- Investigates the causes of economic imbalances.
- Explores and develops market-based solutions.
The Property and Environment Research Center (PERC) held a two-day workshop in Key Largo, FL on the viability of a market for coral reef restoration in the Florida Keys. The purpose of this event was to explore how voluntary agreements between reef users, conservationists, government, and private businesses might improve the stewardship and restoration of Florida’s coral reefs.
Market-based conservation programs have generated environmental and economic returns for numerous terrestrial resources, but their application to marine resources such as coral is limited. This workshop brought together a diverse mix of professionals from the conservation, business, scientific, and government communities to discuss whether similar successes are possible for Florida’s coral reefs.
More detail on the workshop, including the agenda and participant list, can be found in the attached program.
This project addressed the purposes of the foundation by investigating the causes of economic imbalances, particularly the economic disconnect between the beneficiaries of a healthy reef ecosystem and the potential producers of reef restoration. We discovered that a host of factors have contributed to this imbalance, including a collective-action problem among reef users, the absence of clearly defined property rights to marine resources, and permitting requirements in the Florida Keys National Marine Sanctuary.
The project also explored the feasibility of overcoming these imbalances by developing a market for reef restoration in the Florida Keys. Workshop participants discussed several strategies for linking buyers and sellers of reef restoration and the practical impediments to each.
Florida coral reefs represent enormous economic value. For example the state estimates natural reefs in Martin, Palm Beach, Broward and Miami-Dade counties generate $3.4 billion in sales and income and support 36,000 jobs annually from recreational activities such as scuba diving, snorkeling, and fishing. In addition, reefs protect Florida coasts by reducing wave energy from storms and hurricanes and serve as critical habitat for numerous species, including commercially important fisheries.
Though promising, markets for environmental goods and services are relatively new and untested. The cost of identifying potential buyers, specifying contractual terms, coordinating inputs, and monitoring performance in this new marketplace can dissipate potential gains from trade. Workshop presenters discussed how to reduce transaction costs for resource owners by identifying potential buyers, economies of scale, and partnerships.
PERC staff will assist the Georgia Aquarium's Walker Conservation Fellow in developing a business plan for market-based reef restoration. The business plan will include input from conservation groups, state and federal agencies, and experts in conservation finance. As appropriate, the plan will be circulated stakeholders in the Florida Keys.
(Check sent: 7/5/2011)