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Sustainable Use for Global, National and Community Benefit:
An Analysis of Utilisation and Biodiversity Conservation

EXECUTIVE SUMMARY

A project funded under the Darwin Initiative

compiled by
Timothy M. Swanson and J. Carlos Fernandez U.
Faculty of Economics and Poiitics, Cambridge University

and

Richard A. Luxmoore

World Conservation Monitoring Centre

December 1995

WORLD CONSERVATION
MONITORING CENTRE

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The World Conservation Monitoring Centre,
provides information services on the conservation and

sustainable use of species and ecosystems and supports
others in the development of their own
information systems.

Sustainable Use for Global, National and Community Benefit:
An Analysis of Utilisation and Biodiversity Conservation

EXECUTIVE SUMMARY

A project funded under the Darwin Initiative

compiled by
Timothy M. Swanson and J. Carlos Fernandez U.
Faculty of Economics and Politics, Cambridge University

and

Richard A. Luxmoore

World Conservation Monitoring Centre

December 1995

Digitized by the Internet Archive
in 2010 with funding from
UNEP-WCMC, Cambridge

htto://www.archive.org/details/sustainableusefo95swan

Abstract

This document summarises the principles for the implementation of sustainable wildlife use
at the global level for the purpose of securing maximum conservation and development
benefits at the local level. It is based upon a series of case studies conducted for the purpose
of analysing the meaning of sustainable use. These case studies are summarised within the
document for the purpose of illustrating the basic principles of a sustainable use regime.
The conclusion states that there is a need for a certification mechanism that certifies
sustainability and engenders exclusive purchasing arrangements between certified
producers and conservation-minded consumers. It is recommended that this mechanism be
created at the multilateral level in order to induce the substantial investments required for
its success and in order to make exclusive purchasing a legal obligation.

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Introduction

Biodiversity is under threat from a number of distinct sources: over-exploitation, introduction of
exotic species, habitat conversion and environmental pollution. At base, however, the problem of
loss of biodiversity lies with the developmental process and the pressures that this places for social
change and consequently land use and general environmental change. Species have adapted to one
set of conditions and humans are reshaping the environment in ways that upset this equilibrium.
Out of such conflicts come projections of global change and possible mass extinctions.

The use of wildlife must be seen within the context of this fundamental conflict between human
development and the conservation of biological diversity. All of the values of wildlife must be
recognised and realised if it is to find its rightful position in relation to human development. This
study focuses primarily on the use values of widlife . The non-use values may be equally large or, in
some cases, greater, but they are difficult to quantify and mechanisms for capturing them are poorly
developed. Until they have been, use values will form the bulk of market values of wildlife. The
sad fact is that the future of all wildlife is now an economic question, simply because economics is
defined as the study of the human allocation of resources between competing objectives. Species
now have their future determined by decisions on resource allocation made by human societies, if
not directly, then concerning the conservation of a habitat or its protection from pollution. Human
societies have many competing objectives (health, education, recreation) and wildlife will have to
compete with these for its allocation of resources. It will be the aggregate value of wildlife that will
ultimately determine its allocation of resources, and hence its continued existence.

This document outlines the conditions that are required to channel wildlife values, and especially
use values, into constructive forces. This is a difficult task, as the history of wildlife use attests;
however, there is no alternative. In this document, the basic principles of sustainable use are
outlined in the context of several case studies. These principles point to the importance of the
development of a sustainable use certification mechanism, which is described further in the
concluding recommendation. There are good reasons for developing this mechanism at the
multilateral level in order to make its recognition and enforcement a legal obligation.

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A. The Need for the Development of Wildlife Resources

1. Local communities make the decisions on land uses that will determine the natural
resources with which they live.

2. Successful wildlife conservation policies are necessarily based in the sustainable
development of the local communities down pathways that are compatible with the
resources with which they live.

3. Policies based on the prohibition of all use are unlikely to provide for the long term
viability of a species.

The case study of the different Monarch Butterfly reserves illustrates the first two points. In each
case, the reserve was primarily designated to conserve the butterfly (as it was a critical habitat for
the species), and the government had enacted a prohibition on alternative uses of the habitat that
conflicted with this objective. Despite this prohibition, in all but one of these reserves, substantial
use of the forest resources occurred, primarily timber extraction for commercial and subsistence use
by local communities. The one exception occurred in the monarch butterfly reserve that had
developed a substantial tourism-based economy around it. In this instance, the local community
had come to view the reserve as an asset on which its development relied. Here, the local
community’s incentives were compatible with the national government's prohibition and, for that
reason alone, the prohibition on alternative uses was effective.

The third point is suggested by the case study of the Vicufia (summarised below in section B),
which had been harvested almost to extinction, prior to the introduction of a prohibition on its use.

Initially this prohibition met with success, the population soared severalfold, in response to
conservation measures until it neared the carrying capacity. At this pomt, poaching increased and
the population began to fall once more. An additional problem was that the vicufa is in competition
with other domesticated livestock (llamas and alpacas) over its range. While the vicufa could not
be harvested legally, it had zero use value for the local communities and, indeed, carried a
significant opportunity cost as a competitor for grazing. In the long term it is unlikely that the local
communities would have continued to tolerate these levels of competition.

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A. Conservation and development in the Monarch Butterfly Special Biosphere Reserve.

The monarch butterfly, Danaus plexippus. | Map 1. Migratory routes of the Monarch butterfly
undertakes one of the most outstanding

examples of animal migration, described as
“a unique biological phenomenon". Each
winter. hundreds of millions of monarchs
coalesce from a continent-wide distribution
in North America to overwinter at as many as
129 colonies in California and approximately
10 small sites in central Mexico that range in
area from 0.03 to 3.34 hectares of oyamel fir
forest (see Map 1).

Despite the fact that the monarch butterfly is
a common species, its migration to tightly
aggregated overwintering sites makes this
phase of its life history especially vulnerable.
Hence, the conservation of _ these
overwintering aggregations and their habitat ‘ Q
is crucial. The fact that the monarch remains SY Gaxtzos
for up to 5 months in these heavily packed mia
aggregations poses considerable problems for
their conservation, particularly in Mexico,
where socioeconomic pressures for land use
are greatest.

In California, the Xerces society secured funding for the Monarch Project in 1984 and started negotiating
protective easements and landowner registrations. Unlike California, Mexico's overwintering sites are mostly
located in communal and “ejido” land under community management, and the creation of private reserves is
not feasible for most sites. In fact, only a fraction of one of the five biosphere reserves (Chincua) created to
protect the monarch was bought from a private land owner.

The oyamel fir forest, used exclusively by the monarch, has been exploited both for commercial and
subsistence use in Mexico to a point that only 40,000-50,000 ha are thought to be left. Monarch colonies tend
to aggregate in the higher and dense fir-dominated forest. This association is the main source of limitation on
forestry activities in the region. There is, however, much controversy over which particular forest densities the
butterflies select. Some studies have suggested that monarchs prefer moderately disturbed forests, leading to
the belief that controlled forest management is a feasible conservation option and this is currently being
developed in one of the reserves.

The Monarch Butterfly was declared protected in 1980, but it was not until 1986 that the Monarch Butterfly
Special Biosphere Reserve (MBSBR) was formed by decree and its boundaries established. In total, the reserve
covers some 16,110 ha in the Mexican states of Mexico and Michoacan. The five areas constituting the reserve
(Sierra El] Campanario, Chivati-Huacal, Altamirano, Cerro Pelon and Sierra Chincua) differ significantly in
size and degree of restrictions. The creation of the MBSBR directly affected 37 ejidos, 11 communities and 5
small private properties.

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Table 1. Number of visitors (national and foreigners), total
income and entrance fee to the E] Campanario Sanctuary
during the seasons 1984-94

Gross
Income

‘000 N\S

Visitors

Total

National Foreigners
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90 \1
1990-91
1991-92
1992-93
1993-94
\1 Estimate produced by SEDUE.
Source: INE, 1992, SEDESOL 1994.

As a means of involving the local community and to
help alleviate the negative impacts of the restrictions
on logging, a local NGO, Monarca AC, and the
government have encouraged the development of
tourism in one site open to the public (Cerro El
Campanario). The promotion activities and the media
rapidly increased the popularity of the site, from some
7,500 visitors in 1984, to a peak 70,000 in 1990
before declining to about 57,000 in 1993. The
mnajority are national visitors who come from Mexico
City, whereas most foreign tourism comes from the
United States (Table 1) .

As aresult of socioeconomic pressures, illegal logging
has increased in most areas. An illegal network of
intermediaries is still in operation, particularly in
areas where the forest is not managed by the
community. Analysis of deforestation in the five
reserve areas between 1982 and 1990 shows
significant differences among the various areas of the
reserves. The least altered was El Campanario, where

there is a local tourism industry, indicating that tourism has managed to curb land use conversion. The
government’s designation of monarch reserves has had little impact on areas other than this one (see Figure 1).

Figure 1. Changes in land use patterns in the five polygons of the reserve between 1982/84 and 1989/90.

Taken from SARH 1992.

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89-
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82-
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Campanario Chincua

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Meadows and
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Open Forest
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Dense Forest

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B. The Need for Managed Development of Wildlife Resources

1. Use of wildlife is not, in itself, sufficient to establish incentives for its conservation -
management is required for use to generate these.

2. Governmental intervention in wildlife use should be directed to the creation of rents
(restricted output) and the reduction of the costs of joint management (increased
monitoring).

3. Rent appropriation is important because it creates incentives to invest in the resource.
Monitoring is important because it reduces the incentives to over-exploit the resource.

These points are best illustrated by the Red Sea Coral Reef case study of two tourism development
sites. One, Hurghada, made use of its coral reef resource in an unrestricted fashion, where the
government allowed unmanaged development of the shores along the reef. The other, Sharm,
made use of its coral reef in a managed fashion, where the government restricted development
density along the reef (tourism and fishing) and implemented a monitoring programme for
compliance. The contrasting results were dramatic. In Hurghada, development density is nearly
three times greater and the reef suffers from over-exploitation (three times as many visitors and
twice as many boats), reckless exploitation (unnecessary damage from construction of hotels and
unmanaged tours) and pollution (poor visibility). In Sharm, the restricted number of operators has
rendered it possible for them to recognise their interdependence in their joint use of the reef, and
thus they have invested in its conservation. The hoteliers in Sharm provide more mooring sites and
diver briefings to spread impacts and reduce unnecessary damage. They have also invested in
sewage controls and visibility is ten to twenty times greater than at Hurghada. Importantly, all of
these investments earn a return. Hoteliers at Sharm are able to charge a fee double that applicable
at Hurghada. It is this price differential between the controlled and the uncontrolled resource use
that is the rent flowing from the resource. It is only through governmental restriction of use of the
resource (and monitoring to ensure compliance with the restriction) that rents are created, and
hence incentives to invest in the reef are induced.

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B. Sustainable Tourism in Ras Mohammed National Park, Egypt.

The Sinai peninsula, located at the northern- | Map 2. The Ras Mohammed National Park and Hurghada.
most part of the Red Sea, is embraced by the

Gulf of Suez to the west and Aqaba to the
east (Map 2). The Gulf of Aqaba is bordered
by a luxuriant fringing reef which extends
along almost the whole 200 km shoreline
from Eilat (Israel) in the north to Ras
Mohammed (Egypt), the southernmost tip of
the peninsula, interrupted only by shallow
bays.

The reefs of the Gulf of Aqaba are subject to
few natural disturbances. The Red Sea is a
narrow and almost enclosed body of water
with generally small waves and very rare
storms; the lack of river runoff, low
planktonic primary production and extremely
low rainfall result in very clear water. These
features have all contributed to the biological
uniqueness of the area; a relatively high
diversity of corals and over one thousand ae ee
. 723 2 Ras Mohammed National Park

species of fish living in transparent, warm | ©) Res Motummed Sector - additional marine arcas
waters have formed the basis for the region's
popularity as a tourist destination.

The vicinity of Sinai's reefs to the European tourism market and Egypt's economic needs have led to an
unprecedented increase in tourism and associated infrastructure. In 1983 the Government of the Arab Republic
of Egypt declared the Ras Mohammed peninsula, a ‘Marine Protected Area’, in order to protect the coral reef
and its tourism potential. Technical assistance from the EU supported an initial development phase. This first
phase, lasting two and half years, demonstrated, among other things, that strict management of marine
resources did not need to hinder development in South Sinai. One of the objectives of the management in place
at Ras Mohammed was to show that all development in the area was resource dependent and that the
degradation of coral reefs and other marine ecosystems would limit the area's economic potential, a message
that has since been recognized by the private investors in the region.

Despite the fact that since 1988 the number of hotels in South Sinai has increased from 5 to 36 and the number
of diving centres from 5 to 26 in response to the higher demand, many of the usual negative consequences of
tourism development have been avoided at Ras Mohamed. Some of the more common effects, such as siltation
due to construction, waste water discharge, damage from collecting, fish feeding, over-fishing, anchoring and
diver damage are, for the most part, absent in the Ras Mohammed National Park Management Sector.

Measures to minimize the negative impacts of tourist on reefs (e.g. environmental education, walkways,
sewage systems, moorings) have been deployed in the RMNP, some of them state-funded, but an increasing
proportion have resulted from private investment (see Table 2), after realizing the benefits of conservation.
Some hotel managers indicated that lack of diving intensity limitations would increase their revenue by 10-
15% per year but only for two-three years at most. Indeed, a niche in specialized tourism has been created and
operators are keen to maintain it.

From a survey, the majority of visitors rated the Ras Mohammed Sector reefs and associated marine life very
highly. More than 50% of visitors surveyed rated the South Sinai reefs better than other destinations when
describing corals, fish life and visibility, respectively. This clearly shows the benefits of management and
controlled development.

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The mechanisms in place at Ras Mohammed, however, are
by no means standard in the region and the effects of
unregulated tourism can be seen in other reefs in
continental Egypt, such as Hurghada. The resort of
Hurghada was established nearly 30 years ago and rapidly
became a tourist destination for Europeans. The less
controlled development led to massive hotel development
between the coastal road and the shoreline and, in
particular, on the back reef itself. Developed under lax
regulations, Hurghada represents an example of resultant
environmental collapse and loss of an economic resource.
Use levels of the reef are much higher than in Sharm, dive
packages selling for up to 50% less than in Sinai and
providing a lower quality service. Boats are having to take
their customers further south along the Egyptian mainland
in search of less degraded reefs. Table 2 presents the sharp
contrast between the quantity and quality of development
between Sharm and Hurghada.

Successful management at Sharm has so far prevented the
resort from following the same course of development as
Hurghada. From an economic point of view, the rents to
resource “appropriators', i.e. the tourism industry, created
through restricted output, have to be maintained to
encourage resource investment (management costs). In
Hurghada, rents appear to have been almost dissipated and
the open access to the reef has eroded all incentives for
individual firms to protect it.

Table 2. Some key parameters at Sharm el Sheikh and
Hurghada. Most data from RAS MOHAMMED
NATIONAL PARK (SHARM) and Fawzi (1995), HEPCA
and Medio (pers. obs.).

Sharm Hurghada

Government Intervention

Urban planning yes no
Monitonng programme yes no
Public awareness prog. yes no

Fishing regulations

Development density indicators

Hotels 40 127i
Dive centres 27 85
Boats

Investment for conservation
Dive sites 37 30
Fixed moorings 108 65

Diver briefing (% dive centres)

Conservation benefits

Sewage pollution no yes
Infilling 1/40 64/75
Underwater visibility (m) 15-30 1-2

Anchor damage

Rents from conservation

Avg. price of package US$27

This situation is illustrated in Figure 2. While Sharm caters for specialised tourism, Hurghada pursues a mass
tourism strategy offering a lower natural quality. The significant difference in package prices indicates the
extent of rent dissipation in Hurghada, with Sharm operators capturing rents in the area P, -A-C-C,, in

Figure 2, while rents in Hurghada are dissipated (C, = P,, ).

Quantitative and qualitative supply restrictions appear to be critical for the maintenance of appropriate rent
levels. Current management at Sharm addresses both by limiting the number of boats per site, passengers per
boat, number of diving sites (quantitative), while also providing environmental awareness talks to the visitors,
requiring appropriate sewage systems and infrastructure designs to minimise damage per visitor (qualitative).
These findings stress the need for regulation to complement and, direct market forces to generate conservation.

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WS ym hh a mia ihe. evan vi fh aly odd witre Ma “mil Ale *b Eastin ayia if
i EPG oni ive eat he Tae ie Se thie ian yitinan ds Gar ae
= eG i} ; fee wna meal / ANS oe Eb hi is Ji vied aa (

) x oieal owt Beale

1 ‘PcStgnen one aa oat oeod? ao ine

Ve
: Je atenrgniyrt) Ps aun enane Sale:
by a a is oe merch we
f Vy tay Witileer (ast Sak atu
; if ble owt veh avad MED:
i : AES hte WR) sea peiy
free eter: al a HG WEA ot Oe
wi Eg hs lat A wa hea Led ae <4

ftiwser tad oye pith hd, : eee
} ot A Oh hetlhes at <i Chenier ei

ere kamen yous Tee
i ° a Serial head zn tian
Ci aA Owilereopy rote Waive tte We
evn Sais puss

Figure 2. The regulated (Sharm) versus unregulated (Hurghada) tourism.

Price,cost Unregulated

Specialized Regulated supply cost
Pi |bosts ea ers tourism supply cost (Hurghada)

“mass”
tourism

Pu =Cu
Cm|- - ===
Demand
Xm Xu Diving intensity
3,500-20,000 50,000-75,000 (dives/year)

Notes: By controlling and restricting the access to the reefs, operators in Sharm are able to maintain prices (Pm) above costs (Cm) and earn a
positive rent from the resource at the regulated level of diving intensity (Xm), represented by the shaded area. In contrast, the lack of control
allowed the significant expansion of the industry, to a point that tourism related damage reduced the quality of the reef. Moreover, operator costs
are increasing as a result if the search for better reefs and they are forced to lower prices to maintain their share im the market. As a result, rents
from the resource have been eroded and operators charge prices (Pu) equal to their cost (Cu) at the unregulated level of diving intensity (Xu).

The fast future growth expected in Sharm will have to be counterbalanced by maintaining current incentives to
protect the reef at the tour operator level. This will not only depend on the enforcement capacity of the
management authority, but also on the continued existence of positive rents to be gained from conservation

investments.

_ i beste dane beta gaeree wv aval. la)
; aeniigen ari Ls Pi. cencinal
, 4 .
0 F Te ae Te digit oed ost eae ney: Lefer ne
= ie ve | Peamoyttalie SS emant 4 !
: , pares ' i w
\ a - }
a Pay dl 1) i
i. a ; oa
- : —
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; = ; f aoe = i“
i ;
hat ce Se al tn He ag — — oe)
y oS

wr.) tee

7 o a di pale al CMY ae VE ae hie
as: (Gita aie A He aa eer ae he, ee

wore Te yy pa recta aiete FE '
serene icy erlgcyas fs aed 2h hele
SS er er ke.

sade Menu fh as Sing ivy ad Wiles “a 9
Fath or PT ea ee AUIS eof evigats ele oe
Wey evi ay nian ail), a ai me ine

| C. The Respective Roles of Individuals, States and International Institutions in the
Management of Wildlife

1. There are distinct roles for several different levels of wildlife management: individuals
and local communities, states and international institutions.

2. Financial incentives will induce individuals to manage wildlife resources in the social
interest, with two provisos: a) they must be made to perceive the full social cost and/or value
of the impacts of their decisions with regard to the resources they are managing; and b) they
must be made to perceive the value of cooperating with others in their community with
regard to the resource.

3. The role of the state is to correct individual incentives where they conflict with the social
good, and to maximise rents from the use of the resource. This means that states should: a)
internalise costs external to the individual's decision making framework; b) aid individuals
in contracting between each other for this purpose; and c) implement policies that manage
aggregate production from the resource.

4. The role of international institutions is to aid states in accomplishing their objectives,
when certain of their problems transcend national boundaries. This means that
international institutions should: a) internalise values of wildlife that exist beyond state
boundaries; and b) aid states in implementing their rent appropriation policies.

These points are best illustrated within the context of the Southern African Conservancy Case
Study. In Namibia in 1967 the state took wildlife management in a new direction by devolving
management of all wildlife on private property to the individual landholder. Despite fears of
uncontrolled harvesting of wildlife, the opposite has been the case. The number of species on
Namibian private lands has increased several fold, and the total biomass of wildlife has doubled
over this period. The financial incentives to use wildlife resources are substantially greater than to
use domesticated livestock over much of the arid range of southern Africa, and individual
landholders are acting in recognition of these incentives.

The state retains important management roles in regard to the wildlife resource, even when
individuals are given a recognised or primary management role. First, the individuals only respond
to the financial incentives to invest in wildlife, not the socially correct ones; this indicates that the
state has a role in internalising external costs. For example, the landowners in Namibia are not
only re-introducing the wildlife species once eradicated by active government livestock
programmes, they are also introducing exotic species demanded by big game hunters. These
exotics have potentially large ecological cost, and it is the government's role to make certain that
the individuals bear this cost when making this decision.

Secondly, there are many other externalities of wildlife management which individuals may be able
to internalise through joint management with one another. This has occurred in southern Africa
through the emergence of the conservancy movement, whereby neighours join together to manage
their property for wildlife conservation. This has resulted in the removal of interior fences and joint
investment in the provision of water and the re-stocking of wildlife species, investments that would

ital

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have been impossible in the absence of cooperation to increase the scale of the operation. The role
of the state here has been to aid these individuals in the enforcement of their contracts. The
conservancies depend for their success upon the monitoring of individual use of the joint assets.
Namibia provides this monitoring by means of the requirement of a state-licensed guide with each
hunting party and the requirement for annual state-monitored wildlife censuses. These auditing
roles of the state increase the efficiency of wildlife management based on individual incentives.

Thirdly, as indicated in the Coral Reef case study, the ultimate objective of the state in wildlife
management must be the inducement of individual investments by means of restrictions on
aggregate harvesting. Overuse, even in the aggregate, drives down the prices for everyone, and
restricts the availability of rents. The state should always look to restrict entry to the market in
order to maintain high prices and rent-induced investments.

These points indicate the nature of the role of an international mstitution as well. There are certain
of the above roles of a state which extend beyond its borders, and hence cannot be managed by one
state alone. The southern African wildlife case study provides a good example, where the focus is
on those uses which produce the greatest appropriable value. These tend to be uses for which
travel to those countries is a requirement, i.e. tourism and sport hunting. There are other values of
wildlife which do not involve travel to the host state, and these are less easily appropriated by the
host state in the absence of international cooperation. For example, a pilot study in the U.K.
indicated that the average person might be willing to contribute £10 for programmes to ensure the
conservation of the black rhinoceros, an exclusively southern African species. It is one of the roles
of an international institution to enable the host state to appropriate such transnational values so
that they may be applied to conservation there.

An international institution may also assist in the pursuit of other objectives of the host state, such
as the monitoring and enforcement of rent-creation policies. Whenever the producers of a wildlife
resource are in one country and the primary consumers are in another, international cooperation
will be required in order to implement any sort of policy directed to rent maximisation. For
example, producer states might need to implement an aggregate quota on production, and
consumer states could assist by monitoring imports and restricting them to designated quantities
and suppliers.

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WET preter 4 alt we. panne veftina” it ee ayia bs i fe OF
| eed Aen, AT ver gag |) dt ait Ww at right nate oat ar Pa ESE 1) Ot
fans tien shioy ai NTA, Ny tre ei AALS aman vit Boron ae

ae pels pirrinee areas? bev itomrye tana Hh te) VT Irevcaeemayey tt ai OS
f weoadisinstce outed ter sees oi] wy pie By tows edt ult seer rad 3 TAS BO

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C. Conflicts in Wildlife Conservation-The Role of Property Rights: the Southern African Conservancies

The southern African conservancy movement | Map 3. Tne Khomas Hochland Conservancy, Namibia
originated initially in the legislation passed
in 1967 by the South West African (now
Namibian) assembly by giving “the owner
and occupier of a farm full ownership of all
game, other than specially protected and
protected game, while such game is lawfully
upon such farm and while such farm is
enclosed with a sufficient fence." It was this
“privatisation” approach to wildlife that
generated an entirely different management
system for the wild animals in what is now
Namibia. Subsequently, nearly identical
legislation was adopted in Zimbabwe,
extending these rights of ownership to
commercial farmers and then to communal
areas in 1982.

Once private property rights in game species
were in place. the individual landowner had
the capacity to capture the use values of
wildlife on his land. The immediate problem
facing these individuals was that in many
cases the individual landholdings were
insufficient to support the range of the wildlife species. Much of the Namibian territory is extremely arid and
wildlife must range across large territories in order to browse successfully and to locate water supplies.

Although individual ranches are usually very large (c. 5-10,000 ha), the individual range of many of the
wildlife species in these arid districts is often even larger.

The solution to such problems has come with the establishment of a contractual relationship between
neighbouring landowners providing for the joint management of the wildlife species that range across their
lands. In such agreements, between ten and twenty landowners join together to establish a common outside
boundary around a more substantial land area, and principles for the joint management and use of the wildlife.
In Namibia there are at present four conservancies: Ngarangombe (100,000 ha), Waterberg (150,000 ha),
Khomas Hochland (130,000 ha) and Black Nossob (130,000 ha). Each of these conservancies has been
registered with the Namibian Ministry of Environment, and has agreed to certain regulations governing its
registration; such a registration is necessary in order for the landowners to have their land designated for joint
management.

The conservancy concept constitutes a solid groundwork for the joint management of game species by both
getting the individual users involved in the development of the control policy and by having an outside
presence involved in the implementation of that policy. The former element is important in making the policy
acceptable, and thus enforceable at least cost. The latter element is essential for providing the assurance that
all parties are complying with the agreement, removing the incentive to free-ride on the others’ compliance.

The key to this programme is the values that these species generate, and the benefit sharing system that has
been implemented. Each hunter must pay a trophy fee for any animal bagged on the conservancy property as
well as for lodging and a licensed guide. The hunter is recruited from Europe or the U.S. and his lodging fee
is kept by the landowner who recruits and lodges him. However, once the hunter is within the conservancy,
the individual conservancy member is welcome to hunt on any of the conservancy property. The landowner on
whose property the game is bagged is entitled to a specified share of the trophy fee, and the conservancy itself
receives a further 5% of this specified fee; the recruiter conservancy member is entitled to the rest of the trophy
fee as well as the lodging fee.

iS)

ee li ee ee =m
mance Witare ad? syn HF i tea eat
ree hg ee te eo mast le were May Pont : : a
i eae 4A Pa atin > Wy Speedy pe ite) eI prey an tls
‘ q WTS (oy irae vat
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|
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bial Atel Te sath Qoe > re *
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AY tans 7 cc, Bohan

aN Cage Sew cies wow -
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ca Has o Seite co one od gin
PL capt: Sala iyirh, Yo. tine

This benefit sharing
arrangement allows for the
various landholders to share in
the __ benefits of game
ownership, even if they do not
themselves engage in
Tectuiting and lodging trophy
hunters. All that is required is
that they participate in the
joint management actions that
enable the use of their land by
game species. In addition, the

_ Namibian Heculation of the Conservancy Movement

The state ee that affect ae members of a Namibian conservancy.

- the conservancy must have a common Douney within which all
jandowners are members

- the conservancy must have a secure extemal fence marking its boundary
- the conservancy must have a constitution governing its objectives and a
standing committee responsible to the state for meeting those objectives

- the conservancy must provide for rules concerning management and use.
(benefit sharme)

= Taanagement rules must provide for ongoing monitoring of _ specified
characteristics of the game: ‘Species (e.g. populations, trophy sizes, sex

levy collected by —the | ;atios) and it must allow the state to participate in that monitoring
conservancy itself is used tO |_ the conservancy must provide a state-licensed guide on each trophy hunt
fund jointly beneficial

management activities,

including restocking of game
species and the construction of
exterior game-proof fences.

Therefore, as a direct result of the financial incentives inherent in the privatisation of wildlife within Namibia,
private landowners are in the process of removing fences erected earlier this century and re-stocking species
that were eradicated in the process of these earlier conversions. In addition, it is clear that these are only the
first steps down the road toward wildlife-based land uses. Conservancies continue to look for members and are
in the process of importing other wildlife (giraffe, impala) in the hopes of developing the ecotourism-based
values of its lands as well.

The analysis of economic

_ Joint Management Actions of Cie te ection Coreroney 2 EO 2 AERA DRESS A

land use models at

int management | actions taken by Khomas Hochland conservancy since } an f
ation in Sepia 1992, Tae included: — S eae? a e
operation offers

important insights into
the economic forces at
work. First, there is a
positive financial return
to game ranching on
Namibian land, even at
the individual landowner
level; however, it is
apparent that this is nota
socially beneficial use of
capital as the rates of return are relatively low for this economy (i.e. in the region of 4-5%). The economies of
scale realisable when several landowners work together in the provision of wildlife services changes this
picture quite dramatically. At the scale of most existing conservancies (i.e. c. 100,000 ha.) the rates of return
increase to economically competitive levels (i.e. 8-10%). This is the incentive for the creation of these large
landholdings under joint management. Even more importantly, when the real social costs of the factors used
in these operations are evaluated (rather than the prices actually paid) the rates of return to a conservancy
escalate to a very impressive level (i.e. 13-20%). These studies provide a picture of privatisation-led land use
determinations (through fiscal incentives) that are generating substantial value for the society as a whole.

‘reduction of the cue soca levels: on 1 the conservanc:
pening of waterholes to game during the dry season:

emoval of two wire strands from the interior. fences: ie
‘erection of game. foe fences on some: of the exterior ‘Doundary

evelopment of common marketing organisation (broche re, agent).

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ed at yim sida 2-cavogy hn (la :
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hw ae

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ee ne
deat A vel

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Governmental Interventions - Land Use Conflicts

Interventions Required for Market Determined Optimal Land Uses;

Remove distortions in market prices ‘of factors used and products produced im alternative land uses
Genel subsidies, labour-based taxes)
= Introduce charges for internalisation of social costliness of alternative land uses (e. 2. erosion cost ,
pesticide accumulation internalisation)
> Install mechanisms that allow for all ranges of values to ae with ee not only the most
direct forms of use (e.9. land banking and compensated zoning schemes)

Ynterventions at the Conservancy Level
*Flow Monitoring”- monitoring the rate at which wildlife is bemg used consumptive.
s S tock Monitoring'-monitor the stock of wildlife periodically.

The privatisation of wildlife within Namibia has contributed to the significant increase in wildlife numbers and
biomass (70% and 85% respectively) over the 20 year period between 1972 and 1992. There appears to have
also been an increase of some 44% in the diversity of species. Therefore, the impact of privatisation in Namibia
provides solid evidence of the incentives that this programme has created for the conservation of wildlife.

In Zimbabwe, a similar phenomenon to that in Namibia is occurring, with the expansion of wildlife use on
private landholdings driven once again by the financial incentives for the use of wildlife rather than cattle. The
contributions of the Conservancy movement at the national scale are not insignificant. The Save Valley
Conservancy alone represents about 1% of the land area in Zimbabwe, and more importantly, it has increased
the land dedicated to wildlife by 6%.

These findings illustrate that financial incentives are an important keystone for building a sound land use
policy option, while the government has an important role in correcting obvious policy and market failures. It
is important to note that the government plays an important role in the Conservancy movement providing the
assurance of credible monitoring and enforcement structures within private joint management regimes. It
requires the presence of a state-licensed guide on each conservancy hunt, enabling each conservancy member
to monitor its partners’ benefit taking. It further requires an annual state monitored stock taking excercise in
order to audit the general performance of the conservancy.

The conservancy movement in southern Africa represents one of the most dynamic and hopeful trends in
wildlife management currently taking place. Southern Africa is probably the only place on earth that is
currently expanding the amount of habitat that is available to wildlife species on a significant scale. It is
interesting that this movement is occurring in an area that has abandoned traditional wildlife management
practices in favour of a market-based approach. Here, the forces for development are encouraging the adoption
of more wildlife uses of land.

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ss Da etapa, £2 ig mba. Lowery t WHET H

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ava, ae DOI ae “4

a ia Lear oo hag

D. The Role of the International Institution: Monitoring and Certifying Habitat Use

1. Most of the conservation value of the sustainable use of a species is related to natural
habitat, not the species in isolation. There is little conservation value from ''captive
breeding" of wildlife itself.

2. Certification should be used to induce investments in stocks of species in particular
habitats, and hence "sustainability" should have, as its primary criterion, the maintenance
of stocks in designated habitats.

3. Sustainable use must be based on some agreed indicator of stocks in the wild, by
including: surveys, population analysis and flow analysis.

‘The Papua New Guinea Crocodile Case Study illustrates these pots. In that country, and others,
large crocodile farms have been established as a means of supplying the trade in reptile skins. There
is little conservation value in the establishment of captive breeding operations, as it merely translates
what was once wildlife into the domesticated sphere. The conservation value of wildlife use is in
the creation of an instrument by which the investment in the retention of natural habitats may be
compensated. Crocodile farms in PNG satisfy this criterion by means of their dependence on wild
breeding stock: that is, the crocodile farms operate as "ranches" in the sense that they procure much
of their required inputs (eggs, young crocodiles) from the wild.

Incentives for sustainable use at the individual level may be induced by means of certification
programmes that afford certified producers special access to markets; the crocodile is once again a
good case study. Many of the populations of crocodile were initially listed on Appendix I of
CITES on account of their endangerment, and this denied lucrative markets to most traders. Some
populations of crocodile have been "downlisted" (allowed into trade) under exemptions granted for
demonstrably sustainable ranching of wildlife. On account of this exemption, there is an incentive
for the traders to demonstrate that their use is not harming crocodile populations, in order to keep
their businesses intact. This incentive has resulted in the creation of a management programme to
restrict the harvesting activities of individuals supplying them. Traders have even paid for the
monitoring effort which certifies that stocks of crocodiles in the affected habitat remain relatively
stable. These management activites are all induced by reason of the CITES certification mechanism
which promises a market to those regimes which demonstrate management activities.

One of the most difficult facets of the certification process is the establishment of a criterion for
sustainability that can be monitored. The first-best criterion is one which demonstrates that a
management regime is able to set a stock target and then achieve it; second-best is a demonstration
that populations do not decrease significantly. Such criteria need to be fully specified. Actual
population trends are virtually impossible to measure for most species; in most cases, some sort of
indicator must be substituted. In the case of PNG crocodiles, an aerial survey is conducted of
nesting sites and, from this information; a rough trend regarding adult crocodile populations trends
is obtained.

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bisstonndle wi vate 2 Aer! asi vuln wilt hs ga
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4 ws ice He

j . :
oirigir nh HAL Lbs TAgtt

nm} ; Biase ae oe ay ic) ; wy
pe | he pal Ty ai. Sites é - y
pbtaton cold. gages ca
mie ts ‘ol rama tse ne x ;

ia
ite at #8 a Mot, Leda a

D. The Crocodile Industry in Papua New Guinea.

There are two species of crocodiles occurring | Map 4. Distribution of C. porosus and C. novaeguineae in
in PNG, the endemic freshwater crocodile, | Papua New Guinea

Crocodylus novaeguineae and the saltwater
crocodile, Crocodylus porosus. Their habitat
extends through most of the lowlands of the
main PNG landmass, and C. porosus is
believed to be the only species in the offshore
islands (see Map 4). Prior to European
contact, in the areas where crocodiles Were
plentiful the native people hunted them for
food, with the eggs and younger population
most heavily used. Commercial shooting of
crocodiles in PNG started in the mid 1950s,
in particular, uncontrolled shooting of
saltwater crocodiles from upwards of 150 cm
in length, which over the period 1955-60
greatly reduced the adult population. This
decline in saltwater crocodiles was soon
followed by increased hunting of the less
valuable freshwater crocodiles (see Figure 3).

By the mid-1960s, the industry showed clear
signs of over-exploitation of both crocodile T1 istrbution of C. novaeguineae
species. Hunters targeted the remaining large
breeding stock, greatly affecting the regeneration potential of the species. Besides, poor international
marketing meant low prices throughout the industrial chain.

It was believed that effective direct control of the hunters would be impossible to achieve, given the extreme
isolation of many rural communities. Instead, control over the intermediate stages of industry. traders and
exporters, was expected to affect hunters’ behaviour in a positive way. After the hunting peak of 1965-66. a
management programme and legislation was introduced to maintain the crocodile populations and manage the
skin trade. While other crocodile populations were listed in CITES Appendix I worldwide due to their
endangerment, all crocodiles in PNG were retained in CITES Appendix II to allow for a managed trade. A
licensing system for traders and exporters was introduced.

Figure 3 .Historical data on crocodile harvests in Papua New Guinea, 1955-1993.

Live crocodiles
80,000 O Wild Skins

Licences for traders,

70,000 Licences for
traders and eee L
60,000 hunters angeme nny
4 Ban <7"
Ss Freshwat
i 50,000 ee Ban > 51cm
S harvest peak
= 40,000
2
= 30,000
Z
20.000 Few European traders,
Mainly Indigenous hunters
10,000 saltwater skins
0
w ~ a = Gal Va) i fon al on Ya) ia a al Gal a) CS lon _ Gal
al a) w \o \o \o \o eo} = ~ i= = = ao co oo co o nan n
Sie eR AES ICON) FI CO nS ON Gy. OS I ONS

tinh monte ee ee ee a eT Te — A _—
erg partie tyre ¥
So
ier i SPV aways “h t UD
Wulebs + eee? aiieel lL! rite’

(Wei

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core)

Way Mies re wee |

ay ) ui Ete "
KS io ile fy!

f Hy hrontielt SB i, ; aL

dw ro, Ke ee
eae fy at eat ry

il tas GNF fos PT via | aM Fr ial up

an pitas; 1a SOME GON ee ru)
, ill hg ii x HY npg nN 7 a ar a

_ Beah orate en: M 2soF elias Raat a Fete

i Vena
cu ec |

| Since then, the management system has allowed both the hunting of wild crocodiles and a thriving trade in live

animals. The relatively high prices offered to hunters for live animals has resulted in a very active live trade
(see Figure 3) and hunting effort appears to have been partially diverted from large crocodiles for the skin
market to small live animals for the farms (see below and Figure 4). These findings indicate that the existence
of an active trade in live animals is having a positive impact on the conservation of the species, reallocating
hunting strategies and efforts.

Figure 4. Indicator of hunting effort for C. porosus. Higher the selectivity implies more effort is exerted on that
cohort. Excludes live trade.

0.07 + Higher targeting of large
> SWiEapua crocodiles in Papua
2 0.06 = —— SW New Guinea
S
Ss 0.05 +
= Higher trade in small crocodiles may
= 0.04 indicate mortality of small crocodiles
= 0.03 + intended for live trade
3
5 0.02 + Differential mean selectivity sizes
= reflect the hunting bias towards
S 0.01 smaller crocodiles in New Guinea
0
lo) +r \o ao nN vr \o co So
_ Nn N N fsa) ise) an foe) om wT + vr wT vr wo

Crocodile size expressed in belly width (cm)

At present, crocodiles are hunted/trapped by individual village hunters with previous knowledge of prices and
conditions, they then sell their live crocodiles and skins to registered traders. Traders, who are normally
members of the community, are permitted to operate only within a certain area, which creates an incentive to
maintain specific populations. This contrasts sharply with the unregulated market where itinerant traders have
little conservation interest.

In order to improve the marketing conditions for hunters, the government established the Skin Marketing
Service (SMS), to assist local hunters internally and the PNG industry externally. The first objective was
accomplished by the creation of an alternative direct marketing source, the SMS, which would buy at better
prices than intermediaries. This simplified and made more transparent the trade structure, in preparation for a
private system taken over by licensed traders and company buyers. The SMS also suceeded in creating the
necessary market power for PNG exports.

The need to maintain international certification has created incentives to monitor wild populations in order to
demonstrate sustainability. Both large farms and the exporters of wild skins have a strong vested interest in the
maintenance of the trade, which effectively means keeping the CITES Appendix II listing. In order to do that,
monitoring mechanisms such as the aerial population surveys and the costs of issuing CITES permits have
been financially supported by the industry. The interest of industry in the continuity of the monitoring and
enforcement system is a positive outcome of use, with much needed support in times of financial difficulties for
the government, although care must be taken to ensure the independence of the state’s monitoring mechanism
(see the Conservancy Case Study).

The CITES Appendix II ranching resolution has provided the certification mechanism required for the creation
of incentives for the sustainable use of some other crocodile populations; however, the dissipation of rents at
the international level, due to overproduction of crocodilian skins worldwide, indicates the need for
international coordination of conservation/production operations to ensure adequate production levels to
generate revenue for conservation. International institutions need to focus on both roles: certifying
sustainability and generating rents.

; Ove) tt atlan! gare seat) ge hie robitewrerir Mdpe oe tin Pe OT Wiidh: at vie nee

Shee al svete wrens § eo Eeilemer de) ulioanass) A et seein OT oy ;
ety ail) Wd elie: apt pr eat lea) eet et ee cg te) colton
sient wl) reat) eakotlon wpb voy ule DM ee het oi OT A
Sila) 2a 20) AB PhD ENG ere) wah toe: aval

ee 4 : ; : a

oe 7 Anarene nha Sh hetrendky ull poh il nomny > che, Gehan ee aeialn SER a

ane f STAY: AD ig 0 chs i be

Pie of, eee
7 7 : aa) Ch a et
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meni Wor bindoPus A alk ‘-

sere Fyiby 4 wiew§ \eetiPetiate Ai broys atid aes 4
Y aelhsn: itn 7 ayia IPG, DEA sk Lema
ie MS hahy + iltee wire um pai fe akebiu yy ed:

medicnancael 2 ay eal y

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patency Lesh) cami, ie, 1 ie ch
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i rayne Sis Pb uiis Sarre: #¢

ena’ eae 4 aha |
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ners eesti (iva ace
dhe p Gale ni “aan a tnt rat

BT vavbayhy coe "
cad at eons

i mines cochia
: ierng Pate Pat

Rr Wilco) gare renal y
Binet acy “dhe

E. The Role of the International Institution: Generating Appropriable Rents

1. The object of an international institution must be the generation of the maximum
appropriable rents to those production systems which are certified as sustainable.
Management must not simply allow trade or ban it.

2. The international institution should attempt to achieve the maximum rents for the
certified producers by: a) determining a revenue maximising aggregate quota and allocating
it between certified producers; and b) investing in the monitoring required to ensure
exclusive purchasing from certified producers.

The Vicuria Case study illustrates these points. A simple ban on the use of vicufa initially provided
the necessary management to reverse the decline of this species. However, as the species expanded
‘to its carrying capacity, poaching resumed. One factor was the reluctance of local communities to
share their lands with vicufias, which were believed to compete with domestic livestock for grazing.
The alternative for them was simply to replace them with domesticated species.

This pressure could be counterbalanced by some sort of management system that would cause
vicufia production to be as lucrative as the alternative land use: llamas and alpacas. This could not
be achieved simply by allowing the trade to resume in an unmanaged fashion; instead, a producers’
cooperative was formed which allowed all products to flow through one channel. So long as
consumers agree to exclusive purchase from this conduit (and enforce their agreement), the price of
vicufa products can be controlled through restricted sales.

International institutions need to induce consumer states to agree to provide exclusive markets
to those regimes which are certified as sustainable. This enables the certified producers to
receive the greatest rents from their production, and hence have the greatest incentives to
invest, provided they form cooperatives that determine aggregate production and allocate
quotas. The price differential that results (between that afforded the certified cooperative and
the uncertified suppliers) will be the rents that flow to sustainable management. This price
differential will only be maintained to the extent that consumer states agree to provide
exclusive markets, and then monitor and enforce this agreement.

ALS)

| ralE alrite ee thoes = ,ncbeheriahy

baad te, poidecesit wt Eo ‘teas nities teats cyan na ta
aya yy halle siylinhepe bar fh Bh wit birt

When ie a ttt sible Wiis, Jota

7" : a am dimhien. we re ae ‘Yrgtexsaats falagerrt> rr tga thee aera
ie ae putnioetn Daw arn egarayss Gor Init oi, ea 3 bape Tes ie nribe,
joie - orechaiies a 9 Tecan aytiowl gules fist teh Fete (ens uierey bat

Mts sti be stinis une rg Ey;

vis a wget a Ah a lhe ami f ane hahen a 4tiead “Mt vi nie we
ose “meh tye waa We patient ie BEV iM erg
bah ext) cae: areal PRS, hemetyesy iilenginy

’ eS Dovialod Ope gat iespeas tbe ine

- ab ing inte. eer tas MGA ea ei i 7
, 0 ays al in Rae Sionsilp 2 aa
, at as su raivearesity ye et epee coh i ne
ie gia PU hve fy 1) Sat nl wrireodle wey
UMAT iy prcategity Me Loveth. Avner Geetem

sa a pi ah OF RATED yf erate
‘abies p AD) Aas vena Eben es a

ceylaere inlihg) yeni i beta
Pi IT shrindhixtowiown teAltinrn wie.
yr cpg Makuinany vice) where) agra
_ ark Hai Sener iawn ence NE
eves aiaahyat). utes Sort laine TH ag se
a oT ft Yt Daeg: dats atl (per ayn ye val
Ha a Siesad can at eee i yi

E. Commercial Use of Vicuna

|The vicuna (Vicugna vicugna) is one of the | Map 5S. Distribution of Vicugna vicugna
South American camelids along with the
guanaco (Lama guanicoe), the llama (Lama
glama) and the alpaca (Lama pacos). While
_vicuiia and guanacos are wild, the llamas and
alpacas are their domesticated counterpart, a
process of selection that appears to have
started between 7,000 and 6,000 years ago.
The vicufia inhabits the Andean highlands,
between 3,000 and 4,600 m. Its range
currently extends over large areas of Peru
(80,000), north of Argentina (23,000) and
Chile (25,000), and west of Bolivia (12,000)
(see Map 5).

Hunted for their precious wool, which is the
finest in the world, the vicufa was near to
extinction by the late 1960s. With the
European invasion, a trade in fibre was
developed, involving the killing of the
animal. The few attempts to regulate the use
of vicufias up to this century failed and
uncontrolled hunting continued until the
species reached near extinction, with just an
estimated 10,000 individuals left in the 1950's.

Vicuiia wool has been long praised for its softness and fineness. Its current scarcity also adds to the high prices
commanded by the few items traded internationally. Vicufia wool (or rather fleece) is regarded as a luxury fibre
along with Alpaca, Angora, Cashmere, Camel hair, Mohair, Musk Ox and, Yak, which are noted for their
fineness, scarcity. unique appearance and status. It is a very exclusive market, with production of all luxury
fibres representing less than 3% of annual sheepwoo! production by weight. Vicuiia is considered the finest and
rarest of all, and its softness and colour are highly valued, commanding the highest prices.

Conservation efforts to protect the vicufia started in Peri in 1969, with the creation of the Pampa Galeras
National Reserve. Subsequently, range states have coordinated conservation efforts through several

Figure 5. Total estimated vicufia population in Pert, 1965-1994.

CITES Custody and
120,000 + ratified neo
eli het a communities | Ajj p. App. II.
100,000 1 Vicuiia agreement Fa ee Se ae export.
and Pampa : SPs \
2 80,000 | Galeras created ; ' ic bed
= ' 1
$ 60,000 Some pop. moved App I : E. ; an
3 >App II : he
£40,000 + Cloth trials. eines
No trade. ! '
20,000 J : ;
0 :
Val i a = al Val io fon = Cal vel io a = Gal Val
\o \o \o i io lo" CC (oe ao o co co ao an n an
x S Ss 2 2 3 2 2 SS Ss Ss es oy 2S Sy =

agreements. In 1969 the first agreement for the protection of the vicufa was signed. Peru and Bolivia signed in
1969, with Argentina joining in 1971 and Chile in 1972. The agreement banned all international and internal

ms
} ‘ b
are aaron ich-e arg ree ae my os Saari gtacami iL ;
; Goa WiPrgy it % ib Dapeeendn ae yuNe | SNE
3 or ag F ’ eh
SOPs tincinoe gigh ~ —— fh SP a he

10m caer! BS ; of sii od. Pee

7 Sate nae Uke il cy ae
z : a rhe & ‘iuceg ee

‘ jens oe) Pike 4 AVENE Lyete, ete 7 .2ot Segba

Pole ep Pci / elbethoel earn (ortip. <0

eA) Duvet reli De 47

hey gh at ge Abs 4 7” f
Hn 4 Oia ya eas teal Mas

vio hi bt

f ' gaguee eon aes: We tip 0 Tein Kat,

Ais GST ales" 28h ectoowy wk
Ad “elas sires — aengrrd ey

| trade in vicufia products and prohibited the export of fertile individuals to third parties. The vicufia was also
listed in Appendix I of the Convention on International Trade in Endangered Species of Wild Fauna and Flora
(CITES) in 1975, ratified by all range states and banning all international trade in the species.

These coordination efforts for SS
| conservation at the international level Ce piseree pie irene

created a strong base for cooperation

among range states. As a result, the

| vicufa experienced an impressive

| recovery during the last 30 years,

particularly in Peri (see Figure 5)...
| From an estimated 6,000 over the four

range countries in 1965, the vicuna

reached 10,000 by 1970, 101,215 in

1983 and around 154,000 by 1992.

However, financial and _ physical

requirements to effectively protect

those areas has not grown at the same

rate.

Studies in Chile suggest that the
vicufia population has reached the
carrying capacity of the habitat, given
the existing livestock. At the regional
level, some areas show significant
overstocking, as in the Lauca National
Park. As populations recovered, the
competition over habitat with

domestic livestock (llamas and Sage

alpacas) increased, being this one of + Ascccin Se Conmnidates Canpesinss Crindores Ge Views y res camblidos ela Resta Los Libcradores War

the factors behind the increase in fa as Coa ae Cana on Ves wegen Toe pce

poaching. These factors made the —E_E ETE

involvement of the local communities essential for the long term protection of the species. One way to create
incentives for conservation and protection of the vicufia at the local level was to reopen trade in vicufa wool,
which can be extracted by shearing live vicufias with little impact on wild populations, and generating revenue
for local communities. This was the philosophy behind the second vicufia agreement in 1979.

In recent years, initiatives to reopen a legal trade in vicufa fibre have taken concrete form and Pert and Chile
are already exporting/processing vicuiia fibre for commercial purposes. In 1986, the trademark ~ Vicufandes"
was registered and some populations in Peri were downlisted to Appendix II in CITES to allow export of cloth
made with fibre from live animals. In the last Conference of the Parties (Fort Lauderdale 1994) this was taken
further and all Peruvian populations were downlisted to Appendix II. The downlisting was conditional on the
trade in fibre from live vicunas.

In Pert in 1991, legal reforms altered the status of the vicufas in communal lands, returning them to the local
communities in usufruct and custody, thus enabling their use under state regulation. Communal Vicufa
Committees have been created since then as a means to protect, negotiate and regulate the use of the vicufa,
complementing state protection. The National Vicufia Breeders' Society (NBS), encompassing all regional
associations, is the legal body representing the communities.

Since Vicufa fibre is difficult to process given its fineness and relatively short staple length, the management
authorities sought to create a joint venture with the industry. In order to get better prices, the NBS put out for
tender the processing of the stock of fibre accumulated until 1993. A total of 2,000 tonnes of fibre and 200
metres of cloth from early trials were offered. The tender was for a two year participation agreement, requiring
the applicant to guarantee a direct processing line to the final consumer.

Ayal

- alexeye Ehwaly col? aneraieg tobi) ve alengtier ta albrie\ibs te ae
iP deg sath? GHA Yh congrats WARY Heeoduir,* yee OPEL
sath het sey trainers wi ts SIDR ih Miide wat

Sosa rant

=~ serra Ses —
| ,

Hievern. ig ga
be Oe ed wa ab a ms
(Wie og ee eva ee

i tA | ee

ve ides —
a ot reer

trots distin « Pig ay wa nee
SHS ce matte ¥ J a a

nor de
ee te nc HE

SO ese.

Pret all ad pais. nertgt site nese ews =
Cibcregeer yy! aaread? vit tee

aa 4
i aye le aA! tS G4 ary hey

es he MSE phe = pr fe iy oy a is

The resulting agreement was very advantageous, and several funds for development and conservation were
secured. The International Vicufia Consortium, the winning Italo-Peruvian venture, gained in exchange
exclusive use for two years of the trademark and marketing of existing stocks of fibre. Figure 6 illustrates the
various aspects of the agreement.

Revenues from the agreement will be channelled back to the communities through the National Vicufa
Breeders' Society. At present, Pert's Rural communities are collecting fibre for the next tender which should
take place in 1996.

Becilbl ie tthany Hi

par gererery aes me a ee wi Thi:
on aids ihirtwe podem wae serait wd Sega Pols

F. The Need for a Sustainable Use Certification Protocol

1. The sustainable use certification should occur within the context of an international
multilateral agreement.

De A protocol to the Convention on Biological Diversity for the establishment of a
sustainable use certification mechanism is necessary.

3. The mechanism should be extended to apply to the widest range of values possible,
including non-use values.

As indicated in the case study on certification, there are at present a large number of formal and
informal certification programmes. Many of these comply with many of the principles set forth
above. Nevertheless, it is important that this plethora of programmes be replaced by a single
multilateral mechanism for accomplishing these objectives. There are two primary reasons for
doing so, both concerned with the establishment of the credibility of the certification mechanism.

First, the fundamental purpose of the establishment of such a mechanism is to allow consumers to
convey the additional value that they attach to natural habitat back to producers who sustain it.
The only task that must be accomplished in order to attain this object is the development of a
credible mechanism for assuring consumers of this result. A legal obligation by the consumer state
to monitor and enforce this mechanism, together with an international auditing mechanism to
confirm this, is the highest form of assurance that may be achieved.

Secondly, sustamability must be assessed according to an agreed criterion, not a multitude of
possible standards. An international authority would establish the international scientific committee
required to agree consensus-based standards, and it could establish the international monitoring
committee that would agree the basis for surveying with respect to those standards.

The development of a single multilateral agency to perform these tasks would eliminate the
wasteful replication involved in the establishment of numerous unofficial bodies doing the same
things. All that is required is a small multilateral agency composed of a scientific committee that
establishes the criteria for sustainability and a monitoring committee that audits the performance of
both consumer and producer states.

These tasks cannot be accomplished within the framework established under CITES. First, CITES
is exclusively concerned with those species which are endangered or potentially threatened through
commercial use; the required certification mechanism must be applicable to all the possible products
from natural habitat utilisation, endangered or not. Secondly, the framework of CITES is directed
to a very different purpose - the monitoring and halting of trade in endangered species; the object of
a certification mechanism is to maximise the differential premium attainable from sustainable
utilisation production methods.

Finally, it is important to recognise that there are many people who value wildlife for purposes
other than use values, and that a multilateral agency could also harness these values and channel
them back to the range states. In this case the agency would not certify the wildlife product as
sustainable, but would instead certify the state's commitment to provide specific habitats or

lanoterreiYini dy lo i ytean ov. tithiv Ww er feactiad witoines ro pheteasise yet ae
ce 7 has ics 5 and

i
ow Sewireleigte mal? wok wacesvilt Lagi eth 44 are aun dS: ah ni! ese -
: wikereny a priests 4c) AD RARE ae: Lagan
‘id taog waite Ww ognet hihi nh wo elgg sh baits ad huni, alco ait ~
ve 2, ile ge aa

hiss, Serveclh So soterdes signal we tearsign), fe 271: pig! puatines
eR soe wohginatiny Gey da end ahiper iin ea anh YO VRE i

f thyida x ud bores Sperone me sot hee J) Hai P Wey er or
WA neimanin cumini OWS one edt ahaa 22) Sri pmelbe Te ene
- wraps Ae nowaober es al no ies Poppet! ool ity Bes ary f

= oF erannieioo vente ay 2¢ aminedoom 5 Rove bo at api es lhl aurea ignites , Tes.
finery pit gimauboxy co) Sond drill! foop ht yeatonl iPod ici ook» (nals

ae enectyetseved fh a snblo zit mints va aaiD BY 4 dL oaicpttytn ati vat bias
hip mainte att yd wabssihio legs A. prank a hp pietarea? x
©) caeinptiysett eal bnotsa ia, a aah. pea i ts x aah

— ne ah. aphijron bi ees Od | PCS Wak alien
og Ger i ae data Dh a ehtaon tuts herent :
oil theliinnes Wipes A aes 2isighitsye buh bane, 10> Oat
ce canna ere y ven lea eats Aepge bith bes

conservation programmes as credible. In this way, individuals in consumer states could be assured
that their donation would be channelled in the precise manner that the certification asserted. It is
precisely the same certification process, only attached to a programme rather than a specific
product.

~*~
~—

barijene od Plan. eouta yen ar te Abi Khar. dieees a illbape of peiteettnys cry et
ed 8 Berean Nontvins Si ats mite oy ih} ter ‘Yaltoarnein sd olan 1 erty
hae Qratt edist omumemgry bs Late Yd areantt cere “y “att ay

F. Certification programme and the sustainable use of forest products.

There has been an increasing trend towards the use of markets to enhance conservation incentives at the local
level in developing countries. A significant green" market has evolved, with both traditional and new
products reaching the marketplace. This growth of environmentally aware consumerism has led to a plethor of
labels appearing in the market making doubtful claims about products as firms try to capture the ~~green"
premium from consumers. A study in 1991 by WWF UK found over 600 different timber firms making
ecolabel claims for their wood products, of which only four were willing to substantiate their marketing claims.

NGOs have also established their own formal or informal ~ certification" programme. Informal ones have
relied on the use of the NGO's reputation and use its emblem in the labels with some information on the
product's characteristics. This has been the case in many non-timber products such as those from the
Conservation International's Cultural Survival Enterprises, the Body Shop and Ben & Jerry's, who lack third
party verification.

Formal certification schemes have been created through independent bodies with set criteria to assess the
sustainability of forest management; among these are the Rainforest Alliance's Smart Wood" (US), Scientific
Certification Services' Green Cross" (US), Soil Association's ** Woodmark" (UK) and the Societe General de
Surveillance (Switzerland). Even governments, such as Indonesia, have taken measures aimed at identifying
wood products from acceptable sources.

The consequences of this proliferation of labels has been confusion among consumers, who cannot link a label
to sound conservation practices. A step forward in unifying all certification programme has been the creation
in 1993 of the Forest Stewardship Council, an independent, non-profit, and non-governmental organization,
aiming to provide consumers with reliable information about forest products and their sources. Involving
representatives from governments, NGOs, indigenous peoples’ organizations and forest industry, the FSC is
seeking to accommodate the views of all stakeholders involved, acknowledging the need for wide support and
recognition of it is to be credible. Previous global certification efforts by governments through organizations
such as ITTO, where progress has been slow, have highlighted the limitations of a government approach
ignoring the NGO and industry perspective.

The FSC is not a certifier of forest products, but its role is to accredit, evaluate and monitor certifiers of forest
products. Through its principles, the FSC requires certifiers to assess a wide range of criteria, from land tenure
to indigenous peoples’ and
community rights as well as

environmental and monitoring Figure 7. UK surveys on the Willingness to Pay for Sustainably produced

2 Tropical Timber
standards. A major step of the FSC 25
was the inclusion of both ]
temperate and tropical forest 50 Milland's study
products, hence involving a fairer il manufacturers’
mmitment for both developed WHE
o me : P 15 I WWF's study consumer's average WTP (13.6)

and developing countries.
consumers' expected WTP by

In order to allow for national Milland’s study average WTP (6.35)
provisions, the FSC isencouraging | — — — — — SW — — — — -

the creation of National Working rela OPE Meera. Lia wee 5 8
Groups to draft country specific
interpretations and expansion of
the principles. This is necessary to a 20 40 60 30 TOORGiGieee
allow differences in tropical and

temperate areas and other social

and political conditions. Despite the apparent difficulties in establishing unified criteria, the process was cased
by the tacit harmonisation of existing criteria. Indeed, comparative studies of the various forest sustainability

criteria used by various NGOs and governments have shown a high degree of similarity in their objectives.

LEEC's study consumers’ expected

te oe ea hp obs

Pe Soe ee ee Scie :

sein Haine Sa Gay adit hom hii als ital ye

~, a, a

Pee) Peau ae ey ‘puppets 6» ipa Beal dt ahve ain
wre Aedte WitecA ahead ied Orie: sHlgenery es A ska CAE iewsthril i Fs
ae melee, tar trek aa el ‘nglnnigun aa ane! Mine ral i caiaty. i
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Key to the creation of product differentiation was the issue of product discrimination by method of production,
explicitly prohibited by GATT. For this reason, the approach has been to certify on a voluntary basis, with no
legal restriction on imports; hence, the system must work purely on consumer preferences. With regard to
differentiated access to certification services by operations in the developed and developing countries, measures
are being taken, with some previous certification systems, such as Smart Wood, explicitly non-discriminating
on the basis of cost.

The certification process promoted by FSC involves both forest management certification and product
certification. The first involves the assessment of the viability of the operation at the grassroots level, while the
product certification involves tracing the wood from source through the supply chain to the final products
(chain-of-custody). While more expensive than alternative systems like country certification, this method
allows for greater credibility of the label as well as a greater involvement of higher stages of industry in the
certification process.

To date, 40 major retailers in the UK, representing 5% of the entire UK market for wood-based products, have
publicly committed to buy FSC-accredited certified products by the end of 1995, a trade representing some
USD 2 billion per year. In the US, 41 wood suppliers have been certified by a third party. At grassroots level,
19 forests have been certified, covering 4.26 million hectares and 1.2 million cubic metres per year. More than
half of these are tropical forests.

The real test for this encouraging response from industry and NGOs will be the consumers’ real willingness to
pay for certified wood. Studies conducted to date show that consumers are expected to pay between 5% and
13.5%. However. retailing companies are still very much influenced in their buying decisions by price rather
than environmental issues (see Figure 7).

The creation of exclusive marketing channels for the low volumes produced by ~‘sustainable harvesting”
projects has proven to be costly, with NGOs and government often subsidising the production of these projects
at least during the pilot phase. It has been estimated that harvesting costs could almost double by the use of
sustainable techniques. Additionally, certification costs are as yet uncertain but substantial. Governments and
NGOs will have to play an active role in promoting the use of certified wood in order to create this price
differential.

In addition to the capture of consumer willingness to pay for sustainably produced timber, the establishment of
a credible ecolabel will also allow the use of other creative mechanisms to internalise the environmental
externalities in the forests, such as tax or revenue transfers and trade subsidies. Such mechanisms could
encompass wider resource values other than use.

ni! WP ssulletony les ehiome ye, rrulbaatyhiririatty Haubinne = sua aa T. ra im iho hi bvahievin ts aiderahy We a
i) iis 4 il platens Ca igre! ay ned yal sl sand 7 nt eats STE ee Lalo ay ty

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— OE
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penny ie ohana ee tee pie yee eth ai i chisel ss 4a « a sorasaedh at
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+ geen Heghtcen ety TimtathS acted pe “y we ek
oe sie aia “— eee ini ort ibe: sae oni aise

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msds Cay
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ase i

152 enenyailti.’ ising sii
As er Shaki

Recommendation
It is the considered recommendation of this project team that the above principles be implemented

by means of the adoption of a protocol to the Convention on Biological Diversity that would certify
sustaiable use regimes in the manner described above.

The object of the protocol would be the establishment of an agency for the following purposes:

a) the development and implementation of a set of agreed standards on the sustainable use of
natural habitats;

b) the development and implementation of monitoring and auditing mechanisms that ensure that
member states purchase exclusively those products that have been certified to meet these
sustainable use standards.

These objects would be accomplished by the implementation of the following tasks:

a) the establishment of agreed criteria for sustainable use based upon stock level indicators in
specified habitats;

b) the establishment of procedures for assessing the attaimment of certain indicator levels in
specified habitats as against specified criteria of sustainability;

c) the auditing of the performance of applicants for certification, and the continued auditing of the
performance of existing certificants;

d) the auditing of the performance of consumer states in the execution of exclusive purchasing
agreements; and

e) the provision of market information to certified producers regarding rent-maximising aggregate
flows of particular wildlife products, and the monitoring of these flows.

In order to accomplish these tasks, the international agency would consist of:

a) a standards committee (for establishing general criteria for sustainability and the creation of
regulations for each sub-agency);

b) a habitat monitoring sub-agency (responsible for implementing surveys of stock levels and
testing for attainment of the criteria set for sustainability);

c) an international auditing sub-agency (responsible for annual and random auditing of the
performance of producers and consumers in terms of flows between them); and

d) a market analysis sub-agency (responsible for providing rent maximisation analysis and advice to
producers to aid and enhance their cooperation).

sadibiingith wt ialgh ating: “Hi ti dhs: ‘dh wtges peas da aed co imei): bade oat i tami
ihtinseh blarsiw? tanh neezsennie — tes mags i ealisiephrmn a Maat th

prt Hepa yee ay wii eames

i
—

4 nso ett wan na sas anf hd pier err
i ian bid ill stv cl bee oa tome ta aso bah ‘{apoest

‘ be aD

. h A ', wield iets a alis Pree ty (iat jornisttiyeah Lark. anrcneg
oe see all ae bis bail Pees hb ernest A

tee

In order to reach these decisions, the standards committee would be:
a) a small representative body elected by the member states to the convention;

b) a democratic body rendering decisions and regulations by majority vote.

By g

nest i na

aes

py
h

bi eh
wi aS

ie
wer

WORLD CONSERVATION

: TESS) MONITORING CENTRE
a. —
| io”)

S Hy

World Conservation Monitoring Centre.
219 Huntingdon Road tae
Cambridge CB3 0DL bee

United Kingdom >

Telephone: +44 1223 277314
Fax: +44 1223 277136
e-mail: info@weme.org.uk

The World Conservation Monitoring Centre is a joint-venture betw
partners who developed the World Conservation Strategy and its successc
for the Earth: YUCN-The World Conservation Union, UNEP-Unite
Tid Wall Conta asn UN UNEP WWE Environment Programme, and WWF-World Wide Fund for Nature. - a

a
oe DW i

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Full text of "Sustainable use for global, national and community benefit: an analysis of utilisation and biodiversity conservation. Executive summary"

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