Valuation Study

Value of Adapting to Coastal Erosion

Attributes

Medium: Land

Country: Philippines

Analytical Framework(s): Economic Analysis

Study Date: 2008

Publication Date: 2009

Major Result(s)

About the Inflation Adjustment: Prices in Philippines (PHP) changed by 23.55% from 2008 to 2014 (aggregated from annual CPI data), so the study values were multiplied by 1.24 to express them in 2014 prices. The study values could be expressed in any desired year (for example, to 2025) by following the same inflation calculation and being sensitive to directional (forward/backward) aggregations using your own CPI/inflation data.

Study Note: The general objective of this study was to estimate the economic vulnerability of San Fernando Bay in San Fernando City, La Union, to coastal erosion/shoreline retreat, and identify and evaluate various adaptation options to address the hazard. The specific objectives were: to identify and delineate critical areas at risk to coastal erosion/shoreline retreat until 2100; to prepare an inventory and estimate of the value of resources, properties, structures and economic activities at risk to coastal erosion/shoreline retreat; to identify possible adaptation strategies to address coastal erosion/shoreline retreat; to conduct a cost-benefit analysis on the identified adaptation strategies; and to evaluate the different adaptation strategies based on social, administrative, and legal/political feasibility.

Study Details

Reference: Jaime Kim E. Bayani et. al. 2009. Economic Vulnerability and Possible Adaptation to Coastal Erosion in San Fernando City, Philippines. EEPSEA Research Report, No. 2009-RR2.

Summary: Coastal erosion or shoreline retreat is currently affecting many coastal areas in the Philippines. Natural factors such as wind and waves, long shore currents and tectonic activities, as well as anthropogenic factors such as dam construction, sand mining, coral reef destruction, groundwater extraction, wetlands conversion, dredging of inlets for navigation, and boat traffic have been identified as the factors contributing to the hazard. The impact of this coastal hazard is expected to become more widespread due to climate change and sea level rise as well as with the continuing urbanization and development of coastal communities in the country. The hazard can inflict serious adverse impacts on society. Land, properties, infrastructure, and natural resources, such as sandy beaches, can be destroyed. It is not surprising that huge efforts are being exerted to mitigate the impacts of the hazard. Typical responses usually involve protection activities or retreat. These adaptation options, however, entail large investments and sometimes even cause undesirable impacts. It is important, therefore, to carefully evaluate and assess the feasibility of these options before action is taken. In light of this, this research evaluated three adaptation strategies: (a) the "business as usual" or hold-the-line strategy which involves the construction of bulkheads; (b) planned protection which involves the construction of bulkheads and revetments complemented by bio-engineering (combination of hard and soft protection); and (c) planned retreat/relocation. This study focused on the San Fernando Bay in San Fernando City, La Union, an area identified as susceptible to coastal erosion/shoreline retreat. The results of this study showed that about 300 structures; 283,085 square meters of land; and 123,033 square meters of beach along San Fernando Bay will be lost to coastal erosion/shoreline retreat by the year 2100. The total current value of these threatened lands and structures was estimated to be Php 1.04 billion. The annual value of the social services derived from the threatened beaches, on the other hand, was estimated at Php 12.54 million. It was concluded that among the three adaptation options evaluated, planned protection was the best strategy to pursue. This option yielded the highest net present value (NPV) of about Php 148.63 million under the assumption that beaches were not resilient (Scenario A), and about Php 126.78 million under the assumption that beaches were resilient (Scenario B), at a discount rate of 6%. The "business as usual" option followed with an NPV of about Php 123.18 million under Scenario A and Php 101.33 million under Scenario B. The planned retreat/relocation option, on the other hand, yielded negative NPV estimates. The planned protection strategy fared fairly well in terms of social feasibility, with about 65% of the survey respondents agreeing to it. Government involvement through the implementation and financing of protection projects was also found to be legally/politically feasible, with 82% of the local government respondents expressing agreement with the proposed intervention.

Site Characteristics: Small fishing communities, busy ports, industrial hubs, urban settlements, agricultural plots, sandy beach resorts, wetlands and mangrove areas--these characterize the diversity of land use that can be found along the 34,539 km coastline of the Philippines. With the country comprising more than 7,100 islands, Filipinos are naturally drawn to the bounties and beauty of the sea. In fact, most of the major cities in the Philippines developed near the coast, where constant development and rapid land conversion are taking place. Thus, the coastal areas in the country are critical areas not only for their natural resources, but also for their growing economic and social importance. However, the coastal cities and municipalities in the Philippines are also facing growing threats from and vulnerability to natural hazards and disasters as their exposure to these increases with urbanization and development. Among these hazards is coastal erosion (which is also referred to as shoreline retreat). Coastal erosion is the process of the wearing away of materials from the shoreline. Its long-term trend is shoreline retreat which is the landward encroachment of the sea. For the purposes of this study, coastal erosion and shoreline retreat refer to the same phenomenon and are thus used interchangeably. Coastal erosion/shoreline retreat is a complex problem because it occurs in a very dynamic environment and results from a combination of factors interacting along the coast. Both natural factors (wind and waves, long shore currents, and tectonic activities) and anthropogenic factors (dam construction, sand mining, coral reef destruction, groundwater extraction, wetlands conversion, dredging of inlets for navigation, and boat traffic) have been identified as the causes. Even activities that are meant to curb coastal erosion, such as building of ripraps and seawalls, have also been found to accentuate coastal erosion problems.

Comments: With the archipelagic nature of the country, many areas in the Philippines are prone to coastal erosion/shoreline retreat. In fact, it has been documented in several areas of the country including La Union, Bataan and Leyte. When coastal erosion/shoreline retreat occurs, adverse impacts to society, the economy, and the environment are to be expected. These include the loss of beaches, loss of land, loss of livelihood, displacement of people, and destruction of property and infrastructure. As a response, adaptation strategies are usually undertaken to address the hazard. These adaptations take the form of either protection or retreat/relocation which entail huge investments, and sometimes even have undesirable impacts and consequences. It is necessary, therefore, that an evaluation of adaptation strategies be undertaken to ensure efficient coastal erosion/shoreline retreat management. Recognizing this need, this study evaluated three adaptation strategies to coastal erosion/shoreline retreat in one of the coastal areas in the country identified to be experiencing the hazard i.e., San Fernando Bay in San Fernando City, La Union Province. In support of this goal, the areas at risk to coastal erosion/shoreline retreat until 2100 were first delineated and the economic vulnerability of these areas was then quantified.

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