Forgot your password?
Document Actions
Economic Valuation of a Mangrove Ecosystem Threatened by Shrimp Aquaculture in Sri Lanka (Gunawardena and Rowan, 2005)
DOI: 10.1007/s00267-003-0286-9
Economic Valuation of a Mangrove Ecosystem
Threatened by Shrimp Aquaculture in Sri Lanka
M. GUNAWARDENA the proposal and an estimate of the ‘‘total economic value’’
Environmental Science Department (TEV) of a mangrove ecosystem. The analysis revealed that
Lancaster University, the internal benefits of developing the shrimp farm are
Lancaster, LA1 4YQ, United Kingdom higher than the internal costs in the ratio of 1.5:1. However,
when the wider environmental impacts are more compre-
J. S. ROWAN*
hensively evaluated, the external benefits are much lower
Environmental Systems Research Group
than the external costs in a ratio that ranges between 1:6 and
Department of Geography
1:11. In areas like Rekawa, where agriculture and fisheries
University of Dundee
are widely practiced at subsistence levels, shrimp aqua-
Dundee, DD1 4HN, United Kingdom culture developments have disproportionately large impacts
on traditional livelihoods and social welfare. Thus, although
ABSTRACT / Mangrove ecosystems in Sri Lanka are the analysis retains considerable uncertainties, more explicit
increasingly under threat from development projects, espe- costing of the environmental services provided by mangrove
cially aquaculture. An economic assessment is presented for ecosystems demonstrates that low intensity, but sustainable,
a relatively large (42 ha) shrimp culture development pro- harvesting has far greater long-term value to local stake-
posed for the Rekawa Lagoon system in the south of Sri holders and the wider community than large shrimp aqua-
Lanka, which involved an extended cost–benefit analysis of culture developments.
Mangrove ecosystems in Sri Lanka are increasingly shoreline erosion; and absorption of pollutants; main-
under threat from development projects, especially tenance of biodiversity and water conservation (Dier-
shrimp aquaculture. Despite covering only 0.19% of Sri berg and Kiattisimkul 1996). The productivity of
LankaÕs total land area, shrimp sales from these areas aquaculture systems such as shrimp ponds is also
and associated coastal waters are an important source heavily dependent on the surrounding mangroves,
of foreign exchange and account for 40–50% of total which provide a range of free services such as seed,
aquaculture exports (Senarath and Visvanathan 2001). food inputs, and clean water for culture practices
Many of Sri LankaÕs mangroves have either been (Beveridge and others 1997). They also offer protec-
developed or are earmarked for shrimp ponds. It is tion against floods, hurricanes, and erosion and so
also widely observed that when successful shrimp farms protect aquaculture operations against natural hazards.
are introduced into new areasÕ they encourage further Ronnback (1999) discussed that the life-support func-
¨ ¨
development until only a remnant of the original area tions of mangroves are crucial for the sustainability of
remains or until the entire mangrove area has been aquaculture systems and that failure to acknowledge
converted into ponds (Amarasinghe 1988). this function is one explanation for the boom-and-bust
Mangroves have contributed significantly to the pattern of shrimp aquaculture. Considerable amounts
livelihood of coastal communities through products of energy and money would be required if free man-
used for fuel, construction, fishing, agriculture, forage grove goods and services were to be substituted with
for livestock, medicines, and food items (Primavera human technology. However, the market price of the
1997). Furthermore, mangroves supply multiple eco- cultured product captures only a fraction of the ser-
system services such as: nursery grounds and shelter for vices provided by the host environment.
fish, crabs, and shrimp; buffers against storm surge and Shrimp aquaculture is widely considered to be one
of the most environmentally destructive forms of
modern agriculture. Aquaculture projects not only
KEY WORDS: Shrimp aquaculture; Mangroves; Total economic value
destroy mangroves for shrimp ponds but also deplete
and extended cost–benefit analysis; Sri Lanka
groundwater resources to fill ponds and pollute surface
waters with pond effluent (Goldburg 1997; McKinnon
Published online August 29, 2005.
and others 2002). One of the most unfortunate aspects
*Author to whom correspondence should be addressed; email:
of the expansion of the shrimp culture industry is the
j.s.rowan@dundee.ac.uk
ª 2005 Springer Science+Business Media, Inc.
Environmental Management Vol. 36, No. 4, pp. 535–550
536 M. Gunawardena and J. S. Rowan
lack of consideration given to the long-term conserva- comparing current costs to undertake the development
tion and management of natural resources (Flaherty versus the potential future benefits. Lal (1990) re-
and Karnjanakesorn 1995; Corea and others 1995). ported negative NPV results (i.e., loss making) for
High profitability and the opportunity to generate converting mangrove forest to shrimp and rice farming
foreign exchange have provided the main driving forces over a 50-year planning horizon. These examples
for the expansion of shrimp culture in Sri Lanka and are illustrate the need for greater awareness of economic
used to justify the conversion of mangroves to shrimp analysis within environmental impact assessment and
ponds. The external costs associated with the removal of project appraisal (Gunawardena 2001). The present
mangroves for shrimp ponds have hitherto been over- study attempts to make a contribution to this resource
looked in project valuation in Sri Lanka. This is because management debate by undertaking an extended cost–
the total value of mangrove ecosystems has not been benefit analysis (ECBA) of a moderately large shrimp
fully realized; indeed, these ecosystems are often con- aquaculture project proposed for a relatively pristine
sidered as wastelands by planners, developers, and pol- mangrove ecosystem in the south of Sri Lanka. The
iticians and, therefore, their conversion to shrimp ponds ECBA was designed to reveal the costs and benefits of
has witnessed little resistance (cf. Hamilton 1989). the project, the number of individuals affected, and
Development-oriented financial analyses typically the different social groups to which the costs and
focus on monetary profit. They seldom capture all benefits of the project accrue. However, the main focus
environmental effects and thus consistently underrep- of the present article is to report on the determination
resent the wider welfare of society. Financial assess- of the total economic value (TEV) of the mangrove
ments favor the higher returns of intensive shrimp system, which systematically identifies and values the
farming over intact mangroves, which are typically wider range of environmental services offered by the
viewed as common-property resource systems (cf. Ar- mangroves (cf. Pearce and Turner 1990). The com-
mitage 2002). However, when the goods and services of bined approach was then used to assess whether the
mangroves and the short-term viability and sustain- proposed shrimp project will result in greater or less
ability of shrimp operations are considered, the eco- social well-being than the predevelopment condition.
nomic analysis can reveal a substantially different
benefit and cost profile. It is, therefore, important to
Methodological Considerations
monetize the total value of mangrove ecosystems in
It is widely acknowledged that the ‘‘true’’ economic
order to provide comprehensive information to
national governments and international funding value of mangroves is underestimated because most
organizations as a check for the continued promotion mangrove valuation studies cover only marketed re-
of industrial-scale shrimp aquaculture development sources such as forestry and fishery benefits (Primavera
1997). Ronnback (1999) posits that undervaluation
programs (Davenport and others 1999). ¨ ¨
Most mangrove valuation efforts have covered only further stems from the general lack of ecological
marketed resources and ignored subsistence-level uses knowledge among economic analysts, the failure to
and nontraded uses such as the conservation of biodi- adopt a holistic approach that fully recognizes the
versity. When only mangrove fishery and forestry ben- complex interdependency of marine, coastal, and ter-
efits are included, the annual value of mangroves has restrial ecosystems, along with the difficulties involved
been estimated between to be US$ 500/ha/year and in placing monetary values on the relevant factors. As a
2500/ha/year (Dixon 1989). However, when complete result, many environmental goods and services pro-
vided by mangroves have been ignored, either because
mangrove systems are considered, much higher figures
of between US$ 1000/ha/year and 11,600/ha/year these are nonmarketed or they occur off-site and tend
were obtained (Primavera 1997). The value of a man- to be overlooked.
grove area in Sarawak (Malaysia) was estimated as Ideally, the full range of goods and services of
approximately US$ 25 million/year when forestry, mangroves should be evaluated, including those pro-
fisheries, and tourism revenues were considered duced on-site and off-site. Off-site goods and services
(Bennett and Reynolds 1993). include fisheries caught both within the mangrove la-
Khor (1995) reported the results of cost–benefit goon and in nearby coastal waters. The valuation of
subsistence-level goods is also needed, but this is
analysis (CBA) in India, which concluded that the
shrimp culture caused more economic harm than especially difficult to achieve in developing countries
good, the damage outweighing the benefits by as much because of the lack of quantitative data on products
as 4 to 1 in Andhra Pradesh. Net present value (NPV) is harvested and the absence of markets for most of these
often used to evaluate the economics of a project by goods (Ruitenbeek 1994). However, these traditional,
537
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
untraded goods can be a substantial component of dynamics might be subject to considerable dispute
local economies and thus must be acknowledged, even and scientific uncertainty. Unfortunately, it is often
if only in a qualitative framework (Ronnback and Pri- the case that the true value of the protection services
¨ ¨
mavera 2000). provided by natural ecosystems only becomes known
In the assessment of the TEV of ecosystems, the full once they are lost—often irreversibly (Aylward and
range of indirect services is often aggregated into a Barbier 1992). These general methodological issues
composite term including option, existence, and be- are now considered in detail within the case study
quest values. However, it is important that TEV com- presented.
ponents be shown to be mutually exclusive; if not,
double-counting among the various component values
Study Site
can occur (Winpenny 1991). This is especially true
because most of the indirect benefits of environmental The Rekawa mangrove–lagoon ecosystem is located
goods and services occur off-site, at a distance from the in the Hambantota District, southern Sri Lanka. The
ecosystem itself, and because most environmental sys- dominant features of the area are the 250-ha lagoon
tems have a large range of functions that are inter- and its fringing mangrove forest of approximately 200
linked. Thus, judgment has to be used in selecting the ha (Figure 1). The mangrove–lagoon ecosystem is
bounded on the seaward side by a broad sandy beach,
most economically significant uses for the valuation
procedure. Therefore, once external benefits have which is approximately 10 km long, and on the land-
been traced to their initial source within the ecosystem ward side by extensive tracts of abandoned rice fields.
concerned, there is little advantage in further disag- The mangrove–lagoon ecosystem supports rich and
gregation (Aylward and Barbier 1992). Also, trade-offs diverse habitats, including mangrove forest, lagoon,
between the different components of TEV can occur, beach, coral reefs, and sea grass beds—all of which are
again emphasizing the need to ensure that double- interconnected by tidal flows, current patterns, and
counting and possible trade-offs are explicitly taken trophic relationships.
There are 20 villages within 7 GN (Grama Niladha-
into account. A further problem in economic valuation
is predicting the environmental response to a given ri) Divisions at the Rekawa site, which supports a
development activity in the presence of discontinuity; population of 1184 households and 5373 people
that is, the effects of a development activity in one (Ranaweera and others 1994). The rural communities
location might not be replicated in another. Economic are closely connected with the natural resources of the
analysis tends to assume that change takes place in a area and depend on mangroves for a range of direct
fairly continuous fashion, but changes in an ecosystem and indirect benefits. The former includes firewood
might be discontinuous. Therefore, predicting the for domestic use, timber for house construction,
material for fish and prawn traps, and other minor uses
environmental response to economic change can be
difficult in the presence of discontinuity. Prediction is such as extraction of medicinal plants, whereas the la-
made more difficult because the various links within ter includes nursery grounds for coastal fisheries and
and between the ecosystems might be unknown or protection from coastal flooding. Human-induced
poorly understood. pressures on the system include declining lagoon water
In developing countries, particularly in remote quality, overfishing of shrimp and fish in the lagoon,
rural areas, such as southern Sri Lanka, the logistics forest encroachment, coral mining, and poaching of
of data collection are difficult and accessing reliable turtle eggs. During the early 1990s the absence of
‘‘official’’ data (government, local government, and coordinated sustainable agriculture and aquaculture
associated research agencies) can be additionally programs led to RekawaÕs designation as a Special Area
problematic (cf. Lee and George 2000). Valuation Management (SAM) pilot-study site under the aegis of
strategies in developing countries often differ from Sri LankaÕs Coast Conservation Department. Such SAM
those in developed countries; that is, willingness-to- projects were established with the aim of promoting
pay methods might be replaced by more tractable community-led coastal resource management and
methods such as replacement-cost analysis, damage- stimulated studies into the physical characteristics of
cost analysis, and related methods of valuation the lagoon, socioeconomic profiling, along with a fea-
sibility study into the potential role of aquaculture
(Winpenny 1991). Although such methods might be
suboptimal, they might be the best available given projects (Lowry and others 1999).
constrained resources. However, their main draw- Of particular concern for this study is a proposal to
backs are that the ecosystem under investigation develop a relatively large 42-ha shrimp aquaculture
might have limited baseline data and so system project in the Medilla area on the western shore zone
538 M. Gunawardena and J. S. Rowan
Figure 1. Location and physical characteristics of the study site.
Field Methods and Analytical Approach
of Rekawa Lagoon (Figure 1). Thirty-two hectares will
be developed for shrimp aquaculture and 10 ha will be
reserved without development as a buffer zone. The Conceptual Framework and Background Data
proposal involved the following components: (1) 48 Availability
shrimp culture ponds; (2) inlet feeder canals bringing
A scoping analysis was first undertaken to identify the
in fresh seawater to the ponds; (3) effluent canals that
key environmental and socioeconomic impacts likely to
will transfer the effluent to the settlement tanks; (4)
arise from the proposed shrimp culture project at Rek-
settlement tanks; (5) pump house and standby gener-
awa. Standard EIA approaches (cf. Glasson and others
ator; (6) an intake structure located at the sea coast
1994) were adopted, supported by discussions held with
nearest to the projec, which will extract water from the
government officials, consultants, and members from
sea and transfer it via a pipe laid below ground level to
local communities and set out as an ECBA framework
the feeder canals, which, in turn, will distribute the
(Figure 2). The TEV of the Rekawa mangrove ecosystem
water to individual ponds through control structures;
was then calculated by estimating the monetary values
(7) a pipe carrying the treated effluent will be laid
for (1) the total direct use value, (2) the total indirect use
below ground level through which the effluent will be
value, and (3) the option value along with the existence
pumped out into the sea; (8) storm water disposal ca-
and bequest values. TEV is given by
nals that will divert excess storm water from the project
TEV = Direct use value
area; and (9) administrative buildings, stores, and res-
idential areas (EIAR 1993). Approximately half the þ Indirect use value + Option value
local population live off products sourced form the þ Existence and bequest values
lagoon and sea fishing; the other half is engaged in
(cf. Pearce and Turner 1990). In the TEV assessment,
various agriculture-related activities (RSAMMC 1996).
essentially five use categories of the environmental re-
It was proposed that around 50 jobs would be created
source are recognized, with different degrees of trac-
on a regular basis and around 250 during the main
tability. Direct use values for mangroves include
construction period.
539
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
Figure 2. Extended cost–benefit analysis
framework to appraise a proposed shrimp
culture project in Sri Lanka.
forestry and fishery products harvested. Indirect use sion Office, and local authorities within the Rekawa
values or functional values relate to the ecological area.
functions performed by the environmental resource The pilot survey established that there was adequate
(Adger and others 1995). The option value has been government fisheries catch data for both the Rekawa
defined as a Willingness-To-Pay (WTP) for the preser- lagoon and coastal fisheries. Fisheries data collated
vation of an environment or resource against some included production figures, species harvested, the
probability that the individual will make use of it at a number of fishing boats and fishermen, and the costs
later date (Winpenny 1991). Existence and bequest in terms of fuel, bait, fishing gear, and boats. An
values relate to the fact that even if the individual does important caveat to consider is that official figures
not consume the environmental services, he/she might consistently undervalue noncommercial catches and
still be concerned about the quality or the existence of nonmarketed species (Ronnback1999); thus, the value
¨ ¨
the asset and derive satisfaction from the simple fact of the lagoon and coastal fisheries reported in this
that the asset is available for other people living now or study should be considered as minimum estimates of
in the future (Johansson 1990). the total resource.
The different methods used to quantify the TEV The Rekawa case study deals with a single aquacul-
of the mangrove ecosystem are outlined in Table 1. ture development project that will extend over a fifth
The data collection was initiated in June 1998. The (21%) of the mangrove area, although land clearance
for ponds will be restricted to approximately 16 % of
first phase of the data collection process involved a
pilot survey comprising visits to government agencies the total area in the first instance. Clearly, there are
along with reconnaissance surveys to the Rekawa site scaling issues involved in quantifying the effects of
and existing aquaculture projects elsewhere in the partial losses to selected components of the ecosystem.
region. The aim of the pilot survey was to collect all For example, Pauly and Ingles (1986) observed that the
available information relevant to calculating the TEV relationship between the yield of penaeid shrimp
components of the Rekawa mangroves. The agencies fisheries and intertidal mangrove area was nonlinear
visited included the Coast Conservation Department, (logarithmic), indicating that the impact intensified as
the Ministry of Fisheries and Aquatic Resources, the the proportion of land conversion increased. Eluci-
Department of Fisheries, the National Aquaculture dating the complex and dynamic linkages between the
Development Agency, the Tangalle Fisheries Exten- mangrove ecosystem and the lagoon and coastal fish-
540 M. Gunawardena and J. S. Rowan
Table 1. Approaches adopted for TEV assessment
Environmental goods
and services Approach Data derivation
Firewood collection—at Marketed substitutes/alternative supplies Data collected from a random
a subsistence level (after Winpenny 1991) sample of households
Lagoon fisheries—at a Valuing the marginal productivity of the Based on available government
subsistence level resource net of any human effort (after catch data for the Rekawa
Turner 1993). lagoon fisheries
Coastal fisheries—at Valuing the marginal productivity of the resource Based on available government
subsistence and commercial levels net of any human effort (after Turner 1993). catch data for the Rekawa
coastal fisheries
Shoreline stabilization, Preventive expenditures or damage costs avoided Based on available government
erosion control, and (after Turner 1993). data on the costs to implement
control of storm surges erosion control structures
Existence, bequest, and Contingent valuation method (after Bateman and Based on data collected from a
option values Turner 1993) random sample of households
eries was beyond the scope of the present study (Gu- number of children per household, the questionnaire
nawardena 2001). Consequently, a linear response be- sought to establish the proportion of the local popu-
tween habitat loss and ecological impact was assumed lation directly benefiting from mangrove goods and
(cf. Nickerson 1999); thus, the empirical results and services (i.e., forestry and fisheries) as opposed to those
conclusions are heavily dependent on this assumption. not directly benefiting from mangroves (i.e., mangrove
nonusers). This was needed to avoid double-counting
Questionnaire Survey effects when calculating the individual TEV compo-
The second phase of the data collection process ex- nents.
tended over a period of 1 month and principally in- The questionnaire sought information about the
volved in-depth interviews and questionnaire surveys as range of mangrove products harvested, along with
the means to collect other relevant data necessary to quantities and frequency of collection. These data were
complete the TEV. Survey respondents were asked used as the basis for quantifying the value of traditional
about the nature of mangrove products harvested and forestry uses in Rekawa. Survey respondents were also
about their dependence on lagoon and coastal fisher- asked about their dependence on lagoon and coastal
ies. These data enabled the proportion of mangrove fisheries. However, most of the data needed to calcu-
users and nonusers to be defined and was used as the late the mangrove fisheries value were based on exist-
basis for establishing the existence, bequest, and option ing government fisheries catch data.
values of the mangroves for the local community. One The contingent valuation method (CVM) using an
of the researchers (MG) lived among the local com- open-ended approach (after Bateman and Turner
munity for the duration of the study, enabling a re- 1993) was adopted to measure the worth of preserving
search diary to be maintained and providing valuable the Rekawa mangrove–lagoon ecosystem from shrimp
qualitative insights into lifestyles, local economic prac- development. The CVM was designed to measure WTP
tices, and cultural attitudes to resource management. to preserve the Rekawa mangroves, estimated in the
To represent the population of Rekawa, a systematic form of voluntary contributions to a hypothetical
random sample was drawn from a complete list of mangrove protection fund (cf. Hutchinson and others
households held by the relevant local authorities. The 1995). The contingent market section of the question-
household list revealed that there were a total of 1184 naire described the various functions and benefits of
households in the Rekawa area. From this list, a ran- mangroves and presented information on the scale and
dom sample of 205 households was drawn. The sample nature of the proposed shrimp farm. Respondents were
interviewed was assumed to be representative of the then asked a series of structured questions regarding
entire Rekawa community. The questionnaire design maximum WTP to preserve and conserve the existing
followed accepted conventions (Joliffe 1983), and mangrove system without further development.
interviews were conducted on a house-to-house basis
and conducted in the local language, Sanskrit. A total
NPV of the Proposed Shrimp Development
of 205 persons were interviewed. Beyond basic demo-
The internal costs and benefits of the proposed
graphic data, including age, education, gender, in-
shrimp farm were estimated from the financial state-
come, the number of occupants per household, and
541
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
low discount rates such as 2% or 0 % favors projects
ment of the project proposal, as were the external
benefits. The external costs of the proposed shrimp with long-term benefits, whereas using high discount
development were estimated from the TEV assessment rates (i.e., greater than 10%) favours projects with
of the mangrove ecosystem. These data were used in an short-term benefits.
NPV formulation for the project where:
Results of the Rekewa Lagoon TEV
X
n
t
NPV ¼ ðBd À Be À Cd À Ce Þ=ð1 þ r Þ The TEV required utilitarian (direct and indirect
t¼1
values), option, existence, and bequest values to be
NPV = net present value; Bd = direct or internal project quantified and these will be reported in turn.
benefits; Be = external project benefits, Cd = direct or
Direct Value: Forest Goods and Services
internal project costs, Ce = external project costs;
r = discount rate; t = year in which costs or benefits The household survey results revealed that 24% of
occurred; and n = number of years in economic time the population harvested the mangroves for firewood,
horizon or project lifetime 10% for fish or prawn traps, 8% for construction
(Source: Carpenter and Maragos 1989). material, and a small proportion for other miscella-
A key variable in determining NPV is the expected neous products (e.g., medicinal extracts, honey and
useful life of the project. Shrimp pond productivity has other food items, tannins for dyes, and manure). The
been observed to decline at a rates between 3%–8% per rates of extraction of forestry products in Rekawa are
production cycle (cf. Funge-Smith and Briggs, 1994). currently low, and most harvesting is conducted at
When intensive aquaculture is practiced, the life span subsistence levels. Patterns of dependency were highly
of ponds typically does not exceed 5 to 10 years be- variable, with some households in the local villages
cause of attendant problems of self-pollution, disease, heavily dependent on mangrove wood and timber
and acid–sulphate conditions (Gujja and Finger-Stich products for domestic uses, and others not at all.
1996). In Thailand, 70% of previously productive The survey revealed that those households depen-
ponds get abandoned (Stevenson 1997), while in Sri dent on forestry products (24% of the 205 households
Lanka, even after a few years of operation the aban- surveyed) harvested an average of 20.5 kg of firewood
donment rate can be even higher c. 90% (Siriwardena each week, equivalent to 982 kg/year. Assuming that
2000). In view of the findings in the literature, the the random sample is representative of the total 1184
present analyses assumed that the working life span of households in the area (Ranaweera and others 1994),
the proposed shrimp farm to be 10 years and benefits it can be extrapolated that the annual harvest equates
were calculated accordingly. However, the costs of to 279 tons/year, which from a 200-ha mangrove forest
the project will occur during and well after the ex- represents 1.4 tons/ha/year.
pected useful life of the project. Therefore, the NPV The value of mangrove firewood was estimated
was calculated over a more realistic time frame of 20 using the actual amount of firewood harvested multi-
plied by the ‘‘shadow value’’ in the form of the price
years.
Discounting the costs and benefits in CBA is based for firewood obtained inland and sold by local licensed
on the fact that future costs and benefits usually weigh concessionaries. Minor products such as honey or
less in the decision-making process, rather than those those used for medicinal purposes were not valued due
occurring nearer the present time. This is because to the absence of markets for these products and the
governments and people tend to prefer present values difficulty in establishing quantities harvested. At local
over future ones. The projectÕs NPV was calculated over markets, equivalent firewood sold for 1.2 Rs/kg, giving
a range of discount rates spanning from 0% to 15% to an annual value to the harvest of 334,800 Rs (US$
explore the sensitivity of the results. Discount rates 4783), equivalent to 24 US$/ha/year. This figure pro-
should partially reflect the cost of borrowing money as vides a minimum gross preservation value for firewood,
set in the marketplace by financial institutions such as but does not include an estimate of the opportunity
banks, which for Sri Lanka at the time of the study costs associated with the time spent foraging for tim-
ranged between 10% and15%. They should also par- ber. Such costs can be approximated using shadow
tially reflect the social rate of time preference, which wage rate techniques, but have not been undertaken
indicates societyÕs willingness to sacrifice present con- here because wood harvesting is conducted at subsis-
sumption for the future (Bateman 1995). This rate will tence levels. It must be acknowledged that the simple
normally be lower than that of the money market, so replacement-cost approach only partially captures the
social discount rates of 2% and 5% were used. Using social welfare aspects of forest losses imposing a market
542 M. Gunawardena and J. S. Rowan
Table 2. Calculation of the value of the Rekawa mangrove–lagoon and near-shore coastal fisheries
Lagoon fisheries
Total number of lagoon fishermen1 = 250, total annual production2 = 36 tons
Crustaceans (30% of total lagoon fisheries catch)2
Main species harvested: Penaeus indicus, Penaeus monodon, and Metapenaeus monoceros1
Mean catch per person = 2.96 kg/day
Total annual catch = 10.8 tons/year @ 300 Rs/kg = 3.24 · 106 Rs/year
Fish (70% of total lagoon fisheries catch)2
Main species harvested: Mugil cephalas, Oreochromis niloticus, O. mossambicus, Anabus testudini,
Ophiocephalus punctuates3
Mean catch3 = 1.0 kg/day
Annual catch2 = 25.2 tons @ 40 Rs/kg = 1.01 · 106 Rs/year
I. Total value of mangrove dependent lagoon fishery = 4.25 · 106 Rs year
II. Harvesting costs
Harvesting costs per fisherman (fishing gear, bait, and other minor costs)c = Rs 2000/year
Total harvesting costs = 2000 · 250 = 0.5 · 106 Rs/year
III. Net Value of the lagoon fisheries (I–II) = 3.75 · 106 Rs/year
Net Value based on 200-ha mangrove = 18,750 Rs/ha/year (US$ 268/ha/year)
Coastal fisheries value
Number of fishermen4 = 276, number of boats2= 60, mean catch per boat2 = 23.5 kg, mean number of fishing trips per
month5 = 22, number of fishing months per year5 = 9, fishing households4 = 228, population of fishing households4 = 972,
mean boat to fishermen ratio4 = 1:4
Catch data and gross value
Sardine fishery (family Clupeidae): Total annual catch4,6 = 75 tons @ 85 Rs/kg = 6.4 · 106 Rs
Mullet fishery (family Mugilidae): Total annual catch4,6 = 12 tons @ 160 Rs/kg = 1.9 · 106 Rs
Prawn fishery (family Penaidae): Total annual catch4,6 = 5 tons @ 300 Rs/kg = 1.5 · 106 Rs
I. Total value of mangrove dependent coastal fishery = 9.8 · 106 Rs/year
Harvesting costs
Total variable cost per boat per year5 = 44,748 Rs
Average cost per boat for boat, fishing nets and other gear4,6 = 4150 Rs
II. Annual harvesting costs for 60 boats (60 · 48,898) = 2.9 · 106 Rs/year
III. Net value (I–II) = 6.9 · 106 Rs/year
Net Value based on 200-ha mangrove = 34,500 Rs/ha/year (US$ 493/ha/year)
Data sources: 1RSAMCC (1996), 2Jayakody and Jayasinghe (1992), 3DFAR, personal communication (1998), 4DFAR (1998), 5Ediriweera (2000),
6
DFAR, personal communication (2000).
economy onto local people who previously have drawn tems (Robertson and Blaber 1992), it has been sug-
uncosted goods from the forest (cf. Nickerson 1999). gested that fish and invertebrates occupying mangrove
habitats do so mainly to utilize the food resource
Indirect Value: Fisheries (Singh and others 1994). Primary production in man-
Mangroves are characterized by a high abundance groves can be attributed to several sources such as the
of fish, crustaceans, and molluscs and capture fisheries trees themselves, the associated epiphytes, phyto-
constitute a major value of marketed products from an plankton, and benthic microalgae (Ronnback 1999).
¨ ¨
unexploited mangrove forest (Barbier 2003). Fish The proportion of commercially important marine
standing stock is much higher in mangrove habitat fisheries dependent on mangroves for key stages of
their lifer-acycle varies from 60% to 90 % (Nickerson
compared to adjacent coastal habitats. This is because
many species of fish and invertebrates use mangroves 1999).
during at least one stage of their life cycle, which, in Mangrove ecosystems provide a range of services
turn, is related to food abundance, shelter from pre- that are important for the recruitment success of many
dation, and the hydrodynamic ability of mangroves to species of fish, crustaceans, and molluscs. Mangroves
retain immigrating larvae and juveniles (Ronnback serve as refuges from predation for larvae and juveniles
¨ ¨
1999). of many fish and invertebrates by virtue of the shallow
The role of mangroves in the production of leaf water and highly turbid conditions, as well as the
litter and nutrients, which support the rich aquatic and structural complexity resulting from mangrove roots,
benthic plankton food supply for fisheries, is well debris, and other vegetation (Singh and others 1994).
documented (Moberg and Ronnback 2003). Because In addition, mangroves help increase the residence
¨ ¨
of the high primary productivity in mangrove ecosys- time of water and thus facilitate settling of immigrant
543
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
Table 3. Environmental protection provided by mangroves
Environmental
protection
function Examples of problems resulting from mangrove clearance
Protection against erosion Indonesia and Philippines: loss of inland agricultural land through sedimentation and
coastal erosion (Bennett and Reynolds 1993)
Protection against storm The destruction of mangroves along the Philippines coastline accounts in part for the great
damage and flooding losses to life and property inflicted by typhoons and tsunamis each year (e.g., 7000 deaths
in Ormoc and other towns in 1991) (Primavera 1991).
The clearing of mangroves in the Chakaria Sundarban area of Bangladesh resulted in the
increased vulnerability of the area to cyclones and tidal waves (Choudry and others, 1994).
On the east coast of India, shrimp ponds impeded water flow that resulted in floods
(Alagarswami 1995).
Protection against Salt-water intrusion due to shrimp ponds has been observed in coastal areas of Vietnam
salt intrusion (Thuoc 1995) and 6 km upstream from shrimp ponds in Sri Lanka (Jayasinghe 1995).
Salinization of groundwater supplies and agricultural land reported widely, including Sri Lanka
(Foell and Harrison 1999).
Protection of nearby Indonesia and Philippines: mangrove destruction for aquaculture ponds led to mud deposition
beaches and coral reefs on nearby beaches and degradation of coral reefs (de la Cruz 1979).
larvae spawned from offshore areas into mangrove The annual net value of the Rekawa mangrove–la-
habitat, where they find refuge and food during their goon fisheries per hectare of mangroves was estimated
juvenile stages. Mangrove ecosystems are also impor- at US$ 268/ha/year and that of the Rekawa coastal
tant in trapping sediment and organic material from fisheries at US$ 493/ha/year (Table 2). The lagoon
land resources and interact with sea grass and coral fishery, which engages up to 250 local people, is very
reef ecosystems by maintaining water quality, nutrient traditional in nature. Nonmarket labor is effectively
balances, and hydraulic characteristics (Nickerson universal and fishing gear is mainly derived from
1999). Although mangroves, sea grass beds, and coral products of the mangrove forest (e.g., for making
reefs can exist in isolation from each other, they wooden traps and boats), and polychaetes and other
commonly form integrated ecosystems of high pro- organisms from the mangrove system provide bait
ductivity and provide a myriad of ecological services (Ediriweera 2000). The use of motors in the man-
(Moberg and Ronnback 2003). grove–lagoon system boats is prohibited (thus, engines
¨ ¨
In the present analysis, it was assumed in that the and fuel costs are taken as zero).
Rekewa mangrove forest represents the main source of To determine the total value of the coastal fishery,
detritus and nutrients and provides essential habitat the catch of each mangrove-dependent family was cal-
protection for fishery nursery grounds in the local area. culated and then these were combined to determine
The two main types of fishery identified were the the aggregate yield. The key species were Clupeidae,
mangrove–lagoon and the near shore–coastal systems Mugulidae, and penaeid shrimp, which registered a
respectively (RSAMCC 1996). Both fundamentally combined net value (including variable costs, but
operate at subsistence levels. Government survey data excluding the opportunity costs of subsistence labor)
indicate that the key crustaceans and fish harvested of 9.6 million Rs, equating to a mean annual value for
from Rekawa waters belong to the families Penaidae, the Rekawa fisheries of US$ 754/ha/year. This figure is
Mugilidae, and Clupeidae (RSAMCC 1996; DFAR, at the bottom of the range of valuations US$ 750/ha/
personal communication 1998, 2000). These families year to 11,280/ha/year reported by Ronnback (1999),
¨ ¨
not only spawn in the Rekewa lagoon areas, with the who criticized valuations using only official statistics
exception of the penaeid shrimp (Davenport and because of their overreliance on one or a few species of
others 1999), but their fry and larvae also spend critical economic importance and so overlook the potentially
periods of their life cycles in the mangrove–lagoon significant value of nonmarketed species (in terms of
habitat (Matthes and Kapetsky 1988). Indirect impacts protein sources and damage to the ecosystem) or their
from pollution resulting from waste effluents from the failure to acknowledge the value of noncommercial
aquaculture ponds (McKinnon and others 2002) are catches. Acknowledging these concerns, the reported
also a potential concern, although in this case, this is- value of the Rekawa fisheries should thus be regarded
sue was well mitigated in the project design. as a minimum figure.
544 M. Gunawardena and J. S. Rowan
Indirect Value: Shore Zone Stability the design-life of such structures will control long-term
financial commitments. The Sri Lankan Coastal Zone
The ecological services provided by mangrove eco-
Management Plan (CCD 1997) uses a general estimate
systems depend on, and, in turn, influence through
of 14 million Rs (US$ 20,000/km) to install erosion
complex feedback mechanisms, the operation of nat-
and storm control structures in this area. It further
ural physical processes in the coastal zone. Throughout
reports that such structures require replacement within
much of the tropics, mangroves forests are important
a 10-year maintenance cycle.
features of the coastline, with roles in stabilizing
Based on the scale ofthe proposed shrimp farm, it
shorelines, preventing flooding, and protecting bea-
might be conservatively estimated that the shrimp
ches and corals from siltation. Table 3 provides exam-
proposal for the Rekewa Lagoon will compromise
ples of the environmental services provided by
approximately 3 km of the natural coastal defense
mangroves, along with some of the problems that re-
function of the coastline through direct structural
sult when the mangroves are cleared for shrimp farm-
damage to the mangrove forest and disruptive engi-
ing.
neering activity within the coastal barrier between the
Primavera (1991) reported that the incident of life
lagoon and the ocean. The costs to emplace such a
and property damage has increased significantly along
program can thus be estimated at 42 million Rs, which
the coastline of the Philippines as a result of mangrove
annualized over a 10-year cycle equates to 4.2 million
clearance. Increased vulnerability of coastal commu-
Rs/year. The value of the mangrove buffer can also be
nities to tropical storms in the aftermath of extensive
expressed on a unit area basis as 21,000 Rs/ha/year or
mangrove clearance was also demonstrated in Bangla-
US$ 300/ha/year.
desh (Choudry and others 1994). The introduction of
shrimp ponds affects the hydrology of local systems by
Option, Existence, and Bequest Values
raising water tables, leading to impeded water flow and
Mangrove ecosystems represent a rare and declining
flooding (Alagarswami 1995). The construction of
habitat in Sri Lanka. The Rekawa ecosystem represents
dikes and embankments for shrimp ponds can also
a relatively intact mangrove site, where the full range of
induce extensive salinization; for example, Jayasinghe
(1995) reported saltwater intrusion to occur up to 6 km flora and fauna can be conserved. The site supports 17
species of mangrove and associated mangrove flora. In
upstream of wetland areas in the northwestern prov-
addition, the mangroves provide a habitat for a variety
ince of Sri Lanka. Sediment budgets are also frequently
of wildlife species, including: 66 species of resident
disrupted; for example, de la Cruz (1979) connected
birds, 15 species of migratory birds, 37 species of la-
aquaculture-driven mangrove conversions to acceler-
goon fish, 9 species of mangrove crustaceans, 6 species
ated rates of sedimentation on beaches and associated
of mammals, and 6 species of reptiles (RSAMCC 1996).
degradation of coral reefs within both Indonesia and
In addition, the mangrove–lagoon system acts as a
the Philippines.
In areas where mangrove conversions have im- buffer and offers protection to the 10-km-long strip of
beach, which is an important nesting ground for sev-
pacted physical environmental processes, the manage-
eral species of rare sea turtles. It has been estimated
ment response has often been to undertake expensive
that 1900 turtles nest in the Rekawa area, including
engineering works to counteract the problems. A sim-
Green, Loggerhead, Leatherback, Hawksbill, and the
ple approach to value the protective roles of natural
Olive Ridley turtle, all of which are in the World
systems is to use replacement-cost analysis (RCA).
Conservation Union (IUCN) Red List of globally
According to this method, the value of the mangrove
threatened species. As such, the wildlife resources in
system is estimated in relation to the costs incurred to
construct coastal defenses such as seawalls, revetments, the Rekawa area are a potentially significant source of
tourist revenue, although this potential remains unre-
and groins. Constanza and others (1997) estimated the
alized in much of Sri Lanka beyond the perimeters of
disturbance regulation function of mangroves at US$
the countryÕs National Parks (Bandaratillake 1995).
1800/ha/year, and Chan and others (1993) estimated
The contingent valuation method with an open-
the cost of replacing Malaysian mangroves at US$ 3
ended approach was used to quantify the option, exis-
million per kilometer of coastline.
tence, and bequest values of the Rekawa system. The
The RCA approach requires the size, complexity,
questionnaire survey established that 49% of the
and life span of any engineering response to be spec-
ified. For example, the size and style of a coastal de- households in the area directly used mangroves for for-
estry and fisheries products; the remainder were non-
fense system to guard against coastal erosion or storm
users. WTP values were thus estimated from the 105
surges will determine the initial construction costs, but
545
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
Table 4. Results of TEV assessment for Rekawa mangrove ecosystem
Value Value
Mangrove benefits Methods (Rs/ha/year) (US$/ha/year)
Forestry net benefits Estimated using the actual amount of wood 1,500 24
harvested multiplied by the ‘‘shadow value’’ in
(at a subsistence level)
the form of the price for inland wood sold by
licensed concessionaires.
Lagoon fishery net Estimated using actual data on amount of 18,750 268
benefits (at a subsistence level) fish obtained and their market value.
Coastal fishery net benefits Estimated using actual data on amount of 34,500 493
fish obtained and their market value, net of
any human effort.
Erosion control and buffer against Estimated using replacement-cost analysis. 21,000 300
damage from storms This involved estimating the costs incurred to
have erosion control and/or storm-control
structures such as sea walls, revetments, or
groins.
Existence, bequest and option values to Estimated using the contingent valuation 181.2 2.6
local community method with an open-ended approach. This
involved estimating WTP values in the form
of voluntary contributions to a hypothetical
mangrove protection fund.
Total value 75,931 1,088
Table 5. Projected external costs of the proposed shrimp culture project
Equivalent Equivalent
costs costs
External costs Magnitude/significance of impacts (Rs/year) (US$/year)
Loss of forestry products Loss of at least 32 ha of mangrove forestry products, 48,000 768
(replacement costs) 42 ha if locals excluded from projectÕs perimeter
‘‘buffer zone’’.
Loss of lagoon fisheries Proposed project will cause the direct loss of 32 ha 600,000 8,571
(loss of sales revenue) (or 16%) of the mangrove habitat for shrimp ponds.
1.1 · 106
Loss of coastal fisheries It was assumed that this loss will result in a proportionate 15,776
(loss of sales revenue) decline in the lagoon and coastal fisheries
Loss of natural coastal Again, assumed that relationship between loss of mangrove 672,000 9,600
defense services leading to habitat and erosion is linear and that 16% of the coastal
increased coastal erosion defense services of the mangrove forest would be lost.
and greater vulnerability of
coastal community
Loss of option, existence WTP values in the form of voluntary contributions to a 5,798 83
and bequest values hypothetical mangrove protection fund were estimated.
2.43 · 106
Total 34,798
mangrove nonuser households surveyed in the form of from the open-ended sample is considered the most
voluntary contributions to a hypothetical mangrove conservative estimate of WTP for conservation of natural
protection fund. Aggregating the option, existence, and resources. In part, the apparently low WTP returned
bequest values, it was determined that the mean contri- from the survey can be explained by the fact that many of
bution proposed by each household was 60 Rs/year. This the households operate at subsistence levels; for exam-
sum extrapolated across the estimated 600 households ple, within the Hambantota District, 31% of the popu-
lation face ‘‘consumption poverty,’’ 80% of whom live in
in the area having little or no direct use of mangroves
generates a value of 36,240 Rs/year, equivalent to a unit- rural areas like Rekawa (Gunetilleke 2000). This for-
area value of US$ 2.6/ha/year. The mean WTP measure mulation of WTP does not explicitly address the fact that
546 M. Gunawardena and J. S. Rowan
Table 6. Total benefits and costs, and the NPV of proposed shrimp culture project
Discount factor 0% 2% 5% 10% 15%
Total internal benefits 393 360 318 264 224
(millions of Rs)
Total external benefits 4.5 4.3 4.0 3.5 3.2
(millions of Rs)
Total internal costs 269.2 246 217 180 153
(millions of Rs)
Total external costs 51 42.2 32.7 23.1 17.6
(millions of Rs)
NVP over a 20-year planning + 77.7 +76.3 +72.3 + 64.7 +56.8
horizon (millions of Rs)
NVP over a 20-year planning +1.11 +1.09 +1.03 +0.92 +0.81
horizon (millions of US$)
wider conservation issues such as the conservation of of the project. External benefits included employment
turtle habitats, migratory birds, and biodiversity in gen- opportunities during the construction, operational,
eral have value far beyond community boundaries. WTP and restoration phases of the project.
estimates of value are also generally below those pro- Table 6 presents the total internal costs and bene-
duced by ‘‘Willingness to Accept’’ methods, which fits, the total external costs and benefits, and the NPV
measure what people are willing to accept as compen- of the proposed shrimp project over a 20-year planning
sation for a cost (Daly and Farley 2003). Both consider- horizon using discount rates ranging between 0% and
ations suggest that the existence value presented will 15%. Selection of the appropriate discount rate is
underestimate the ‘‘true’’ existence value and should be critical to the projected value of a project. The use of a
considered as a minimum. standard discount rate reflects returns on investment,
A summary of the results of the TEV assessment for but is insensitive to the degradation of the wider eco-
the Rekawa mangrove–lagoon ecosystem is presented system services, which should exhibit higher marginal
in Table 4. The TEV assessment of the Rekawa man- values in the future (Daly and Farley 2003). Notwith-
grove–lagoon ecosystem indicated that the annual va- standing this concern, the results still demonstrate that
lue per hectare was in the order of US$ 1088/ha/year. the total internal benefits of the shrimp proposal are
Clearly, the greatest component of the value is ob- much higher than the total internal costs. The devel-
tained from the fisheries, which collectively equate to oper will make a profit ranging from US$ 1 million to
70% of the TEV of the system. All of these estimates are 1.7 million (Rs 224 million to 393 million), depending
subject to considerable uncertainties, not least of which on the discount rate during the estimated 10-year
is quantifying the consequences of the partial loss of lifetime of the project. The ECBA for the shrimp pro-
the Rekewa mangrove forest (Table 5), along with posal revealed that the project gives a positive net
complex indirect effects resulting from the generation present value (+NPV) over a 20-year planning horizon,
of waste outputs, potential propagation of diseases into for all discount rates. The envelope of +NPV ranged
wild shrimp populations, and long-term issues such as from US$ 1.1 million with 0% discounting to US$ 0.81
resistance to antibiotics within the farm stock (cf. Co- million with 15% discounting.
rea and others 1995). In spite of the +NPV suggesting a commercially
viable future, the key finding of the research was to
NPV of the Proposed Shrimp Development demonstrate that the total external benefits of the
proposed aquaculture project were much lower than
the total external costs; that is, the total costs to society
The proposed shrimp project is to be developed in 3
in developing the aquaculture project are much higher
stages over a 3-year period (i.e., in year 1, 16 ponds to be
than the total benefits. The net cost to society over a
developed; in year 2, another 15 ponds to be developed;
20-year planning horizon was estimated to be between
and in year 3, a further 17 will be commissioned, to a
US$ 0.64 million (with 0% discounting) and US$ 0.24
total of 48 ponds). In calculating the total internal
million (with 15% discounting). The economic analysis
benefits and costs of the proposal, the anticipated life
for the proposed aquaculture project shows that al-
span of the scheme was assumed to be 10 years. Data
though the internal benefit to internal cost ratio for
used to calculate internal costs and benefits and exter-
the project was 1.5:1, the external benefit to external
nal benefits were obtained from the financial statement
547
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
cost ratio for the project lies between 1:11 and 1:6, growing rural population will be forced to concentrate
depending on the rate of discount used. their collection activities in a smaller forest area, which
could lead to severe degradation of the ecosystem
through overuse.
Discussion
It is estimated that the intact mangrove ecosystem
There are two broad reasons for engaging in valu- supports at least 1512 people from the local commu-
ation exercises: first, to show that environmental issues nity through fisheries alone (Ranaweera and others
are important for planning at the macroeconomic level 1994). The livelihood of all these people will be
(i.e., in the consideration of the damage and depreci- threatened by the aquaculture development. The pro-
ation of natural resource stocks in national accounts) posed 42-ha shrimp farm is likely to employ only about
and second, for making efficient allocation decisions at 50 people on a regular basis and around 250 people
the microeconomic level; that is, understanding the during the construction period. Employment of the
full costs and benefits of a project is essential to making local people in shrimp farms is often limited to low-
investment decisions and for the decision-making paying, unskilled jobs such as laborers and guards,
process (Winpenny 1991). whereas the technical and managerial positions are
The evaluation of the importance of mangroves to reserved for outsiders. Furthermore, because the funds
society requires insight into the flow of products and invested in the aquaculture development are gener-
services within coastal communities and how they are ated from the outside, all of the project profits will
linked and influenced by domestic and international leave the local community.
markets and organizations. It also requires insight into The present economic analysis shows that the
the biophysical links within and between mangroves internal benefits of the project are about 1.5 times
and other ecosystems for the generation of natural greater than the internal costs, whereas the external
products and services, many of which are harvested or costs, or the costs to society, are between 11 add 6 times
enjoyed outside the mangrove system (Ronnback more than the benefits. Even though mangrove con-
¨ ¨
1999). Failure to consider all of the relevant issues has version to shrimp ponds in the Rekawa area would give
resulted in the economic value of mangroves being a positive return, the net benefits from shrimp culture
generally underestimated. Although it will not be pos- are obtained entirely by the aquaculturist; that is,
sible to place a monetary value on all relevant factors, shrimp aquaculture would negatively impact on the
these must be recognized and incorporated at least indices of equity and offer limited scope to share the
qualitatively in the cost–benefit analysis. benefits among the local and wider community. ECBA
In its entirety, the Rekawa mangroves, the lagoon, can therefore be a useful tool for decision-makers in
the fisheries and other wildlife, the agricultural land, considering the nature of the costs and benefits, the
the dynamic beach environment, and the local people number of individuals affected, and the user groups to
who depend on and coexist with these resources which the costs and benefits accrue (Nickerson 1999).
comprise a large and complex ecosystem. The area and These considerations are important in ensuring sus-
its components are all interconnected and each com- tainable resource use and improvements in social wel-
ponent is important to the otherÕs well-being. The fare.
conversion of mangroves to shrimp ponds will have The environmental statement that accompanied the
several important consequences to the people of the planning application for the Rekawa shrimp project-
local community. Of key significance will be loss of mshowed only a financial breakdown of the projectÕs
traditional livelihood practices. The Rekawa mangroves internal benefits and costs. This can be misleading to
provide a source of income and, in addition, non- the decision-makers because internal benefits and costs
monetary sources of welfare to people, many of who deal only with the profits and losses made by the pri-
live at the poverty level. Nickerson (1999) discusses vate company and not the benefits and costs accrued
that although shrimp culture is not a mangrove-area- directly to society. It is important to include the
dependent use (i.e., shrimp developers have alternative external costs and benefits of a project into the eco-
sites for ponds), traditional sectors have no alternative nomic analysis, if an accurate estimate of a projectÕs
sites for fishery nursery grounds and forestry products total costs and benefits is to be obtained. As seen from
provided by mangroves. Furthermore, levels of extrac- the present study, economic analysis (provided it
tion of mangrove products at Rekawa might be sus- integrates environmental, economic, and social issues)
tainable indefinitely due to relatively low extraction is a valuable tool to more fully elucidate the likely
rates. However, if the proposed aquaculture project is consequences of development projects, programs, or,
developed, the area of mangroves will decline and the indeed, policies.
548 M. Gunawardena and J. S. Rowan
Conclusions costs and benefits to the local community, it is clear
that the ecological and cultural dimensions of the
It is now widely recognized that development of
proposal have consequences for regional, national, and
mangrove systems for shrimp aquaculture degrades
international stakeholders (e.g., eco-tourism).
ecosystems, providing a range of environmental ser-
Economic valuation can be used to estimate a
vices into unsustainable monocultures (cf. Hein 2002;
monetary equivalent for environmental goods and
Senarath and Visnanathan 2001). Because of the for-
services that might otherwise be treated as free. Such
eign exchange earning potential of shrimp develop-
analysis is naturally constrained by the assumptions
ment projects, such as that proposed at Rekewa,
made because most valuation studies ultimately rely on
governments have placed relatively few constraints on
some element of subjectivity. ECBA is a valuable
mangrove conversions, and aquaculture developments
framework for interpreting the biophysical findings of
continue to be authorized at the expense of common
EIA in economic welfare terms, and presenting the
property resource systems (cf. Armitage 2002). How-
results in a language familiar to decision-makers. The
ever, the evidence clearly indicates that intensive
aspiration of this study was to undertake a total eco-
industrial-scale production is rarely sustainable.
nomic valuation, but it is recognized that the analysis
Abandonment and progressive encroachment in
remains selective, and considerable uncertainty
increasingly marginal areas has been a common expe-
remains regarding the full range of environmental
rience in many mangrove ecosystems. Clearly, new ap-
services provided by mangrove ecosystems and how
proaches and mitigation strategies are needed (cf.
these interact with other ecosystems that also produce
Paez-Olsuna 2001; Lebel and others 2002). At Rekewa,
services of value to humans. Accepting such qualifica-
this might involve smaller ponds and situating ponds at
tions, the conclusion remains that ECBA should be
the inner margin of the mangrove along the man-
promoted to enable decision-makers to be more fully
grove–dryland gradient. Alternatively, it might be more
cognizant of a projectÕs environmental and socioeco-
desirable to boost the output of traditional fisheries by
nomic implications.
supplementing the natural stocks within the lagoon.
Davenport and others (1999) released Penaeus monodon
postlarvae into the Rekawa Lagooon and reported a
33% increase in the annual catch within 2 years of the Acknowledgments
experiment commencement. The use of such culture- This work was completed while MG completed a
based fisheries is, therefore, a potentially important PhD at Lancaster University, UK. TEAMS Consultants
means of spreading benefits across rural communities are acknowledged for providing studentship funds
and counteracting the most damaging aspects of the and providing logistical support for fieldwork in Sri
conventional aquaculture industry (De Silva 2003). Lanka. The valuable and constructive comments
This study began an ongoing process to more fully made by two external reviewers are also gratefully
articulate and value the full range of environmental acknowledged.
and social services provided by mangrove–lagoon eco-
systems such as Rekawa. The analysis demonstrated
that an ecologically rich ecosystem supporting low-
intensity, but sustainable, harvesting is far more valu- Literature Cited
able to the local and wider community—engaging
Adger, W. N., K. Brown, R. Cervigini, and D. Moran. 1995.
several hundred local residents—than a large shrimp Total economic value of forests in Mexico. Ambio 24:286–
culture project, which is associated with significant 296.
socioeconomic impact and loss of traditional liveli- Alagarswami, K. 1995. Status of aquaculture in India. Annex
hoods. The issue of wealth distribution is crucial to the 11-12 in Regional study and workshop on the environ-
social and economic development of any country. By mental assessment and management of aquaculture
development (TCP/RAS/2253), NACA Environment and
highlighting the nature of the benefits and costs
Aquaculture Series No. 1. Network of Aquaculture Centres
accruing to each group, more information can be
in Asia-Pacific, Bangkok, Thailand.
made available to decision-makers concerned with the
Amarasinghe, M. D. 1988. Socio-economic status of human
promotion of equity amont the populace. Typically, communities for selected mangrove areas on the west
aquaculture is favored because individual developers coast of Sri Lanka. Mangrove Ecosystems Occasional Papers
can capture all of the benefits, whereas the benefits of 15:1–19.
intact mangroves accrue to the entire community. Al- Armitage, D. 2002. Socio-institutional dynamics and the
though the focus of this investigation has been on the political ecology of mangrove forest conservation in Cen-
549
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
tral Sulawesi, Indonesia. Global Environmental Change-Hu- Davenport, J., S. U. K. Ekaratne, S. A. Walgama, D. Lee, and J.
man and Policy Dimensions 12:203–217. M. Hills. 1999. Successful stock enhancement of a lagoon
prawn fishery at Rekawa, Sri Lanka using cultured post-
Aylward, B., and E. B. Barbier. 1992. Valuing environmental
larvae of penaeid shrimp. Aquaculture 180:65–78.
functions in developing countries. Biodiversity and Conser-
vation 1:34–50. de la Cruz, A. Ad. 1979. The function of mangroves. Biotrop
Special Publication 10:125–138.
Bandaratillake, H. M. 1995. Use of non wood forest products
by village communities in Sri Lanka. Pages 291–298 in P. De Silva, S.bA. 2003. Culture-based fisheries: an underutilised
B. Durst, A. Bishop. (eds.) Beyond timber: social, eco- opportunity in aquaculture development. Aquaculture
nomic and cultural dimensions of non wood forest prod- 221:221–243.
ucts in Asia and the Pacific. RAP Publication 1995/13. DFAR (Department of Fisheries and Aquatic Resources. 1998.
FAO Regional Office for Asia and the Pacific, Bangkok, Census of marine fisheries in Sri Lanka. UNDP/FAO/
Thailand. SRL/91022. DFAR, Colombo, Sri Lanka.
Barbier, E. B. 2003. Habitat-fishery linkages and mangrove Dierberg, F., and E. W. Kiattisimkul. 1996. Issues, impacts and
loss in Thailand. Contemporary Economic Policy 21:59–77. implications of shrimp aquaculture in Thailand. Environ-
Bateman, I. J., and R. K. Turner. 1993. Valuation of the mental Management 20:649–666.
environment, methods and techniques: the contingent Dixon, J.bA. 1989. Valuation of mangroves. Tropical Coastal
valuation method. Pages 120–191 in R. K. Turner. (ed.) Area Management Newsletter 4:3.
Sustainable environmental economics and management:
Ediriweera, S. 2000. Analysis of cost and earnings of selected
principles and practice. Belhaven Press, London.
fishing crafts and gear in Sri Lanka. Department of Fish-
Bateman, I. J. 1995. Environment and economic appraisal. eries and Aquatic Resources, Colombo, Sri Lanka.
Pages 45–65 in T. OÕRiordan. (ed.). Environmental science
EIAR. 1993. Environmental Impact Assessment Report for a
for environmental management. Longman, Harlow, UK.
Proposed Shrimp Culture Project in Madilla, Rekawa, 75
Bennett, E. L., and C. J. Reynolds. 1993. The value of a pp. Unpublished Environmental Statement.
mangrove area in Sarawak. Biodiversity and Conservation
Flaherty, M., and C. Karnjanakesorn. 1995. Marine shrimp
2:359–375.
aquaculture and natural resource degradation in Thailand.
Beveridge, M. C. M., M. J. Phillips, and D. J. Macintosh. 1997. Environmental Management 19:27–37.
Aquaculture and the environment: the supply of and the
Foell, J., and E. Harrison. 1999. Participatory mechanisms for
demand for environmental goods and services by Asian
sustainable development of coastal ecosystems. DFID Pro-
aquaculture and the implications for sustainability. Aqua-
ject R6977, Sri Lanka, 44 pp.
culture Research 28:797–807.
Funge-Smith, S. J., and M. R. P. Briggs. 1994. Development of
Carpenter, R. A., and J. E. Maragos. 1989. How to assess
strategies for sustainable shrimp farming. Final Report to
environmental impacts on tropical islands and coastal
the Overseas Development Administration, Research Pro-
areas. Environment and Policy Institute East-West Centre,
ject R4751. Institute of Aquaculture, University of Stirling,
Honolulu, 345 pp.
31 pp.
CCD. 1997. Revised coastal zone management plan. Coast
Glasson, J., R. Therivel, and A. Chadwick. 1999. Introduction
Conservation Department, Coastal Resources Management
to environmental impact assessment: principles and pro-
Project, Colombo, Sri Lanka, 128 pp.
cedures, process, practice and prospects, 2nd ed. UCL
Chan, H. T., J. E. Ong, W. K. Gong, and A. Sasekumar. 1993. Press, London.
The socio-economic, ecological and environmental values
Goldburg, R 1997. Shrimp aquaculture. Environment 39:37–39.
of mangrove ecosystems in Malaysia and their present state
Gujja, B., and A. Finger-Stich. 1996. What price prawn?
of conservation. Pages 41–81 in B.F. Clough. (ed.) The
Shrimp aquacultureÕs impact in Asia. Environment 38:12–39.
economic and environmental values of mangrove forests
and their present state of conservation in the South-East Gunawardena, M. 2001. A critical review of ecological impact
Asia/Pacific Region. Vol 1. International Society for Man- assessment in Sri Lanka: with particular reference to the
grove Ecosystems, Okinawa. shrimp aquaculture industry. PhD thesis, University of
Lancaster.
Choudhury, A. M., D. A. Quadir, and M. J. Islam. 1994. Study
of Chokoria Sundarbans using remote sensing techniques. Gunetilleke, N. 2000. Basic MIMAP poverty profile (draft). Sri
ISME Mangrove Ecosystems Technical Report 4:1–22. Lanka Institute of Policy Studies, Colombo, Sri Lanka, 51 pp.
Corea, A. S.L.E., J. M. P. K. Jayasinghe, S. U. K. Ekaratne, and Hamilton, L., J. Dixon, and G. Miller. 1989. Mangroves: An
R. Johnstone. 1995. Environmental impact of prawn farm- undervalued resource of the land and sea. Ocean Yearbook
ing on Dutch Canal: The main water source for the prawn 8:254–288.
culture industry in Sri Lanka. Ambio 24:815–827.
Hein, L. 2002. Toward improved environmental and social
Costanza, R., R. dÕArge, R. de Groot, S. Farber, M. Grasso, B. management of Indian shrimp farming. Environmental
Hannon, K. Limburg, S. Naeem, R. V. OÕNeill, J. Paruelo, R. Management 29:349–359.
G. Raskin, P. Sutton, and M. van den Belt. 1997. The value
Hutchinson, W. G., S. M. Chilton, and J. Davis. 1995. Mea-
of the worldÕs ecosystem services and natural capital. Ambio
suring non-use values of environmental goods using the
387:253–260.
contingent valuation method: problems of information
Daly, H. E., and J. Farley. 2003. Ecological economics: prin- and cognition and the application of cognitive question-
ciples and applications. Island Press, London. naire design methods. Agricultural Economics 46:97–112.
550 M. Gunawardena and J. S. Rowan
Jayakody, D. S., and J. M. P. K. Jayasinghe. 1992. Report of the Primavera, J. H. 1997. Socio-economic impacts of shrimp
development potential of Rekawa lagoon. NARA, Colombo, culture. Aquaculture Research 28:815–827.
Sri Lanka, 64 pp. Ranaweera, B. R., A. Premaratne, and I. Ranasinghe. 1994.
Jayasinghe, J. M. P. K. 1995. Status of aquaculture in Sri People, resources and development potentials in the Rek-
Lanka. Annex II-15 in Regional study and workshop on the awa SAMP area. Coast Conservation Department, Co-
environmental assessment and management of aquacul- lombo, Sri Lanka, 43 pp.
ture development (TCP/RAS/2253), NACA Environment Robertson, A. I., and S. J. M. Blaber. 1992. Plankton, epi-
and Aquaculture Series No. 1. Network of Aquaculture benthos and fish communities. Pages 173–224 in A. I.
Centres in Asia-Pacific, Bangkok, Thailand. Robertson, D. M. Alongi. (eds.) Tropical mangrove eco-
Johansson, P. 1990. Valuing environmental damage. Oxford systems. Coastal and Estuarine Studies No. 41. AGU,
Review of Economic Policy 6:34–50. Washington, DC.
Jolliffe, F. R. 1983. Survey design and analysis. Ellis Horwood, Ronnback, P. 1999. The ecological basis for economic value
¨ ¨
Chichester . of seafood production supported by mangrove ecosystems.
Ecological Economics 29:235–252.
Khor, M. 1995. Protests over shrimp farms spread throughout
India. Third World Resurgence 59:11–12. Ronnback, P., and J. H. Primavera. 2000. Illuminating the
¨ ¨
need for ecological knowledge in economic valuation of
Lal, P. N. 1990. Ecological economic analysis of mangrove
magroves under different management regimes—A cri-
conservation, a case study from Fiji. ISME Mangrove Eco-
tique. Ecological Economics 35:135–141.
systems Occasional Papers No. 6. UNDP/UNESCO Re-
gional Mangroves Project RAS/86/120, 46 pp. RSAMCC. 1996. Rekawa Special Area Management Coordi-
nating Committee. Rekawa Special Area Management Plan
Lebel, L., N. H. Tri, A. Saengnoree, S. Pasong, U. Buatama, and
for Rekawa Lagoon, Sri Lanka, Coastal Resources Man-
L. K. Thoa. 2002. Industrial transformation and shrimp
agement Project, Coast Conservation Department, Co-
aquaculture in Thailand and Vietnam: Pathways to ecologi-
lombo, Sri Lanka, 81 pp.
cal, social, and economic sustainability? Ambio 31:311–323.
Ruitenbeek, H. J. 1994. Modelling economy-ecology linkages
Lee, N., and C. George. 2000. Environmental assessment in
in mangroves: Economic evidence for promoting conser-
developing and transitional countries. John Wiley & Sons,
vation in Bintuni Bay, Indonesia,. Ecological Economics
Chichester.
10:233–247.
Lowry, K., N. Pallewatte, and A. P. Dainis. 1999. Policy-relevant
Senarath, U., and C. Visvanathan. 2001. Environmental issues
assessment of community-level coastal management projects
in brackish water shrimp aquaculture in Sri Lanka. Envi-
in Sri Lanka. Ocean and Coastal Management 42:717–745.
ronmental Management 27:335–348.
Matthes, H., and J. M. Kapetsky. 1988. Worldwide compen-
Singh, H. R., V. C. Chong, A. Sasekumar, and L. K. Lim. 1994.
dium of mangrove associated aquatic species of economic
Value of mangroves as nursery and feeding grounds. Pages
importance. FAO, Rome, FAO Fishery Circular No. 814.
105–122 in Proceedings of the Third ASEAN-Australia
FAO, Rome.
Symposium on Living Coastal Resources, Vol. 1. Chul-
McKinnon, A. D., L. A. Trott, D. M. Alongi, and A. Davidson. alongkorn University, Bangkok.
2002. Water column production and nutrient characteris-
Siriwardena, P. P. G. S. N. 2000. Draft report on the
tics in mangrove creeks receiving shrimp farm effluent.
code of best practices for shrimp culture in Sri Lanka.
Aquaculture Research 33:1–19.
Working paper of the WB/NACA/WWF/FAO Consor-
Moberg, F., and P. Ronnback. 2003. Ecosystem services of the
¨ ¨ tium Programme on Shrimp Farming and the Envi-
tropical seascape: interactions, substitutions and restora- ronment.
tion. Ocean and Coastal Management 46:7–46.
Stevenson, N. J. 1997. Disused shrimp ponds: options for
Nickerson, D. J 1999. Trade-offs of mangrove area develop- redevelopment of mangroves. Coastal Management 25:425–
ment in the Philippines. Ecological Economics 28:279–298. 435.
Paez-Osuna, F. 2001. The environmental impact of shrimp Thuoc, P. 1995. Status of aquaculture in Vietnam.
aquaculture: Causes, effects, and mitigating alternatives. Annex II-20 in Regional study and workshop on the
Environmental Management 28:131–140. environmental assessment and management of aqua-
Pauly, D., and J. Ingles.. 1986. The relationship between culture development (TCP/RAS/2253), NACA Envi-
shrimp yields and intertidal (mangrove) areas: A reassess- ronment and Aquaculture Series No. 1. Network of
ment. in Workshop on recruitment in tropical coastal Aquaculture Centres in Asia-Pacific, Bangkok, Thai-
demersal communities. IOC-FOA, UNESCO, Paris 227–284. land.
Pearce, D. W., and R. K. Turner. 1990. The economics of R. K. Turner. (eds.) 1993. Sustainable environmental eco-
natural resources and the environment. Harvester nomics and management: principles and practice. Belha-
Wheatsheaf, Hemel Hempstead, UK. ven Press, London.
Primavera, J. H. 1991. Intensive prawn farming in the Phil- Winpenny, J. T. 1991. Values for the environment: a guide to
ippines: Ecological, social, and economic implications. economic appraisal. HMSO, London.
Ambio 20:28–33.
Economic Valuation of a Mangrove Ecosystem
Threatened by Shrimp Aquaculture in Sri Lanka
M. GUNAWARDENA the proposal and an estimate of the ‘‘total economic value’’
Environmental Science Department (TEV) of a mangrove ecosystem. The analysis revealed that
Lancaster University, the internal benefits of developing the shrimp farm are
Lancaster, LA1 4YQ, United Kingdom higher than the internal costs in the ratio of 1.5:1. However,
when the wider environmental impacts are more compre-
J. S. ROWAN*
hensively evaluated, the external benefits are much lower
Environmental Systems Research Group
than the external costs in a ratio that ranges between 1:6 and
Department of Geography
1:11. In areas like Rekawa, where agriculture and fisheries
University of Dundee
are widely practiced at subsistence levels, shrimp aqua-
Dundee, DD1 4HN, United Kingdom culture developments have disproportionately large impacts
on traditional livelihoods and social welfare. Thus, although
ABSTRACT / Mangrove ecosystems in Sri Lanka are the analysis retains considerable uncertainties, more explicit
increasingly under threat from development projects, espe- costing of the environmental services provided by mangrove
cially aquaculture. An economic assessment is presented for ecosystems demonstrates that low intensity, but sustainable,
a relatively large (42 ha) shrimp culture development pro- harvesting has far greater long-term value to local stake-
posed for the Rekawa Lagoon system in the south of Sri holders and the wider community than large shrimp aqua-
Lanka, which involved an extended cost–benefit analysis of culture developments.
Mangrove ecosystems in Sri Lanka are increasingly shoreline erosion; and absorption of pollutants; main-
under threat from development projects, especially tenance of biodiversity and water conservation (Dier-
shrimp aquaculture. Despite covering only 0.19% of Sri berg and Kiattisimkul 1996). The productivity of
LankaÕs total land area, shrimp sales from these areas aquaculture systems such as shrimp ponds is also
and associated coastal waters are an important source heavily dependent on the surrounding mangroves,
of foreign exchange and account for 40–50% of total which provide a range of free services such as seed,
aquaculture exports (Senarath and Visvanathan 2001). food inputs, and clean water for culture practices
Many of Sri LankaÕs mangroves have either been (Beveridge and others 1997). They also offer protec-
developed or are earmarked for shrimp ponds. It is tion against floods, hurricanes, and erosion and so
also widely observed that when successful shrimp farms protect aquaculture operations against natural hazards.
are introduced into new areasÕ they encourage further Ronnback (1999) discussed that the life-support func-
¨ ¨
development until only a remnant of the original area tions of mangroves are crucial for the sustainability of
remains or until the entire mangrove area has been aquaculture systems and that failure to acknowledge
converted into ponds (Amarasinghe 1988). this function is one explanation for the boom-and-bust
Mangroves have contributed significantly to the pattern of shrimp aquaculture. Considerable amounts
livelihood of coastal communities through products of energy and money would be required if free man-
used for fuel, construction, fishing, agriculture, forage grove goods and services were to be substituted with
for livestock, medicines, and food items (Primavera human technology. However, the market price of the
1997). Furthermore, mangroves supply multiple eco- cultured product captures only a fraction of the ser-
system services such as: nursery grounds and shelter for vices provided by the host environment.
fish, crabs, and shrimp; buffers against storm surge and Shrimp aquaculture is widely considered to be one
of the most environmentally destructive forms of
modern agriculture. Aquaculture projects not only
KEY WORDS: Shrimp aquaculture; Mangroves; Total economic value
destroy mangroves for shrimp ponds but also deplete
and extended cost–benefit analysis; Sri Lanka
groundwater resources to fill ponds and pollute surface
waters with pond effluent (Goldburg 1997; McKinnon
Published online August 29, 2005.
and others 2002). One of the most unfortunate aspects
*Author to whom correspondence should be addressed; email:
of the expansion of the shrimp culture industry is the
j.s.rowan@dundee.ac.uk
ª 2005 Springer Science+Business Media, Inc.
Environmental Management Vol. 36, No. 4, pp. 535–550
536 M. Gunawardena and J. S. Rowan
lack of consideration given to the long-term conserva- comparing current costs to undertake the development
tion and management of natural resources (Flaherty versus the potential future benefits. Lal (1990) re-
and Karnjanakesorn 1995; Corea and others 1995). ported negative NPV results (i.e., loss making) for
High profitability and the opportunity to generate converting mangrove forest to shrimp and rice farming
foreign exchange have provided the main driving forces over a 50-year planning horizon. These examples
for the expansion of shrimp culture in Sri Lanka and are illustrate the need for greater awareness of economic
used to justify the conversion of mangroves to shrimp analysis within environmental impact assessment and
ponds. The external costs associated with the removal of project appraisal (Gunawardena 2001). The present
mangroves for shrimp ponds have hitherto been over- study attempts to make a contribution to this resource
looked in project valuation in Sri Lanka. This is because management debate by undertaking an extended cost–
the total value of mangrove ecosystems has not been benefit analysis (ECBA) of a moderately large shrimp
fully realized; indeed, these ecosystems are often con- aquaculture project proposed for a relatively pristine
sidered as wastelands by planners, developers, and pol- mangrove ecosystem in the south of Sri Lanka. The
iticians and, therefore, their conversion to shrimp ponds ECBA was designed to reveal the costs and benefits of
has witnessed little resistance (cf. Hamilton 1989). the project, the number of individuals affected, and
Development-oriented financial analyses typically the different social groups to which the costs and
focus on monetary profit. They seldom capture all benefits of the project accrue. However, the main focus
environmental effects and thus consistently underrep- of the present article is to report on the determination
resent the wider welfare of society. Financial assess- of the total economic value (TEV) of the mangrove
ments favor the higher returns of intensive shrimp system, which systematically identifies and values the
farming over intact mangroves, which are typically wider range of environmental services offered by the
viewed as common-property resource systems (cf. Ar- mangroves (cf. Pearce and Turner 1990). The com-
mitage 2002). However, when the goods and services of bined approach was then used to assess whether the
mangroves and the short-term viability and sustain- proposed shrimp project will result in greater or less
ability of shrimp operations are considered, the eco- social well-being than the predevelopment condition.
nomic analysis can reveal a substantially different
benefit and cost profile. It is, therefore, important to
Methodological Considerations
monetize the total value of mangrove ecosystems in
It is widely acknowledged that the ‘‘true’’ economic
order to provide comprehensive information to
national governments and international funding value of mangroves is underestimated because most
organizations as a check for the continued promotion mangrove valuation studies cover only marketed re-
of industrial-scale shrimp aquaculture development sources such as forestry and fishery benefits (Primavera
1997). Ronnback (1999) posits that undervaluation
programs (Davenport and others 1999). ¨ ¨
Most mangrove valuation efforts have covered only further stems from the general lack of ecological
marketed resources and ignored subsistence-level uses knowledge among economic analysts, the failure to
and nontraded uses such as the conservation of biodi- adopt a holistic approach that fully recognizes the
versity. When only mangrove fishery and forestry ben- complex interdependency of marine, coastal, and ter-
efits are included, the annual value of mangroves has restrial ecosystems, along with the difficulties involved
been estimated between to be US$ 500/ha/year and in placing monetary values on the relevant factors. As a
2500/ha/year (Dixon 1989). However, when complete result, many environmental goods and services pro-
vided by mangroves have been ignored, either because
mangrove systems are considered, much higher figures
of between US$ 1000/ha/year and 11,600/ha/year these are nonmarketed or they occur off-site and tend
were obtained (Primavera 1997). The value of a man- to be overlooked.
grove area in Sarawak (Malaysia) was estimated as Ideally, the full range of goods and services of
approximately US$ 25 million/year when forestry, mangroves should be evaluated, including those pro-
fisheries, and tourism revenues were considered duced on-site and off-site. Off-site goods and services
(Bennett and Reynolds 1993). include fisheries caught both within the mangrove la-
Khor (1995) reported the results of cost–benefit goon and in nearby coastal waters. The valuation of
subsistence-level goods is also needed, but this is
analysis (CBA) in India, which concluded that the
shrimp culture caused more economic harm than especially difficult to achieve in developing countries
good, the damage outweighing the benefits by as much because of the lack of quantitative data on products
as 4 to 1 in Andhra Pradesh. Net present value (NPV) is harvested and the absence of markets for most of these
often used to evaluate the economics of a project by goods (Ruitenbeek 1994). However, these traditional,
537
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
untraded goods can be a substantial component of dynamics might be subject to considerable dispute
local economies and thus must be acknowledged, even and scientific uncertainty. Unfortunately, it is often
if only in a qualitative framework (Ronnback and Pri- the case that the true value of the protection services
¨ ¨
mavera 2000). provided by natural ecosystems only becomes known
In the assessment of the TEV of ecosystems, the full once they are lost—often irreversibly (Aylward and
range of indirect services is often aggregated into a Barbier 1992). These general methodological issues
composite term including option, existence, and be- are now considered in detail within the case study
quest values. However, it is important that TEV com- presented.
ponents be shown to be mutually exclusive; if not,
double-counting among the various component values
Study Site
can occur (Winpenny 1991). This is especially true
because most of the indirect benefits of environmental The Rekawa mangrove–lagoon ecosystem is located
goods and services occur off-site, at a distance from the in the Hambantota District, southern Sri Lanka. The
ecosystem itself, and because most environmental sys- dominant features of the area are the 250-ha lagoon
tems have a large range of functions that are inter- and its fringing mangrove forest of approximately 200
linked. Thus, judgment has to be used in selecting the ha (Figure 1). The mangrove–lagoon ecosystem is
bounded on the seaward side by a broad sandy beach,
most economically significant uses for the valuation
procedure. Therefore, once external benefits have which is approximately 10 km long, and on the land-
been traced to their initial source within the ecosystem ward side by extensive tracts of abandoned rice fields.
concerned, there is little advantage in further disag- The mangrove–lagoon ecosystem supports rich and
gregation (Aylward and Barbier 1992). Also, trade-offs diverse habitats, including mangrove forest, lagoon,
between the different components of TEV can occur, beach, coral reefs, and sea grass beds—all of which are
again emphasizing the need to ensure that double- interconnected by tidal flows, current patterns, and
counting and possible trade-offs are explicitly taken trophic relationships.
There are 20 villages within 7 GN (Grama Niladha-
into account. A further problem in economic valuation
is predicting the environmental response to a given ri) Divisions at the Rekawa site, which supports a
development activity in the presence of discontinuity; population of 1184 households and 5373 people
that is, the effects of a development activity in one (Ranaweera and others 1994). The rural communities
location might not be replicated in another. Economic are closely connected with the natural resources of the
analysis tends to assume that change takes place in a area and depend on mangroves for a range of direct
fairly continuous fashion, but changes in an ecosystem and indirect benefits. The former includes firewood
might be discontinuous. Therefore, predicting the for domestic use, timber for house construction,
material for fish and prawn traps, and other minor uses
environmental response to economic change can be
difficult in the presence of discontinuity. Prediction is such as extraction of medicinal plants, whereas the la-
made more difficult because the various links within ter includes nursery grounds for coastal fisheries and
and between the ecosystems might be unknown or protection from coastal flooding. Human-induced
poorly understood. pressures on the system include declining lagoon water
In developing countries, particularly in remote quality, overfishing of shrimp and fish in the lagoon,
rural areas, such as southern Sri Lanka, the logistics forest encroachment, coral mining, and poaching of
of data collection are difficult and accessing reliable turtle eggs. During the early 1990s the absence of
‘‘official’’ data (government, local government, and coordinated sustainable agriculture and aquaculture
associated research agencies) can be additionally programs led to RekawaÕs designation as a Special Area
problematic (cf. Lee and George 2000). Valuation Management (SAM) pilot-study site under the aegis of
strategies in developing countries often differ from Sri LankaÕs Coast Conservation Department. Such SAM
those in developed countries; that is, willingness-to- projects were established with the aim of promoting
pay methods might be replaced by more tractable community-led coastal resource management and
methods such as replacement-cost analysis, damage- stimulated studies into the physical characteristics of
cost analysis, and related methods of valuation the lagoon, socioeconomic profiling, along with a fea-
sibility study into the potential role of aquaculture
(Winpenny 1991). Although such methods might be
suboptimal, they might be the best available given projects (Lowry and others 1999).
constrained resources. However, their main draw- Of particular concern for this study is a proposal to
backs are that the ecosystem under investigation develop a relatively large 42-ha shrimp aquaculture
might have limited baseline data and so system project in the Medilla area on the western shore zone
538 M. Gunawardena and J. S. Rowan
Figure 1. Location and physical characteristics of the study site.
Field Methods and Analytical Approach
of Rekawa Lagoon (Figure 1). Thirty-two hectares will
be developed for shrimp aquaculture and 10 ha will be
reserved without development as a buffer zone. The Conceptual Framework and Background Data
proposal involved the following components: (1) 48 Availability
shrimp culture ponds; (2) inlet feeder canals bringing
A scoping analysis was first undertaken to identify the
in fresh seawater to the ponds; (3) effluent canals that
key environmental and socioeconomic impacts likely to
will transfer the effluent to the settlement tanks; (4)
arise from the proposed shrimp culture project at Rek-
settlement tanks; (5) pump house and standby gener-
awa. Standard EIA approaches (cf. Glasson and others
ator; (6) an intake structure located at the sea coast
1994) were adopted, supported by discussions held with
nearest to the projec, which will extract water from the
government officials, consultants, and members from
sea and transfer it via a pipe laid below ground level to
local communities and set out as an ECBA framework
the feeder canals, which, in turn, will distribute the
(Figure 2). The TEV of the Rekawa mangrove ecosystem
water to individual ponds through control structures;
was then calculated by estimating the monetary values
(7) a pipe carrying the treated effluent will be laid
for (1) the total direct use value, (2) the total indirect use
below ground level through which the effluent will be
value, and (3) the option value along with the existence
pumped out into the sea; (8) storm water disposal ca-
and bequest values. TEV is given by
nals that will divert excess storm water from the project
TEV = Direct use value
area; and (9) administrative buildings, stores, and res-
idential areas (EIAR 1993). Approximately half the þ Indirect use value + Option value
local population live off products sourced form the þ Existence and bequest values
lagoon and sea fishing; the other half is engaged in
(cf. Pearce and Turner 1990). In the TEV assessment,
various agriculture-related activities (RSAMMC 1996).
essentially five use categories of the environmental re-
It was proposed that around 50 jobs would be created
source are recognized, with different degrees of trac-
on a regular basis and around 250 during the main
tability. Direct use values for mangroves include
construction period.
539
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
Figure 2. Extended cost–benefit analysis
framework to appraise a proposed shrimp
culture project in Sri Lanka.
forestry and fishery products harvested. Indirect use sion Office, and local authorities within the Rekawa
values or functional values relate to the ecological area.
functions performed by the environmental resource The pilot survey established that there was adequate
(Adger and others 1995). The option value has been government fisheries catch data for both the Rekawa
defined as a Willingness-To-Pay (WTP) for the preser- lagoon and coastal fisheries. Fisheries data collated
vation of an environment or resource against some included production figures, species harvested, the
probability that the individual will make use of it at a number of fishing boats and fishermen, and the costs
later date (Winpenny 1991). Existence and bequest in terms of fuel, bait, fishing gear, and boats. An
values relate to the fact that even if the individual does important caveat to consider is that official figures
not consume the environmental services, he/she might consistently undervalue noncommercial catches and
still be concerned about the quality or the existence of nonmarketed species (Ronnback1999); thus, the value
¨ ¨
the asset and derive satisfaction from the simple fact of the lagoon and coastal fisheries reported in this
that the asset is available for other people living now or study should be considered as minimum estimates of
in the future (Johansson 1990). the total resource.
The different methods used to quantify the TEV The Rekawa case study deals with a single aquacul-
of the mangrove ecosystem are outlined in Table 1. ture development project that will extend over a fifth
The data collection was initiated in June 1998. The (21%) of the mangrove area, although land clearance
for ponds will be restricted to approximately 16 % of
first phase of the data collection process involved a
pilot survey comprising visits to government agencies the total area in the first instance. Clearly, there are
along with reconnaissance surveys to the Rekawa site scaling issues involved in quantifying the effects of
and existing aquaculture projects elsewhere in the partial losses to selected components of the ecosystem.
region. The aim of the pilot survey was to collect all For example, Pauly and Ingles (1986) observed that the
available information relevant to calculating the TEV relationship between the yield of penaeid shrimp
components of the Rekawa mangroves. The agencies fisheries and intertidal mangrove area was nonlinear
visited included the Coast Conservation Department, (logarithmic), indicating that the impact intensified as
the Ministry of Fisheries and Aquatic Resources, the the proportion of land conversion increased. Eluci-
Department of Fisheries, the National Aquaculture dating the complex and dynamic linkages between the
Development Agency, the Tangalle Fisheries Exten- mangrove ecosystem and the lagoon and coastal fish-
540 M. Gunawardena and J. S. Rowan
Table 1. Approaches adopted for TEV assessment
Environmental goods
and services Approach Data derivation
Firewood collection—at Marketed substitutes/alternative supplies Data collected from a random
a subsistence level (after Winpenny 1991) sample of households
Lagoon fisheries—at a Valuing the marginal productivity of the Based on available government
subsistence level resource net of any human effort (after catch data for the Rekawa
Turner 1993). lagoon fisheries
Coastal fisheries—at Valuing the marginal productivity of the resource Based on available government
subsistence and commercial levels net of any human effort (after Turner 1993). catch data for the Rekawa
coastal fisheries
Shoreline stabilization, Preventive expenditures or damage costs avoided Based on available government
erosion control, and (after Turner 1993). data on the costs to implement
control of storm surges erosion control structures
Existence, bequest, and Contingent valuation method (after Bateman and Based on data collected from a
option values Turner 1993) random sample of households
eries was beyond the scope of the present study (Gu- number of children per household, the questionnaire
nawardena 2001). Consequently, a linear response be- sought to establish the proportion of the local popu-
tween habitat loss and ecological impact was assumed lation directly benefiting from mangrove goods and
(cf. Nickerson 1999); thus, the empirical results and services (i.e., forestry and fisheries) as opposed to those
conclusions are heavily dependent on this assumption. not directly benefiting from mangroves (i.e., mangrove
nonusers). This was needed to avoid double-counting
Questionnaire Survey effects when calculating the individual TEV compo-
The second phase of the data collection process ex- nents.
tended over a period of 1 month and principally in- The questionnaire sought information about the
volved in-depth interviews and questionnaire surveys as range of mangrove products harvested, along with
the means to collect other relevant data necessary to quantities and frequency of collection. These data were
complete the TEV. Survey respondents were asked used as the basis for quantifying the value of traditional
about the nature of mangrove products harvested and forestry uses in Rekawa. Survey respondents were also
about their dependence on lagoon and coastal fisher- asked about their dependence on lagoon and coastal
ies. These data enabled the proportion of mangrove fisheries. However, most of the data needed to calcu-
users and nonusers to be defined and was used as the late the mangrove fisheries value were based on exist-
basis for establishing the existence, bequest, and option ing government fisheries catch data.
values of the mangroves for the local community. One The contingent valuation method (CVM) using an
of the researchers (MG) lived among the local com- open-ended approach (after Bateman and Turner
munity for the duration of the study, enabling a re- 1993) was adopted to measure the worth of preserving
search diary to be maintained and providing valuable the Rekawa mangrove–lagoon ecosystem from shrimp
qualitative insights into lifestyles, local economic prac- development. The CVM was designed to measure WTP
tices, and cultural attitudes to resource management. to preserve the Rekawa mangroves, estimated in the
To represent the population of Rekawa, a systematic form of voluntary contributions to a hypothetical
random sample was drawn from a complete list of mangrove protection fund (cf. Hutchinson and others
households held by the relevant local authorities. The 1995). The contingent market section of the question-
household list revealed that there were a total of 1184 naire described the various functions and benefits of
households in the Rekawa area. From this list, a ran- mangroves and presented information on the scale and
dom sample of 205 households was drawn. The sample nature of the proposed shrimp farm. Respondents were
interviewed was assumed to be representative of the then asked a series of structured questions regarding
entire Rekawa community. The questionnaire design maximum WTP to preserve and conserve the existing
followed accepted conventions (Joliffe 1983), and mangrove system without further development.
interviews were conducted on a house-to-house basis
and conducted in the local language, Sanskrit. A total
NPV of the Proposed Shrimp Development
of 205 persons were interviewed. Beyond basic demo-
The internal costs and benefits of the proposed
graphic data, including age, education, gender, in-
shrimp farm were estimated from the financial state-
come, the number of occupants per household, and
541
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
low discount rates such as 2% or 0 % favors projects
ment of the project proposal, as were the external
benefits. The external costs of the proposed shrimp with long-term benefits, whereas using high discount
development were estimated from the TEV assessment rates (i.e., greater than 10%) favours projects with
of the mangrove ecosystem. These data were used in an short-term benefits.
NPV formulation for the project where:
Results of the Rekewa Lagoon TEV
X
n
t
NPV ¼ ðBd À Be À Cd À Ce Þ=ð1 þ r Þ The TEV required utilitarian (direct and indirect
t¼1
values), option, existence, and bequest values to be
NPV = net present value; Bd = direct or internal project quantified and these will be reported in turn.
benefits; Be = external project benefits, Cd = direct or
Direct Value: Forest Goods and Services
internal project costs, Ce = external project costs;
r = discount rate; t = year in which costs or benefits The household survey results revealed that 24% of
occurred; and n = number of years in economic time the population harvested the mangroves for firewood,
horizon or project lifetime 10% for fish or prawn traps, 8% for construction
(Source: Carpenter and Maragos 1989). material, and a small proportion for other miscella-
A key variable in determining NPV is the expected neous products (e.g., medicinal extracts, honey and
useful life of the project. Shrimp pond productivity has other food items, tannins for dyes, and manure). The
been observed to decline at a rates between 3%–8% per rates of extraction of forestry products in Rekawa are
production cycle (cf. Funge-Smith and Briggs, 1994). currently low, and most harvesting is conducted at
When intensive aquaculture is practiced, the life span subsistence levels. Patterns of dependency were highly
of ponds typically does not exceed 5 to 10 years be- variable, with some households in the local villages
cause of attendant problems of self-pollution, disease, heavily dependent on mangrove wood and timber
and acid–sulphate conditions (Gujja and Finger-Stich products for domestic uses, and others not at all.
1996). In Thailand, 70% of previously productive The survey revealed that those households depen-
ponds get abandoned (Stevenson 1997), while in Sri dent on forestry products (24% of the 205 households
Lanka, even after a few years of operation the aban- surveyed) harvested an average of 20.5 kg of firewood
donment rate can be even higher c. 90% (Siriwardena each week, equivalent to 982 kg/year. Assuming that
2000). In view of the findings in the literature, the the random sample is representative of the total 1184
present analyses assumed that the working life span of households in the area (Ranaweera and others 1994),
the proposed shrimp farm to be 10 years and benefits it can be extrapolated that the annual harvest equates
were calculated accordingly. However, the costs of to 279 tons/year, which from a 200-ha mangrove forest
the project will occur during and well after the ex- represents 1.4 tons/ha/year.
pected useful life of the project. Therefore, the NPV The value of mangrove firewood was estimated
was calculated over a more realistic time frame of 20 using the actual amount of firewood harvested multi-
plied by the ‘‘shadow value’’ in the form of the price
years.
Discounting the costs and benefits in CBA is based for firewood obtained inland and sold by local licensed
on the fact that future costs and benefits usually weigh concessionaries. Minor products such as honey or
less in the decision-making process, rather than those those used for medicinal purposes were not valued due
occurring nearer the present time. This is because to the absence of markets for these products and the
governments and people tend to prefer present values difficulty in establishing quantities harvested. At local
over future ones. The projectÕs NPV was calculated over markets, equivalent firewood sold for 1.2 Rs/kg, giving
a range of discount rates spanning from 0% to 15% to an annual value to the harvest of 334,800 Rs (US$
explore the sensitivity of the results. Discount rates 4783), equivalent to 24 US$/ha/year. This figure pro-
should partially reflect the cost of borrowing money as vides a minimum gross preservation value for firewood,
set in the marketplace by financial institutions such as but does not include an estimate of the opportunity
banks, which for Sri Lanka at the time of the study costs associated with the time spent foraging for tim-
ranged between 10% and15%. They should also par- ber. Such costs can be approximated using shadow
tially reflect the social rate of time preference, which wage rate techniques, but have not been undertaken
indicates societyÕs willingness to sacrifice present con- here because wood harvesting is conducted at subsis-
sumption for the future (Bateman 1995). This rate will tence levels. It must be acknowledged that the simple
normally be lower than that of the money market, so replacement-cost approach only partially captures the
social discount rates of 2% and 5% were used. Using social welfare aspects of forest losses imposing a market
542 M. Gunawardena and J. S. Rowan
Table 2. Calculation of the value of the Rekawa mangrove–lagoon and near-shore coastal fisheries
Lagoon fisheries
Total number of lagoon fishermen1 = 250, total annual production2 = 36 tons
Crustaceans (30% of total lagoon fisheries catch)2
Main species harvested: Penaeus indicus, Penaeus monodon, and Metapenaeus monoceros1
Mean catch per person = 2.96 kg/day
Total annual catch = 10.8 tons/year @ 300 Rs/kg = 3.24 · 106 Rs/year
Fish (70% of total lagoon fisheries catch)2
Main species harvested: Mugil cephalas, Oreochromis niloticus, O. mossambicus, Anabus testudini,
Ophiocephalus punctuates3
Mean catch3 = 1.0 kg/day
Annual catch2 = 25.2 tons @ 40 Rs/kg = 1.01 · 106 Rs/year
I. Total value of mangrove dependent lagoon fishery = 4.25 · 106 Rs year
II. Harvesting costs
Harvesting costs per fisherman (fishing gear, bait, and other minor costs)c = Rs 2000/year
Total harvesting costs = 2000 · 250 = 0.5 · 106 Rs/year
III. Net Value of the lagoon fisheries (I–II) = 3.75 · 106 Rs/year
Net Value based on 200-ha mangrove = 18,750 Rs/ha/year (US$ 268/ha/year)
Coastal fisheries value
Number of fishermen4 = 276, number of boats2= 60, mean catch per boat2 = 23.5 kg, mean number of fishing trips per
month5 = 22, number of fishing months per year5 = 9, fishing households4 = 228, population of fishing households4 = 972,
mean boat to fishermen ratio4 = 1:4
Catch data and gross value
Sardine fishery (family Clupeidae): Total annual catch4,6 = 75 tons @ 85 Rs/kg = 6.4 · 106 Rs
Mullet fishery (family Mugilidae): Total annual catch4,6 = 12 tons @ 160 Rs/kg = 1.9 · 106 Rs
Prawn fishery (family Penaidae): Total annual catch4,6 = 5 tons @ 300 Rs/kg = 1.5 · 106 Rs
I. Total value of mangrove dependent coastal fishery = 9.8 · 106 Rs/year
Harvesting costs
Total variable cost per boat per year5 = 44,748 Rs
Average cost per boat for boat, fishing nets and other gear4,6 = 4150 Rs
II. Annual harvesting costs for 60 boats (60 · 48,898) = 2.9 · 106 Rs/year
III. Net value (I–II) = 6.9 · 106 Rs/year
Net Value based on 200-ha mangrove = 34,500 Rs/ha/year (US$ 493/ha/year)
Data sources: 1RSAMCC (1996), 2Jayakody and Jayasinghe (1992), 3DFAR, personal communication (1998), 4DFAR (1998), 5Ediriweera (2000),
6
DFAR, personal communication (2000).
economy onto local people who previously have drawn tems (Robertson and Blaber 1992), it has been sug-
uncosted goods from the forest (cf. Nickerson 1999). gested that fish and invertebrates occupying mangrove
habitats do so mainly to utilize the food resource
Indirect Value: Fisheries (Singh and others 1994). Primary production in man-
Mangroves are characterized by a high abundance groves can be attributed to several sources such as the
of fish, crustaceans, and molluscs and capture fisheries trees themselves, the associated epiphytes, phyto-
constitute a major value of marketed products from an plankton, and benthic microalgae (Ronnback 1999).
¨ ¨
unexploited mangrove forest (Barbier 2003). Fish The proportion of commercially important marine
standing stock is much higher in mangrove habitat fisheries dependent on mangroves for key stages of
their lifer-acycle varies from 60% to 90 % (Nickerson
compared to adjacent coastal habitats. This is because
many species of fish and invertebrates use mangroves 1999).
during at least one stage of their life cycle, which, in Mangrove ecosystems provide a range of services
turn, is related to food abundance, shelter from pre- that are important for the recruitment success of many
dation, and the hydrodynamic ability of mangroves to species of fish, crustaceans, and molluscs. Mangroves
retain immigrating larvae and juveniles (Ronnback serve as refuges from predation for larvae and juveniles
¨ ¨
1999). of many fish and invertebrates by virtue of the shallow
The role of mangroves in the production of leaf water and highly turbid conditions, as well as the
litter and nutrients, which support the rich aquatic and structural complexity resulting from mangrove roots,
benthic plankton food supply for fisheries, is well debris, and other vegetation (Singh and others 1994).
documented (Moberg and Ronnback 2003). Because In addition, mangroves help increase the residence
¨ ¨
of the high primary productivity in mangrove ecosys- time of water and thus facilitate settling of immigrant
543
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
Table 3. Environmental protection provided by mangroves
Environmental
protection
function Examples of problems resulting from mangrove clearance
Protection against erosion Indonesia and Philippines: loss of inland agricultural land through sedimentation and
coastal erosion (Bennett and Reynolds 1993)
Protection against storm The destruction of mangroves along the Philippines coastline accounts in part for the great
damage and flooding losses to life and property inflicted by typhoons and tsunamis each year (e.g., 7000 deaths
in Ormoc and other towns in 1991) (Primavera 1991).
The clearing of mangroves in the Chakaria Sundarban area of Bangladesh resulted in the
increased vulnerability of the area to cyclones and tidal waves (Choudry and others, 1994).
On the east coast of India, shrimp ponds impeded water flow that resulted in floods
(Alagarswami 1995).
Protection against Salt-water intrusion due to shrimp ponds has been observed in coastal areas of Vietnam
salt intrusion (Thuoc 1995) and 6 km upstream from shrimp ponds in Sri Lanka (Jayasinghe 1995).
Salinization of groundwater supplies and agricultural land reported widely, including Sri Lanka
(Foell and Harrison 1999).
Protection of nearby Indonesia and Philippines: mangrove destruction for aquaculture ponds led to mud deposition
beaches and coral reefs on nearby beaches and degradation of coral reefs (de la Cruz 1979).
larvae spawned from offshore areas into mangrove The annual net value of the Rekawa mangrove–la-
habitat, where they find refuge and food during their goon fisheries per hectare of mangroves was estimated
juvenile stages. Mangrove ecosystems are also impor- at US$ 268/ha/year and that of the Rekawa coastal
tant in trapping sediment and organic material from fisheries at US$ 493/ha/year (Table 2). The lagoon
land resources and interact with sea grass and coral fishery, which engages up to 250 local people, is very
reef ecosystems by maintaining water quality, nutrient traditional in nature. Nonmarket labor is effectively
balances, and hydraulic characteristics (Nickerson universal and fishing gear is mainly derived from
1999). Although mangroves, sea grass beds, and coral products of the mangrove forest (e.g., for making
reefs can exist in isolation from each other, they wooden traps and boats), and polychaetes and other
commonly form integrated ecosystems of high pro- organisms from the mangrove system provide bait
ductivity and provide a myriad of ecological services (Ediriweera 2000). The use of motors in the man-
(Moberg and Ronnback 2003). grove–lagoon system boats is prohibited (thus, engines
¨ ¨
In the present analysis, it was assumed in that the and fuel costs are taken as zero).
Rekewa mangrove forest represents the main source of To determine the total value of the coastal fishery,
detritus and nutrients and provides essential habitat the catch of each mangrove-dependent family was cal-
protection for fishery nursery grounds in the local area. culated and then these were combined to determine
The two main types of fishery identified were the the aggregate yield. The key species were Clupeidae,
mangrove–lagoon and the near shore–coastal systems Mugulidae, and penaeid shrimp, which registered a
respectively (RSAMCC 1996). Both fundamentally combined net value (including variable costs, but
operate at subsistence levels. Government survey data excluding the opportunity costs of subsistence labor)
indicate that the key crustaceans and fish harvested of 9.6 million Rs, equating to a mean annual value for
from Rekawa waters belong to the families Penaidae, the Rekawa fisheries of US$ 754/ha/year. This figure is
Mugilidae, and Clupeidae (RSAMCC 1996; DFAR, at the bottom of the range of valuations US$ 750/ha/
personal communication 1998, 2000). These families year to 11,280/ha/year reported by Ronnback (1999),
¨ ¨
not only spawn in the Rekewa lagoon areas, with the who criticized valuations using only official statistics
exception of the penaeid shrimp (Davenport and because of their overreliance on one or a few species of
others 1999), but their fry and larvae also spend critical economic importance and so overlook the potentially
periods of their life cycles in the mangrove–lagoon significant value of nonmarketed species (in terms of
habitat (Matthes and Kapetsky 1988). Indirect impacts protein sources and damage to the ecosystem) or their
from pollution resulting from waste effluents from the failure to acknowledge the value of noncommercial
aquaculture ponds (McKinnon and others 2002) are catches. Acknowledging these concerns, the reported
also a potential concern, although in this case, this is- value of the Rekawa fisheries should thus be regarded
sue was well mitigated in the project design. as a minimum figure.
544 M. Gunawardena and J. S. Rowan
Indirect Value: Shore Zone Stability the design-life of such structures will control long-term
financial commitments. The Sri Lankan Coastal Zone
The ecological services provided by mangrove eco-
Management Plan (CCD 1997) uses a general estimate
systems depend on, and, in turn, influence through
of 14 million Rs (US$ 20,000/km) to install erosion
complex feedback mechanisms, the operation of nat-
and storm control structures in this area. It further
ural physical processes in the coastal zone. Throughout
reports that such structures require replacement within
much of the tropics, mangroves forests are important
a 10-year maintenance cycle.
features of the coastline, with roles in stabilizing
Based on the scale ofthe proposed shrimp farm, it
shorelines, preventing flooding, and protecting bea-
might be conservatively estimated that the shrimp
ches and corals from siltation. Table 3 provides exam-
proposal for the Rekewa Lagoon will compromise
ples of the environmental services provided by
approximately 3 km of the natural coastal defense
mangroves, along with some of the problems that re-
function of the coastline through direct structural
sult when the mangroves are cleared for shrimp farm-
damage to the mangrove forest and disruptive engi-
ing.
neering activity within the coastal barrier between the
Primavera (1991) reported that the incident of life
lagoon and the ocean. The costs to emplace such a
and property damage has increased significantly along
program can thus be estimated at 42 million Rs, which
the coastline of the Philippines as a result of mangrove
annualized over a 10-year cycle equates to 4.2 million
clearance. Increased vulnerability of coastal commu-
Rs/year. The value of the mangrove buffer can also be
nities to tropical storms in the aftermath of extensive
expressed on a unit area basis as 21,000 Rs/ha/year or
mangrove clearance was also demonstrated in Bangla-
US$ 300/ha/year.
desh (Choudry and others 1994). The introduction of
shrimp ponds affects the hydrology of local systems by
Option, Existence, and Bequest Values
raising water tables, leading to impeded water flow and
Mangrove ecosystems represent a rare and declining
flooding (Alagarswami 1995). The construction of
habitat in Sri Lanka. The Rekawa ecosystem represents
dikes and embankments for shrimp ponds can also
a relatively intact mangrove site, where the full range of
induce extensive salinization; for example, Jayasinghe
(1995) reported saltwater intrusion to occur up to 6 km flora and fauna can be conserved. The site supports 17
species of mangrove and associated mangrove flora. In
upstream of wetland areas in the northwestern prov-
addition, the mangroves provide a habitat for a variety
ince of Sri Lanka. Sediment budgets are also frequently
of wildlife species, including: 66 species of resident
disrupted; for example, de la Cruz (1979) connected
birds, 15 species of migratory birds, 37 species of la-
aquaculture-driven mangrove conversions to acceler-
goon fish, 9 species of mangrove crustaceans, 6 species
ated rates of sedimentation on beaches and associated
of mammals, and 6 species of reptiles (RSAMCC 1996).
degradation of coral reefs within both Indonesia and
In addition, the mangrove–lagoon system acts as a
the Philippines.
In areas where mangrove conversions have im- buffer and offers protection to the 10-km-long strip of
beach, which is an important nesting ground for sev-
pacted physical environmental processes, the manage-
eral species of rare sea turtles. It has been estimated
ment response has often been to undertake expensive
that 1900 turtles nest in the Rekawa area, including
engineering works to counteract the problems. A sim-
Green, Loggerhead, Leatherback, Hawksbill, and the
ple approach to value the protective roles of natural
Olive Ridley turtle, all of which are in the World
systems is to use replacement-cost analysis (RCA).
Conservation Union (IUCN) Red List of globally
According to this method, the value of the mangrove
threatened species. As such, the wildlife resources in
system is estimated in relation to the costs incurred to
construct coastal defenses such as seawalls, revetments, the Rekawa area are a potentially significant source of
tourist revenue, although this potential remains unre-
and groins. Constanza and others (1997) estimated the
alized in much of Sri Lanka beyond the perimeters of
disturbance regulation function of mangroves at US$
the countryÕs National Parks (Bandaratillake 1995).
1800/ha/year, and Chan and others (1993) estimated
The contingent valuation method with an open-
the cost of replacing Malaysian mangroves at US$ 3
ended approach was used to quantify the option, exis-
million per kilometer of coastline.
tence, and bequest values of the Rekawa system. The
The RCA approach requires the size, complexity,
questionnaire survey established that 49% of the
and life span of any engineering response to be spec-
ified. For example, the size and style of a coastal de- households in the area directly used mangroves for for-
estry and fisheries products; the remainder were non-
fense system to guard against coastal erosion or storm
users. WTP values were thus estimated from the 105
surges will determine the initial construction costs, but
545
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
Table 4. Results of TEV assessment for Rekawa mangrove ecosystem
Value Value
Mangrove benefits Methods (Rs/ha/year) (US$/ha/year)
Forestry net benefits Estimated using the actual amount of wood 1,500 24
harvested multiplied by the ‘‘shadow value’’ in
(at a subsistence level)
the form of the price for inland wood sold by
licensed concessionaires.
Lagoon fishery net Estimated using actual data on amount of 18,750 268
benefits (at a subsistence level) fish obtained and their market value.
Coastal fishery net benefits Estimated using actual data on amount of 34,500 493
fish obtained and their market value, net of
any human effort.
Erosion control and buffer against Estimated using replacement-cost analysis. 21,000 300
damage from storms This involved estimating the costs incurred to
have erosion control and/or storm-control
structures such as sea walls, revetments, or
groins.
Existence, bequest and option values to Estimated using the contingent valuation 181.2 2.6
local community method with an open-ended approach. This
involved estimating WTP values in the form
of voluntary contributions to a hypothetical
mangrove protection fund.
Total value 75,931 1,088
Table 5. Projected external costs of the proposed shrimp culture project
Equivalent Equivalent
costs costs
External costs Magnitude/significance of impacts (Rs/year) (US$/year)
Loss of forestry products Loss of at least 32 ha of mangrove forestry products, 48,000 768
(replacement costs) 42 ha if locals excluded from projectÕs perimeter
‘‘buffer zone’’.
Loss of lagoon fisheries Proposed project will cause the direct loss of 32 ha 600,000 8,571
(loss of sales revenue) (or 16%) of the mangrove habitat for shrimp ponds.
1.1 · 106
Loss of coastal fisheries It was assumed that this loss will result in a proportionate 15,776
(loss of sales revenue) decline in the lagoon and coastal fisheries
Loss of natural coastal Again, assumed that relationship between loss of mangrove 672,000 9,600
defense services leading to habitat and erosion is linear and that 16% of the coastal
increased coastal erosion defense services of the mangrove forest would be lost.
and greater vulnerability of
coastal community
Loss of option, existence WTP values in the form of voluntary contributions to a 5,798 83
and bequest values hypothetical mangrove protection fund were estimated.
2.43 · 106
Total 34,798
mangrove nonuser households surveyed in the form of from the open-ended sample is considered the most
voluntary contributions to a hypothetical mangrove conservative estimate of WTP for conservation of natural
protection fund. Aggregating the option, existence, and resources. In part, the apparently low WTP returned
bequest values, it was determined that the mean contri- from the survey can be explained by the fact that many of
bution proposed by each household was 60 Rs/year. This the households operate at subsistence levels; for exam-
sum extrapolated across the estimated 600 households ple, within the Hambantota District, 31% of the popu-
lation face ‘‘consumption poverty,’’ 80% of whom live in
in the area having little or no direct use of mangroves
generates a value of 36,240 Rs/year, equivalent to a unit- rural areas like Rekawa (Gunetilleke 2000). This for-
area value of US$ 2.6/ha/year. The mean WTP measure mulation of WTP does not explicitly address the fact that
546 M. Gunawardena and J. S. Rowan
Table 6. Total benefits and costs, and the NPV of proposed shrimp culture project
Discount factor 0% 2% 5% 10% 15%
Total internal benefits 393 360 318 264 224
(millions of Rs)
Total external benefits 4.5 4.3 4.0 3.5 3.2
(millions of Rs)
Total internal costs 269.2 246 217 180 153
(millions of Rs)
Total external costs 51 42.2 32.7 23.1 17.6
(millions of Rs)
NVP over a 20-year planning + 77.7 +76.3 +72.3 + 64.7 +56.8
horizon (millions of Rs)
NVP over a 20-year planning +1.11 +1.09 +1.03 +0.92 +0.81
horizon (millions of US$)
wider conservation issues such as the conservation of of the project. External benefits included employment
turtle habitats, migratory birds, and biodiversity in gen- opportunities during the construction, operational,
eral have value far beyond community boundaries. WTP and restoration phases of the project.
estimates of value are also generally below those pro- Table 6 presents the total internal costs and bene-
duced by ‘‘Willingness to Accept’’ methods, which fits, the total external costs and benefits, and the NPV
measure what people are willing to accept as compen- of the proposed shrimp project over a 20-year planning
sation for a cost (Daly and Farley 2003). Both consider- horizon using discount rates ranging between 0% and
ations suggest that the existence value presented will 15%. Selection of the appropriate discount rate is
underestimate the ‘‘true’’ existence value and should be critical to the projected value of a project. The use of a
considered as a minimum. standard discount rate reflects returns on investment,
A summary of the results of the TEV assessment for but is insensitive to the degradation of the wider eco-
the Rekawa mangrove–lagoon ecosystem is presented system services, which should exhibit higher marginal
in Table 4. The TEV assessment of the Rekawa man- values in the future (Daly and Farley 2003). Notwith-
grove–lagoon ecosystem indicated that the annual va- standing this concern, the results still demonstrate that
lue per hectare was in the order of US$ 1088/ha/year. the total internal benefits of the shrimp proposal are
Clearly, the greatest component of the value is ob- much higher than the total internal costs. The devel-
tained from the fisheries, which collectively equate to oper will make a profit ranging from US$ 1 million to
70% of the TEV of the system. All of these estimates are 1.7 million (Rs 224 million to 393 million), depending
subject to considerable uncertainties, not least of which on the discount rate during the estimated 10-year
is quantifying the consequences of the partial loss of lifetime of the project. The ECBA for the shrimp pro-
the Rekewa mangrove forest (Table 5), along with posal revealed that the project gives a positive net
complex indirect effects resulting from the generation present value (+NPV) over a 20-year planning horizon,
of waste outputs, potential propagation of diseases into for all discount rates. The envelope of +NPV ranged
wild shrimp populations, and long-term issues such as from US$ 1.1 million with 0% discounting to US$ 0.81
resistance to antibiotics within the farm stock (cf. Co- million with 15% discounting.
rea and others 1995). In spite of the +NPV suggesting a commercially
viable future, the key finding of the research was to
NPV of the Proposed Shrimp Development demonstrate that the total external benefits of the
proposed aquaculture project were much lower than
the total external costs; that is, the total costs to society
The proposed shrimp project is to be developed in 3
in developing the aquaculture project are much higher
stages over a 3-year period (i.e., in year 1, 16 ponds to be
than the total benefits. The net cost to society over a
developed; in year 2, another 15 ponds to be developed;
20-year planning horizon was estimated to be between
and in year 3, a further 17 will be commissioned, to a
US$ 0.64 million (with 0% discounting) and US$ 0.24
total of 48 ponds). In calculating the total internal
million (with 15% discounting). The economic analysis
benefits and costs of the proposal, the anticipated life
for the proposed aquaculture project shows that al-
span of the scheme was assumed to be 10 years. Data
though the internal benefit to internal cost ratio for
used to calculate internal costs and benefits and exter-
the project was 1.5:1, the external benefit to external
nal benefits were obtained from the financial statement
547
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
cost ratio for the project lies between 1:11 and 1:6, growing rural population will be forced to concentrate
depending on the rate of discount used. their collection activities in a smaller forest area, which
could lead to severe degradation of the ecosystem
through overuse.
Discussion
It is estimated that the intact mangrove ecosystem
There are two broad reasons for engaging in valu- supports at least 1512 people from the local commu-
ation exercises: first, to show that environmental issues nity through fisheries alone (Ranaweera and others
are important for planning at the macroeconomic level 1994). The livelihood of all these people will be
(i.e., in the consideration of the damage and depreci- threatened by the aquaculture development. The pro-
ation of natural resource stocks in national accounts) posed 42-ha shrimp farm is likely to employ only about
and second, for making efficient allocation decisions at 50 people on a regular basis and around 250 people
the microeconomic level; that is, understanding the during the construction period. Employment of the
full costs and benefits of a project is essential to making local people in shrimp farms is often limited to low-
investment decisions and for the decision-making paying, unskilled jobs such as laborers and guards,
process (Winpenny 1991). whereas the technical and managerial positions are
The evaluation of the importance of mangroves to reserved for outsiders. Furthermore, because the funds
society requires insight into the flow of products and invested in the aquaculture development are gener-
services within coastal communities and how they are ated from the outside, all of the project profits will
linked and influenced by domestic and international leave the local community.
markets and organizations. It also requires insight into The present economic analysis shows that the
the biophysical links within and between mangroves internal benefits of the project are about 1.5 times
and other ecosystems for the generation of natural greater than the internal costs, whereas the external
products and services, many of which are harvested or costs, or the costs to society, are between 11 add 6 times
enjoyed outside the mangrove system (Ronnback more than the benefits. Even though mangrove con-
¨ ¨
1999). Failure to consider all of the relevant issues has version to shrimp ponds in the Rekawa area would give
resulted in the economic value of mangroves being a positive return, the net benefits from shrimp culture
generally underestimated. Although it will not be pos- are obtained entirely by the aquaculturist; that is,
sible to place a monetary value on all relevant factors, shrimp aquaculture would negatively impact on the
these must be recognized and incorporated at least indices of equity and offer limited scope to share the
qualitatively in the cost–benefit analysis. benefits among the local and wider community. ECBA
In its entirety, the Rekawa mangroves, the lagoon, can therefore be a useful tool for decision-makers in
the fisheries and other wildlife, the agricultural land, considering the nature of the costs and benefits, the
the dynamic beach environment, and the local people number of individuals affected, and the user groups to
who depend on and coexist with these resources which the costs and benefits accrue (Nickerson 1999).
comprise a large and complex ecosystem. The area and These considerations are important in ensuring sus-
its components are all interconnected and each com- tainable resource use and improvements in social wel-
ponent is important to the otherÕs well-being. The fare.
conversion of mangroves to shrimp ponds will have The environmental statement that accompanied the
several important consequences to the people of the planning application for the Rekawa shrimp project-
local community. Of key significance will be loss of mshowed only a financial breakdown of the projectÕs
traditional livelihood practices. The Rekawa mangroves internal benefits and costs. This can be misleading to
provide a source of income and, in addition, non- the decision-makers because internal benefits and costs
monetary sources of welfare to people, many of who deal only with the profits and losses made by the pri-
live at the poverty level. Nickerson (1999) discusses vate company and not the benefits and costs accrued
that although shrimp culture is not a mangrove-area- directly to society. It is important to include the
dependent use (i.e., shrimp developers have alternative external costs and benefits of a project into the eco-
sites for ponds), traditional sectors have no alternative nomic analysis, if an accurate estimate of a projectÕs
sites for fishery nursery grounds and forestry products total costs and benefits is to be obtained. As seen from
provided by mangroves. Furthermore, levels of extrac- the present study, economic analysis (provided it
tion of mangrove products at Rekawa might be sus- integrates environmental, economic, and social issues)
tainable indefinitely due to relatively low extraction is a valuable tool to more fully elucidate the likely
rates. However, if the proposed aquaculture project is consequences of development projects, programs, or,
developed, the area of mangroves will decline and the indeed, policies.
548 M. Gunawardena and J. S. Rowan
Conclusions costs and benefits to the local community, it is clear
that the ecological and cultural dimensions of the
It is now widely recognized that development of
proposal have consequences for regional, national, and
mangrove systems for shrimp aquaculture degrades
international stakeholders (e.g., eco-tourism).
ecosystems, providing a range of environmental ser-
Economic valuation can be used to estimate a
vices into unsustainable monocultures (cf. Hein 2002;
monetary equivalent for environmental goods and
Senarath and Visnanathan 2001). Because of the for-
services that might otherwise be treated as free. Such
eign exchange earning potential of shrimp develop-
analysis is naturally constrained by the assumptions
ment projects, such as that proposed at Rekewa,
made because most valuation studies ultimately rely on
governments have placed relatively few constraints on
some element of subjectivity. ECBA is a valuable
mangrove conversions, and aquaculture developments
framework for interpreting the biophysical findings of
continue to be authorized at the expense of common
EIA in economic welfare terms, and presenting the
property resource systems (cf. Armitage 2002). How-
results in a language familiar to decision-makers. The
ever, the evidence clearly indicates that intensive
aspiration of this study was to undertake a total eco-
industrial-scale production is rarely sustainable.
nomic valuation, but it is recognized that the analysis
Abandonment and progressive encroachment in
remains selective, and considerable uncertainty
increasingly marginal areas has been a common expe-
remains regarding the full range of environmental
rience in many mangrove ecosystems. Clearly, new ap-
services provided by mangrove ecosystems and how
proaches and mitigation strategies are needed (cf.
these interact with other ecosystems that also produce
Paez-Olsuna 2001; Lebel and others 2002). At Rekewa,
services of value to humans. Accepting such qualifica-
this might involve smaller ponds and situating ponds at
tions, the conclusion remains that ECBA should be
the inner margin of the mangrove along the man-
promoted to enable decision-makers to be more fully
grove–dryland gradient. Alternatively, it might be more
cognizant of a projectÕs environmental and socioeco-
desirable to boost the output of traditional fisheries by
nomic implications.
supplementing the natural stocks within the lagoon.
Davenport and others (1999) released Penaeus monodon
postlarvae into the Rekawa Lagooon and reported a
33% increase in the annual catch within 2 years of the Acknowledgments
experiment commencement. The use of such culture- This work was completed while MG completed a
based fisheries is, therefore, a potentially important PhD at Lancaster University, UK. TEAMS Consultants
means of spreading benefits across rural communities are acknowledged for providing studentship funds
and counteracting the most damaging aspects of the and providing logistical support for fieldwork in Sri
conventional aquaculture industry (De Silva 2003). Lanka. The valuable and constructive comments
This study began an ongoing process to more fully made by two external reviewers are also gratefully
articulate and value the full range of environmental acknowledged.
and social services provided by mangrove–lagoon eco-
systems such as Rekawa. The analysis demonstrated
that an ecologically rich ecosystem supporting low-
intensity, but sustainable, harvesting is far more valu- Literature Cited
able to the local and wider community—engaging
Adger, W. N., K. Brown, R. Cervigini, and D. Moran. 1995.
several hundred local residents—than a large shrimp Total economic value of forests in Mexico. Ambio 24:286–
culture project, which is associated with significant 296.
socioeconomic impact and loss of traditional liveli- Alagarswami, K. 1995. Status of aquaculture in India. Annex
hoods. The issue of wealth distribution is crucial to the 11-12 in Regional study and workshop on the environ-
social and economic development of any country. By mental assessment and management of aquaculture
development (TCP/RAS/2253), NACA Environment and
highlighting the nature of the benefits and costs
Aquaculture Series No. 1. Network of Aquaculture Centres
accruing to each group, more information can be
in Asia-Pacific, Bangkok, Thailand.
made available to decision-makers concerned with the
Amarasinghe, M. D. 1988. Socio-economic status of human
promotion of equity amont the populace. Typically, communities for selected mangrove areas on the west
aquaculture is favored because individual developers coast of Sri Lanka. Mangrove Ecosystems Occasional Papers
can capture all of the benefits, whereas the benefits of 15:1–19.
intact mangroves accrue to the entire community. Al- Armitage, D. 2002. Socio-institutional dynamics and the
though the focus of this investigation has been on the political ecology of mangrove forest conservation in Cen-
549
Mangrove Ecosystem and Shrimp Aquaculture in Sri Lanka
tral Sulawesi, Indonesia. Global Environmental Change-Hu- Davenport, J., S. U. K. Ekaratne, S. A. Walgama, D. Lee, and J.
man and Policy Dimensions 12:203–217. M. Hills. 1999. Successful stock enhancement of a lagoon
prawn fishery at Rekawa, Sri Lanka using cultured post-
Aylward, B., and E. B. Barbier. 1992. Valuing environmental
larvae of penaeid shrimp. Aquaculture 180:65–78.
functions in developing countries. Biodiversity and Conser-
vation 1:34–50. de la Cruz, A. Ad. 1979. The function of mangroves. Biotrop
Special Publication 10:125–138.
Bandaratillake, H. M. 1995. Use of non wood forest products
by village communities in Sri Lanka. Pages 291–298 in P. De Silva, S.bA. 2003. Culture-based fisheries: an underutilised
B. Durst, A. Bishop. (eds.) Beyond timber: social, eco- opportunity in aquaculture development. Aquaculture
nomic and cultural dimensions of non wood forest prod- 221:221–243.
ucts in Asia and the Pacific. RAP Publication 1995/13. DFAR (Department of Fisheries and Aquatic Resources. 1998.
FAO Regional Office for Asia and the Pacific, Bangkok, Census of marine fisheries in Sri Lanka. UNDP/FAO/
Thailand. SRL/91022. DFAR, Colombo, Sri Lanka.
Barbier, E. B. 2003. Habitat-fishery linkages and mangrove Dierberg, F., and E. W. Kiattisimkul. 1996. Issues, impacts and
loss in Thailand. Contemporary Economic Policy 21:59–77. implications of shrimp aquaculture in Thailand. Environ-
Bateman, I. J., and R. K. Turner. 1993. Valuation of the mental Management 20:649–666.
environment, methods and techniques: the contingent Dixon, J.bA. 1989. Valuation of mangroves. Tropical Coastal
valuation method. Pages 120–191 in R. K. Turner. (ed.) Area Management Newsletter 4:3.
Sustainable environmental economics and management:
Ediriweera, S. 2000. Analysis of cost and earnings of selected
principles and practice. Belhaven Press, London.
fishing crafts and gear in Sri Lanka. Department of Fish-
Bateman, I. J. 1995. Environment and economic appraisal. eries and Aquatic Resources, Colombo, Sri Lanka.
Pages 45–65 in T. OÕRiordan. (ed.). Environmental science
EIAR. 1993. Environmental Impact Assessment Report for a
for environmental management. Longman, Harlow, UK.
Proposed Shrimp Culture Project in Madilla, Rekawa, 75
Bennett, E. L., and C. J. Reynolds. 1993. The value of a pp. Unpublished Environmental Statement.
mangrove area in Sarawak. Biodiversity and Conservation
Flaherty, M., and C. Karnjanakesorn. 1995. Marine shrimp
2:359–375.
aquaculture and natural resource degradation in Thailand.
Beveridge, M. C. M., M. J. Phillips, and D. J. Macintosh. 1997. Environmental Management 19:27–37.
Aquaculture and the environment: the supply of and the
Foell, J., and E. Harrison. 1999. Participatory mechanisms for
demand for environmental goods and services by Asian
sustainable development of coastal ecosystems. DFID Pro-
aquaculture and the implications for sustainability. Aqua-
ject R6977, Sri Lanka, 44 pp.
culture Research 28:797–807.
Funge-Smith, S. J., and M. R. P. Briggs. 1994. Development of
Carpenter, R. A., and J. E. Maragos. 1989. How to assess
strategies for sustainable shrimp farming. Final Report to
environmental impacts on tropical islands and coastal
the Overseas Development Administration, Research Pro-
areas. Environment and Policy Institute East-West Centre,
ject R4751. Institute of Aquaculture, University of Stirling,
Honolulu, 345 pp.
31 pp.
CCD. 1997. Revised coastal zone management plan. Coast
Glasson, J., R. Therivel, and A. Chadwick. 1999. Introduction
Conservation Department, Coastal Resources Management
to environmental impact assessment: principles and pro-
Project, Colombo, Sri Lanka, 128 pp.
cedures, process, practice and prospects, 2nd ed. UCL
Chan, H. T., J. E. Ong, W. K. Gong, and A. Sasekumar. 1993. Press, London.
The socio-economic, ecological and environmental values
Goldburg, R 1997. Shrimp aquaculture. Environment 39:37–39.
of mangrove ecosystems in Malaysia and their present state
Gujja, B., and A. Finger-Stich. 1996. What price prawn?
of conservation. Pages 41–81 in B.F. Clough. (ed.) The
Shrimp aquacultureÕs impact in Asia. Environment 38:12–39.
economic and environmental values of mangrove forests
and their present state of conservation in the South-East Gunawardena, M. 2001. A critical review of ecological impact
Asia/Pacific Region. Vol 1. International Society for Man- assessment in Sri Lanka: with particular reference to the
grove Ecosystems, Okinawa. shrimp aquaculture industry. PhD thesis, University of
Lancaster.
Choudhury, A. M., D. A. Quadir, and M. J. Islam. 1994. Study
of Chokoria Sundarbans using remote sensing techniques. Gunetilleke, N. 2000. Basic MIMAP poverty profile (draft). Sri
ISME Mangrove Ecosystems Technical Report 4:1–22. Lanka Institute of Policy Studies, Colombo, Sri Lanka, 51 pp.
Corea, A. S.L.E., J. M. P. K. Jayasinghe, S. U. K. Ekaratne, and Hamilton, L., J. Dixon, and G. Miller. 1989. Mangroves: An
R. Johnstone. 1995. Environmental impact of prawn farm- undervalued resource of the land and sea. Ocean Yearbook
ing on Dutch Canal: The main water source for the prawn 8:254–288.
culture industry in Sri Lanka. Ambio 24:815–827.
Hein, L. 2002. Toward improved environmental and social
Costanza, R., R. dÕArge, R. de Groot, S. Farber, M. Grasso, B. management of Indian shrimp farming. Environmental
Hannon, K. Limburg, S. Naeem, R. V. OÕNeill, J. Paruelo, R. Management 29:349–359.
G. Raskin, P. Sutton, and M. van den Belt. 1997. The value
Hutchinson, W. G., S. M. Chilton, and J. Davis. 1995. Mea-
of the worldÕs ecosystem services and natural capital. Ambio
suring non-use values of environmental goods using the
387:253–260.
contingent valuation method: problems of information
Daly, H. E., and J. Farley. 2003. Ecological economics: prin- and cognition and the application of cognitive question-
ciples and applications. Island Press, London. naire design methods. Agricultural Economics 46:97–112.
550 M. Gunawardena and J. S. Rowan
Jayakody, D. S., and J. M. P. K. Jayasinghe. 1992. Report of the Primavera, J. H. 1997. Socio-economic impacts of shrimp
development potential of Rekawa lagoon. NARA, Colombo, culture. Aquaculture Research 28:815–827.
Sri Lanka, 64 pp. Ranaweera, B. R., A. Premaratne, and I. Ranasinghe. 1994.
Jayasinghe, J. M. P. K. 1995. Status of aquaculture in Sri People, resources and development potentials in the Rek-
Lanka. Annex II-15 in Regional study and workshop on the awa SAMP area. Coast Conservation Department, Co-
environmental assessment and management of aquacul- lombo, Sri Lanka, 43 pp.
ture development (TCP/RAS/2253), NACA Environment Robertson, A. I., and S. J. M. Blaber. 1992. Plankton, epi-
and Aquaculture Series No. 1. Network of Aquaculture benthos and fish communities. Pages 173–224 in A. I.
Centres in Asia-Pacific, Bangkok, Thailand. Robertson, D. M. Alongi. (eds.) Tropical mangrove eco-
Johansson, P. 1990. Valuing environmental damage. Oxford systems. Coastal and Estuarine Studies No. 41. AGU,
Review of Economic Policy 6:34–50. Washington, DC.
Jolliffe, F. R. 1983. Survey design and analysis. Ellis Horwood, Ronnback, P. 1999. The ecological basis for economic value
¨ ¨
Chichester . of seafood production supported by mangrove ecosystems.
Ecological Economics 29:235–252.
Khor, M. 1995. Protests over shrimp farms spread throughout
India. Third World Resurgence 59:11–12. Ronnback, P., and J. H. Primavera. 2000. Illuminating the
¨ ¨
need for ecological knowledge in economic valuation of
Lal, P. N. 1990. Ecological economic analysis of mangrove
magroves under different management regimes—A cri-
conservation, a case study from Fiji. ISME Mangrove Eco-
tique. Ecological Economics 35:135–141.
systems Occasional Papers No. 6. UNDP/UNESCO Re-
gional Mangroves Project RAS/86/120, 46 pp. RSAMCC. 1996. Rekawa Special Area Management Coordi-
nating Committee. Rekawa Special Area Management Plan
Lebel, L., N. H. Tri, A. Saengnoree, S. Pasong, U. Buatama, and
for Rekawa Lagoon, Sri Lanka, Coastal Resources Man-
L. K. Thoa. 2002. Industrial transformation and shrimp
agement Project, Coast Conservation Department, Co-
aquaculture in Thailand and Vietnam: Pathways to ecologi-
lombo, Sri Lanka, 81 pp.
cal, social, and economic sustainability? Ambio 31:311–323.
Ruitenbeek, H. J. 1994. Modelling economy-ecology linkages
Lee, N., and C. George. 2000. Environmental assessment in
in mangroves: Economic evidence for promoting conser-
developing and transitional countries. John Wiley & Sons,
vation in Bintuni Bay, Indonesia,. Ecological Economics
Chichester.
10:233–247.
Lowry, K., N. Pallewatte, and A. P. Dainis. 1999. Policy-relevant
Senarath, U., and C. Visvanathan. 2001. Environmental issues
assessment of community-level coastal management projects
in brackish water shrimp aquaculture in Sri Lanka. Envi-
in Sri Lanka. Ocean and Coastal Management 42:717–745.
ronmental Management 27:335–348.
Matthes, H., and J. M. Kapetsky. 1988. Worldwide compen-
Singh, H. R., V. C. Chong, A. Sasekumar, and L. K. Lim. 1994.
dium of mangrove associated aquatic species of economic
Value of mangroves as nursery and feeding grounds. Pages
importance. FAO, Rome, FAO Fishery Circular No. 814.
105–122 in Proceedings of the Third ASEAN-Australia
FAO, Rome.
Symposium on Living Coastal Resources, Vol. 1. Chul-
McKinnon, A. D., L. A. Trott, D. M. Alongi, and A. Davidson. alongkorn University, Bangkok.
2002. Water column production and nutrient characteris-
Siriwardena, P. P. G. S. N. 2000. Draft report on the
tics in mangrove creeks receiving shrimp farm effluent.
code of best practices for shrimp culture in Sri Lanka.
Aquaculture Research 33:1–19.
Working paper of the WB/NACA/WWF/FAO Consor-
Moberg, F., and P. Ronnback. 2003. Ecosystem services of the
¨ ¨ tium Programme on Shrimp Farming and the Envi-
tropical seascape: interactions, substitutions and restora- ronment.
tion. Ocean and Coastal Management 46:7–46.
Stevenson, N. J. 1997. Disused shrimp ponds: options for
Nickerson, D. J 1999. Trade-offs of mangrove area develop- redevelopment of mangroves. Coastal Management 25:425–
ment in the Philippines. Ecological Economics 28:279–298. 435.
Paez-Osuna, F. 2001. The environmental impact of shrimp Thuoc, P. 1995. Status of aquaculture in Vietnam.
aquaculture: Causes, effects, and mitigating alternatives. Annex II-20 in Regional study and workshop on the
Environmental Management 28:131–140. environmental assessment and management of aqua-
Pauly, D., and J. Ingles.. 1986. The relationship between culture development (TCP/RAS/2253), NACA Envi-
shrimp yields and intertidal (mangrove) areas: A reassess- ronment and Aquaculture Series No. 1. Network of
ment. in Workshop on recruitment in tropical coastal Aquaculture Centres in Asia-Pacific, Bangkok, Thai-
demersal communities. IOC-FOA, UNESCO, Paris 227–284. land.
Pearce, D. W., and R. K. Turner. 1990. The economics of R. K. Turner. (eds.) 1993. Sustainable environmental eco-
natural resources and the environment. Harvester nomics and management: principles and practice. Belha-
Wheatsheaf, Hemel Hempstead, UK. ven Press, London.
Primavera, J. H. 1991. Intensive prawn farming in the Phil- Winpenny, J. T. 1991. Values for the environment: a guide to
ippines: Ecological, social, and economic implications. economic appraisal. HMSO, London.
Ambio 20:28–33.