Environmental Engineering Reference
In-Depth Information
of return over 10 years of conservancy development were moderate at between 8
per cent (the discount rate) and 19 per cent.
The community financial values tell us to what extent the communities have
an incentive to invest in conservancies. Here the net income accruing to the
communities in the form of project profits, salaries and wages, and any dividends
paid out to households is presented, ranging from some US$29,000 in Nyae Nyae
to some US$103,000 in Mayuni. Community incomes, measured per household,
ranged from US$41 in Nyae Nyae to US$474 in Torra. Communities invested
that part of the project capital investment that was not donor or government
funded and received a flow of net income described above. Community financial
rates of return on investment over 10 years were generally very high, and for
Mayuni, Torra and
Khoadi //Hôas were over 100 per cent. Rates of return were
attractive but lower for Nyae Nyae and Salambala, the two conservancies with
relatively weak non-consumptive tourism potential (Table 16.1).
Generally, in all cases analysed in Table 16.2, the communities could derive
very favourable returns on their investments. The Torra and Mayuni conservan-
cies were able to earn the most cash income and dividends per household, while
the Mayuni,
Khoadi //Hôas and Torra conservancies, all showed very high
financial rates of return. The Nyae Nyae and Salambala conservancies provided
the least attractive returns for communities. The dominant feature of the commu-
nity analysis was the fact that donors, and not the communities, bore many of the
initial capital and recurrent input costs. All conservancies benefited from donor
assistance in this way. Another feature of the community analysis is that it does
not incorporate the accumulation of wealth in conservancy wildlife stocks, which
communities cannot themselves realize through sale.
The economic values, in Table 16.2, are very useful in that they tell us whether
the conservancy contributed positively to national development or not. Here the
investment consists of project capital measured at its real cost to the nation, (its
opportunity cost), and the benefits include the net national income generated
directly within the conservancy, as well as any capital gains in stock value within
the conservancy. In all cases the conservancies did, with positive annual contribu-
tions to gross and net national income, positive net present values, and generally
very favourable internal rates of return. The 8 per cent real discount rate used in
the cost-benefit analysis is essentially the opportunity cost for the capital used in
the conservancies. It serves as a cut-off rate, in that if projects generate rates of
return lower than this, their capital should be diverted and used for something
else. All conservancy returns were significantly higher than the 8 per cent cut-off
rate, making these investments highly desirable economically.
Conservancies with most favourable returns were found in different settings,
including both the semi-desert (Torra) and the more humid north east (Mayuni).
The main determinants of high investment value for conservancies appeared to
be the potential of their natural resources for non-consumptive tourism (Table
16.1). The low returns for Nyae Nyae were specifically related to an artificially
high costs structure, as well as low initial wildlife densities and relatively low non-
consumptive tourism potential.The low returns for Salambala were also related to
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