Economic Valuation And Green Accounting Of Wetland Resources Of The Kilombero Valley, Ramsar Site, Tanzania

ABSTRACT

Wetland ecosystems in Tanzania are historically important for the well being of human communities, biodiversity conservation and other environmental values. These cover about 88 300 km2 which is about 10% of the land surface. However, in recent years, they have gone through ecological changes. The major reason is increased unsustainable utilization of wetland resources, which may result into losses of livelihoods. Under Ecosystem Services Framework (ESF), the role played by healthy ecosystem in sustainable provision of human wellbeing, poverty alleviation and economic development potential. It has been established that sustainable management of wetland ecosystem and associated resources depends on among other factors, the understanding of their economic value. Furthermore, in order to have a sustained economic growth, there is a need to capture fluctuations in the resources base values and include them in national accounts. Such practice help send signals on the performance of the resource base, with corresponding effects on human welfare and the national economy at large. This information is missing in Tanzania which subjects wetlands into undue degradation. In this study, guided by the Ecosystem Services Framework, Kilombero Valley Flood Plain Ramsar Site (KVFPRS) was used to provide an understanding of the level of household utilization of wetland resources and economic benefits derived from direct utilization, how to capture non-marketed benefits of regulating and biodiversity, green accounting of wetland values by accounting for wetland degradation in the national accounting system. The overall objective of the study was to estimate the Total Economic Value (TEV) of the KVFPRS and account for these values in the national accounting system. Specific objectives were to assess: 1) direct use values, 2) indirect use values, 3) non-use existance biodiversity values, and 4) contribution of wetland resources in the national accounting system to include also degradation. Data were collected through: i) discussions with officials working in the KVFPRS ii) household contigent valuation questionnaire, iii)

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literature searches, iv) expert evaluation, v) focus group discussions and vi) market surveys. The study involved 10 purposely sampled villages, which were selected based on economic activities and exposure to altered ecological characteristics. In these villages, a 5 percent of randomly selected households which resulted in a total sample of 490 households in KVFPRS. For direct economic activities, a Market Price Method was used. In this method, direct activities from agriculture (paddy, sugarcane), fishing, forest products, thatch grass, livestock keeping, water for domestic use and bushmeat hunting were valued. For each activity, the percentage of participating households was identified; information on what they produce, the cost of production and the net benefit was calculated. It was observed that 90% of households engaged in paddy production. The annual population benefit was estimated at a lower bound of Tshs 21.6 billion and higher bound of Tshs 86.4 billion. Sugarcane growing was practiced by 11 percent of the sampled population as outgrowers. Estimated benefit for the population was Tshs 31.6 billion. Thatch grass collection was done by 5 percent of the population. Estimated value stood at 3.2 billion. About 6% of the population wre engaged in forestry related business, however, the dependence for charcoal was about 70 percent and 90 percent for firewood. Estimated value of wood based products was Tshs 20 billion. Fishing was carried out by 22% of population mostly in fishing camps. Average price per fish was Tshs 2 000 and cost of production per trip was Tshs 22 000. Total net benefit was Tshs 4.4 billion. Brick making was carried out by 5 percent of the population. Net benefit was estimated at Tshs 1.6 billion. Livestock keeping especially free ranging cattle was carried out by 22 percent of the population with price per cattle of Tshs 500 000. Sold cattle brought annual benefit of Tshs 4 billion. Hunting for bush meat was carried out by 5 percent of the population with a price of Tshs 2 000 – 5 000 per kg, the earnings from this activity translated to Tshs 800 million per year. Water for domestic use was estimated at 6 billion litres in a year with total value of Tshs 336 million. The total aggregate value for direct economic value

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for studied activities stood at Tshs 152 billion indicating the significant contribution of KVFPRS in supporting direct economic activities. The largest contribution came from agriculture; lead by paddy production (56.6 percent), sugarcane production (20.8 percent), followed by forest products (13.2 percent), fishing (2.9 percent), livestock sale ( 2.6 percent) , bush meat (0.5 percent), brick making (1 percent) and thatch grass (2.1 percent). Contigent valuation of willingness to contribute was used to value non-marketed goods. This was done by asking households’ their Willingness to Contribute (WTC) and Willingness to Accept compensation to valuation scenarios that would prevent biodiversity loss, improve water quantity and quality and control floods in order to avoid losses households face in KVFPRS. Household could contribute in terms of labour, cash, or a combination of the two. Willing to Contribute (WTC) in cash is equivalent to asking the usual Willingness-to-Pay question in CV surveys. The value was at Tshs 3 billion for Biodiversity, Tshs 6 billion for Flood control and Tshs 4 billion for water quantity and quality. Contribution in labour was highest in value for all ecosystem services constituting about 80 percent of the total value. Noted also was that most contribution in cash was less than 10 percent of the average annual household income. In terms of Willingness- To- Accept (WTA) compensation for the next five years, results indicated that 92 percent of respondents voted for it and about eight percent of the respondents were against it. The respondents stated a mean WTA of Tshs 2 709 500 per year and the maximum amount stated was Tshs 100 000 000. However, some of the very high amounts could be a way of protesting though the threshold for what can be viewed as a protest could not be established. A logistic regression analysis was conducted to explain the variation in annual WTC per household for All services, biodiversity, flood control, water quality and quantity; respectively. Willing to Contribute (WTC) was regressed on household size, gender, age of respondent, marital status, education, activities carried out in KVFPRS, income of household and total area owned. The value of wetland based on contingent

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valuation of WTC was significant at Tshs 14 billion. The study shows that it is possible to value non-marketed goods and services provided by the KVFPRS. These findings and the approach used can be used to devise strategies for maintaining ecological health of the KVFPRS. In respect of green accounting of wetland values, both marketed and non marketed wetlands values, wetland services from crop levy, registration fees and royalties and degradation were used to show contribution of wetland resources in the national accounting system. Economic contribution of direct economic values was Tshs 152 billion and non marketed goods which accounts for Tshs 14 billion, wetland services was Tshs 75 million bringing the total value of Kilombero Ramsar site to about Tshs 167 billion in the national account. Furthermore, calculated degradation was reduced as a cost in the national accounting. The study observed overfishing of about 98 000 kg valued at Tshs 196 million, for livestock grazing extra of 200 livestock units required valued at 10 billion and for forests a deforestation rate of 52.2 ha/year valued at Tshs 30 million. This results into degradation value of Tshs 10.1 billion. Thus, green contribution of wetland into the national accounts to amounts Tshs 157 billion. This portrays how economic growth and ecological health of wetland resources sustain each other. It is concluded that sustainable management of wetland ecosystems can not be attained if consideration of direct use, indirect use and existence biodiversity values are ignored when planning for sustainable wetland management.