gpa_east_africa_case.. - GRID Africa GeoPortal - UNEP

YearArrivalsWith ProjectTrend growth5% pa 2000-52% pa after 2005Table 11: Tourism ScenariosArrivalsWithout ProjectOptimistic LikelyScenario Scenario(No growth) 5% declinepa(2)(3)Cost(undiscounted)(1)(1-3)2000 43,000 43,000 43,000 02001 45,150 45,150 45,150 02002 47,407 47,407 47,407 02003 49,777 49,777 49,777 02004 52,266 49,777 47,288 4,978x1,152=5.7x0.5 = 2.82005 54,880 49,777 44,923 9,957x1,152=11.5x 0.5 = 5.72006 55,977 49,777 42,676 13,301x1,152=15.3x 0.5 = 7.62007 57,097 49,777 40,542 16,555x1,152=19.0x0.5 = 9.52008 58,240 49,777 38,514 19,726x1,152=22.70.5 = 11.32009 59,403 49,777 36,588 22,815x1,152=26.3x0.5=13.12010 60,590 49,777 34,758 25,832x1,152=29.7x0.5 = 14.82011 61,803 49,777 33,020 28,783x1,152=33.2x0.5 = 16.62012 63,040 49,777 31,369 31,671x1,152=36.5x0.5 = 18.22013 64,300 49,777 29,800 34,500x1,152=39.7x0.5 = 19.82014 65,586 49,777 28,310 37,276x1,152=42.9x0.5 = 21.42015 66,898 49,000 26,895 40,003x1,152=46.0x0.5 = 23.02016 68,236 49,777 25,550 42,686x1,152=49.2x0.5 =24.62017 69,600 49,777 24,272 45,328x1,152=52.2x0.5 = 26.12018 70,993 49,777 23,058 47,935x1,152=55.2x0.5 = 27.62019 72,413 49,777 21,905 50,511x1,152=58.2x0.5 = 29.12020 73,860 49,777 20,809 53,051x1,152=61.1x0.5 = 30.52021 75,338 49,777 19,768 55,570x1,152=64.0x0.5 = 32.02022 76,842 49,777 18,779 58,063x1,152=66.9x0.5 = 33.52023 78,382 49,777 17,840 60,542x1,152=69.7x0.5 = 34.82024 80,000 49,777 16,948 63,052x1,152=72.6x0.5 = 36.3This is adopted as the basis for estimating the cost of inaction, and conversely, the value oftourism benefits likely to accrue from preventing pollution through sewerage infrastructure.Two adjustments need to be made to avoid double counting and over-estimation. First, not alltourist revenue is net income but only that part of it representing value-added. It is assumedthat value-added is 50% of gross revenues (already applied in the above table). Second,money flows accruing in the future have to be expressed in terms of Present Values.Discounting at 10% and 5% results in benefits of 5.7 million US$ and 9.1 US$ by the year2010, respectively, and 3.7 million US$ and 11.3 US$ by the year 2024 respectively. It isnoted that due to discounting to present values, longer-term benefits are reduced, and thehigher the discount rate the greater the reduction.Table 12: Present Value of Tourism Benefits/Costs in Million $Present Value of benefits Discount rate 10% Discount rate 5%Year 2010 5.7 9.1Year 2024 3.7 11.3Note: The higher the discount rate the lower the present value. The scenarios and the basiccalculations are shown in the following table.2. FisheriesCurrent fisheries output in Beau Vallon is estimated at 1,100 tons a year. There is noinformation if it has declined or increased in recent years. It is assumed to be relativelyconstant. Assuming an average consumer price of 5$ per kg., the value of output is $5.5million a year. This production value is at risk from sea pollution and habitat degradation.Final Draft Report – Cost Benefit Case StudiesGPA Strategic Action Plan on Sewage, October, 200051