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NOT FOR ATTRIBUTION; FOR DISCUSSION PURPOSES ONLY

NOT FOR ATTRIBUTION; FOR DISCUSSION PURPOSES ONLY. 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".

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NOT FOR ATTRIBUTION; FOR DISCUSSION PURPOSES ONLY

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  1. NOT FOR ATTRIBUTION; FOR DISCUSSION PURPOSES ONLY

  2. 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"

  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

  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

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

  9. 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

  10. 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

  11. 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

  12. 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

  13. 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.

  14. Thank you !

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