Value of Coral Reefs
Attributes
Medium: Animals, Plants and/or Others
Country: Thailand
Analytical Framework(s): Contingent Valuation, Travel Cost
Unit(s): Mean WTP, Consumer Surplus
Study Date: 2000
Publication Date: 2001
Major Result(s)
| Resource/Environmental Good | THB (2000) |
THB (2014)1 |
USD (2014)2 |
|---|---|---|---|
| Consumer surplus from the coral reefs (per year) | 8,216,400,000.00 | 11,261,151,348.00 | 342,143,842.13 |
| Use and non-use values of the coral reef (per year) | 19,895,000,000.00 | 27,267,490,150.00 | 828,459,147.46 |
| Consumer's illingness to pay to increase biodiversity (per visit) | 287.00 | 393.35 | 11.95 |
About the Inflation Adjustment: Prices in Thailand (THB) changed by 37.06% from 2000 to 2014 (aggregated from annual CPI data), so the study values were multiplied by 1.37 to express them in 2014 prices. The study values could be expressed in any desired year (for example, to 2024) by following the same inflation calculation and being sensitive to directional (forward/backward) aggregations using your own CPI/inflation data.
Study Note: The concept of adopting a discriminatory pricing scheme, where local and foreign visitors are charged different user fees, was considered as a means to increase the total revenue for the Park. The rationale for charging foreigners a higher entrance fee is firstly, foreigners do not pay income tax or business tax to the local government and secondly, foreigners tend to have a higher WTP for park visitation. However, this study found that, in fact, international visitors here do not have a higher WTP than domestic visitors. In addition, imposing a higher entrance fee for foreigners could create an unnecessary psychological barrier for foreign tourists and could negatively affect the image of Thailand's tourism industry. For this reason, this study recommends that foreign and local visitors be charged the same user fee.
Study Details
Summary: This study recommends a basic entrance fee of 40 Baht (US$1) per person per visit for Phi Phi. Supplementary user charges should also be levied by the Phi Phi Islands Marine Park when visitors receive additional services from the variety of recreational sites on offer at Phi Phi, or visit certain special and environmentally vulnerable recreational sites. For instance, after having charged the basic entrance fee of 40 Baht (US$1), the Park could impose an extra fee of 150 Baht (US$3.75) per person per visit if the visitor chose to visit the coral reef at Maya Bay. This user charge would help raise additional revenue for the Park by transferring surpluses from high-end consumers to economic gains and conservation, while leaving the low-income visitors unaffected. At the same time, charging an additional fee for particular reef sites would assist in reducing the number of visitors. This additional fee could be more expensive during periods when the marine environment is more sensitive to disturbance, thus providing an incentive for tourists to visit at other times. Both these measures could help relieve the negative pressure on the delicate marine environment.
Site Characteristics: The southern coast of Thailand is of great significance, as it marks the boundary between two of the region's major oceans: to the east, the Gulf of Thailand, contained within the Pacific Ocean, and to the west, the Andaman Sea connecting to the Indian Ocean. Because of this strategic location, Thailand's seas are regarded as one of the country's major food sources. The Andaman Sea of Thailand, discussed in this study, is located on the country's west sea border, with Ranong, Phang Nga, Phuket, Krabi, Trang and Satun provinces forming its approximately 700-kilometre coastline. The total macrobenthic fauna on the coastal seabed of the Andaman Sea ranges from 200 to 1000 individuals/m2. Polychaeta and Crustacea are the most abundant groups at about 475 and 318 individuals/m2 respectively. The remainder is made up of Mollusca, Echinodermata, Chordata and others. The Andaman Sea coast also consists of mangrove forest distributed along the coastal belt. On the northern stretch, the mangrove area ranges between 21,800 to 36,700 ha, whilst the southern stretch of mangrove area ranges from 26,500 to 31,500 ha. The largest mangrove area is concentrated on the Phang Nga coast. In addition, the coastal sea also possesses a considerable area of coral reef. A marine park was established on the major reef areas along the Andaman Sea coast, among which are the Surin-Similan Island belt and the Phi Phi Islands belt.
Comments: It is apparent from the study's analysis that both local and national levels of government in Thailand can justify larger annual budget allocations for managing coastal resources. At present, the economic benefits from coastal resource management in Phi Phi are mostly due to the local residents and businesses. One of the economic instrument options to capture the net benefit values of Phi Phi is to directly target the consumers. Tourists could be charged fees for physically using the environment, such as participating in offshore water sports (specifically including snorkelling boats and dive operations), swimming and beach activities. The contingent valuation method provided information regarding the extent of the domestic consumer surplus. It estimated the consumer's willingness to pay to increase biodiversity at Phi Phi as 287 Baht (US$7.18) per visit.