Introduction

The Great Barrier Reef has been an iconic part of Australia’s global image for decades. It is considered one of the seven natural wonders of the world, it has been a world heritage site since 1981 and it is considered a state icon of Queensland. This stunning and complex natural resource draws in more than two million visitors a year, and yet there is immense controversy surrounding the conservation of the reef. The Great Barrier Reef is a sensitive environment that relies on the costal ecosystems surrounding the reef to function. The costal ecosystems provide the aquatic terrestrial link that “…support[s] the physical, biological and biogeochemical process that underpin the ecosystem health of the Great Barrier Reef…” (Great Barrier Reef Marine Park Authority, 2012). The Great Barrier Reef provides Australians and people worldwide many social benefits such as agricultural production, commercial and recreational fishing, tourism, recreation and environmental values.

Total Economic Value of the Great Barrier Reef

The Great
Barrier Reef provides economic benefits when either preserved or destroyed. Environmental
and economic concerns tend to raise controversy, whether it be land rights,
natural resources, pollution or any other variety of environmental concerns.
Public opinion is heavily divided, some believe that the environment should
come first at all costs while others believe the economy is of greater
importance. There is no right or wrong answer. The truth is that economic
benefits often conflict with environmental and social benefits. This effects
the way that policy makers make decisions, therefore it is very important that
there is a way to value environmental features within nature in monetary terms.
“Valuing nature in monetary terms can
effectively inform policy settings and help industry, government, the science
community and the wider public fully understand the contribution of the
environment to the economy and society.” (Total economic value of the Great
Barrier Reef what you need to know, 2017). In a world that is continually growing more
environmentally conscientious it is important that there is a way to assist
with mutual understanding of environmental and economic costs and benefits.
Using the Total Economic Value (TEV) framework a monetary value can be placed
environmental features such as the Great Barrier Reef. The aim of this essay is
to provide an analysis of the value of the Great Barrier Reef and provide a
case for conserving the Great Barrier Reef and limiting
or modifying the main activities or driving forces that are putting pressure of
the Reef’s overall health.

What is Total Economic Value (TEV)?

TEV is a cost-benefit analysis
framework used for valuing a natural resource and comparing the cost and
benefit of having said resource to the cost and benefit of not having it. As
represented in figure 1 below, there are many different types of values, the
main two being use values and non-use values.

Putting a monetary value on a natural
resource is a complex task and therefore all values must be reviewed and
understood. For example the Great Barrier Reef is an iconic Australian image,
as an icon the Great Barrier Reef holds icon value which is internationally
influential on not only tourism but politics and business as well.

Identifying the Costs and Benefits of Great Barrier Reef Conservation

Cost Benefit analysis (CBA) is a
process that attempts to measure the positive and negative consequences of
something. CBA measures externality effects, social benefits and effects on
both participants and non-participants.

Social Benefits of Great Barrier Reef Conservation

The Great Barrier Reef holds a
significant number of social benefits that need to be reviewed when considering
the TEV or a CBA of the reef. In a report of this size not all benefits can be
reviewed, just the most major social benefits and costs will be briefly discussed.
The Great Barrier Reef has been an important resource for thousands of years,
stretching back to when the indigenous population lived within the coastal
areas surrounding the Great Barrier Reef. Today the reef is used and valued as
a place for people to visit and enjoy. The reef has provided over 54000 full
time jobs for Australians through fishing and tourism (At what price? The
economic, social and icon value of the Great Barrier Reef, 2017). The reef is
also an important area for culture, recreation, scientific research and defence
force training (McCook et al., 2010). Even through indirect use the Great
Barrier Reef effects millions of people purely by existing. Having a pristine
coastal and marine area to use for recreational activities promotes a healthier
lifestyle, this is a social benefit that provides a healthier population and
therefore in the long term decreases medical costs. There is a similar
situation regarding air pollution. Having a healthy coastal environment and
healthy marine environment would help to increase clean air and reduce air
pollution, this again would cut medical costs in the long term and promote a
healthy lifestyle.

Social Costs of Great Barrier Reef Conservation

It can be argued that the conservation
of the Great Barrier Reef will have a negative effect on jobs due to the fact
that reef conservation has a negative effect on coal mining and shipping
routes. In order to protect the reef costal development must be regulated and
minimised and this will have a significant effect on population growth and will
economically effect coastal towns. Conservation of the reef does not
necessarily mean removing all profitable practices from the reef. Conservation
can mean that economic activity may continue but only in a way that is
sustainable. Great Barrier Reef conservation will result in decreased growth
rate for jobs within mining, fishing, agricultural and tourism sectors.
Although growth rates for jobs would have to slow in the long term picture the
jobs that are created would be created to last. As population size will
continue to grow it must be determined if the conservation of the Great Barrier
Reef will be enough to support many coastal and inland communities in north
Queensland. The biggest driving force for the support of development of new
coal mines and coastal ports in north Queensland is the promise of new jobs for
the people living in proximity to the Great Barrier Reef.

Measuring the costs and benefits of Great Barrier Reef conservation

Benefits of the Great Barrier Reef

Costs of the Great Barrier Reef

Options for quantifying the costs and benefits of Great Barrier Reef conservation

It appears that the best way to
determine a monetary value of the Great Barrier Reef is the total economic
value (TEV) framework. This framework has been used many times by many
different organisations and repeatedly appears to have consistent conclusions.
Oxford Economics assessed the TEV of the Great Barrier Reef in 2009 and came to
the conclusion that it is worth 51.4 billion dollars (Valuing the effects of
Great Barrier Reef bleaching, 2017), and in 2017 Deloitte economists determined
that the value of the Great Barrier Reef stood at 56 billion dollars (At what
price? The economic, social and icon value of the Great Barrier Reef, 2017). The
TEV framework effectively encompasses the greatest range of costs, benefits and
values out of all other frameworks. When using cost benefit analysis (CBA) the
indirect benefits are not considered in the same way that they are with the TEV
approach. It was determined in the Deloitte economists report that the second
most valuable aspect of the Great Barrier Reef was indirect or non-use value at
23.8 billion dollars, second to only tourism which was determined to be worth a
staggering 29 billion dollars. It is clear that the TEV framework is the best
system currently within use.

Conclusion

The final thoughts on the topic of
evaluating the value of the Great Barrier Reef, one of the world’s greatest
natural resources, is that currently the best and most effective way to put a
monetary value on the reef is to use the TEV approach. This resource must
preserved and Australia must not allow this resource to become abused and
destroyed, it is one of the country’s greatest resources and is such an iconic
image that represents Australia as a whole. The value that this brings through
non-use value is irreplaceable and is in no way worth destroying for an
economic trade off.

References

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