Caribbean mangroves need to be restored.
FRESH research carried out by economists attached to the World Bank and a number of universities in the Americas have identified 20 Caribbean countries where restoring coral reefs and mangroves could yield a high return on investment (ROI). They include Cuba and Jamaica.
Globally, there is a growing need for coastal and marine restoration, but it is unclear how this should be funded, as environmental funding is low and national budgets are stretched in response to natural hazards. . Restoration budgets amounting to billions of US dollars are often quoted.
But for sites in the Caribbean region, researchers using risk industry methods have found that restoring coral reefs and mangroves can yield a strong return on investment for coastal flood risk reduction. of the 20 Caribbean countries.
“Return on Investment for Mangrove and Reef Flood Protection” was submitted on September 17, 2021 by authors; received in revised form on April 19, 2022; and accepted on May 17, 2022 by Ecosystem Services 56 (2022).
This is currently a 2022 release by Ecosystem Services. It is the result of collaborative research between the University of California Institute of Marine Science, the Department of Coastal Studies at the University of Eastern Carolina, the World Bank, the Nature Conservancy and others. institutes. The summary is available at www.elsevier.com.
The researchers say, first, that knowledge is growing on how to rebuild marine ecosystems, but how to pay for it is a challenge. Global conservation budgets are in the billions of dollars, plus disaster recovery budgets and expenditures are in the hundreds of billions of dollars, each year, and growing.
In the summary, the researchers bring good news, saying, “We have identified where there could be significant returns on investment for the restoration of coral reefs and mangroves in the Caribbean. ”
Coastal ecosystems such as reefs and mangroves act as natural barriers against waves and storm surges, and reduce flood damage to people and property.
These benefits are critical in the Caribbean, where there have been substantial increases in storm risk and significant habitat loss. To identify where restoring reefs and mangroves could generate significant returns on investment, the researchers relied on recent work that assesses the annual flood risk reduction benefits of coastal habitats (Beck et al., 2018, Men´endez et al., 2020).
To assess the return on investment, they started by estimating the benefits of flood protection and followed the expected damages approach (Barbier 2015, World Bank 2016), which is also commonly used by the risk industry ( for example in the insurance and engineering sectors).
The researchers also used a suite of probabilistic hydrodynamic and economic models to map flooding on reef and mangrove coasts, with and without habitats, for four storm return periods (1 in 10, −25, −50, − 100 year events).
They assessed inundation in cross-sectional transects every 2 km or less globally and produced inundation maps (inundation depth and extent) at 30 m resolution.
They also used socio-economic exposure data from the World Bank. For mangroves, the researchers assumed that the flood protection benefit from restoring 1 ha of mangrove forest in a 20 km study unit is equivalent to the average decline in benefit from the loss of 1 ha of mangroves. in this unit.
For coral reefs, they assume that the benefit of restoring 1 m of reef height equals the average decline in benefit of losing 1 m of reef height in that unit of study. These assumptions rely on full restoration of habitat features that provide flood protection benefits such as reef height and mangrove density.
This full restoration may not be immediate, which may reduce the overall benefits. On the other hand, restoration projects for flood protection would likely be cited to maximize (or at least do better) than the average flood protection in a given unit of study, meaning that assumptions could under – estimate the potential benefits of restoration.
The researchers conceded that an important shortcoming is that there is little data on the opportunity or maintenance costs of habitat restoration projects. Almost all of the cost data for mangrove and reef projects was for the initial costs (direct investment) associated with habitat restoration.
The researchers added sensitivity analyzes to assess how discount rates and the time required to access all project benefits might affect return on investment.
Funding for restoration
In trying to identify sources of funding for restoration work, the researchers note that reinsurers have sold policies to protect reefs and are developing approaches that could be used to invest in restoration from the start to build resilience and reduce future payments (Kousky and Light 2019, Reguero et al., 2020).
They note: “There are opportunities to align conservation, flood risk reduction and climate adaptation to reduce storm risk. There are many places in the Caribbean where habitat restoration for risk reduction could be cost-effective, and these values open up significant opportunities to pay for their necessary restoration.
The ROI estimates in the paper are conservative. The researchers note: “We do not consider the indirect benefits of avoided flooding, such as avoided business interruptions, which are estimated from claims to be 139% greater than direct property damage (Allianz 2019) . We also do not add values from additional ecosystem services such as carbon sequestration, tourism and fish production.
“We don’t account for sea level rise or increased storms, which would increase the benefits of flood reduction.”
They also assume that restoration costs are fixed, but will likely decrease with economies of scale (for example, mangrove restoration is much cheaper in Southeast Asia, partly for these reasons).
Present value analyzes allow project proponents to consider all potential break-even restoration costs, which could include seldom reported values such as costs to overcome restoration failures or opportunity costs ( for example, land acquisition for mangroves).
The researchers also assume that the benefits of risk reduction will remain static over time in the future, and note: “We have shown that these benefits increase significantly over time for mangroves (World Bank 2021). These results open up new opportunities to support restoration.
Restoring coral reefs in parts of the Caribbean could bring high returns on investment, according to new research.