WAVES Policy Brief Philippines Policy July 2017 Brief Summary Valuing the Protection Services Coastal habitats can protect of Mangroves in the Philippines people and property from storms, floods, and erosion, reducing coastal risk. Natural capital Mangroves and other coastal ecosystems act as natural accounting can ensure that these defenses to reduce the risks from flooding, erosion and ecosystem services are valued natural disasters. Yet the value of these habitats is often not and accounted for in policy and fully accounted for in policy and management decisions, and management decisions. In the Philippines, significant expanses thus they continue to be lost at alarming rates. Using natural of mangroves have been lost in capital accounting, we can measure and value the services the last century, increasing provided by these coastal ecosystems, and thus inform coastal risk2. A recent report policies for sustainable development, disaster risk reduction, demonstrates that mangroves and environmental conservation. A new Report measures and significantly reduce risks from values the coastal protection benefits of mangroves in the flooding in the Philippines. Using high-resolution flooding models, Philippines1. the report compares flooding for scenarios with and without mangroves under different storm Key Points: conditions, and estimates the • If the current mangroves (data from 2010) in the Philippines annual expected benefits of mangroves for protecting people were lost, 24% more people would be flooded annually, i.e., an and property in social and additional 613,000 more people, many of whom live in poverty. economic terms to help inform • Damages to residential and industrial property would increase decision making. by 28% to more than US $1 billion annually; and 766 km of roads would be flooded. Background • One hectare of mangroves in the Philippines provides on average more than US $3200/year of direct flood reduction This brief is part of a benefits. collaboration between The World • Based on the Philippines’s current population, the mangroves Bank WAVES Program, The lost between 1950 and 2010 have resulted in increases in Nature Conservancy (Michael flooding to more than 267,000 people every year. Restoring Beck, Siddharth Narayan, Dania these mangroves would bring more than US $450 million/year Trespalacios), and The Environmental Hydraulics in flood protection benefits. Institute of Cantabria (Iñigo J. • Mangroves provide the most protection for frequent lower Losada, Pelayo Menéndez intensity storms (for example, 1-in-10 year storm events). For Fernandez, Pedro Diaz Simal, more catastrophic events, such as the 1-in-25 year storm, they Antonio Espejo Hermosa). provide more than US $1.6 billion in averted damages Additional support provided by throughout the Philippines. When combined with built the German International Climate infrastructure, mangroves provide an effective defense against Initiative. storms and coastal flooding. www.wavespartnership.org Wealth Accounting and the Valuation of Ecosystem Services Valuing the protection services of mangroves in the Philippines | 1 To halt the loss of our natural capital and ensure the provision of ecosystem services, these services must be accounted for in policy and management decisions. The  aerial  roots  of  mangroves  retain  sediments  and  prevent  erosion,  while  the  roots,  trunks  and  canopy   reduce  the  force  of  oncoming  wind  and  waves  and  reduce  flooding.  Credit:  Ian  Shive. The Coastal Protection Services of Mangroves valued. Many critical services, such as flood protection and climate mitigation, that rely on Mangroves protect coastlines by decreasing the risk keeping ecosystems intact are rarely valued8. This of flooding and erosion. The aerial roots of lack of consideration encourages short-term over- mangroves retain sediments and prevent erosion, exploitation and degradation, reducing the quantity while the roots, trunks and canopy reduce the force and quality of the goods and services provided. To of oncoming wind and waves and reduce flooding. A halt the loss of our natural capital and ensure the 500-meter wide mangrove forest can reduce wave provision of ecosystem services, these services must heights by 50-100%3-5. In low lying areas, even be accounted for in policy and management relatively small reductions in water levels can reduce decisions. Better valuations of the protection services flooding and prevent property damage. In the long of coastal habitats can inform decision-makers as term, mangroves increase sedimentation, decrease they strive to meet risk reduction and environmental erosion, and maintain tidal creeks and channels. management objectives. National economic accounts Mangroves can also support livelihoods and reduce provide an important pathway for the consideration social vulnerability by providing resources such as of these ecosystem services9. fish and other resources. But mangroves are being lost at an alarming rate- 19% The Philippines at Risk of the world’s mangroves were lost between The Philippines is at particularly high risk from coastal 1980-20056-in part because we have not adequately hazards. Between 2005 to 2015, 56% of property valued these natural defenses. In the Philippines, damage from natural hazards was due to typhoons mangrove loss has occurred primarily due to and storms, and another 29% due to floods2. Further, conversion of land to other uses, including the Philippines has lost hundreds of thousands of aquaculture and human settlements7. If mangroves hectares of mangroves in the last century, increasing are degraded or destroyed, the coast line becomes coastal risk. more exposed and vulnerable to the destructive impacts of waves and storm surge, and is at higher Due to a recognition of these increasing risks, and of risk of coastal flooding and erosion. As mangroves the potential role of natural defenses to reduce these are degraded and lost, more people and property are risks, the Philippines WAVES program on natural directly at risk from the impacts of storms, floods, capital accounting is helping the Philippines create and sea level rise. mangrove accounts, with the dual goals of 1) including the value of mangroves in the national Valuing our Natural Capital accounts and 2) providing critical information to decision-makers that may harness natural defenses Conventional approaches to measuring wealth and for disaster risk management, coastal zone economic development focus only on built capital management, and climate change adaptation. The and fail to account for the value all the goods and mangrove accounts will account for multiple services, services provided by natural capital. Currently, only a and will include area, volume, carbon sequestration, subset of the extractive benefits provided by ecotourism, and coastal protection services. ecosystems, such as fish and timber harvests, are Valuing the protection services of mangroves in the Philippines | 2 The Expected Damage Function Approach Data Needs Wind Nearshore Coral reefs Erosion Land Use Global Waves Waves (distribution, Flooding Poverty Astronomical Astronomical height, Wealth Tide Tide condition) GDP Storm Surge Storm Surge Mangroves Built capital Tropical Tropical (distribution, cyclones Cyclones density) Sea Level Rise Sea Level Rise Sea grasses Bathymetry Sample Models & Tide Wave set-up Delft 3D Delft 3D Damage & Loss Function Tools Forecasting Delft 3D SWAN X-Beach Wave, Surge Snell’s Law GIS Hindcasting SLR Projections Key Philippine PAGASA10 PAGASA NAMRIA PAGASA PSA, PAGASA, NEDA Agency NAMRIA NAMRIA DENR NEDA Figure 1 The figure identifies the key steps and critical data needed for the Expected Damage Function Approach, and some of the key agencies in the Philippines that may have critical roles and responsibilities in the development of data, models and results for each step.3 The Technical Report: Methods Figure 1). The benefits provided by mangroves are assessed as the flood damages avoided by keeping The Philippines WAVES program commissioned a mangroves in place. Technical Report to assist the Government of the Philippines in the development of their mangrove The Report compares the people and property accounts. The goal of the Report is to value the flooded under 3 different scenarios: mangrove cover coastal protection provided by mangroves in the existing in 1950, mangrove cover existing in 2010, Philippines and to identify where these natural and finally no mangrove cover (that is, the Report coastal defenses provide the greatest protection assumes all mangroves are lost). It also takes into benefits. account the wave reduction effect from adjacent coral reefs. The Report considers the flooding that To measure and value the coastal protection occurs under regular storm conditions, including benefits provided by mangroves, the Report follows storm surge, by analyzing more than 30 years of the Expected Damage Function approach, wave and water level data, and it also considers commonly used in engineering and insurance flooding under the most extreme events, by sectors and recommended for the assessment of analyzing the historical data and spatial distribution coastal protection services from habitats3 (see of 548 cyclones that made landfall in the Philippines. Valuing the protection services of mangroves in the Philippines | 3 The Report values the benefits provided by already using the core flooding models and mangroves nationally across the Philippines, and accompanying data on mangrove distribution. locally in the municipalities of Pagbilao and • Potential next steps in the Philippines could be: Busuanga. The analyses for the municipalities adjusting or augmenting the existing models; involved very high resolution bathymetric data and supporting data integration efforts between these hydrodynamic flooding models (see Figure 4). The three Philippines agencies; and targeted capacity results from the high resolution local analyses are building in key Philippine agencies. compared to the results from the national-level People   Poor  People   Property  Flooded Roads  Flooded analyses. Flooded Flooded (Billions  US$) (Thousands  kms) (Millions) (Thousands) 3.5 1000 5 5 Key Findings from the Technical Report 24% 23% 28% 26% 900 3 800 4 4 The protection services of mangroves can be 2.5 700 quantitatively valued. 600 3 3 2 • Without mangroves, flooding and damages to 500 people, property, and infrastructure would increase 1.5 400 2 2 annually by approximately 25% (Figure 2). 1 300 • Nationally, Philippine mangroves reduce flooding 200 1 1 to 613,000 people annually, of whom more than 0.5 23% live below poverty. 100 • Mangroves annually avert more than US $1 billion in 0 0 0 0 damages to residential and industrial stock (Figure   With  mangroves               Without  mangroves 2). Figure 2 The bars shows the Annual Expected Damages from flooding in the • Mangroves are expected to avert more than US Philippines under current (2010) mangrove cover (in green) and under no mangrove cover (in red), including the annual percent increase in damages $1.7 billion in damages from 1-in-50 year events to people and property if mangroves were lost. (Figure 3). • Mangroves provide significant benefits for more People Flooded (Millions) frequent, lower intensity events (see Figure 3). 6 • If mangroves were restored to their 1950 distribution, there would be additional benefits to 267,000 people annually, including 61,000 people 4 Millions below poverty, and US $450 million in annual averted damages. 2 • The results from the general, national-scale models were compared with the results from higher resolution, local models. These comparisons reveal 0 10 20 30 40 50 that the national scale models are robust and conservative, i.e., the national models err towards Storm Return Period (years) predicting less flooding and less benefits from Historical Current No mangroves mangroves. Property Flooded (Billions US $) • Maps of the distribution of risks reduction benefits 9 provided by mangroves can inform protection & restoration priorities (see Figure 5). 6 Billions Key Data and Capacity Needs • The national models could be most improved with 3 better topographic and bathymetric data and secondarily with better data on the density of mangroves. 0 10 20 30 40 50 • The valuation of mangrove flood reduction Storm Return Period (years) benefits requires inputs from multiple Philippine Historical Current No mangroves agencies, including PAGASA, DENR, PSA and Figure 3 The curves represent the expected damages from flooding to others10. To any one agency, the data and models people and property under historical (1950), current (2010), and no mangrove scenarios. The difference between the curves represents the will seem complex, however these agencies are avoided damages, or benefits, provided by mangroves. Valuing the protection services of mangroves in the Philippines | 4 Figure 4 High resolution flood mapping. Predicted flooding in Pagbilao during a 1-in-50 year storm event under three different scenarios: historical mangrove cover (1950), current mangrove cover (2010) and no mangrove cover (assuming all mangroves are lost.) Results were produced with a high resolution flood model using data from historical cyclones. Figure 5 The map shows the spatial variation in flood protection benefits from mangroves in the Philippines. Circles represent the annual expected benefit from mangroves for flood protection ($US millions). The values are the difference in expected damages with current mangrove coverage (2010) and without mangroves. Valuing the protection services of mangroves in the Philippines | 5 The Way Forward: Opportunities for the combine mangrove natural defenses with built Philippines (and Beyond) infrastructure. • Numerous programs can incorporate these Mangrove conservation and restoration can be an results into their plans and analysis, including: important part of the solution for reducing coastal the National Greening Program; Integrated risks in the Philippines, especially as those risks Area Development, Risk Resilience and increase with climate change. This Report provides a Sustainability Program; Green Climate Fund social and economic valuation of mangroves that can and People Survival Fund; and the inform the policy and practice of many Philippine Comprehensive Land Use Plans of local agencies, businesses and organizations across governments. development, aid, risk reduction and conservation • PAGASA10 and Local Government Units may sectors as they seek to identify sustainable and cost- use these results to inform and improve their effective approaches for risk reduction. risk assessment and flood risk mapping. • These results can be considered in risk industry By showing the spatial variation of the flood models, which may influence insurance reduction benefits provided by mangroves, these premiums in the Philippines and the results can identify the places where mangrove development of innovative finance mechanisms management may yield the greatest returns. By to support mangrove management. valuing these coastal protection benefits in terms Catastrophic hazard bonds, resilience bonds, used by finance and development decision-makers and blue bonds among others could use the (e.g., annual expected benefits), these results can be risk reduction benefits of mangroves to readily used alongside common metrics of national support habitat conservation and restoration11. economic accounting, and can inform risk reduction, development and environmental conservation decisions in the Philippines. In the past nature-based measures for coastal protection, such as mangrove restoration, were not In the Philippines, many opportunities exist for the assessed for their cost effectiveness for risk application of these results: reduction, because rigorous values of their coastal protection benefits were missing. These services can • These results can help identify priority sites for be rigorously valued to inform national accounting, mangrove conservation and restoration for cost-benefit analyses and comparisons of different coastal protection, either as ‘stand-alone’ coastal protection options, including natural, hybrid solutions, or part of hybrid approaches that and built defenses. Notes 1. Losada, I.J., M. Beck, P. Menéndez, A. Espejo, S. Torres, P. Díaz- 6. Spalding, M., M. Kainuma, L. Collins. 2010. World Atlas of Simal, F. Fernández, S. Abad, N. Ripoll, J. García, S. Narayan, Mangroves. London: Earthscan. D. Trespalacios. 2017. Coastal Protection Services of 7. Giri, C., J. Long, S. Abbas, R. M. Murali, F. M. Qamer, B. Pengra, Mangroves in the Philippines. Instituto de Hidráulica D. Thau. 2015. Distribution and dynamics of mangrove forests Ambiental Universidad de Cantabria, The Nature of South Asia. Journal of Environmental Management 148:101– Conservancy. Valuing Protective Services of Mangroves in the 111 Philippines. 8. Narayan, S., M. W. Beck, B. G. Reguero, I. J. Losada, B. van 2. NEDA. 2017. Philippine Development Plan 2017-2022. National Wesenbeeck, N. Pontee, J. N. Sanchirico, J. C. Ingram, G-M. Economic and Development Authority, Pasig City. Lange, K. Burkes-Copes. 2016. The benefits, costs and 3. World Bank. 2016. Managing Coasts with Natural Solutions: effectiveness of natural and nature-based coastal defenses. Guidelines for Measuring and Valuing the Coastal Protection PLoS ONE 11(5): e0154735. Services of Mangroves and Coral Reefs. M.W. Beck & G-M. 9. Polasky, S., Tallis, H. & Reyers, B. 2015. Setting the bar: Lange, editors, World Bank, Washington, DC. Standards for ecosystem services. PNAS 112, 7356-7361. 4. McIvor, A.L., I. Möller, T. Spencer, M. Spalding. 2012a. 10. PASAGA: Philippine Atmospheric Geophysical and “Reduction of wind and swell waves by mangroves. Natural Astronomical Services Administration; NAMRIA: National Coastal Protection Series: Report 1.” Cambridge Coastal Mapping and Resource Information Authority; DENR: Research Unit Working Paper 40. The Nature Conservancy and Department of Environment and Natural Resources; NEDA: Wetlands International. National Economic and Development Authority; PSA: 5. McIvor, A.L., T. Spencer, I. Möller, M. Spalding. 2012b. “Storm Philippine Statistics Authority Surge Reduction by Mangroves. Natural Coastal Protection 11. Colgan, C. S., M. W. Beck, S. Narayan, 2017. Financing Natural Series: Report 2.” Cambridge Coastal Research Unit Working Infrastructure for Coastal Flood Damage Reduction. Lloyd’s Paper 41. The Nature Conservancy and Wetlands International. Tercentenary Research Foundation, London. Download Policy Briefings at www.wavespartnership.org Wealth Accounting and the Valuation of Ecosystem Services (WAVES) is a global partnership led by the World Bank that aims to promote sustainable development by ensuring that natural resources are mainstreamed in development planning and national economic accounts