ii

FORESTRY PRACTICES IN NORTH SEIANGOR PEAT SWAMP FORESTS, MALAYSIA

Zuber, Mohd. (1983) - A Review of the Status and Approximate Range of Sumatran Rhinoceros

Population in Sungai Dusun Game Reserve and Surrounding Areas. Journal of Wildlife and Parks 2: 1-29.

Appendix 1: Data Used to Estimate Capital Costs for the Alternative (Tram line) Strategy

Item

Mainline construction

Labour

Rail cost

Nails

Treated sleeper

Total

Expressed on a per hectare basis:·

Mainline construction Temporary line (welding costs)

Locomotive

Total

Notes:

Recond.ition!'!d. tram line ·

RM/chain

180 0

33

125

338

RM/ha

19 0

80

99

New,tramline

RM/chain

180

246

33

125

584

RM/ha 33

110

120

263

In every 17.5 ha, one chain of tram line is constructed, giving a value of RM19/ha and RM33/ha.

I

j

In a block of 200 ha, 3 locomotives (each costing RMS,000) are used, giving set up costs of RM 120/ha/year. That

using reconditioned locomotives is estimated to be two-thirds of this i.e. RM80/ha/year.

107

CHAPTER 6

CONSERVATION AND LAND USE IN KUALA SELANGOR WETLANDS, MALAYSIA

Mohd. Shahwahid Haji Othman

The Kuala Selangor wetlands are part of an extensive coastal belt of mangrove forest with a broad zone of intertidal mudflats located on the west coast of Peninsular Malaysia. In 1987 the Government of Selangor had two options for using a 130 ha parcel of land comprising dry secondary forests adjacent to a tract of mangrove forest. One option was to convert it into a residential township and the other was to incorporate it into a 320 ha nature park, and relocate the township farther south of Kuala Selangor town, thereby protecting a habitat for globally significant biodiversity Incremental costs have been made by various stakeholders following that decision. This case study illustrates the use of incremental cost analysis for retrospective evaluation and a treatment of the opportunity cost of land.

BIODIVERSITY AND THE ENVIRONMENT OF KUALA SELANGOR

Kuala Selangor town is located 65 km from Kuala Lumpur, the federal capital of Malaysia (Figure 1 ). It is a historic town and administrative centre for the Kuala Selangor district. On the coast immediately to the south of the Selangor River Estuary and to the southwest of Kuala Selangor, there is a highly modified mangrove forest1 site of approximately 320 ha. This mangrove forest site is overlooked by Bukit Melawati, a steep hill and historic site, which is also a nature reserve. There has been considerable public interest in conserving this tract of mangrove forest, which is well known as a site to see mangroves and watch water birds and the Silvered Leaf Monkey Presbytis cristata. Of global interest is the site's importance for migratory birds. There was added pressure to conserve the site since it was reported that the dry, secondary forest was disturbed or had been poached for its timber. Establishing the site as a nature park with adequate management was undertaken to eliminate that threat.

Fireflies

The village of Kampong Kuantan is located 4 km from Kuala Selangor. The main attraction of Kampong Kuantan to tourists is the firefly Pteroptyx tener (locally known as kelip-kelip), a beetle that belongs to the Lampyridae family. At night the synchronised rhythmic flashing of these beetles

1 140 ha mudflats. 50 ha mangrove, 130 ha secondary dryland forest (former mangrove habitat).

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110 GEF


can be seen along the tidal reaches of the Selangor River. This flashing display is seen only in tree

species with an open foliage, such as the mangrove tree Sonneratia caseo/aris (locally known as Berembang). A few households are involved in a firefly-watching business as part-time boatmen,

ticket sellers and helpers.

To Tanjung Karang

D Mudflats m!!I Cockle Culture • Kuala Selangorlown • Kampung Kuantan

. ~ [Ilil' Kuala Selangor Nature Park ~ Mangrove Forest Reserve O Bukit Melawati --. Coastal Bund

Figure 1: Site of the Kuala Selangor Nature Park

Mangrove forests and coastal mudflats

The North and South Ban jar forests and the coastal mudflats are important breeding and harvesting

grounds for coastal fisheries, aquaculture and cockle harvesting. Together, the 320 ha mangrove

forest site on the outskirts of Kuala Selangor, the surrounding mangroves of the North and South

Banjar forests and the village of Kampong Kuantan are an excellent wetland area with important

ecological and economic interrelationships.

LAND USE AND CONSERVATION

The objective of this case study is to analyse the economic and ecological (biodiversity) implications

of two alternative land use options for the site that the State Government of Selangor was considering

in 1987.

w"ETLANDS lt:•i!;'f'·'l'·'~f.ii

CONSERVATION AND lAND USE IN KUAlA SElANGOR WETLANDS, MALAYSIA

Previous uses of the site and surrounding areas

Coastal mangroves are of great importance for coastal fishing, timber and hunting. It is likely that the case study site had long been utilised for these purposes by local communities. In 1965/66, a coastal bund was constructed to reclaim the land for agricultural use, and a drainage canal dug to drain water from the agricultural land to the south. Since the reclaimed area was earmarked for development, the mature mangrove forest on the landward side of the bund was logged under a State logging licence (Muhammad Akhir, undated). Agricultural use of the area was never taken .up.

In the early 1970s, the mangrove forest at the south of the case.study site was cleared to create evaporational salt pans, which proved uneconomic but provided an open ground used by waders as refuges and foraging areas when high tides covered the mudflats (Davison et al., 1989). The salt pans have been used in a ringing project2 for some 8,000 waders (Parish & Wells, 1984). As part of the state developmental plans in the area, the Selangor State Government planned a new township in place of the salt pans in the mid-1980s and further land was cleared prior to construction (Figure 2). The latter would remove what had become a major roost site for waders on migration, and at the same time place heavy pressures on the adjacent remaining mangroves and landward vegetated mudflats (Davison et al., 1989). The development of the new town site opened the adjacent remaining mangroves to threats of other development proposals, including golf courses and housing projects.


The broad development goal of the Kuala Selangor Town Council was to provide housing for an expanding population, subject to environmental and other constraints. Housing development required land-use project approval. Before licensing any land use applications, the Council sought the advice of relevant government agencies, and when the land exceeded a certain area or when the project had an environmental impact the Council also required an Environmental Impact Assess merit.

Land-use options in 1987

Given this broad goal, a reasonable way for the Council to have addressed the housing needs would have been to approve housing in the secondary forests and saline and freshwater Jake sites within the Kuala Selangor Nature Park (KSNP). The mangrove and mudflats both within the current KSNP and at the North and South Banjar forests would not have been affected at that time, as they were either scheduled or already gazetted as forest reserves. The village of Kampong Kuantan would also not have been significantly affected by development pressures.

Current and previous officials of the District Council of Kuala Selangor and State Planning Department have confirmed that housing projects (and a golf course) were indeed among the · alternative development projects being considered in 1987. The most likely use for the site seemed

2 Bird ringing projects assist the study of migratory patterns and other habits. A small metal ring, with a unique alphanumeric code and the address of the ringing authority/scheme, is placed on the bird's leg. The identification of ringing and recapture locations assists in indentifying migration routes.

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112 GEF


at the time to be for further housing, because of the increase in such projects within the Kuala Selangor township dt:1ring the 1980s - the number of housing units rose from 1,465 in 1980 to 1,922 in 1991 (Department of Statistics, 1992) - and because the site was very close to Kuala Selangor. A golf course was probably not a major option at the time, as none has since been built

near the town.

Conservation

Countering this was a concern to preserve the ecosystem of the study site and to maintain its value as a resting place for migratory waterbirds. To see whether this would have been a binding constraint on the broad housing development goal above, it is necessary to look at the impact of a housing project on the area and the possibility of alternative housing developments meeting the same development goal. Later we look at the incremental cost of such an alternative.

Impact of housing Housing projects would have stopped the flow of environmental goods and services, particularly to the ecotourism, education, and science; would have destroyed the habitats for globally significant biodiversity, such as the Silvered Leaf Monkeys, shorebirds, and migratory waders, and prevented the introduction of endangered Milky Stork Mycteria cinerea to the site (see below).

Silvered Leaf Monkey Housing projects would threaten the unique ecosystem and wildlife. Kuala Selangor's role as a link in the migratory chain through Southeast Asia for waders and as shelters for other wildlife such as the Silvered Leaf Monkey would further deteriorate. The Silvered Leaf Monkey is already confined mainly to coastal areas such as the study site (Manaloor et al., 1989), and its population had been decreasing on Bu kit Me/awati .. In 1965-66 there were five troops of Silvered Leaf Monkey on Bukit Melawati, totalling 160 individuals (Bernstein, 1968); nine years later there were still five troops (Wolf & Fleagle, 1977), but in 1989 only four remained, comprising 112 individuals (Manaloor et al., 1989).

Milky Stork With its extensive mangrove forest adjoining a muddy shoreline, KSNP was a potential habitat for Milky Stork3 (Mohammed Nazim, 1994), and there was potential for introducing a population of these birds into the park. The range of the Milky Stork formerly included Vietnam, Cambodia, Peninsular Malaysia, Sumatra, Java and Bali, but little was known about its status (Mohammed Nazim, 1994). The earliest recorded captive birds were a pair from Taiping, in the Matang forest, Peninsular Malaysia, in 1983. They had both died by 1991. However, a large flock was discovered in Sumatra (Silvius et al., 1986), and the world population has been estimated at 6,000 by Silvius (1986) and 5,000 by Verheugt (1987). In Matang, the population has since dropped to 80-90 birds (Mohammed Nazim, 1994). Along the Selangor coast, where Milky Stork is known to have bred in the 1930s, it is extinct. In the 1980s, Zoo Negara in Kuala Lumpur acquired seven Milky Stork chicks. With a breeding base at hand and a potential managed-release site at KSNP, Zoo Negara embarked on a captive breeding programme for Milky Stork with sponsorship from the Malaysian Wildlife Conservation Foundation. By September 1995, the captive management

3 The Milky Stork is also listed in CITES Appendix I, which means that trade in and possession of this species are prohibited.

'Y'/ETLANDS

Dii-V'·h'·'ff'' CONSERVATION AND LAND USE IN KUALA SELANGOR WETLANDS, MALAYSIA

programme at Zoo Negara had raised the population of Milky Storks to 48 adults and about five chicks at the aviary.

Mudflats and mangroves A housing project would not necessarily have covered the whole 320 ha of mangrove forest. This mangrove forest site had 140 ha of mudflats at low tide, 50 ha of. secondary mangrove and 130 ha of dry secondary forest. Given the conservation drive of the Fishery and Forestry Departments at that time, 'it is likely that only the 130 ha of dry secondary forest would have been opened for housing development (Figure 2) and that the 140 ha of mudflats and 50 ha of secondary mangrove would in any case have been preserved. Had this been so, the ecological functions of these two sites would not have been adversely affected.

Furthermore, it is likely that the mangroves and mudflats in the existing KSNP site and those at the North and South Banjar forests would also have remained. The two mangrove forests had been gazetted as forest reserves by the Forestry Department, and the mudflats, being the breeding ground of cockles and other fishery resources, were included in a zone of 'no commercial cockle harvesting' that had been established by the Department of Fishery (Department of Fishery, undated). Because of this, the ecological benefit of neither the mudflats nor the mangroves in Kuala Selangor would have been threatened - although the mangroves would still have required rehabilitation, having been exploited before 1987,

Decision

In 1987, after due consideration between these two alternative uses for .the land, the .Selangor Government established a nature park, known as Kuala Selangor Nature Park (KSNP): The park was established with financial support from the State Government and is currently gazetted as a town/public park under the Local Government -Act 1976. Following an agreement with the State Government of Selangor, it is being managed by the Malayasian Nature Society (MNS). The housing needs were met by siting four housing projects elsewhere in the suburbs of Kuala Selangor town (Figure 2). Overall, this was considered the least costly way of meeting the developmental goals while avoiding the environmental impacts described above.

BASELINE AND ALTERNATIVE COURSES OF ACTION

It is the objective of this case study to estimate the time stream of costs and benefits that accrue to different groups of people in Malaysia of the two courses of action that were open in 1987.

Baseline

The baseline course of action against which the alternative was evaluated was the development of housing on the site. Although this course of action could reasonably have been anticipated at the time, it was not, in the event, permitted. In the .baseline, it is assumed that housing projects would have been approved on the secondary dryland forest portion of the 320-ha mangrove forest site but that the mangrove and mudflat portions of the site and at the North and South Banjar

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INCREMENTAL CO!irS OF WETLAND CONSERVATION

forests would not have been developed. There would have been some efforts at rehabilitation of the mangrove forests by the Department of Forestry.

Alternative

The alternative course of action adopted by the State Government of Selangor was the establishment of a nature park at the site and the siting of the housing projects elsewhere, in the new southern township (Figure 2).

The establishment of a nature park, the KSNP, was to ensure the sustainable production of the local benefits and the protection of globally significant biodiversity. Specific activities included:

i. Re-establishing indigenous plant species and restoring habitat that may have been damaged . by human activities.

ii. Promoting educational, recreational and ecotourism activities in the park and vicinity to enhance benefits to society at large, and supplementary incomes'to communities neighbouring the KSNP.

COSTS AND BENEFITS

Many of the costs and benefits would have been the same in either the baseline or alternative course of action,. and so do not merit detailed analysis. In particular, the domestic benefits from the offshore fisheries and aquaculture developments would have been the same. These activities, which will play an increasingly important role in the future as a source of protein food, include culture of brackishwater fish; rearing prawns, particularly the Giant Tiger Prawn Penaeus monodon; culture of cockles, fattening -of crabs - especially the Mangrove Crab Scylla serrata - in beds and net c·ages; and seasonal cockle collection along the coasts.These benefits are linked to the mangrove forest, and for the mangrove forest to maintain its role the Department of Forestry would have had to incur costs for the enrichment planting of young seedlings in either the baseline or alternative course of action.

The analytical effort was therefore concentrated on estimating those benefits and costs that would have been differential. They concern the establishment of the KSNP itself, the Milky Stork breeding programme, the Kampong Kuantan firefly attraction and the transportation costs to be incurred by residents of the housing projects in alternative sites.

KSNP

With the establishment of the KSNP, a detailed plan of action was formulated by the KSNP Development Committee. The work concentrated on three main aspects: i) the lake, ii) the trails within the park and iii) the visitor centre and the car park. The capital and operational costs incurred and benefits derived were estimated. For the lake, the work included a scientifi~ survey, land clearing, engineering survey, design, ground levelling and excavation, construction of a sluice gate

w"ETLANDS 'Oil9;tft.1;t.1~0+

CONSERVATION AND !AND USE JN KUAlA SElANGOR WETLANDS, MALAYSIA

To Tanjung Karang

Prawn Culture

Alternative Housing Project Sites

N

l 1 km .... _____ _

To Kuala Lumpur

Figure 2: Locations of Main Activities

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INCREMENTAL COSTS OF WET/AND CONSERVATION

and pumping facility, and letting in water. For the trails, the work included a survey of the park area and construction of trails, bridges, bird hides and a boardwalk (Table 1 ).

Table 1: Major Infrastructural Costs for the Establishment of KSNP

Item

Lake - Lake construction - Pump & sluice gate

Trails Visitor centre, chalets & staff quarters

Notes: NPV for 1995, 10% p.a.

US$

20,000

2,500 6,000

75,000

Since the completion of the facilities at the KSNP, the number of visitors has increased steadily. The number registered from 1989 to 1995 was 4, 717, which is an underestimate of total attendance since registration is voluntary. There are various sources of income for the KSNP, of which the park entrance fees form a small proportion (Table 2). Other sources of income are sales of souvenirs, books, food and other general items, chalet rentals and fees for nature camp field courses.

Table 2: Main Sources of Income for KSNP, 1995

Item

Park entrance fees Sales of souvenirs, books, food and other general items

Chalet rentals

Nature camp field course fees

Notes: NPV for 1995, 10% p.a.

Milky Stork introduction

US$

3,000

20,000

20,000 8,000

The expenditures in the first phase of the Milky Stork captive breeding and management programme at Zoo Negara were incurred outside KNSP. But it should be noted that they are incurred to fulfil the

objective of reintroducing the zoo-bred Milky Storks to the KSNP to breed a second generation.

\l\l"ETLANDS lttil#;i}f.iji.J~f.ii


Since the expenditure is a prerequisite to meet the objective of the programme, they are included. The major capital costs are for the construction of a flight aviary (US$24,000), a pond (US$8,000), and artificial nest platforms (US$8,000).

For the second generation breeding programme, another breeding aviary will be built to transfer the zoo-bred storks to the KSNP site and breed a second (F2) generation. A roofless enclosure adjacent to the second aviary to transfer the F2 young into will also be constructed. The construction costs for these will be about US$110,000.

Fireflies

The firefly boat-ride business in Kampong Kuantan is run privately by a company owned by a single family, the only one licensed by the District Council, which monitors and regulates the activity. This activity employs five people and provides 22 part-time or contract jobs for the villagers (Bann, 1995). This is the only instance of additional financial benefits following from the conservation activity. These additional financial benefits accrue to the boat company, which enjoys an increase in visitors due to the attraction of the nearby KSNP - 90% of guests at the KSNP chalets are known to take the Kampong Kuantan firefly boat ride (Rasainthiran, pers. comm.). The boat ride operator also incurs an increase in operational costs, but this is more than offset by the increased revenue relative to the baseline course of action, namely developing housing projects at what is now the KSNP site.

Housing

The housing projects would have had various impacts on existing uses and created new sources of income for the local economy. Developers would have incurred costs of housing construction

but, along with these, gained substantial incomes. There would have been no additional cost or benefit from logging had the area been cleared and developed for housing since the dry secondary forest was already disturbed and its timber had been poached.

Transportation costs

It is assumed that the construction costs at either the KSNP site (baseline) or the township to the south of Kuala Selangor town (alternative) would be similar. But the .residents purchasing these houses would have incurred different costs for transportation to school and work. The transportation

costs from the alternative housing sites were estimated on the basis of the US$0.20 one-way bus

fare to Kuala Selangor town (incurred by an average of two school children per family), and

US$0.16/km for the average 2-km, one-way trip (for government servants and other professionals). Those from the baseline site (where the KSNP is now situated) were estimated on the basis of a

US$0.08 bus fare and the trip clair:ns at the same rate but for the shorter distance to town of 0.5 km.

Discussion

The estimated net present values of these various activities are summarised in a matrix that shows the global environmental benefits, the domestic benefits and the costs that accrue to different

117

118 GEF


groups (Table 3). The increments are differences between the costs or benefits in the alternative adopted and those of the baseline.

Of interest are the incremental benefits from the firefly boat rides in Kampong Kuantan (US$37,383) and those of the KSNP in the form of rentals of chalets, proceeds from the organisation of nature camp activities, and sales from the visitor centre (US$231,393).

The incremental costs of managing these wetlands for biodiversity conservation were estimated at US$3,555,097. The highest proportions are from the increase in travelling costs that the housebuying families now incur to commute to Kuala Selangor town. This constitutes 84.1 % of the total incremental costs. Government grants to establish the KSNP were 4.1 %, while those expenditures made directly by the park management comprised 7.4%. The Milky Stork breeding programmes took up another 3.7%. Of limited interest is the incremental cost incurred by the community involved in the Kampong Kuantan boat rides (US$24,549) which is less than 1 % of the total incremental cost. With the establishment of the KSNP, there are increases in visitors to the firefly attraction, which increased the operational costs.

Some points to note:

i. The above analysis was made under data availability constraints.

ii. The analysis is a retrospective look at the incremental costs of conserving biodiversity in the wetlands of Kuala Selangor. Thus, the incremental cost has in fact already been borne by the community, park management and State Government. The largest share is increased travelling cost and this has been borne by the residents in the housing projects.

iii. Some of the necessary costs have not yet been financed, however: there is a need to build another breeding aviary to transfer the zoo-bred storks to the site, breed a second (F2) generation and construct another roofless enclosure adjacent to the second aviary to transfer the F2 young to (Mohammed Nazim, 1994). Substantial incremental costs, which are much higher than the operational costs of Zoo Negara, have yet to be incurred and a financing mechanism would have to be resolved. Also, after 1995, substantial government expenditures were planned for the KSNP and the Kampong Kuantan firefly project. These expenditures on infrastructure such as new chalets, landscaping and a jetty may support or hinder the conservation at these sites depending on the selection and supervision of individual projects.

iv. As the number of visitors to the KSNP and Kampong Kuantan is expected to increase in the coming years, further research in areas such as the carrying capacities of these attractions would be important. Such endeavours would identify the threshold level of human disturbance that the wildlife could bear.

~TLANDS #;Vf.iji.IH.!i


Table 3: Matrix of Increments for Biodiversity Conservation in Kuala Selangor Wetlands (US$)

i Baseline Alternative lnqement 1

I Global Environmental Habitats Protect habitats for Silvered Leaf Monkeys, Habitats Benefits destroyed shorebirds, migratory waders; Milky Stork protected

Domestic Benefits breeding programme; firefly attraction

Local communities 339,356 376,739 37,383 (ecotourism-fireflies)

Housing developers 47,140,000 47,100,000 -

Park management agency - 231,393 @ 231,393@

Zoo Negara - Captive breeding at Zoo Negara and release 1st and 2nd of Milky Stork to natural habitat at KSNP for generation second generation breeding breeding and

release

INCREMENTAL BENEFIT 268,776 @@

Costs

Local communities - House buyers 1,449,000 4,438,000 2,989,000

· - · Ecotou rism 278,319 302,868 24,549

Housing developers 39,629,000 39,629,000 -

Park management - 264,782 264,782

Government 145,354 - Government grants for KSNP - 145,354 -- Kampong Kuantan 157,100 157,100

Fireflies

Zoo Negara* - 65,295 65,295

2nd-generation Milky Stork - 66,117 66,117 breeding programme at KSNP

Volunteer work and staff - ? ? time

INCREMENTAL COST 3,555,097

Notes

* Through grants from the Malaysian Wildlife Conservation Foundation and Zoo Negara's annual operational

budget, the first phase of the Milky Stork breeding programme was implemented at Zoo Negara.

@Inclusive of park entrance fees, rental of chalets, sales of souvenir and food, equipment rental and sponsorships

for an annual 'bird race'.

@@ Not inclusive of incremental intangible benefits from enhanced biodiversity and habitat protection.

? No complete record.

119

120 GEF


REFERENCES

Bann, C. (1995) - Maximising the Economic and Environmental Benefits of Ecotourism. Unpublished

report. WWF-Malaysia, Kuala Lumpur, 13 pp. Bernstein, l.S. (1968) - The lutong of Kuala Selangor. Behaviour 32: 1-15.

Davison, G.W.H., Muhammad Akhir 0., Prentice, C. & Howes, J. (1989) - A Coastal Nature Reserve

in Malaysia. Oryx 23(3): 138- 41.

Department of Fishery (Undated) - Aquaculture Development in Malaysia in the 1990s. Ministry of

Agriculture, Kuala Lumpur, 39 pp. Department of Statistics (1992)- Lapuran Permulaan Mukim. Government of Malaysia, Kuala Lumpur,

212 pp. Mohammed, Nazim Y. (1994) - Captive-breeding and Reintroduction Project for the Milky Stork,

Mycteria cinerea at Zoo Negara, Malaysia. International Zoo Yearbook 33: 39-48.

Muhammad, Akhir 0. (Undated) - Kuala Selangor Nature Park: A Conservation Effort in the Coastal

Zone. Unpublished report, 1 O pp.

Manaloor, V., Sorensen, G. & Jungersen, G. (1989) - A study of Presbytis cristata in the Kuala

Selangor Nature Park, Malaysia. Report submitted to the Malayan Nature Society, 25 pp.

Parish, D. & Wells, D. R. (1984)- lnterwader '83 Report. lnterwader Publication No. 1. Kuala Lumpur.

Silvius, M.J. (1986)- Survey of coastal wetlands in South Sumatra and Jambi, Indonesia. AWB-PHPA,

Bogar, Indonesia, 101 pp.

Silvius, M.J., Verheugt, W.J.M. & lskandar, J. (1986) - Coastal wetlands inventory of South East Sumatra. ICBP Study Report No. 9, Cambridge, UK, 65 pp.

Verheugt, W.J.M. (1987) - Conservation status and action program for the Milky Stork (Mycteria cinerea). Colonial Waterbirds (ICBP), 1 O: 211-220.

Wolf, K.E. & Fleagle, J.G. (1977) - Adult replacement in a group of silvered leaf monkeys at Kuala Selangor, Malaysia. Primates 18(4): 949-955.

·----------------.------,-----------------------

GEF


Global Environment Facility (GEF)

The Global Environment Facility provides funding to developing

countries for projects that yield local as well as global

environmental benefits. GEF projects address problems in the

areas of biodiversity, climate change, international waters, ozone

depletion, and the cross-cutting issue of land degradation.

The GEF operates, on an interim basis, the financial· mechanism

for the Convention on Biological Diversity and the United Nations

Framework Convention on Climate Change. Restructured and

replenished with a $2 billion trust fund in 1994, the GEF has now

authorized more than $1.8 billion in grants to recipient countries,

while leveraging more than $4.5 billion from other sources. With

161 participating nations, the GEF is at work in more than 110

developing countries and countries with economies in transition.

Its implementing agencies - the United Nations Development

. Programme, the United Nations Environment Programme, and .

the World Bank - collaborate with a wide range of government, ·

non -governmental, and private sector partners to pursue

sustainable development projects, mainstream the global

environment into the· agendas of international development

institutions, and leverage additional funds for global

environmental investment.

i I.

I

\X/ETLANDS lfhii;hf.01.lJ!.ii

CONSERVATION ANO /AND USE IN KUA/A SE/ANGOR WET/ANDS, MAIAYSIA

WETLANDS INTERNATIONAL Conserving Wetlands for people and wildlife

Wetlands International, the world's leading non-profit wetland conservation organisation, was created by the integration of the Asian Wetland Bureau, the International Waterfowl and Wetlands Research Bureau, and Wetlands for the Americas. The achievements of the founding organisations date back 40 years, and include the launch of (and support to) the Ramsar Convention, major regional surveys and conservation programmes for wetlands and wetland species, and the development of international programmes for migratory waterbird conservation.

Sound technical information is the basis for Wetlands lnternational's work, which includes coordinating conservation, management and assessment projects at international level, providing technical and fundraising support to national and local projects, and helping to build the capacity of relevant agencies. Wetlands International produces a wide range of publications and awareness materials, and organises numerous workshops, training courses and conferences each year.

Wetlands lnternational's global network provides rapid access to wetland conservation specialists throughout the world. Together with the staff of the organisation's 19 regional and project offices, . they provide a unique force to support wetland conservation activities. Partnership is at the heart of Wetlands International, and strong links exist with either international conservation agencies such as IUCN, WWF and Birdlife International, and the secretariats of the Ramsar and Bonn Conventions. Global and regional programmes are supported by over 120 government agencies, NGOs, foundations, development agencies and private sector groups.

For further information please contact the appropriate regional office:

Wetlands International Asia Pacific Institute of Postgraduate Studies and Research University of Malaya 50603 Kuala Lumpur Malaysia

Tel: +60 3 756 6624 Fax: +60 3 757 1225 Email: [email protected]

Wetlands International Africa, Europe, Middle East 11 Marijkeweg PO Box 7002 6700 CA Wageningen The Netherlands

Tel: +3131747 47 1 I Fax: +3131747 47 12 Email: [email protected]

Wetlands International The Americas 7 Hinton Avenue North Suite 200 Ottawa, Ontario KIY 4P1 Canada

Tel: +1 613 722 2090 Fax: +1 613 722 3318 Email: [email protected]


T he cost of protecting a wetland and its biodiversity from the adverse impacts of development is an important

input into the choice between development alternatives and into negotiations on sharing the cost of such protection.

Although the concept of incremental cost has long been used in economics, finance and business to help decision-makers choose between alternatives, it is only since Agenda

21, the Convention on Biological Diversity, and the Global Environment Facility gave it prominence that it has been systematically applied to environmental decision-making.

This publication illustrates how the incremental cost of development to protect the functions and benefits of wetlands should be compared to the consequences of development that provides no protection. Incremental cost is the cost of a decision to do one thing instead of another. Here is it the additional cost, relative to a baseline course of action affecting a wetland, of a decision to adopt a different course of action that not only meets the original national priorities but also protects biodiversity.

Two introductory chapters, 'Biodiversity and the Global Significance of Asian Wetlands' and 'Incremental Costs of Conserving Wetland Bodiversity', are complemented by four case studies from the Asia-Pacific region.

Prmted on Wooctt,.. bpi reqded so gsm. CCM!f Maple - 220 !JSl'TI.

ISBN 983-9663-26-7

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