1. Economic Valuation of Coral Reefs in St. Lucia – June 2008 Castries, St. Lucia Lauretta Burke World Resources Institute

2. Project Partners Include Regional Partners University of the West Indies (UWI) / Sustainable Economic Development Unit (SEDU) University of the West Indies (UWI) / Sustainable Economic Development Unit (SEDU) Caribbean Natural Resources Institute (CANARI) Caribbean Natural Resources Institute (CANARI) T&T Institute of Marine Affairs (IMA) T&T Institute of Marine Affairs (IMA) CEHI CEHI OECS OECS Saint Lucia Government of Saint Lucia Government of Saint Lucia Planning Department Fisheries Department SMMA Ministry of Tourism Statistical Office St. Lucia National Trust St. Lucia National Trust SLHA, resorts SLHA, resorts

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

4. Program Overview 1. Ecosystem Goods and Services 2. Summary of results 3. Policy Applications 4. Background on this Economic Valuation project – method and features 5. Valuation – details for St. Lucia 6. Policy Applications Buccoo Reef example Buccoo Reef example Discussion Discussion

5. Beautiful

6. Valuable

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

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

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

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

11. Ecosystem Services Ecosystem goods (such as food) and services (such as waste assimilation) represent the benefits human populations derive, directly or indirectly, from ecosystems.

12. Ecosystem Services from Coral Reefs Provisioning Services -food – fish and shellfish -genetic resources - natural medicines and pharmaceuticals -ornamental resources - building materials Regulating Services - carbon storage / climate regulation -erosion control -storm protection CulturalServices -spiritual and religious values -knowledge systems / educational values -inspiration -aesthetic values -social traditions -sense of place -recreation and ecotourism Supporting Services -sand formation -primary production

13. Ecosystem Services from Coral Reefs Provisioning Services -food – fish and shellfish -genetic resources - natural medicines and pharmaceuticals -ornamental resources - building materials Regulating Services - carbon storage / climate regulation -erosion control -storm protection CulturalServices -spiritual and religious values -knowledge systems / educational values -inspiration -aesthetic values -social traditions -sense of place -recreation and ecotourism Supporting Services -sand formation -primary production

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

15. Summary of Values for St. Lucia

16. Valuation Summary – Tourism and Recreation Coral reef-associated tourism and recreation – contributed between US$160 and $194 million to the national economy in 2006.

17. Valuation Summary – Fisheries Coral reef-associated fisheries – important for cultural tradition, safety net, and livelihood important for cultural tradition, safety net, and livelihood provide annual economic benefits estimated at between US$0.5 – 0.8 million. provide annual economic benefits estimated at between US$0.5 – 0.8 million.

18. Valuation Summary – Shoreline Protection Shoreline Protection Services of Coral Reefs – avoided erosion and storm damage from waves valued between US$28 and $50 million per year. avoided erosion and storm damage from waves valued between US$28 and $50 million per year.

19. Valuation Summary Tourism and Recreation - US$160 to $194 million in 2006. Tourism and Recreation - US$160 to $194 million in 2006. Coral reef-associated fisheries - US$0.5 – 0.8 million / year Coral reef-associated fisheries - US$0.5 – 0.8 million / year Shoreline protection services – US$28 and $50 million per year. Shoreline protection services – US$28 and $50 million per year. These are significant compared to St. Lucia’s GDP, which was $825 million in 2005. These are significant compared to St. Lucia’s GDP, which was $825 million in 2005. Coral reefs provide other important values not estimated in this study, and these numbers should be regarded as a lower bound estimate. Coral reefs provide other important values not estimated in this study, and these numbers should be regarded as a lower bound estimate.

20. Coral Reefs – economically important to St. Lucia Valuation can highlight: Significant contribution to GDP Significant contribution to GDP Taxes paid to government Taxes paid to government Jobs and wages dependent on coral reefs Jobs and wages dependent on coral reefs Value of social safety net Value of social safety netSupports: Coastal Planning (shoreline protection analysis) Coastal Planning (shoreline protection analysis) Evaluation of trade-offs Evaluation of trade-offs

21. Economic Valuation applications Estimate Economic Contribution to GDP Estimate Economic Contribution to GDP Compare benefits of development / management options Compare benefits of development / management options Encourage increased investment in coastal management / MPAs / fisheries management Encourage increased investment in coastal management / MPAs / fisheries management Identify sources of support for management / policy / protected areas Identify sources of support for management / policy / protected areas Set fees, such as visitor fees Set fees, such as visitor fees Damage assessment Damage assessment Comparing “reef-dependence” Comparing “reef-dependence”

22. St. Lucia - specific examples To guide future development, including evaluating To guide future development, including evaluating the changes resulting from marina development on east and west coasts the changes resulting from marina development on east and west coasts The benefits of investing in improved sewage treatment The benefits of investing in improved sewage treatment Guide the management planning for SMMA or Point Sabel Guide the management planning for SMMA or Point Sabel Examine changes in fisheries management and the impact on short-term livelihoods versus long-term benefits Examine changes in fisheries management and the impact on short-term livelihoods versus long-term benefits To evaluate tourism carrying capacity and potential revenue To evaluate tourism carrying capacity and potential revenue To estimate loss of local use of beaches due to development To estimate loss of local use of beaches due to development

23. EV Project Characteristics 1. Develop method which is simple and replicable 2. Rely predominantly on existing, available data 3. Develop a tool to guide valuation and apply to policy questions. 4. Produce coral reef valuation estimates for 2 pilot areas (Tobago and St. Lucia) 5. Estimate likely economic loss due to coral reef degradation

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

25. Challenges Distinguishing the coral-reef associated benefits Distinguishing the coral-reef associated benefits Tourism Tourism Fisheries Fisheries Shoreline protection Shoreline protection Valuing “local use” Valuing “local use” Secondary (indirect) economic impacts Secondary (indirect) economic impacts

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

27. Tourism Valuation issues 1. Identifying “coastal” visitors 2. Quantifying reef recreation 3. Getting accurate MPA visitation numbers 4. Estimating labor and other operating costs

28. Tourism and Recreation Valuation Assumptions 25% of visitors come to St. Lucia in part due to the reefs. 25% of visitors come to St. Lucia in part due to the reefs. Non-labor operating costs – about 40% Non-labor operating costs – about 40%

29. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7

30. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8

31. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8 Marine Park Revenues $0.1

32. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8 Marine Park Revenues $0.1 Misc. Visitor Expenses $21.2

33. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8 Marine Park Revenues $0.1 Misc. Visitor Expenses $21.2 Total Direct Impact $91.6

34. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8 Marine Park Revenues $0.1 Misc. Visitor Expenses $21.2 Total Direct Impact $91.6 (11% of GDP)

35. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8 Marine Park Revenues $0.1 Misc. Visitor Expenses $21.2 Total Direct Impact $91.6 Indirect economic Impact ** $68 – 102

36. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8 Marine Park Revenues $0.1 Misc. Visitor Expenses $21.2 Total Direct Impact $91.6 Indirect economic Impact ** $68 – 102 Total Direct & Indirect Impact US$160 – 194 million

37. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8 Marine Park Revenues $0.1 Misc. Visitor Expenses $21.2 Total Direct Impact $91.6 Indirect economic Impact ** $68 – 102 Total Direct & Indirect Impact US$160 – 194 million Consumer Surplus $2.2 – 2.4

38. Tourism Valuation for St. Lucia Coral Reef-associated:($US million) Accommodation Value $64.7 Reef Recreation – Diving $4.9 Reef Recreation – Snorkeling $0.8 Marine Park Revenues $0.1 Misc. Visitor Expenses $21.2 Total Direct Impact $91.6 Indirect economic Impact ** $68 – 102 Total Direct & Indirect Impact US$160 – 194 million Consumer Surplus $2.2 – 2.4 Local Use $52 – 109

39. Local Reef Use Survey Commissioned a survey through the University of West Indies / Sustainable Economic Development Unit / Government of St. Lucia, Department of Statistics Commissioned a survey through the University of West Indies / Sustainable Economic Development Unit / Government of St. Lucia, Department of Statistics 300 people surveyed in 6 locations in St. Lucia (Soufriere, Vieux Fort, Anse La Raye, Castries town, Gros Islet, Dennery/Micoud) 300 people surveyed in 6 locations in St. Lucia (Soufriere, Vieux Fort, Anse La Raye, Castries town, Gros Islet, Dennery/Micoud) Designed to measure local use of beaches and reefs as well as recreational and subsistence fishing Designed to measure local use of beaches and reefs as well as recreational and subsistence fishing

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

41. Fisheries Valuation Issues 1. Limited data on local use 2. Focus on economic impact – does not fully capture social values.

42. Commercial Fishing in St. Lucia Estimate derived from two approaches – Estimate derived from two approaches – 1. reef fish productivity 2. recorded landings

43. a) Reef Fish Productivity Reef Area: 33 km 2 (from this project) Reef Area: 33 km 2 (from this project) Estimated fish productivity rate: range of 1 to 5 MT of fish / km 2 of coral reef Estimated fish productivity rate: range of 1 to 5 MT of fish / km 2 of coral reef Potential sustainable harvest of 73,000 to 363,000 lb of reef fish Potential sustainable harvest of 73,000 to 363,000 lb of reef fish

44. b) Landings recorded 9 landing sites 9 landing sites Fisheries Dept. data for 2002-2004 Fisheries Dept. data for 2002-2004 Prices Prices Pot fish = EC$10 (US$3.75) Pot fish = EC$10 (US$3.75) Lobster = EC$25 (US$9.00) Lobster = EC$25 (US$9.00) Sea Urchin = EC$50 (US$18.00) Sea Urchin = EC$50 (US$18.00)

45. Average Fish Landings 2002-04 PoundsValue ($US)Percent of Value Squirrelfish13,459$50,7887.3% Snapper44,995$169,79524.5% Grouper8,244$31,1084.5% Parrotfish9,930$35,4455.1% Total for finfish76,628$287,13741.4% Lobster29,000$273,58539.5% Sea Urchin 7,251$132,53819.1% Grand Total112,879$693,260*100.0%

46. Fisheries Valuation for St. Lucia Coral Reef-associated:($US thousand) Commercial Fisheries – Gross Revenue$515 - 772 N.L. Operating Costs (25%)$129 – 193 Commercial Fisheries – Net Revenue$386 – 579 Fish cleaning and processing$51 – 77 Total Direct Impact $437 – 656

47. Fisheries Valuation for St. Lucia Coral Reef-associated:($US thousand) Commercial Fisheries – Gross Revenue$515 - 772 N.L. Operating Costs (25%)$129 – 193 Commercial Fisheries – Net Revenue$386 – 579 Fish cleaning and processing$51 – 77 Total Direct Impact $437 – 656 Indirect economic Impact $82 – 185

48. Fisheries Valuation for St. Lucia Coral Reef-associated:($US thousand) Commercial Fisheries – Gross Revenue$515 - 772 N.L. Operating Costs (25%)$129 – 193 Commercial Fisheries – Net Revenue$386 – 579 Fish cleaning and processing$51 – 77 Total Direct Impact $437 – 656 Indirect economic Impact $82 – 185 Total Direct & Indirect Impact $520 – 841

49. Fisheries Valuation for St. Lucia Coral Reef-associated:($US thousand) Commercial Fisheries – Gross Revenue$515 - 772 N.L. Operating Costs (25%)$129 – 193 Commercial Fisheries – Net Revenue$386 – 579 Fish cleaning and processing$51 – 77 Total Direct Impact $437 – 656 Indirect economic Impact $82 – 185 Total Direct & Indirect Impact $520 – 841 Local (non-commercial) fishing $155 - 790

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

51. Shoreline Protection Valuation Potential Valuation Methods: Replacement Cost Replacement Cost Avoided Damages Avoided Damages

52. Physical Factors Physical factors affecting the protection afforded by a coral reef: orientation of the coast (windward / leeward; high energy or low energy coast) orientation of the coast (windward / leeward; high energy or low energy coast) bathymetry / shoreline profile bathymetry / shoreline profile shoreline shape (bay, headland) shoreline shape (bay, headland) depth of the reef / geology (type of reef) depth of the reef / geology (type of reef) distance the reef is from land distance the reef is from land

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

54. Shoreline Protection Analysis (5 Steps) 1. Identify vulnerable areas 2. Identify areas protected by coral reefs 3. Evaluate the relative protection provided by reefs 4. Incorporate property values 5. Combine to evaluate potential storm damage avoided

55. 4% of St. Lucia’s land area rated “vulnerable.”

56. 44% of St. Lucia’s coastline is protected by coral reefs.

57. Shoreline Stability Factors (from IMA) 1. Coastal Geomorphology 2. Coastal Geology 3. Coastal Protection Structures 4. Wave Energy 5. Storm/Hurricane Events 6. Coral Reef Index (Reef type, continuity, distance offshore) 7. Coastal Elevation 8. Coastal Slope 9. Coastal Vegetation 10. Anthropogenic Activities

58. Factor Factor Coastal Protection Scheme (from IMA) Very High 4High3Medium2Low1None0 Coastal Geomorphology Rocky, Cliffed Coastline Soft (Limestone) Cliffs or Low Bluffs MangrovesBeachesN/A Coastal Geology Igneous and/or Volcanic MetamorphicSedimentary Unconsolidated Sediments N/A Coastal Protection Structures Protected by 2 prominent headlands and breakwater Protected by 2 prominent headlands Seawalls, Riprap or Breakwaters Protected by one or two small headlands No protection by headlands Wave Energy (~ Max. Wave Height [cm]) < 20 20 - 40 40 - 60 >60N/A Coral Reefs Reef Type Reef Type Reef Distribution Reef Distribution Reef Distance (m) Reef Distance (m)BarrierN/A < 250 PatchN/A 250 - 500 FringeContinuous 500 - 1000 ApronDiscontinuous > 1000 No reef present Storm/Hurricane Events Affected by 1-5 TS every 10 years Affected by at least 5 TS every 10 years Affected by at least a category 1 every 25 years Affected by at least a category 3 every 25 years N/A Coastal Elevation (m) > 12 5 - 12 1 - 5 0 - 1 < 0 (N/A) ** Coastal Slope (%) 6.2 – 9.7 2.6 – 6.2 1.1 – 2.6 0.4 – 1.1 N/A Coastal Vegetation * Type Type Distribution DistributionMangroves > 75 % length of coastline Coastal Woodlands 50% - 75 % of length Thicket 25% - 50 % of length Runners < 25% length of coastline None No Vegetation Coastal Anthropogenic Activities No sand mining, coastal development, etc. Misc. Other Activities Either sand mining or coastal development Sand mining and coastal development N/A

59. Stability Factors used in St. Lucia Analysis 1. Coastal Geomorphology 2. Coastal Geology 3. Wave Energy 4. Storm/Hurricane Events 5. Coral Reef Index (Reef type, continuity, distance offshore) 6. Coastal Elevation 7. Coastal Slope 8. Coastal Vegetation Not Available 1. Coastal Protection Structures 2. Anthropogenic Activities

60. Factor Integration 3a. Shoreline stability (RTCP) = 3a. Shoreline stability (RTCP) = Sum of factor scores / n 3b. Relative reef contribution = 3b. Relative reef contribution = Sqrt of ((reef index / sum of factor scores) / RTCP)) Apply with minimum of 5 factors. Apply with minimum of 5 factors.

61. 3a. Relative Total Coastal Protection (RTCP) With reef present With reef present Without reef Without reef

62. 3b.

64. Potentially Avoided Damages Estimated based on property values in “vulnerable areas” which are “protected by a reef,” based on the “relative reef contribution” for that area. Estimated based on property values in “vulnerable areas” which are “protected by a reef,” based on the “relative reef contribution” for that area. St. Lucia – property values estimated at US$25 - 30 per square foot St. Lucia – property values estimated at US$25 - 30 per square foot Relative reef contribution applied at +/- 20%, reflecting some uncertainty. Relative reef contribution applied at +/- 20%, reflecting some uncertainty.

65. Shoreline Protection Summary – St. Lucia St. Lucia Land Area (sq km) 610 km2 Vulnerable Land Area (sq km) 24.5 km2 4% Vulnerable Area Protected by reefs (sq km) 10 km2 1.5% Shoreline length Protected by Reefs 44% Average Property Value (US$) US $25 - 30 US $25 - 30 Potentially Avoided Damages (2007) US $28 – 50 mill

66. Shoreline Protection Summary – St. Lucia St. Lucia Potentially Avoided Damages (2007) US $28 – 50 mill Potentially Avoided Damages (over 25 years) US $700 million - $1.2 Billion

67. Summary of Values for St. Lucia Coral Reef-associated :($US million / yr) Tourism and Recreation – Total Direct Impact$91.6 million Tourism and Recreation – Total economic Impact$160 – 194 million Fisheries – economic Impact$0.5 – 0.8 million Shoreline Protection Services$28 – 50 million

68. Policy Exploration – Buccoo Reef Tourist Destination Tourist Destination Environmental issues Environmental issues water quality water quality overfishing overfishing reef condition reef condition BRMP - enforcement BRMP - enforcement

69. Management Options – Buccoo Reef Enforcement of no- fishing regulations Enforcement of no- fishing regulations Re-routing of storm drain Re-routing of storm drain Integrated watershed management Integrated watershed management Sewage treatment Sewage treatment

70. Economic Value – Buccoo Reef Glass-bottom / snorkel Tours –US$1.4 mill / yr Glass-bottom / snorkel Tours –US$1.4 mill / yr Tourism Tourism US$7-8 million / yr US$7-8 million / yr US$128 – 156 million over 25 years US$128 – 156 million over 25 years Shoreline protection - US$140-250 million over 25 years Shoreline protection - US$140-250 million over 25 years

71. Policy Recommendations for St. Lucia Improve mapping and monitoring of coral reefs and mangroves Improve mapping and monitoring of coral reefs and mangroves Maintain coastal mangroves Maintain coastal mangroves Monitor and improve coastal water quality Monitor and improve coastal water quality Monitor marine recreation and manage within sustainable limits Monitor marine recreation and manage within sustainable limits Use the coral reef valuation methodology and Tool to track the economic contribution of coral reefs over time Use the coral reef valuation methodology and Tool to track the economic contribution of coral reefs over time

72. Available online at www.buccooreef.org andwww.buccooreef.org www.wri.org/project/valuation-caribbean-reefs Contacts: WRI –Lauretta Burke, +1 (202) 729 7774, lauretta@wri.orglauretta@wri.org Gov StL – LaVerne Walker lwalker2006@gmail.com lwalker2006@gmail.com IMA – Sean Paddy, (868) 634 4291 x405, spaddy@ima.gov.ttspaddy@ima.gov.tt