1. FOR DISCUSSION PURPOSES ONLY
NOT FOR ATTRIBUTION;
FOR DISCUSSION PURPOSES ONLY

2. A Contribution to the Philippines
The Forestry Sector: Costs of Environmental Damage & Net Benefits of Priority Interventions
A Contribution to the Philippines
Country Environmental Analysis
Antonio P. Carandang, Ph.D.
World Bank CEA Workshop
Manila, June 16-17, 2008"
asd

3. Outline: Introduction Valuation Framework Forest depletion statistics
Status of tenurial instruments in the country, open access areas
Some depletion valuation results using net price, and asset value
TEV/Impacts (Indicative results)
Potential Interventions
Some Insights
Objectives:

4. Valuation Framework VALUATION METHODS AVERAGE VALUE PER UNIT RESOURCE
NET PRICE
ASSET VALUE APPROACH
VALUE OF ASSET CHANGE THROUGH TIME
DIRECT: CONSUMPTIVE & NON- CONSUMPTIVE
USE VALUES
INDIRECT/ REGULATING
TOTAL ECONOMIC VALUE
OPTION VALUES
EXISTENCE
NON-USE VALUES
BEQUEST

5. The Net Price (NP) Method
the average net price per unit of resource
accounts for the change of stocks of natural capital
the change in stock arises from harvesting, damage, and conversion
the physical accounts and the economic accounts in current and constant prices

6. The Asset Value Approach
measures the annual asset value change of the natural capital by estimating the stream of goods and services derived from the physical resource through time
future stream of benefits and costs of the assets is computed in present value terms through the discounting process

7. DEFORESTATION STATISTICS

11. Annual Foregone Value of Second Growth due to Depletion = 61.2 Bil P

12. ASSET VALUE, 3 SCENARIOS:
1 – Optimum harvest options in production forests including NTFPs
2 – Status Quo (with TLA and limited utilization in IFMA, CBFM, etc., and NTFP utilization)
3 – Total Logging Ban with NTFP utilization

15. POTENTIAL INTERVENTIONS BEING EXAMINED
Intervention 1: Putting all forest areas under formal tenure or management with formal/indicative plans being implemented.
Intervention 2: Improved protection of all forest areas and rehabilitation of degraded forest lands under different schemes, e.g., reforestation, agroforestry, private investment in ITP, reforestation for carbon market
Stressor/s addressed: Conversion of open access forests
Resources affected/receptors: All open-access forest areas
Damage reduced/eliminated: Continued reduction in hectarage of forest converted and its negative impacts

16. POTENTIAL INTERVENTIONS BEING EXAMINED
Intervention 3: Non-traditional forest development approaches employing Payments for Environmental Services (PES, RUPES EPWS), etc.
Intervention 4: Co-Management of forest areas by DENR, LGUs and Local POs
Stressor/s addressed: Population pressure, unsustainable farming/ lack of livelihood, poverty
Resources affected: All Watershed Resources
Damage reduced/eliminated: Forest conversion, illegal activities due to lack of livelihood

17. OTHER POTENTIAL SUPPORT INTERVENTIONS BEING EXAMINED
Promotion of Value-Added Processing among legal forest products extractors
More support to CBFM, participatory development; More active participation of LGU’s in resource management, protection, and accounting
Policy reform and advocacy on the promotion of resource conserving tenures
Simplified procedures/requirements for sustainable NTFP utilization by POs
Network of Protected Areas/Information sharing, Integrated Valuation Studies, Institutional capability strengthening

18. Insights:
Importance of Net Price and Asset Value approaches in estimating the value of resource depreciation and the justification for conservation measures, Net Price is biased to protection and preservation while Asset value is biased to utilization
Importance of TEV to assess the total impacts of forest intervention or policy directions in the sector, e.g., conversion of forest areas into agriculture would entail great economic costs to society in all 3 methods examined.
Initial Recommendation: Expansion of stewardship concept like CBFM, to be opened to interested groups, to work with the communities and use PES to sustain funding and allow limited utilization to sustain interests of NR stewards.

19. Thank you !