Palawan Asset Accounts

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Palawan was selected in 1998 as the pilot
area for the institutionalization of the Philippine Economic-Environmental and Natural Resources Accounting (PEENRA) System at the provincial level.

Focusing this time on the valuation of the asset accounts for five resources of Palawan, this activity was able to show that environmental and natural resources accounting could be successfully carried out at the sub-national level.

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Palawan Asset Accounts

  1. 1. ENVIRONMENTAL AND NATURAL RESOURCES ACCOUNTING II PROJECTPALAWAN ASSET ACCOUNTSFishery, Forest, Land/Soil,Mineral and Water Resources Palawan Council for Sustainable Development Staff National Statistical Coordination Board United Nations Development Programme
  2. 2. FOREWORDIn 1994, the Palawan Council for Sustainable Development Staff (PCSDS) and theProvincial Government, together with the National Statistics Office (NSO) and theBureau of Agricultural Statistics (BAS), had the occasion of working with the NationalStatistical Coordination Board (NSCB) for the pilot-testing of the compilation of theGross Provincial Domestic Product. A first attempt at sub-regional disaggregation ofthe GDP, this exercise provided the basis for determining Palawan’s contribution tothe national economy. This activity likewise paved the way for identifying the areasfor improvement of the statistical data collection system in the province.As an offshoot of this undertaking, Palawan was again selected in 1998 as the pilotarea for the institutionalization of the Philippine Economic-Environmental and NaturalResources Accounting (PEENRA) System at the provincial level. Focusing this timeon the valuation of the asset accounts for five resources of Palawan, this activity wasable to show that environmental and natural resources accounting could besuccessfully carried out at the sub-national level. Such activity could not have beenachieved without the support and cooperation of the various data producing agenciesoperating in the province.On behalf of the Provincial Government of Palawan, I would like to extend ourgratitude to the United Nations Development Programme (UNDP), the sponsor of thesecond phase of the Environment and Natural Resources Accounting Project, NSCBand the United Nations Statistics Division (UNSD), for the technical guidanceprovided to us. I also commend the heads of agencies and technical staff who hadactively participated in pursuing the realization of the objectives of this project.We take great pride that Palawan had initiated this worthwhile endeavor. Throughthis publication, we hope to disseminate the experience and outputs of Palawan as apilot model towards the establishment of a provincial asset accounts of interestedprovinces. JOEL T. REYES Governor Province of Palawan ii
  3. 3. FOREWORDThis report contains the output of the technical working groups from 14 nationalagencies and local government offices in Palawan who were involved in theEnvironment and Natural Resources Accounting (ENRA) II Project. Funded by theUnited Nations Development Programme (UNDP), the ENRA II Project included aprovincial component which aimed to institutionalize the Philippine Economic-Environmental and Natural Resources Accounting (PEENRA) System at theprovincial level. Following the methodologies adopted during the first phase of theproject, asset accounts for five resources of Palawan, namely: land and soil, forest,fishery, mineral and water, were compiled by a technical working group for eachresource.As the lead implementing agency in the province, the Palawan Council forSustainable Development Staff (PCSDS) had spearheaded the operationalization ofthe project. To effectively undertake our tasks, we sought the participation of nationalagencies (Bureau of Agricultural Statistics, Department of Agrarian Reform, NationalIrrigation Administration, National Statistics Office, and the Department ofEnvironment and Natural Resources) and the offices of the Palawan ProvincialGovernment (Provincial Planning and Development Office, Office of the ProvincialAgriculturist and the Environment and Natural Resources Office) and PuertoPrincesa City Government (City Planning and Development Office and CityEnvironment and Natural Resources Office). The Palawan Tropical ForestryProtection Programme, a project of the PCSDS and the Paltubig, Inc. were alsoactive partners in this undertaking. Their participation and untiring support wereinstrumental in the achievement of the project’s objectives. All our efforts howevercould not have been effectively carried out without the guidance and supervision ofthe National Statistical Coordination Board (NSCB), the project’s overall leadexecuting agency.Indeed we are grateful for the opportunity given to us by NSCB and for theirconfidence that our provincial leaders and policy makers will find this project asignificant exercise. The skills that were imparted to us by the NSCB staff will be putinto test when we update the accounts in the future. The PCSDS fervently hopes thatthe cooperation shown to us by the various agencies with whom we have workedwith will continue as we pursue the ultimate objectives of the PEENRA system. JOSELITO C. ALISUAG Executive Director PCSDS iii
  4. 4. FOREWORDTowards the Institutionalization of the Philippine Economic-Environmental andNatural Resource Accounting (PEENRA) System at the Provincial Level, the NationalStatistical Coordination Board is pleased to have been a part of the “PalawanProvincial Asset Accounts”, a product of the Environmental and Natural ResourceAccounting II (ENRA II) Project funded by the United Nations DevelopmentProgramme.Palawan, is so far the only province that has its own Provincial Product Accounts. Asa pioneering output in environmental accounting at the subnational level, it is hopedthat the Palawan Provincial Asset Accounts will greatly contribute to the developmentof Palawan and will serve as a model for other provinces. Indeed, this compilation ofenvironmental resource accounts in Palawan from 1988 to 1999 covering six (6)resources namely land/soil, fishery, mineral, forest, water and wildlife resources, is apotent medium to bring to the fore the importance of environmental protection at thesubnational level.The NSCB salutes the Palawan Council for Sustainable Development Staff for itsdedicated work in pursuing the realization of environmental accounting in theprovince. The close collaboration among the various stakeholders -- the ProvincialGovernment, other government agencies, non-government organizations and privateinstitutions in Palawan, and the individual members of the Provincial SteeringCommittee and the Technical Working Groups (TWGs), is an experience that shouldinspire other provinces who wish to undertake the same activity. We acknowledgethe United Nations Statistics Division (UNSD) for the technical assistance given andthe UNDP for the financial support extended to the ENRA II Project. ROMULO A. VIROLA Secretary General, NSCB iv
  5. 5. TABLE OF CONTENTSForewordList of Tables viiiList of Figures xiiList of Appendix Tables xvExecutive Summary xviiiCHAPTER 1. MARINE FISHERY RESOURCE1.1 Introduction 21.2 Conceptual Framework 3 1.2.1 Scope and Coverage 3 1.2.2 Framework of the Asset Account 31.3 Operationalizing the Framework 5 1.3.1 Sources of Data 5 1.3.2 Estimation Methodology 51.4 Results and Discussion 7 1.4.1 Share of the Fishery sector to GPDP 7 1.4.2 Fish Catch and Fishing Effort 7 1.4.3 Sustainable Yield and Depletion 81.5 Recommendations 10Acronyms 12Definition of Terms 13References 14CHAPTER 2. FOREST RESOURCE2.1 Introduction 162.2 Conceptual Framework 17 2.2.1 Scope and Coverage 17 2.2.2 Framework for the Asset Accounts 172.3 Operationalizing the Framework 18 2.3.1 Sources of Data 18 2.3.2 Estimation Methodology 192.4 Analysis, Results and Discussions 22 v
  6. 6. 2.4.1 Old Growth Dipterocarp Forest 22 2.4.2 Second Growth Dipterocarp Forest 25 2.4.3 Mangrove Forest 27 2.4.4 Rattan 292.5 Recommendations 31Acronyms 33Definition of Terms 34References 48CHAPTER 3. LAND/SOIL RESOURCE3.1 Introduction 503.2 Conceptual Framework 50 3.2.1 Scope and Coverage 50 3.2.2 Framework for the Asset Accounts 503.3 Operationalizing the Framework 53 3.3.1 Sources of Data 53 3.3.2 Estimation Methodology 54 3.3.3 Underlying Assumptions and Limitations 573.4 Result and Discussion 58 3.4.1 Physical Asset Accounts 58 3.4.2 Monetary Accounts 63 3.4.3 Summary of the Land and Soil Resource 663.5 Recommendations 67Acronyms 69Definition of Terms 70References 87CHAPTER IV. MINERAL RESOURCE4.1 Introduction 904.2 Conceptual Framework 92 4.2.1 Scope and Coverage 92 4.2.2 Framework for the Asset Account 924.3 Operationalizing the Framework 93 4.3.1 Sources of Data 93 4.3.2 Estimation Methodology 94 vi
  7. 7. 4.4 Results and Discussion 95 4.5.1 Physical Asset Account 95 4.5.2 Monetary Account 974.5 Recommendations 98Acronyms 100Definition of Terms 101References 108CHAPTER 5. WATER RESOURCE5.1 Introduction 1105.2 Framework for the Asset Account 111 5.2.1 Scope and Coverage 111 5.2.2 Framework for the Asset Account 1115.3 Operationalizing the Framework 112 5.3.1 Surface Water 112 5.3.2 Groundwater 1125.4 Analysis, Results and Discussion 116 5.4.1 Physical Accounts of Surface Water 116 5.4.2 Physical Accounts of Groundwater 1175.5 Limitations 1195.6 Recommendations 119Acronyms 121Definition of Terms 122References 130 vii
  8. 8. LIST OF TABLESTable Number Title PageCHAPTER 1. MARINE FISHERY RESOURCE 1.1 Gross Provincial Domestic Product Accounts, (Palawan 1988 and 1994) ……………………………. 7 1.2 Estimated Volume of Catch and Fishing Effort of Marine Fishery resource, Palawan, 1983-1998 … 8 1.3 Estimated Marine Fishery Resource Depletion, Palawan, 1983-1998 ….………………………….…… 9CHAPTER 2. FOREST RESOURCE 2.1 Area Accounts of Old Growth Dipterocarp Forests, 1988-1999 (in hectares)…………………….. 23 2.2 Volume Accounts of Old Growth Dipterocarp Forests, 1988-1999 (in thousand cubic meters)……. 23 2.3 Economic Accounts of Old Growth Dipterocarp Forest at Current Prices, 1988-1999 (In million pesos)……………………………………….. 24 2.4 Economic Accounts of Old Growth Dipterocarp Forest at Constant Prices, 1988-1999 (In million pesos)……………………………………….. 24 2.5 Stumpage Value for Natural Forest Stands at Current Prices, 1988-1999……………………………. 25 2.6 Area Accounts of Second Growth Dipterocarp Forests, 1988-1999 (in hectares)…………………….. 25 2.7 Volume Accounts of Second Growth Dipterocarp Forests, 1988-1999 (In thousand cubic meters)……. 26 2.8 Economic Accounts of Second Growth Dipterocarp Forest at Current Prices, 1988-1999, (In million pesos)…………………………. 27 2.9 Economic Accounts of Second Growth Dipterocarp Forest at Constant Prices, 1988-1999, (In million pesos)………………………… 27 2.10 Area Accounts of Mangrove Forests, 1988-1999….. 28 viii
  9. 9. Table Number Title Page 2.11 Volume Accounts of Mangrove Forests, 1988-1999, (In thousand cubic meters)…………….. 28 2.12 Rattan Resources Volume Accounts, 1988-1998 (In thousand lineal meters)…………………………… 29 2.13 Economic Accounts of Rattan at Current Prices, 1988-1991 (In million pesos)………………………… 31 2.14 Economic Accounts of Rattan at Constant Prices, 1988-1991 (In million pesos)………………………… 31CHAPTER 3. LAND/SOIL RESOURCE 3.1 Sources of Data on Lands Devoted to Forestry, Agriculture and Built-up Uses………………………… 54 3.2 Physical Asset Account of Land Resources Devoted to Forest Uses, Mainland Palawan, 1988-1998……………………………………………… 59 3.3 Physical Asset Account of Land Resources Devoted to Agricultural Uses, Palawan, 1988-1998……………………………………………… 60 3.4 Physical Asset Account of Land Resources Devoted to Built-up Uses, Palawan, 1988-1998……………………………………………… 60 3.5 Physical Asset Account of Soil Resources Devoted to Forest Uses, Mainland Palawan, 1988-1998……………………………………………… 61 3.6 Physical Asset Account of Soil Resources Devoted to Agricultural Uses, Palawan, 1988-1998……………………………………………… 61 3.7 Adjusted Physical Area of Forest Lands by Type of Forest, in Hectares, Mainland Palawan, 1988-1998……………………………………………… 62 3.8 Adjusted Physical Area of Agricultural Lands by Type of Farm, In Thousand Hectares, Palawan, 1988-1998………………………………………………. 62 3.9 Adjusted Physical Area of Built-up, In Hectares, Palawan, 1988-1998…………………………………… 63 ix
  10. 10. Table Number Title Page 3.10 Monetary Estimate of Land Resources Devoted to Forest Uses, Mainland Palawan, 1988-1998……………………………………………… 63 3.11 Monetary Estimate of Land Resources Devoted to Agricultural Uses, Palawan, 1988-1998……………………………………………… 64 3.12 Monetary Estimate of Land Resources Devoted to Built-up Uses, Palawan, 1988-1998……………………………………………… 64 3.13 Monetary Estimate of Soil Resources for Lands Devoted to Forest Uses, Mainland Palawan, 1988-1998……………………………………………… 65 3.14 Monetary Estimate of Soil Resources for Lands Devoted to Agricultural Uses, Palawan, 1988-1998……………………………………………… 65 3.15 Summary Table of Physical Asset Account of Land Use by Year, Palawan, 1988-1998………………….. 66 3.16 Summary Table of Monetary Asset Account of Land Use by Year, Palawan, 1988-1998………………….. 67CHAPTER 4. MINERAL RESOURCE 4.1 Mineral Deposit in Palawan, 1981………………..… 91 4.2 Nickel Physical Asset Accounts in Ore Form……… 96 4.3 Nickel Physical Asset Account in Metal Form…….. 96 4.4 Sand and Gravel Physical Account………………… 97 4.5 Nickel Monetary Account (Using Net Price Method at 15% Interest Rate, In Peso)……………. 98 4.6 Sand and Gravel Monetary Account (Using Net Price Method at 15% Interest Rate, In Peso)……… 98CHAPTER 5. WATER RESOURCE 5.1 Physical Accounts Framework for Surface and Groundwater……………………………………….…. 111 5.2 Estimation Methodology and Sources of Data……. 114 x
  11. 11. Table Number Title Page 5.3 Surface Water Physical Asset Account of Palawan, 1988-1998 (MCM)……….…………………………… 116 5.4 Physical Account of Groundwater in the Province of Palawan , 1988-1996 (MCM)…………………….. 118 xi
  12. 12. LIST OF FIGURESFigure Number Title PageCHAPTER 1. MARINE FISHERY RESOURCE 1.1 Catch by Commercial and Municipal Fishery Industry, Palawan, 1983-1998……………………… 2 1.2 Asset Accounts Framework for Fishery Resource… 4 1.3 Total Catch and Total Fishing Effort, Palawan, 1983-1998……………………………………………… 8 1.4 Sustainable Yield Effort Curve for Marine Fishery Resources, 1983-1998……………………………….. 10CHAPTER 2. FOREST RESOURCE 2.1 Asset Accounts Framework…………………………… 18 2.2 Area and Volume Accounts of Old Growth Dipterocarp, 1988-1999…………………………….…. 24 2.3 Area and Volume Accounts of Second Growth Dipterocarp, 1988-1999………………………………... 26 2.4 Area Change by Forest Type…………………………. 28 2.5 Volume Change by Forest Type……………………… 29 2.6 Volume of harvested/Cut Rattan as Compared to the stock, 1989-1999…………………………….…. 30 2.7 Monetary Valuation of Rattan Forest Resource at Current and Constant Prices, 1988-1999………………………………………………. 30CHAPTER 3. LAND/SOIL RESOURCE 3.1 Physical Accounts Framework for the Land/Soil Resource,………………………………….. 51 3.2 Monetary Accounts Framework for the Land/Soil Resource…………………………..……….. 52 3.3 Summary of Physical Asset Accounts for Forest, Agriculture, Built-up and Other Land Uses, 1988 and 1998………………………………………… 66 3.4 Comparison of Monetary Value of Forest, Agriculture and Built-up Use………………………… 67 xii
  13. 13. Figure Number Title PageCHAPTER 4. MINERAL RESOURCE 4.1 Asset Account Framework for Mineral Resource… 93 4.2 Actual Nickel Extraction by RTNMC, 1988 – 1998………………………………………….. 96 4.3 Sand and Gravel Reserve and Extraction, 1990 –1999…………………………………………… 97CHAPTER 5. WATER RESOURCE 5.1 Precipitation vs. Basin Recharge vs. Direct Run-off, 1987-1998……………………………………………… 116 5.2 Surface Water Physical Account (Net Basin Recharge vs. Withdrawal vs. Closing Stock), 1988-1998…….. 117 5.3 Surface Water Withdrawal, 1988-1998…………….. 117 5.4 Groundwater Physical Account, 1988-1998……….. 118 5.5 Groundwater Demand in 1988 an 1998..…………… 118 xiii
  14. 14. LIST OF APPENDIX TABLESAppendix Table Number Title PageCHAPTER 2. FOREST RESOURCE 2.1 Physical Area of Forest Lands by Type, Mainland Palawan, 1985 and 1992……………………………….. 37 2.2 Physical Area of Forest Lands by Type, Mainland Palawan, 1986-1992…………………………………….. 37 2.3 Adjusted Physical Area of Forest Lands by Type, Mainland Palawan, 1986 –1989………………………… 37 2.4 Average Bole Volume by Species in Dipterocarp Old Growth Forest, Forest, Palawan………………………… 38 2.5 Average Bole Volume by Species in Dipterocarp Residual Forest, Palawan……………………………….. 39 2.6 Average Rattan Occurrence in Dipterocarp Old Growth Forest, Palawan……………………………. 40 2.7 Average Rattan Occurrence in Dipterocarp Residual Forest, Palawan………………………………. 40 2.8 Total Volume of Timber Production, In Cubic Meters, 1988-1999………………………………………………… 41 2.9 Total Volume of Confiscated Timber, In Cubic Meters, 1988-1999………………………………………………… 41 2.10 Total Area Covered within ISF/CBFM Concessions andAgro. Forestry, 1988 – 1999……………………….. 42 2.11 Total Area of Implementation of Conservation Efforts (Second Growth Forest), 1988 – 1999………………... 42 2.12 Total Area of Implementation of Conservation Efforts (Mangrove Forest), 1989 – 1995………………………. 43 2.13 Total Area Damaged from Kaingin and Forest Fires, 1991-1999…………………………………………………. 43 2.14 Total Rattan Harvest Manifestation, 1988-1999………. 44 2.15 Total Volume of Confiscated Rattan, 1989-1995…….. 44 2.16 Rattan Resources Volume Accounts, 1988-1999 (In thousand lineal meters)……………………………… 45 xiv
  15. 15. Appendix Table Number Title Page 2.17 Economic Accounts of Rattan at Current Prices 1988-1999, (in million pesos)……………………… 46 2.18 Computation for the Stumpage Values for Rattan Resources, 1988-1998…………………….. 47CHAPTER 3. LAND/SOIL RESOURCE 3.1 Physical Area of Forest Lands by Type of Forest, Mainland Palawan, 1985-1998, in Hectares………………………………………… 81 3.2 Forest Destruction by Cause, Mainland Palawan, 1991 – 1998, in hectares…………….………… 82 3.3 Conversion of Forest Lands to Other Uses, Mainland Palawan, 1988-1997………….……. 82 3.4 Areas of Reforestation by Municipality, Mainland Palawan, 1987-1998, in hectares... 83 3.5 Logged Area, Palawan, In Hectares, 1988-1992……………………………….….….. 83 3.6 Land Values, Palawan, In Hectares, 1987-1998…………………………………..….. 83 3.7 Erosion Hazard Assessment, Tamlang Catchment, 1985……………………….….…... 84 3.8 Slope Distribution, by Class Interval, Palawan, in Hectares, 1985………………..….. 84 3.9 Retail Price of Fertilizers, Philippines, 1988-1998…………………………………..…… 84 3.10 Daily Wage Rate for Agricultural Plantation, Philippines, 1986-1997……………………..….. 85 3.11 Physical Area of Agricultural lands by Type of Farm, Palawan, in Thousand Hectares, 1980 and 1988 to 1999…………………………. 85 3.12 Kaingin Areas, Palawan, in Hectares, 1991-1998………………………………….…….. 85 3.13 Land Conversion from Agricultural to Other Uses by Municipality, Palawan, 1989-1998…………. 86 xv
  16. 16. Appendix Table Number Title Page 3.14 Mangrove Area Converted to Fishpond, Palawan, in hectares, 1995 to 1998…………………………… 86 3.15 Physical Area of Built-up Area, Palawan, 1988 to 1998, in hectares…………………………… 86 3.16 Estimated Zonal Values of Lands, by type of Land Use, Palawan, 1985……………………….. 86CHAPTER 4. MINERAL RESOURCE 4.1 Nickel Reserve of Mining Companies, 1996………… 104 4.2 Volume of Nickel Reserve and Metal Content by Rio Tuba Nickel Mining Corporation, 1987 – 1996……… 105 4.3 Summary of Sand and Gravel Reserve on Selected Rivers in Palawan, 1999……………………….……… 106 4.4 Computed Unit Rent and Resource Rent of Nickel Resource, Palawan, 1988 – 1998……………….…… 106 4.5 Computed Unit Rent and Resource Rent of Sand and Gravel Resource, Palawan, 1990 – 1999……….…… 107 4.6 Market Price per Unit Volume, 1988 – 1999……….… 107CHAPTER 5. WATER RESOURCE 5.1 Estimated Basin Recharge, 1987-1998 (MCM)…….. 124 5.2 Palawan Annual Rainfall Data, 1987-1998 (mm)…… 124 5.3 Palawan Hydrometric Network Mean River Discharge, 1986-1989 (MCM)………………………… 124 5.4 Agricultural Water Uses from Surface Water in the Province of Palawan, 1988-1998 (MCM)…………… 125. 5.5 Total Area Planted with Crops, in hectare, 1988-1998 125 5.6 Physical Accounts of Groundwater, 1980-1987 (MCM) 125 5.7 Water Demand from Groundwater, 1980-1996 (MCM) 126 5.8 Palawan Population Data, 1980-1998………………. 127 5.9 Number of Establishments, 1978-1999……………… 127 xvi
  17. 17. Appendix Table Number Title Page 5.10 Livestock and Poultry Water Demand from, Groundwater, 1988-1994 (MCM)…………………….. 128 5.11 Livestock and Poultry Population, Number of Heads, 1988-1998………………………………………………. 128 5.12 Groundwater Recharge Based from Rainfall, 1980-1998………………………………………………. 129 xvii
  18. 18. EXECUTIVE SUMMARYPalawan is one of the remaining islands of the Philippine archipelago with a relativelywell maintained environment. In order to ensure the preservation of the remainingforest areas, coral reefs and other fragile ecosystems as well as to promote the wiseutilization of its natural resources, Republic Act No. 7611, otherwise known as theStrategic Environmental Plan (SEP) for Palawan Act, was adopted in June 1992 asthe province’s framework for sustainable development. To achieve a balancebetween development and conservation, all programs and projects in Palawan weresubsequently aligned with the goals and objectives of the SEP. Complementarypolicies were likewise issued by the provincial government in consonance with theplan.The selection of Palawan as the pilot area for the institutionalization of the PhilippineEconomic-Environmental and Natural Resources Accounting (PEENRA) was then awelcome opportunity for the local government and the Palawan Council forSustainable Development Staff (PCSDS), the policy-making body tasked with theoperationalization of the SEP, to have at hand a system that can provide the basis forthe formulation of the policies that will promote the rational utilization of its resources.The provincial component of the UNDP-funded Environment and Natural ResourcesAccounting (ENRA) II Project called for the compilation of asset accounts of fivemajor resources, namely, fishery, forest, land and soil, mineral and water. Based onthe experience at the national level, asset accounts were estimated by technicalworking groups whose members came from 14 national agencies and offices of theProvincial Government of Palawan and the City Government of Puerto Princesa.Attempts were made to compute both the physical and monetary valuation of theresources. However, due to data limitations, both physical and monetary accountswere established only for fishery, land/soil, and mineral resources. For surface andground water, mangrove forest and fishery resources, only the physical accountswere compiled.A major objective of the project in Palawan was the institutionalization of thePEENRA system. As the lead implementing agency and in the light of its mandateunder R.A. No.7611, the PCSDS assumed the responsibility of sustaining theactivities. Immediately after the termination of the pilot testing in June 2001, thePCSDS integrated into its regular annual plan the updating of the asset accounts.The PEENRA system became a component of an Environmental Monitoring andEvaluation System which was developed to determine the status of the environmentin support to the implementation of the SEP. Currently, preparations are underway toformalize the arrangements with the agencies of the national and local government tocover data gathering and actual compilation of the accounts. The recommendationsmade by the technical working groups will also be pursued.The highlights of the results of the accounting exercise in Palawan are summarizedin the following sections. xviii
  19. 19. Fishery ResourceThe resources covered in this accounting exercise are municipal and commercialmarine fisheries. Because of constraints in the data, the compilation was limited tothe estimation of the volume of depletion and an approximation of the sustainableyield levels based on the Fox Model.The fishery sector contributed 22.8 percent and 20.6 percent to the gross provincialdomestic product for Palawan in 1988 and 1994, respectively. Despite efforts toprotect the numerous fishing grounds and long coastline of Palawan, the resourceshowed signs of depletion. A comparison of the trends in 1988 to 1998 reveals thatfishing effort increased at a faster rate than fish catch. In fact, during this period, thevolume of catch rose by 3.0 percent while fishing effort, based on the totalhorsepower of both municipal and commercial vessels, grew by 21.4 percent.The maximum sustainable yield of 101,954 metric tons, that is, the biomass that canbe caught without jeopardizing the fish stock of any species, was reached at an effortof 65,629 horsepower. During the earlier years of the accounting period, the volumeof catch exceeded the rate of natural growth. Depletion level was pegged at acomparatively high 20,727 metric tons in 1988 but this went down to 1,413 metrictons in 1990. In the next four years (1992 to 1995), the extraction level was below thesustainable yield. During this period, the local government’s active law enforcementand concerted conservation and protection programs of different sectors werebelieved to have contributed to the recovery of the marine ecosystem from previousdestructive fishing practices. However, starting 1996, the result showed thatproduction activities had again put pressure on the resource as evidenced by theharvested volume being greater than the resource’s natural growth. From a depletionlevel of 2,639 metric tons in 1996, it rose to 23,607 metric tons in 1998.Based on the experiences in the compilation of the asset accounts and results of theaccounting exercise, the technical working groups had drawn up recommendations toimprove the data collection system and the actual consolidation of information fromthe offices of the different data producers. Initial policy recommendations were putforward to address certain issues that are being confronted in line with themanagement and utilization of these resources. Mechanisms to institutionalize theaccounting were likewise identified. xix
  20. 20. Forest ResourceThe forest provides both ecological and economic benefits. Palawan is one of thecountry’s provinces endowed with rich natural resources and the forest ecosystem ischaracterized by a highly diverse flora and fauna. Palawan’s forest land of 647,090hectares accounts for 43 percent of Palawan’s total land area.Due to commercial logging, which was allowed until 1992, old growth forest areadeclined by 52 percent (175,990 hectares) from 1988 to 1999. From the closing stockof 339,208 hectares in 1988, total forest area decreased to 163,218 hectares in1999. Similarly, the equivalent volume of old growth dipterocarp timber was depletedby 2.9 million cubic meters per year, reducing its 1988 timber closing stock of 61.1million cubic meters to its 1999 stock of 29.4 million cubic meters. The monetaryvalue for old growth forest fell during the accounting period by P 2.6 billion or P 233.9million annually at current prices. At constant prices, the value shrunk from P 55.3billion in 1988 to P 26.6 billion in 1999. The depletion that resulted from the changesin the physical stock of old growth forest averaged P 860 million per year or anannual decline of 1.6 percent.The 1988 closing stock of second growth forest area was 216,057 hectares andincreased to 392,406 hectare in 1999, representing an 82 percent increase. Secondgrowth dipterocarp timber volume increased by 25,042 thousand cubic meters from1988 to 1999 with an average annual increase of 2,277 thousand cubic meters peryear. Several factors contributed to the increase including the prevalence ofreforestation and assisted natural regeneration activities and old growth forest beingconverted to second growth forest. The monetary value of second growth forest,likewise, showed an increasing trend with an annual average increment of P 4.1billion at current prices and P 1.0 billion at constant prices.Mangrove forest plays a vital role in directly preserving the islands surroundingmarine ecology. However, because of the conversion to fishpond and harvesting,vast tracts of mangrove areas were lost at a rate of 683.5 ha per year. The totalmangrove stock declined at a rate of 88,091 cu. m. per year from its 1988 closingstock of 4.6 million cubic meters to 3.7 million cubic meters in 1999.Rattan stock in both old growth and second growth forest decreased at a rate of 4.5million linear meters annually draining its 1988 closing stock of 746.0 million linearmeters to 696.6 million linear meters in 1999. Because of the decrease in the volumeof stock of rattan, the value of its closing stock at current prices increased from P590.0 million in 1988 to P 1.1 billion in 1999. At 1985 prices, the real value declinedfrom P 508.9 million in 1988 to P 470.0 million in 1999, recording an annual declineof 0.7 percent. xx
  21. 21. Land and Soil ResourcesLand and soil resources are among the most important natural resources because oftheir direct relationship to plants that in turn provide environmental benefits, food andlivelihood. Thus, it is imperative to understand the nature and characteristics of theseresources in order to manage and conserve them properly.Palawan is the largest province of the country with a land area of 1,489,630 hectares.In 1988, about 43.4 percent of its total land area was devoted to forest area,particularly in Mainland Palawan, 11.6 percent to agriculture use, and a negligible 0.5percent to built-up use. Meanwhile, a large proportion of about 44.5 percent wasclassified as reproduction brush, grassland, water bodies and shallow coast includingthe forest areas in the island municipalities.From 1988 to 1998, forest area decreased from 647 thousand hectares valued atP 31.9 million to 612 thousand hectares valued at P 75.9 million in 1998. It declinedat an average annual rate of 0.5 percent equivalent to around 3,545 hectares peryear. Given the general increase in the prices of land, there was a substantialincrease of P 44.0 million in the value of forest area. An average of 1,494 hectaresper year of forest area was converted to different agricultural uses. Such change inland use was attributed to the deforestation caused by logging and conversion tokaingin and other non-forest uses. It also includes conversion of mangrove forestareas into fishpond.In 1988, the total agricultural land was 172,945 hectares with a monetary value of P1.7 billion which increased to 217,697 hectares in 1998 with a value of P 5.3 billion.Meanwhile, more than 600 hectares of lands devoted to agricultural uses wasrecorded as legally converted into built-up areas. It is however observed that thisarea is quite small considering the change in built-up area from 1988 to 1998 of34,796 hectares (equivalent to P 84.1 billion). Unreported illegal land conversion fromagriculture to other land uses without the approval of DAR is one of the reasons forthe large area that is left unaccounted for.The change in soil quantity, expressed in terms of nutrient loss, serves as anindicator on the extent of soil degradation. The amount of soil eroded, on the otherhand, is a measure of soil depletion. In 1988, a total of 11.8 million metric tons waseroded from forest and agricultural lands. By 1998, the volume was estimated at 13.9million metric tons. Some portions of the eroded materials are deposited inwaterways and farmland, while others may be dissolved in water as they are carrieddownstream. The volume of sediment due to erosion from forest and agricultural areagrew from 8.1 million metric tons in 1988 to 9.6 million metric tons ten years hence.The annual average nutrient loss from sediments, expressed in fertilizer equivalent,from both forest and agricultural lands were 22,959 tons of nitrogen, 487 tons ofphosphorous, and 3,542 tons of potassium. In sum, the estimated value ofdegradation amounted to P 111.2 million in 1988 and increased to P 253.8 million in1998 for both forest and agricultural lands. xxi
  22. 22. Mineral ResourceAmong the metallic mineral deposits mapped in the province are nickel, chromite,copper, mercury, antimony, lead, gold, manganese, uranium, pyrite and iron.Meanwhile, the non-metallic reserves are silica, limestone, pebbles, marble, coal,sand and gravel. Nickel, which is the only metallic metal currently being put intocommercial production, was included in accounting for the resource.The opening stock of nickel ore in 1988 was placed at 412.7 million metric tons andhad an equivalent volume of about 5.8 million metric tons of metal. By 1998, thevolume of nickel ore had declined to 407.5 metric tons with a corresponding metalcontent of 5.7 metric tons. The metal content slightly varied during the period from1.41 percent to 1.43 percent. In sum, the total extracted ore during the accountingperiod of 3.7 million dry metric tons contained 52 thousand metric tons of nickelmetal.In monetary terms, Palawan’s nickel reserve, valued at P 272.6 billion in 1988,increased by 1.1 percent to P 304.7 billion in 1998. The variable market price ofnickel was noted during the period. The highest market price was recorded in 1989at P 68.25 per kilogram and the lowest was in 1993, pegged at P 27.07 per kilogram.Based on a 1999 survey of 15 rivers in Mainland Palawan which are the majorsources of sand and gravel aggregates, the reserve was placed at 5.4 million cubicmeters. The volume extracted increased at an average of 12.7 percent per annum.From the 1990 extraction of 19 thousand metric tons, the volume rose to 71 thousandmetric tons in 1999 with equivalent monetary values of P 66.6 million and P 629.4million, respectively. xxii
  23. 23. Water ResourcePalawan consists of 191 catchments, 31 of which are identified as major catchments.According to the Master Plan Study on Water Resources Management of thePhilippines conducted by the National Water Resources Board (NWRB) in 1977, only15 percent or 2,242 square kilometers of the 14,896 square kilometers total land areaof Palawan has available groundwater. The population depends mainly on thegroundwater for its domestic, commercial and industrial consumption. On the otherhand, a large proportion of the surface water is being consumed by the agriculturesector.For this specific undertaking, both the surface and groundwater resources werecovered. Results of the estimation of the physical accounts of surface water showedan increase in stock from 15,023.0 million cubic meters in 1988 to 45,642.5 millioncubic meters in 1998. The increasing trend in the demand for surface water inagriculture is still very small compared to the basin recharge. Thus, the availablestock for surface water adds potential for the agricultural development of theprovince.The groundwater stock depends on the recharge from rainfall. The provinceexperienced the lowest recharge in 1991 due to lower amount of rainfall particularlyin the southern part of the mainland. The study showed an increase in abstraction ofgroundwater for domestic, commercial and industrial purposes from 24.4 millioncubic meters in 1988 to 37.7 million cubic meters in 1998. The increase in abstractionmay be attributed to the rapid increase in population brought about by migration. xxiii
  24. 24. Palawan Marine Fishery Resource
  25. 25. Environmental and Natural Resources Accounting MARINE FISHERY RESOURCE1.1. INTRODUCTION1. Palawan is an archipelago of 1,780 islands and islets with a coastline ofabout 2,000 kilometers. It has an estimated water body of 49,408 square kilometers,coral reefs of 9,800 square kilometers (excluding Tubbataha and Kalayaan) and amangrove forest of 46,445 hectares (JAFTA, 1992).2. The province has numerous coves and bays with rich fishing grounds. About64,400 fishers, majority of whom are migrants coming from Cebu, Iloilo and otherprovinces ply these waters. Palawan contributes roughly 40 percent to the totalfishery production of the Philippines (BAS, 1998). Commercial and municipalfisheries registered an average production of 94,070 metric tons annually from 1988to 1998 (Figure 1.1). Vessels classified under municipal fishery represented 77percent of the total fishing boats. Similarly, about two thirds of the total catch in 1998was contributed by municipal fishery. It is not surprising therefore that fish is theprincipal source of protein for the Palaweños whose per capita food requirement forfish is estimated at 30.66 kilos per annum (MHS, 1982). Figure 1.1 Catch by Commercial and Municipal Fishery Industry, Palawan, 1983 to 1998 (In Metric Tons) 90,000 Catch (in metric tons) 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 Commercial Municipal3. In 1995, about 75 percent (NSO, 1995) of the total population resided in thecoastal zone whose sources of livelihood were derived from the coastal/marineresources. Majority of the local residents engaged in municipal fishing, howeversome of them resorted to deep-sea fishing in order to increase production. One ofthe factors that influenced small fishers to go beyond the municipal waters was thedeclining catch.2 Palawan Marine Fishery Resource
  26. 26. Environmental and Natural Resources Accounting4. Human activities have been contributory to the deterioration of the coral reef,sea grass beds and mangrove forest that serve as shelter and nursery of spawningand juvenile fish. The problems besetting the fishery resource are also rooted to thedestructive activities in the terrestrial area that cause siltation and sedimentation inthe coastal areas. Moreover, the use of harmful fishing methods, such as trawl anddynamite fishing, and obnoxious substances like sodium cyanide, put pressure onthe resource. Meanwhile, the mangrove forest in Southern Palawan has beendestroyed through illegal mangrove tree debarking and conversion of mangroveforest into fishpond. The coral reefs are also deteriorating as disclosed by someresearches. For example, out of 75 sites surveyed in 1997 to 2000 by the PalawanCouncil for Sustainable Development Staff (PCSDS) and Non-GovernmentOrganizations (NGOs) in Puerto Princesa City, Aborlan, Narra, Espanola, andBusuanga, only 12 percent were classified under excellent condition, that is, having acoral cover of at least 75 percent.5. To address these problems and issues and to formulate appropriate plansand policies in accordance with the concept of sustainable development,comprehensive information on the status of the fishery sector is needed by plannersand policy makers. It is for these reasons that accounting of the resource waspursued under the Environment and Natural Resources Accounting (ENRA) IIProject.1.2. CONCEPTUAL FRAMEWORK 1.2.1 Scope and Coverage6. The fishery resource accounts cover cultivated and non-cultivated fish stockand other aquatic animals. The former includes the stock of fish and other aquaticanimals in fishponds and farms while the latter are found in the ocean and the inlandand coastal waters. The study however is confined to non-cultivated fish stocks anddue to data limitations, it covers only marine fishery resource for the period 1988 to1998. 1.2.2 Framework of the Asset Account7. The SEEA framework was used in the accounting of the resource both for thephysical and monetary accounts. Below is the conceptual framework operationalizedto come up with the fishery resource accounts for the Province of Palawan. Figure 1.2 Asset Accounts Framework for Fishery Resource Palawan Marine Fishery Resource 3
  27. 27. Environmental and Natural Resources Accounting OPENING STOCK Changes due to economic activity Depletion Total Catch Sustainable Yield Other Accumulation +/- Conversion of fish stocks to economic control Other Volume Changes due to natural or multiple causes + Natural growth - Natural mortality +/- Net migration - Mortality due to natural disasters or due to the destruction of natural habitats Changes in Stocks Revaluation* CLOSING STOCK *For monetary valuation only Fish Stocks8. The opening and closing stocks characterize the volume of the asset at agiven point in time. Ideally, the stock is measured in terms of the biomass at thebeginning and end of the accounting period. Changes in Stock9. Change in the volume of stock is affected by natural loss, fishing activity andrecruitment. Fishing is an extraction activity resulting to reduction of stock. The levelof fish catch that is beyond its natural growth occurring at a given point in time isconsidered as depletion. It occurs when total catch exceeds sustainable yield. Other Accumulation10. The positive or negative conversion of fish stocks to economic control isaccounted as other accumulation. Other Volume Changes11. The variables classified under other volume changes may be due to natural ormultiple causes. It consists of natural growth as additional stock and natural mortalityas reduction to the stock. Mortality due to natural disasters or destruction of naturalhabitat is also a reduction to the stock. Meanwhile, net migration is either addition orreduction to the stock.12. Due to data constraints, the accounting of the fishery resource was limited tothe framework discussing the changes due to economic activity particularly on thedepletion of the marine fishery resources. The methods used in the exercise is justan alternative approach to account for the resource rent based on the level ofdepletion, considering that depletion is only one of the changes in the balance sheet.The physical and monetary values of depleted commercial and municipal fish catchwere presented as an initial output for the fishery resource accounting.4 Palawan Marine Fishery Resource
  28. 28. Environmental and Natural Resources Accounting1.3. OPERATIONALIZING THE FRAMEWORK 1.3.1. Sources of Data13. The basic data requirements of the account using the Fox model are volumeof catch and the fishing effort expressed in terms of horsepower. The Bureau ofAgricultural Statistics (BAS) provided the data for total fish catch and producers’price based on their surveys covering the period 1988 to 1998. Data on catch from1983 to 1987 were retrieved from the Bureau of Fisheries and Aquatic Resources(BFAR) Statistical Profile. The total number of fishing boats and their correspondinggross tonnage and engine horsepower for commercial and municipal fishery werederived from the records of fishing vessel operators when they apply for a licensefrom the office of the Philippine Coast Guard, BFAR and MARINA. Since these areavailable in raw form, processing of data on horsepower and gross tonnage fromindividual licenses issued to fishing operators was undertaken under the project1.14. Gathered data were only restricted to a period of fifteen years covering 1983to 1998. Data on total fish production, measured in metric tons, were gathered fromlanding centers and were classified into commercial and municipal fishing.Commercial fishing uses boats that are more than three gross tons while municipalfishing uses boats of three gross tons and below. 1.3.2 Estimation Methodology Fish Stock15. The Palawan Technical Working Group (PTWG) attempted to compute for thephysical asset accounts of the fishery resource using the System of IntegratedEconomic and Environmental Accounting (SEEA) framework. However, results ofstock assessment surveys of several reef areas of Palawan conducted independentlyby BFAR, PCSDS and NGOs were not sufficient to represent the stock of theprovince’s numerous fishing grounds. Fish Catch16. One of the data needed to derive variables on fishing effort, sustainable yieldand depletion is the fish catch. Data on fish captured from commercial and municipalfishing were gathered focusing only on marine fishes. Fishery products such asshrimps, prawns and other invertebrates were excluded in the resource accounting.To show the status of Palawan’s fishery resource in terms of Maximum SustainableYield (MSY) for fishing, a series of data of at least fifteen years was compiled. Anundercoverage of 20 percent was applied to compute for the total fish production(NSCB, 1994). It represents the assumed unrecorded fish catch in different landingsites not monitored by the survey conducted by BAS. Fishing Effort17. At the outset, the working group tried to estimate the stock based on theassumption that a coral reef yields an average 15.6 tons/km2/year (White, et. al.,1 Processing of data from the files of individual operators was contracted in order to estimate the horsepower of fishing vessels. Palawan Marine Fishery Resource 5
  29. 29. Environmental and Natural Resources Accounting1998). However, this method was not deemed acceptable to the UNSD consultantsince it only accounted for the growth for a particular year and did not provide theinitial stock. It was further recommended that ICLARM should be consulted on theestablishment of the baseline data and development of a model that can be adoptedfor the regular updating of the accounts.18. Finally, the group adopted the Fox Model the data requirements of which arefish catch and total fishing effort (expressed in horsepower) to be able to come upwith an estimated catch per unit effort (CPUE), sustainable yield and depletion.Absence of published data on the number of fishing vessels, gears used and numberof fishers prompted the processing of raw data on fishing effort from individualrecords of fishing boat operators from boat licensing offices, namely, MARINA,Philippine Coast Guard and BFAR.19. Initial results of the data processing from the records of the afore-mentionedagencies showed a big leap in the horsepower from 1991 to 1992 and 1997 to 1998.One of the possible causes of the erratic trend was the failure of some fishingoperators to register their vessels for the year although their operation wasuninterrupted. In 1992, the recording system may have been affected by the transferof responsibilities on boat licensing from the Philippine Coast Guard and MARINA.Missing records were also noted. There were some municipalities with zeroregistration which is considered impossible and therefore erroneous. Meanwhile,intensified law enforcement activities of national agencies and local task forces in1998 was believed to have been instrumental to the increase in the number ofregistered fishing boats.20. In view of these observations, the PTWG reviewed the raw data processed bythe contractor and conducted a rapid appraisal of the economic life span of fishingboats. As a result, duplicate entries were cancelled and the records corrected. Aminimum period of eight years was applied to a fishing boat starting from the year itwas built. Based on the adjusted data, the total horsepower of commercial andmunicipal fishing vessels was derived. It is noted however that this computedhorsepower is underestimated. The equivalent fishing effort of the fishing gear andthe fishers were not covered because of the absence of an inventory of gears usedwhile there were no data on the number of fishers by type of employment, that is, onthe number of full-time, part-time time and occasional fishers. Sustainable Yield21. Sustainable yield was estimated using the Fox Model. The equation belowwas used (Philippine Asset Accounts, 1998): Y = E exp (a + b E) where: Y = catch or yield from the resource E = fishing effort per unit time a = constant b = regression coefficient22. The regression coefficient was determined by establishing the relationshipbetween the time series data on fish catch and the estimated fishing effort. Depletion6 Palawan Marine Fishery Resource
  30. 30. Environmental and Natural Resources Accounting23. To compute for depletion, total actual catch was deducted from thesustainable yield. If the catch exceeds the sustainable yield, depletion then occurs.To value the cost of resource depletion, expressed as net rent, the net price methodwas used. Net rent is the value of the output per unit of measurement after deductingthe expenses incurred in extracting the resource. The equation used is as follows: Depletion = Actual Catch less Sustainable Catch Net rent = Net price per unit x Depletion1.4. RESULTS AND DISCUSSION 1.4.1. Share of the Fishery Sector to GPDP24. Fishery is a major sector of the economy of Palawan. Estimates of the GrossProvincial Domestic Product (GPDP) in 1988 showed that agriculture, fishery andforestry accounted for about 54.2 percent of the provincial economy with fisherycontributing 22.8 percent (Table 1.1). By 1994, the share of the fishery sector wasslightly smaller at 20.6 percent but it still had contributed the second largest share tothe total GPDP, next to agricultural crops. Table 1.1. Gross Provincial Domestic Product Accounts, Palawan, 1988 and 1994 (In Million Pesos) At Constant 1985 Prices Percent Sector 1988 1994 1988 1994 Agriculture, Fishery and Forestry 1,603.9 1,907.7 54.2 49.9 Agricultural Crops 602.0 866.0 20.4 22.7 Livestock and Poultry 166.2 253.3 5.6 6.6 Fishery 673.8 784.9 22.8 20.6 Forestry 161.8 3.4 5.0 0.1 Industry 459.7 636.9 15.6 16.7 Services 891.6 1274.4 30.2 33.4 GPDP 2,955.2 3819.0 100.0 100.0 Source: Development of the Gross Provincial Domestic Product (GPDP) Accounts for the Province of Palawan, NSCB, Provincial Government of Palawan, PCSDS, 1998 1.4.2 Fish Catch and Fishing Effort25. During the entire 11-year accounting period, municipal fishery comprised thebulk of the total fish production (Table 1.2). On the average, catch of municipalfishers represented 74 percent of the total while commercial fishery accounted for theremaining 26 percent. Both municipal and commercial fishery showed an increasingtrend in terms of catch.26. Results of the comparative analysis of fish catch vis-à-vis fishing effort or theCPUE (Figure 1.3) also showed that the rate of increase in fishing effort was morethan that of the fish catch. Total catch rose by 3.0 percent from 1988 to 1998 whilefishing effort increased by about 21.4 percent. Palawan Marine Fishery Resource 7
  31. 31. Environmental and Natural Resources Accounting Table 1.2. Estimated Volume of Catch of Marine Fishery Resource, Palawan, 1988 - 1998 Fish Catch Commercial Total Year Municipal Fishery Fishery (in metric (in metric ton) (in metric tons) tons) 1988 54,284 28,622 82,907 1989 56,264 32,456 88,721 1990 69,349 20,348 89,698 1991 73,624 21,066 94,690 1992 67,136 15,380 82,517 1993 68,108 25,426 93,534 1994 73,556 24,076 97,632 1995 74,580 20,579 95,159 1996 73,256 20,890 94,146 1997 81,731 26,082 107,813 1998 81,605 26,356 107,960 Source: BAS Central Figure 1.3. Total Catch vis-à-vis Total Fishing Effort 120,000 120,000 100,000 100,000 Total Catch (in metric tons) Fishing effort (in horsepower) 80,000 80,000 60,000 60,000 40,000 40,000 20,000 20,000 - - 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 Total Catch Fishing Effort (Hp) 1.4.3 Sustainable Yield and Depletion27. Extraction of marine fish and utilization of the fishery resource in generalcannot be left unregulated. However, in order to have a sound basis for managingand regulating the extraction of the resource, fish stock, sustainable yield and levelsof depletion, if any, of the resource should be determined. Because attempts in thisstudy to establish the sustainable yield was faced with the difficulty of meeting thedata requirements of the SEEA framework, an approximation was arrived at usingthe Fox Model.28. Table 1.3 shows the estimated sustainable yield and depletion of the marinefishery resource after combining the catch and effort of municipal and commercialfisheries. At the start of the accounting period in 1988, depletion was observed and8 Palawan Marine Fishery Resource
  32. 32. Environmental and Natural Resources Accountingcontinued until 1991 but at a decreasing rate; from 20,727 metric tons, the level ofdepletion went down to 1,413 metric tons. Apparently, efforts by law enforcementagencies to curb destructive fishing methods were becoming effective. During thistime, the government introduced interventions to put a stop or at least minimizeharmful fishing practices and restrain over-fishing. The local government organizedthe Bantay Dagat, an inter-agency task force that was formed to enhance themonitoring of the coastal areas and went further to apprehending violators of fisheryregulations and other environmental laws. From 1992 until 1995, there was norecorded depletion of the marine fishery resource.29. However, in 1996, depletion of the marine fishery was again evident. Startingat a volume of 2,639 metric tons, it dramatically rose to 20,153 metric tons in 1997and went further up to 23,607 metric tons in the following year. It is believed thatinitial headway reached in combating illegal fishing activities and destruction of themarine ecosystems during the early 90’s may have not been sustained.30. Figure 1.4 presents the Sustainable Yield – Effort Curve with MaximumSustainable Yield estimated at 101,954 metric tons and effort at 65,629 horsepower. Table 1.3. Estimated Marine Fishery Resource Depletion, Palawan, 1988-1998 Year Total Catch Fishing Sustainable Depletion Effort (Hp) Yield 1988 82,907 19,958 62,180 20,727 1989 88,721 25,462 72,946 15,774 1990 89,698 34,415 86,023 3,675 1991 94,690 41,695 93,277 1,413 1992 82,517 47,120 97,050 - 1993 93,534 59,256 101,441 - 1994 97,632 67,391 101,918 - 1995 95,159 89,816 96,517 - 1996 94,146 101,047 91,507 2,639 1997 107,813 108,593 87,659 20,153 1998 107,960 114,715 84,354 23,607Figure 1.4. Sustainable Yield - Effort Curve for Marine Fishery Resource, 1988 – 1998 Palawan Marine Fishery Resource 9
  33. 33. Environmental and Natural Resources Accounting 110,000 1993 1995 100,000 1991 1997 1994 Sustainable Yield 1992 90,000 1996 (in metric ton) 1989 1990 1998 80,000 1988 70,000 60,000 50,000 - 20,000 40,000 60,000 80,000 100,000 120,000 140,000 Fishing Effort (in horsepower) Estimated Maximum Sustainable Yield = 101,954 metric tons Estimated Maximum Fishing Effort = 65,629 horsepower1.5. RECOMMENDATIONS31. There are indications that the fishery resource of Palawan is now facingthreats. Based on the initial findings of the study, the volume of depletion of marinefishery resource is rising at an increasing rate. However, to have a more solid basisfor evaluating the condition of the resource and in the formulation of the appropriatepolicy interventions, the SEEA framework should be fully operationalized. Foremostis the need to satisfy the data needs of the framework. Along this line, follow-onactivities are recommended in order to meet the requirements of the fishery resourceaccounting, namely: a. Resource assessment should be conducted to be able to establish the fish stock. b. Close monitoring of fishing activities and regular collection of data should be strengthened. Among the data that should be compiled are: (a) fish catch by species; (b) number of fishermen and terms of employment, that is, whether full-time, part time, or occasional; (c) number of fishing boats with corresponding horsepower; and (d) inventory of fishing gears. c. The prevailing price of fishery products by species should be gathered as well as cost of production to facilitate monetary valuation. d. Installation of Municipal Fishery Licensing System to keep a record of operating fishing vessels. This will help in determining the pressure to the coastal area as a result of fishing. It will also provide baseline information that can be subsequently used for regulatory and revenue purposes.10 Palawan Marine Fishery Resource
  34. 34. Environmental and Natural Resources Accounting e. Strengthen collaboration with the provincial offices of national agencies and the municipal offices in the compilation of data that they generate through locally initiated surveys and in the exercise of their regulatory functions. These data should be incorporated into their regular reports. f. Conduct of studies to gather a more comprehensive data on cultivated and non-cultivated fish stock for both marine and fresh water bodies32. Moreover, it is emphasized that the economy of Palawan is still hinged on theagricultural sector, in particular, crop farming and fishery, which are the population’smajor sources of livelihood. While this study is focused on the fishery resource, itshould not be overlooked that most fishers also cultivate small farm lots to augmenttheir income. Further, because of the topography of the province, its coastal areasand marine resources are especially vulnerable to adverse environmental activities inthe terrestrial areas. Aside from the destruction of the mangrove and marineecosystems that have direct impact on the resource, activities in the terrestrial areas(e.g., lowland and upland farming) also affect the coastal areas. As such, depletion ofthe resource is not only the effect of harmful fishing practices but may also be theresult of equally harmful farming techniques. Fishing and farming should therefore beaddressed through parallel interventions. It is imperative that both sectors beafforded immediate attention in terms of policy and program formulation.33. Meanwhile, efforts to mitigate the problems on illegal fishing call for stricterimplementation of fishery laws and related environmental laws primarily to protectand conserve the coastal marine ecosystem and its natural resources. Formulation ofmunicipal and barangay ordinances to support national policies is likewiserecommended. Palawan Marine Fishery Resource 11
  35. 35. Environmental and Natural Resources Accounting ACRONYMSBAS Bureau of Agricultural StatisticsBFAR Bureau of Fisheries and Aquatic ResourcesCPUE Catch Per Unit EffortGT Gross TonnageHp HorsepowerICLARM International Center for Living Aquatic Resources ManagementMARINA Maritime Industry AuthorityMSY Maximum Sustainable YieldMT Metric TonsNGO Non-Government OrganizationsPCSDS Palawan Council for Sustainable Development StaffPTWG Provincial Technical Working Group MembersSEEA System of Integrated Economic and Environmental AccountingUNSD United Nations Statistics DivisionJAFTA Japan Forest Technical Association12 Palawan Marine Fishery Resource
  36. 36. Environmental and Natural Resources Accounting DEFINITION OF TERMSDepletion is the extraction of fishery resources beyond the rate of natural growth, measured as a positive difference between catch and sustainable yield. It occurs when the total catch exceeds the natural growth.CommercialFishing is fishing for commercial purposes in sea waters with the use of fishing boats of more than three gross tons.Fishing Boat refers to the watercraft used for catching and transporting of fish resources from seawaters.Fish Catch refers to the volume of fish landed by commercial and municipal fishery industry.Fishing is the catching, gathering and culturing of fish, crustaceans, mollusks, and all other aquatic animals and plants in the sea or in inland waters. It includes the catching of fish and aquatic animals like turtles; the gathering of clams, snails, shells and seaweeds; and the culturing of fish and oysters. Sport fishing or small sale fishing pursued as a hobby is excluded.Fishing Effort refers to manpower, machine power and technology employed in harvesting fishery resources yielding to catch per unit effort. It is measured in terms of horsepower.Fishing Gears are equipment used in catching fish with or without the use of boats.Marine Fishery refers to the fishing activity at the seawaters outside of the coastal line.Municipal Fishing is characterized by the use of simple gear and fishing boats some of which are non-motorized and with a capacity of three and less than three gross tonnage.Horsepower is the work done at the rate of 550 foot-pounds per second and it is equivalent to 745.7 watts Palawan Marine Fishery Resource 13
  37. 37. Environmental and Natural Resources Accounting REFERENCESBureau of Agriculture Statistics. Production Fishery Production Statistics, Production Statistics, BAS. 1988 – 1993. BAS, Quezon City.Bureau of Fisheries and Aquatic Resources. 1997 Philippine Fisheries Profile. BFAR. Quezon City.Ilarina, Vivian. Compilation of Resource Accounts (Selected Case Studies) Fishery Resources. International Workshop on Environmental and Economic Accounting. September 2000. Manila, Philippines.Ministry of Human Settlements. Town Planning Guidelines and Standard, Economic Sector, 1982.National Statistics Office. 1995 Census of Population (Palawan).Palawan Integrated Area Development Project, Phase II Final Report. Volume 2- Production Component Annexes. February 1990.Philippine Asset Accounts. ENRA Report No. 2. May 1998. NSCB.Japan Forest Technical Association (JAFTA). Forest Register (Palawan). Information System Development Project for the Management of Tropical Forest. 1992.White, Allan, et al. The Value of Philippine Coastal Resources: Why Protection and Management are Critical. 1998. Coastal Resource Management Project. DENR and United States Agency for International Development. Cebu City, Philippines.14 Palawan Marine Fishery Resource
  38. 38. Palawan Forest Resource
  39. 39. Environmental and Natural Resources Accounting FOREST RESOURCE2.1 INTRODUCTION1. Palawan is situated in the southwest part of the Philippine Islands chain.Palawan stands as the countrys largest province with its 1.5 million hectaresland area. Tall mountain ranges bisect the province into east and west coast. Theeast coast has narrow beaches and a swampy shoreline, backed by plains andshort valleys. The west coast is more rugged, with mountains rising up near thesea, and narrow lowlands. Palawan, often intriguingly described as "The LastFrontier" and "Paradise Lost", is home to vast rainforests, underground rivers andcave systems, mangrove swamps, and rare species of flora and fauna found onlyin the Philippines. Palawan’s forest area of 647,090 ha accounts for 43 percentof its total land area (NAMRIA, 1985 and JAFTA, 1992).2. The objective of this study is to account for the physical and monetarystock of the forest resources from 1988 to 1999 and to determine the factors thatcontribute to the changes. Ultimately it aims to come up with relevantrecommendations in the proper management of the resource.3. Palawan’s forests are classified into four different types, namely,dipterocarps, submarginal, mossy and mangrove forest. Dipterocarp forests arefurther classified as either old growth or second growth. Old growth dipterocarpforests are virgin forests with no traces of commercial logging, while secondgrowth dipterocarp forests are those with traces of logging (NSCB, 1998). Thedipterocarp forest is the principal Indo-Malayan tropical rainforest formation. It isone of the world’s three main tropical rainforests in addition to the tropicalAmerican and African rainforests. Several layers of vegetation and a multiplicityof tree species characterize these tropical rainforests. The dipterocarp forest isnot a pure stand of tree species belonging to the family Dipterocarpaceae butrather a mix forest consisting of species of various families with the dipterocarpas dominant component.4. Philippine dipterocarps are mostly medium to large sized trees,unbranched to a considerable height and usually attain a height of 40 to 65meters in diameter at breast height (dbh) or diameter above buttress (dab) of 60to 150 centimeters. A few unusually large trees have been found to attain a dabas large as 30 cm, their boles are generally straight and regular (Whitford, 1911;Tamesis and Aguilar, 1951). In terms of economic importance, the familyDipterocarpaceae produces the greatest bulk of commercial wood in the countrysold worldwide under the trade name “Philippine Mahogany”. Dipterocarp timberconstitutes the bulk of our country’s log exports and wood for domestic buildingconstruction and infrastructure development (NSCB, 1998).5. Mangroves are coastal trees or shrubs that are adapted to estuarine oreven saline environments. The term mangrove refers to the individual plants,whereas mangal refers to the whole community or association dominated bythese plants. Mangroves have characteristic features that allow them to live inmarine waters (Calumpong and Meñez, 1996).16 Palawan Forest Resource
  40. 40. Environmental and Natural Resources Accounting6. Mangroves minimize soil erosion and pollution of seawater. Its extensiveair root system traps eroded soil and industrial pollutants especially during strongrains; aids in reclaiming considerable land area, shelterbelt against tidal waves,typhoons and strong winds; wildlife habitat; increase fish and shellfishproductivity; provides alternative wood supply, and industrial inputs such as resinfor plywood, adhesive manufacture, fuelwood and high grade charcoal, tanningfor dyeing hide into leather, viscose rayon for textile fabric manufacture; livestockfeed supplement, medicine and wine, vinegar and thatching materials from nipa(Soriano and Fortes, 1987). It is also for these reasons that mangrove forestsare drastically exploited. To address possible loss of mangrove genetic diversityor a much worse scenario of the entire mangrove forest area of the provincebeing wiped out, Palawan’s mangrove area has been declared a MangroveSwamp Forest Reserve on December 29, 1981.7. Rattan is a climbing palm which has a versatile stem of high economicvalue. It is one of the most important non-timber forest products of Palawan. It isused in the manufacture of fine handicrafts, furniture and furniture components,binding materials, fish traps, hammocks, sleeping mats, carpet beaters, hats,walking sticks, tool handles and others. Palawan is a major source of rattan polesfor furniture centers like Manila, Iloilo and Cebu. It is a major livelihood source forpoor and indigenous communities who are tapped by most rattan permittees forcane gathering and processing.8. Among the many non-timber forest resources, rattan is being prioritized inthis accounting effort in view of its worsening state. Unlike bamboo, rattan is notso prolific. Since rattan is co-terminus with dipterocarp forests, rattan is subject tothe damages caused by logging of its tree hosts.2.2 CONCEPTUAL FRAMEWORK 2.2.1. Scope and Coverage9. The system of forest resource accounting calls for the compilation ofasset accounts for area (in hectare) and volume of standing trees (in cubicmeter) and non-timber forest products. However, for this study, the accounting islimited to the asset accounts of dipterocarp forest (old growth and secondarygrowth), mangrove forest, and rattan. These resources were included in theaccounting process because of their economic and ecological significance and inconsideration of the availability of data. 2.2.2. Framework for the Asset Account10. The forest accounts, in physical and in monetary terms, adopted theformat presented on the next page. The opening stock represents the stock ofresources at the beginning of the accounting period. Several factors account forthe changes in stock including changes due to economic activities, otheraccumulation, and other volume changes representing the changes due to non-economic factors. Other volume changes include the statistical discrepancyequivalent to the difference between the computed closing stock (based on theframework’s identified factors) and the opening stock of the succeeding year.The closing stock for a year is equal to the opening stock of the succeeding year. Palawan Forest Resource 17
  41. 41. Environmental and Natural Resources Accounting Figure 2.1. Asset Accounts Framework OPENING STOCK Changes due to economic activity Assisted regeneration Legal Logging Unauthorized cutting Damage from logging Other Accumulation Forest Conversion Other Volume Changes Stand growth Mortality Forest fires Natural Disasters Changes in stock CLOSING STOCK11. Changes due to economic activity refer to human production activities asthey affect the stock of resources. Assisted regeneration is caused by humanintervention in regenerating natural forests such as plantations and reforestationactivities. Legal logging refers to the commercial logging done byconcessionaires from 1988-1992 when commercial logging was still allowed inthe province. Legal logging data from 1993 onwards account for harvestmanifestations from areas with known Certificate of Stewardship Contracts(CSC) as proof of right in the management of the awarded forest area. The itemunauthorized cutting, on the other hand, accounts for illegally extractedresources as manifested by confiscated forestry products during apprehension.Damage from logging accounts for forest resource damages, which resulted inthe actual conduct of the logging activity.12. The item other accumulation covers forest conversions which mainlyrefers to clearing of forest to convert it to other uses such as for residential orindustrial purposes. Under other volume changes, additions to the stock includenatural stand growth and regeneration while reductions to the forest cover aremortality, forest fires and natural disasters.2.3 OPERATIONALIZING THE FRAMEWORK 2.3.1. Sources of Data Physical Accounts13. The base information for forest area was lifted from the 1992 JAFTALandSat Thematic Mapper and 1985 aerial photographs from NAMRIA, coveringmainland Palawan. Stock volume was projected using information available fromthe RP-German Forest Resource Inventory Project (FRIP). The projectgenerated data on the inventory of standing volume, forest regeneration andminor forest products from national agencies and LGUs.18 Palawan Forest Resource
  42. 42. Environmental and Natural Resources Accounting14. For dipterocarp forests, data for depletion due to legal logging andunauthorized harvesting were taken from the Provincial Environment and NaturalResources Office (PENRO) and Community Environment and Natural ResourcesOffices (CENRO) of the DENR, Economic Intelligence and Investigation Bureau(EIIB), and Bantay Palawan, a multi-sectoral task force that conductsapprehension of illegal loggers.15. For mangrove forests, data came from DENR-PENRO, CENROs, andMunicipal Planning and Development Offices (MPDOs). Rattan data were liftedfrom the RP-German FRIP and records of the DENR-PENRO, Bantay Palawanand EIIB. Monetary Accounts16. Parameters used in the computation of stumpage value for rattan weresupplied by the National Statistics Office, National Statistical Coordination Boardand Pio Bote’s 1990 study on stumpage value for dipterocarp forest. 2.3.2. Estimation Methodology17. Physical asset accounts for old and second growth dipterocarp forest andmangrove consisted of area and volume accounts while accounts for rattan werelimited to volume only. On the other hand, the study came up with the monetaryvaluation only for dipterocarp forest and rattan. There was no availableinformation on the stumpage value of mangrove forest. Physical Asset Accounts, Area a. Old Growth Dipterocarp Forest18. In the compilation of the physical asset accounts, the forest stock in areaterms were projections from the 1985 NAMRIA aerial photographs and 1992JAFTA satellite imagery covering mainland Palawan only. Legal logging in oldgrowth forests from 1988-1992 were still covered by Timber License Agreementsbefore the implementation of the total commercial log ban in the entire province.19. Other changes under other volume changes represent the statisticaldiscrepancy (S.D.) or the unaccounted factors in the changes in area. It isderived as the reported closing area during the year, taken from the officialsources, less the computed closing area, derived by summing up the openingarea, changes due to economic activity, changes due to other accumulation andthe identified other volume changes. b. Second Growth Dipterocarp Forest20. Changes due to economic activity include assistedregeneration/plantation or reforestation, the accounted legal logging and loggingdamage. Assisted regeneration comprised the area covered by those forestareas with Certificate of Stewardship Contracts (CSC) such as Integrated SocialForestry (ISF) Program, Community Based-Forest Management Agreements(CBFMA), Industrial Tree Plantation (ITP) and agro-forestry projects. Legallogging area was derived from the total area covered within ISF/CBFM Palawan Forest Resource 19
  43. 43. Environmental and Natural Resources Accountingconcessions, ITP and agro-forestry areas times 80 percent1. The estimateddamage due to logging was placed at 15 percent of logged area (legal and illegallogging) in old growth forests during the previous year. Other accumulationincludes data covered by old growth forest converted to second growth forestand other non-forest land use and areas devoted/converted to kaingin or uplandfarming. The area converted from old growth to second growth is equal to thearea logged in old growth forest in the previous year less 15 percent for loglandings, roads and skidding/yarding trails. Other volume changes account forarea covered by forest fires and statistical discrepancy (S.D.) or the unaccountedfactors in the changes in area. c. Mangrove Forest21. Mangrove forest area was likewise derived from the same geometricprojections as that of the dipterocarp forest. Changes due to economic activityincludes plantation and reforestation efforts, which are treated as an addition tostock, and unauthorized mangrove harvesting, and charcoal making, which aretreated as reduction to the stock. Mangrove forest conversions to fishponddevelopment were the activities that contributed to area deductions under otheraccumulation and as such also treated as reduction to the stock. Statisticaldiscrepancy (S.D.) was likewise accounted for under other volume changes. d. Rattan22. No separate area accounts for rattan were compiled since rattan thrivesin the same area as that of dipterocarp forest. Physical Asset Accounts, Volume a. Old Growth Dipterocarp Forest23. Opening volume was derived from area projections multiplied byharvestable volume of 180.2 cu. m. per hectare computed from the FRIP. Legaland unauthorized logging were regarded as depletion as adopted from actualdata generated from EIIB, DENR-PENRO and CENRO’s monthlyaccomplishment reports. Other changes (S.D.) were computed using the sameprocedure as in the area accounts. b. Second Growth Dipterocarp Forest24. Opening and closing volume were likewise derived from the areaprojections in second growth dipterocarp following the same sources andmultiplying the computed area by 142 cu.m. per hectare, harvestable volume forsecond growth dipterocarp forest based on the results of the FRIP.25. Damage from logging, kaingin, and forest fires were treated as depletionfrom stock while old growth conversion to second growth was accounted asaddition. All derivations were obtained using the same assumed 142 cu.m. perhectare harvestable volume. Meanwhile, stand growth under other volumechanges was computed by multiplying the opening area with the annual growthrate of 4.735 cu. m. per hectare based on the study of Uriarte and Virtucio in1988.1 It is assumed that the actual area logged is 80 percent while 20 percent will remain as second growth forest.20 Palawan Forest Resource

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