GEOG 300i 1st Edition Lecture 13• Deforestation• Fisheries and forestso In the case of the fisheries, oftentimes, the costs of overuse are borne by the fishermen themselves in the future – when they find the fish is no longer availableo In the case of deforestation, the costs of overuse are often borne by a much wider groupof people. o Why?o The reasons for overexploitation of forests are more complex and varied than the reasons for fisheries’ overexploitation.o Why? What roles do forests fulfill for the people living in or near them?• Deforestation from an ecological perspective (The case of the Amazon)o Deforestation sacrifices environmental services such as maintenance of biodiversity, water cycling and carbon stocks.o Deforestation impacts are magnified by the pattern of clearing that leaves the remainingforest divided into fragments, which then degrade both biodiversity and carbon stocks.o Deforestation also affects water cycling, because conversion of forest to cattle pasture results in the water running off into the rivers and flowing directly to the ocean without being recycled through the trees. o A significant part of the rainfall in Amazonia, especially in the dry season, depends on water that has been recycled through the trees of the forest. Water from Amazonia is also critical to maintaining rainfall in the heavily populated regions in south-central Brazil, such as São Paulo, and in neighboring countries such as Argentina. These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.o Global warming receives a substantial input of GHG from Amazonian deforestation. Over three-fourths of Brazil’s contribution to this global problem is the result of Amazonian deforestation. o Half of the dry weight of the trees is carbon, and when forest is cut this carbon is released to the atmosphere either as carbon dioxide or as methane, both from burning and from decomposition of wood that fails to burn. o The fact that most deforestation is for cattle pastures that do little either for the nationaleconomy or for providing employment to the population offers an opportunity to slow deforestation. o The value of the damage done by greenhouse-gas emissions from deforestation far exceeds the value of the timber, beef and other products that are sold as a result of the clearing. • Kremen 2000o Each year:an estimated 13 million hectares of forests are destroyed (an area the size of Greece);5.6 to 8.6 Gt of carbon are emitted ;14,000 to 40,000 species disappear from tropical forests;o Greenhouse gas emissions are likely to increase Earth’s temperature by 1° to 4°C in the next century, leading to the possibility of increasingly severe droughts and floods, enhanced rates of species invasion and extinction significant economic harm.o Tropical deforestation alone is responsible for 20 to 30% of carbon emissions and most species extinction worldwideanalyzed the economic benefits of forest conservation from local,national, o global perspectives to determine the structure of incentives;it is the interaction of these incentives across scales that will determine the fate of forests.o Deforestation from an economic perspectiveo Benefits and costs of forest preservationo The costs of forest preservation are the foregone benefits of deforestationo Opportunity cost concept – the next best alternative – here: the land use that produces the highest alternative returno We need to compare both to determine why deforestation is occurring and how to stop it o We need to consider the incentives at the three scales and change policies so that the forest protection policy is still incentive compatibleo The authors use the Masoala National Park Integrated Conservation and Development Program (ICDP) in Madagascar as their case study, because it provided ample data for economic evaluation. o The park (2300 km2) is composed of primary rain forest and is surrounded by a 1000-km2 buffer of unprotected forest. o Slash-and-burn farming for subsistence rice production represents the current principal threat to these forests. o At current rates, farmers may reach the park boundaries in as few as 9 years. o To counter deforestation, the strategy is to create economic incentives for conservation, by working with local communities to develop markets for forest products from the buffer areas and nature-based tourism in the parko Home of one of the 6 most endangered birds in the world, the serpent eagleo Local incentives are important, but incentives at national and global scales are also essential to the success of conservation efforts, because national governments often make large-scale natural resource decisions affecting conservation, the international community sponsors conservation through foreign aid and technical assistance. o Conservation is most likely to succeed when benefits outweigh costs at the scales of all relevant decision-makers.o Discount rate and net present value to compare benefits and costs in different time periods.o How do we compare benefits tomorrow with costs today?o We use discount rates.o In the private sector, discounting is straightforward: invested money earns interest. o The opportunity cost of an investment is the interest that could be earned by putting themoney in the bank.o We can convert the future streams of returns and costs to today’s $s (present value) o For example, if we are looking at a two year project and  The discount rate is 5%,o The costs are incurred now and equal $100,o The benefits accrue at the end of the project and are $120, theno The Present value of the benefits is o 120/(1+0.05) = 114.3o The future value of the costs is o 100*(1+0.05) = 105o Net present value is 114.3-100o Net future value is 120-105o Three opportunity cost scenarios – three alternative uses of the land:o Large scale logging scenario - Full captureo The national opportunity costs to Madagascar for not granting a large-scale logging concession includedstumpage fees, taxes, employment, and infrastructure development. Expatriate investors (i) invest in minimum infrastructure, (ii) hire national staff primarily, (iii) harvest all currently exported hardwoods, (iv) exportroundwood to mills outside of Madagascar,and (v) pay all taxes and fees legally due.o Three opportunity cost scenarios – three alternative uses of the land:o Large scale logging scenario