It is perhaps no coincidence that the Big Five appear on South Africa’s currency. Leopard, buffalo, lion, elephant and rhino distinguish our R200, R100, R50, R20 and R10 notes, respectively. These images send a subtle message to all South Africans as well as the rest of the world: our natural heritage as symbolised by the Big Five is a valuable heritage in which we should take pride.
But can we quantify how valuable the Big Five are? Should we even try? Most southern African conservationists would say yes, because they believe conservation has to justify itself in economic terms to be able to survive.
This is not the only argument for conserving biodiversity: ecological, philosophical, ethical and aesthetic justifications are equally important. But economic arguments can create positive incentives for conservation.
Environmental and resource economists use the concept of ‘total economic value”, which includes both use and non-use values. Use values can be direct or indirect, such as hunting and ecotourism. People’s appreciation of wildlife and their willingness to pay to preserve these resources are non-use values. Quantifying such values is not an academic exercise – understanding them can help to guide environmental policies and enable policy-makers to prioritise conservation choices and decisions.
The Big One – elephant
Even though the ivory trade was banned in 1989 by the Convention on International Trade in Endangered Species (Cites), while the trade was still allowed, elephant ivory could fetch $200 (about R1 240) per kilogram. The ivory was used to make cutlery, jewellery, billiard balls and piano keys as well as ornaments, with the largest markets for such products being Japan and Hong Kong. Legal trade in non-ivory products produced from culling, such as hides, meat and hair, nets R3,2-million per year. Elephant hides (an average of 80kg per animal) cost about $12 (R75) per kilogram, for making boots in the United States and handbags and belts in the Far East. Other elephant products include meat, biltong, fat and bone meal.
In his book At The Hand of Man — Peril and Hope for Africa’s Wildlife, Raymond Bonner traces the history of the highly politicised ivory trade in several African countries and discusses various approaches to elephant management. The debate is between the ‘idealistic preservationists”, who see the ivory trade as corrupt and are vehemently opposed to any use of ivory, and the ‘pragmatic conservationists”, who argue that it is logical to control elephant populations through selective cropping and to trade the resulting ivory to earn much- needed revenue to fund future conservation efforts.
The pragmatic view may sound callous, insensitive to animal welfare concerns about trauma or suffering on the part of the elephants themselves, but it does make economic sense. But can we weigh economic values against the ethical aspects of killing elephants? This intractable dilemma continues to haunt conservation agencies.
Conservation versus preservation is at the heart of the culling debate. In the Kruger National Park, the ecological carrying capacity of 7 500 animals has been vastly exceeded by over 10 000 animals, because no large-scale culling has been done since pressure from animal welfare groups brought about a moritorium. Although this may have prevented the killing of elephants, it has its costs. Besides preventing the Kruger Park from earning revenue from the sale of tusks to fund ongoing conservation and reserve management, it also has an ecological cost. Large elephant populations can drastically alter the landscape if their numbers are not kept in check.
Over a decade ago, when preservationists lobbied for and succeeded in securing the enforcement of a unilateral ban on trade in ivory products, the result was a decline in elephant poaching in many African countries such as Kenya and Tanzania. But, in South Africa, Zimbabwe and Botswana, where policy and management are better controlled, the ban prevents these countries from earning revenue for conservation.
Jon Barnes, an environmental economist, has argued that, although the ban on ivory sales had helped slow the species decline in many states, the trade ban was having a negative effect on southern African elephant populations. Hence, he said, there was a need to increase the economic value of elephants, without which they would not be protected.
David Pearce, a professor of economics and director of the Environmental Economics Centre at University College London, points out that, by depriving countries of ivory sales, the ban was the equivalent of a $50 000 000 (about R310-m) tax on African governments.
Russel Train, former chairman of WWF-US, believes that elephant hunting provides ‘the most effective and efficient and cost-effective form of providing economic benefits for local people that you can find”, as it can yield from $10 000 to $16 500 (R62 000-R102 000) per animal. Thus, if 60 elephants per year were hunted in the Kruger National Park (as part of the culling programme), this could earn the reserve up to $1-million (R6 174-m), which could cover the costs of the overall culling programme as well as fund other initiatives and research.
This year, South Africa considered selling its stockpiles of elephant tusks, which could earn SANParks in the region of R30-million.
The horn of a dilemma – rhino
Because the ivory market is dictated largely by aesthetic tastes, trade in ivory is more easily enforced because of the stigma attached to purchasing ivory products, which in turn lowers overall demand. Rhino products, conversely, are used mainly as medicines in Far Eastern countries such as China and Taiwan. Despite the protests of African conservationists, this market seems insatiable.
This dilemma has prompted several conservationists to find a solution by studying this market in greater detail. They argue that understanding the economics of the rhino trade may help in formulating new conservation strategies. For example, the demand for rhino horn can be said to be ‘price inelastic”, implying that the market is largely affluent people who are unlikely to change their behaviour and who are willing to pay high prices. So a ban would be ineffective and could drive this market underground.
What would be the economic feasibility of harvesting rhino horn sustainably, should the Cites ban ever be lifted? One factor would be the market value of the horn, which can vary from R4 000 to R30 000 per kilogram. By weighing these economic indicators against rhino population data, the total value of a (hypothetical) white rhino horn industry on private land in South Africa was valued, in 1997, at between R14-million and R195-million. Today, it has probably doubled. These values exclude the value of existing stockpiles of horn and the auction value of live animals, both of which are substantial.
White rhino have recently been moved from Appendix I to Appendix II of Cites, allowing for limited trade in rhino horn, which has expanded the legal market somewhat. Although Cites officials are not unanimously in favour of a controlled legal trade in rhino horn, a growing number of South African conservationists advocate sustainable trade in rhino horn, including the selling of stockpiles to earn revenue.
This group argues that, as white rhino are no longer endangered and have, in fact, recovered considerably in certain areas, controlled trade can be justified, especially if the revenue is used to conserve the much more endangered black rhino.
At first glance, this approach sounds callous, but the reality and severity of the situation may force conservationists to adopt unpopular policies simply to ensure the survival of conservation efforts. They argue that, by strengthening property rights in natural resources such as rhino, and by increasing their market value, incentives to conserve will also be created.
So, what’s the price tag on a (live) rhino? Recent auction figures for white rhinos would set you back an average of R192 000 per animal. The record price to date is R450 000. For the rarer black rhino, prices range from R450 000 to R602 000. Factor in trophy hunting, and you could net up to $50 000 (about R300 000).
Buffalo, lion and leopard
Although nowhere near as expensive as elephant and rhino, the other three don’t come cheap either. Average auction prices for buffalo, in 2003, were around R120 000 per head, with record prices of up to R225 000. But current veterinary regulations do not allow for Kruger buffalo to be moved elsewhere in the country, which limits the full realisation of their value.
Lions currently sell for an average of R23 000, preserved skins for up to R100 000, while, in exceptional cases, hunting trophy animals can realise as much as R230 000.
South Africa is allowed to export 75 leopard trophies per year, each of which can be worth between R45 000 and R80 000 to a landowner on whose farm a leopard is hunted. But, as Luke Hunter and Guy Balme point out in a study of the leopards in the Phinda Reserve of Kwazulu-Natal, the accumulated total that tourists will pay to view a leopard over its lifetime far exceeds the one-off profit made from shooting one.
The Big Five and ecotourism
The value of the Big Five can also be deduced from the investment needed for the protected areas that support them, whether state-owned or in private hands.
National Big Five parks include Kruger, Addo, Augrabies, Mapungubwe and Kgalagadi, St Lucia, Hluhluwe-Umfolozi and Mkuze. Private game reserves include Sabi Sands, Timbavati, Klaserie, Manyeleti and Umbabat.
Ecotourism is often touted as the only viable way to earn revenue to justify the conservation of a particular area and thus prevent its conversion to agriculture, human settlement or other form of land use. Ecotourism is therefore regarded as one of conservation’s major economic engines.
Ezemvelo Kwazulu-Natal Wildlife manages 415 000 hectares of conserved land. To get an idea of its worth, private Big Five real estate is valued at between R2 000 to R4 000 per hectare. A recent World Bank report shows that, on a macro scale, ecotourism accounts for 21% or R415-million of the gross geographic product (GGP) of the north-eastern Zululand economy and supplies 7 000 jobs. Ecotourism’s contribution to overall provincial GGP is R545-million.
SANParks has set up a new system of private concessions within Kruger Park. In a recent article, the Financial Mail stated that capital investments to date exceed R216-million. SANParks anticipates a 20-year income of up to R403-million.
Some lodges in the 60 000ha Sabi Sands game reserve have been operating for over 25 years. As a result, game has become habituated to the presence of humans, allowing exceptionally close encounters from open landrovers. For this reason, tourists to Sabi Sands are willing to pay high tariffs. Because of this, the value of the land has increased considerably, up to 700%.
Neighbouring Kruger Park comprises two million hectares and is regarded as an ecological jewel. Mike t’Sas-Rolfes, a resource economist, pointed out in 1994 that, even if Kruger were valued at less than a third of Sabi’s value, it would be worth as much as R20-billion, making SANParks one of the 25 wealthiest corporations in the country. Even at a more realistic valuation of R4-billion, Kruger would rank among the top 100.
These astronomic values do not imply that wildlife reserves all operate at a profit. In fact, for many, the reverse is true. Investing huge sums of capital in ecotourism and conservation areas can be a risky business, with high operating costs, compounded by the competitive nature of the ecotourism industry and the current uncertainty of the market.
Making wildlife work
An indirect reflection of value is job creation, especially for impoverished rural communities close to protected areas. The Kruger Park alone employs over 3 000 permanent staff, while the new concessions have created an additional 700 jobs.
Creating value for local communities is a major challenge in conservation, one that is compounded by population growth and poverty, which can place increased pressure on protected areas. Integrated conservation and development projects for the benefit of communities living adjacent to reserves are critical to ensuring the continued existence of reserves.
Pricing a priceless legacy
Beyond the economic value of wildlife, as represented by the Big Five, there are intangible, or ‘non-use”, values to be derived from the mere fact that wildlife exists.
For many South Africans, wherever we live, and whether or not we ever visit wildlife reserves, just knowing, for instance, that our population of black rhino has recovered to healthier levels because of conservation efforts is a source of national pride.
For those of us who visit parks, there is an indescribable thrill about seeing a pride of lions around a giraffe kill, or a pair of leopards mating, or the majesty of a herd of elephants.
Should we factor in these intangible ‘existence” values? Is it even possible to measure the value our society as a whole places on ensuring the continuing existence of wildlife populations?
Conservationists and policy-makers hold conflicting views about whether these intangible values should be used alongside other methods of quantifying the value of environmental resources, whether they have any place in cost-benefit analyses. Some argue that trying to assess intangible values is too subjective to be a consistent yardstick and, by trying to incorporate them, one would have to consider an endless list of other social values as well.
Others argue that existence values are expressed in the form of donations towards the conservation of a particular resource, that one can use this to measure to what extent people are willing to pay for conservation and hence the level of intangible existence values. By incorporating such non-use values in decision-making, a better reflection of the true value of a particular resource is obtained.
It is a complex argument and perhaps the Big Five should not be the only species we use to promote the conservation of biodiversity — but, nevertheless, by raising the total economic value of these flagship species and the protected areas that support them, they protect the myriad of other species within these areas: insects, small mammals, birds, amphibians, reptiles, and hence South Africa’s biodiversity.