An Economic Valuation of Sago Forest Harvesting Regimes
The perception that peat swamp land is a marginal land and sago is a marginal crop is an understatement. It is an understatement that omits the environmental costs and benefits associated with sago peat swamp forest management. Sago peat swamp forest serves important ecological and environmental...
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| Main Author: | |
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| Format: | Thesis |
| Language: | English English |
| Published: |
2005
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| Subjects: | |
| Online Access: | http://psasir.upm.edu.my/id/eprint/6054/1/FEP_2005_2.pdf |
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| Summary: | The perception that peat swamp land is a marginal land and sago is a marginal crop
is an understatement. It is an understatement that omits the environmental costs and
benefits associated with sago peat swamp forest management. Sago peat swamp
forest serves important ecological and environmental functions and provides
perpetual benefits, if managed in a sustainable manner. One of the measures for
sustainability is the valuation of the resource. This study uses the disciplines of
economics in order to generate the set of values. Hence the total economic valuation
(TEV) approach is adopted. In order to demonstrate the TEV, the components of
sago peat swamp forest to be estimated and quantified are the stumpage value, fish,
domestic water, carbon sequestration and wildlife. The methods adopted in valuation
of these benefits are market price, damage cost avoided and contingent valuation.
The objective of the study is to estimate the TEV of sago harvesting regimes that are
most efficient both financially and environmentally. The samples are the heads of
the households from the villages that surround the study site. This is to ensure the
samples are familiar with the study site.
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The analysis is conducted in three parts. The first part is the willingness-to-pay
(WTP) for the benefits provided by the Mukah Sago peat swamp forest. The analysis
reveals that the determination of WTP is the income earned from the benefits. The
second part is the quantification of each component of TEV used in the study. The
analysis shows that the economic value is higher under sustainable option when
compared with unsustainable option. The final part is the financial analysis. The
financial and economic internal rates of return are calculated. The financial internal
rate of return highlights only the income derived from the sago logs, the tangible
asset. However, the economic rate of return aggregates all the values of the other
benefits, both tangible and intangible into the income calculation.
The results are significant at both local and state levels. At the local level, the sago
peat swamp forest plays an important role in income contribution to the farmers.
However, their attitudes towards the conservation and maintenance of the sago peat
swamp forest have to change towards sustainability for perpetual benefits. At the
state level, sustainability needs proactive management to make the sago peat swamp
forest more productive by implementing environmentally friendly projects that
generate income for the benefit of the stakeholders. |
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