A Spatial Analysis of Northern Guatemala

Quantifying Environmental Services: A Spatial Analysis of Northern Guatemala

Thesis

Presented in Partial Fulfillment of the Requirements for the Degree Master of Science in

the Graduate School of The Ohio State University

Shelby Stults

Graduate Program in Environmental Science

The Ohio State University

2018

Thesis Committee

Dr. Brent Sohngen

Dr. Daniela Mitvea

Dr. Sathya Gopalakrishnan

Dr. Jeremy Brooks

Copyrighted by

Shelby Stults

2018

Abstract The concept of ecosystem services has become an increasingly useful framework through which we can evaluate the consequences of policy choices. Economists believe that it is useful to quantify the physical flows and the value of services gained and lost to help policy-makers more effectively analyze the benefits and costs of preserving important natural assets. This can lead to more efficient allocation of scarce public resources. In the tropics where significant deforestation is occurring as land is converted to agricultural uses, understanding the value of ecosystem services may provide important price signals to encourage protection of intact, forested ecosystems.

Recognition of these values may provide a critical tool for local groups that rely on intact ecosystems for the preservation of forests that contain the resources they value.

Unfortunately, in many places there is little quantifiable data or information on ecosystem services and their value. This project aims to address this issue in the Maya

Biosphere Reserve (MBR) of Northern Guatemala, which is the largest intact tropical rainforest in Central America. The government of Guatemala has partnered with a number of international institutions to protect the MBR from agricultural encroachment through a range of protection measures including the development of community based forest concessions and strict protection.

Although there is evidence that the concessions have successfully protected forests from deforestation (Blackman, 2015; Fortmann, Sohngen, & Southgate, 2017), pressure to convert forests to agriculture is growing. While agricultural outputs are more easily measured via prices, most of the ecosystem services that are lost when deforestation

ii occurs have not been quantified. Through this research, important ecosystem services will be valued and used to assess the economic impacts of forest loss. In particular, provisioning services (timber harvesting, non-timber forest product harvesting of Xate and Chicle, and agricultural production), regulating services (carbon sequestration and climate regulation), and cultural services (ecotourism) will be used to assess the net impacts of deforestation.

By valuing ecosystem services present in the Maya Biosphere Reserve in a net- revenue analysis, a broader measure of land value can be estimated and compared to the value of agricultural land-use. I hypothesize that valuing and including multiple dimensions of ecosystem services will raise the value of intact forested ecosystems above the economic threshold of agriculture, one of the largest threats to the forested region. I also hypothesize that ecosystem values vary across several scales, including human boundary conditions (e.g., tenure rights) and ecological boundaries. I will spatially document ecosystem services at detailed level that allows me to illustrate the pattern of ecosystem value in the Maya Biosphere Reserve. The resulting data can help policy makers develop new measures to protect remaining forests. In the discussion and conclusion of this thesis I offer insights into policies and measures that could be considered.

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Acknowledgments I am grateful for the help and guidance I have received from numerous individuals during the course of this project. Each of my committee members have provided extensive assistance with both this project and professional guidance throughout the duration of my Master’s program. I have appreciated the time and commitment each of my committee members has contributed to my personal and professional growth. I would also like to acknowledge the assistance of Dr. Bayron Milian for his expertise and kindness during my fieldwork in Guatemala and with acquiring the documents necessary to complete this analysis. Corinne Bocci, has also provided countless support and advice during this project as a friend and collaborator. I am also appreciative of the assistance of

Alexis Scharrer for her support while in Guatemala. I would also like to thank Dr. Brent

Sohngen for his guidance and support during this project and the numerous others we have collaborated on together. I am very grateful for the opportunities he has extended to me through research and professional support.

Vita Shelby Stults 44 East Arcadia Avenue Columbus, Ohio 43202

The Ohio State University Master of Science Environmental Sciences Graduate Program

Columbus State Community College Certification Program, Geographic Information Sciences Coursework and Internship Components

The Ohio State University Bachelor of Arts, Globalization Studies

Fields of Study

Major Field: Environmental Science

Table of Contents

Abstract ...... ii Acknowledgments ...... iv Vita ...... v List of Tables ...... viii List of Figures ...... ix Chapter 1:Introduction ...... 1 The Maya Biosphere Reserve: ...... 5 Research Questions: ...... 14 Chapter 2: The Value of Carbon Sequestration Potential in the Maya Biosphere Reserve ...... 16 Methodology: ...... 18 Results: ...... 22 Chapter 3: Value of Community Forest Concession Activities ...... 31 Methodology: ...... 34 Timber ...... 35 Results: ...... 37 Timber: ...... 37 Non-timber Forest Products: ...... 42 Tourism: ...... 45 Discussion: ...... 52 Chapter 4: Non-timber forest product harvesting and commercialization in the Maya Biosphere Reserve ...... 55 Xate Harvesting and the Community Forest Concessions ...... 58 The Demand Side of Xate ...... 67 Estimating Potential For Increased Revenue ...... 70

Discussion ...... 76 Chapter 5: New policies in the Maya Biosphere Reserve: How to build on existing success for protection in the future? ...... 78 Potential for Payments for Ecosystem Services ...... 81 PES in the Maya Biosphere Reserve ...... 86 Land Rent Returns ...... 88 Discussion ...... 91 Conclusion: ...... 93 Citations ...... 96

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List of Tables

Table 2.1: Value of CO2e Rent at the Social Cost of Carbon in the Concessions………..21 Table 2.2 Value of CO2e Loss at the Social Cost of Carbon in the Concessions ………26 Table 3.1: Transportation and Harvesting.………………………………………………36 Table 3.2: Sawmill and Operating Costs1………………………………………………..37 Table 3.3: Average Net Revenue Timber………………………………………………..38 Table 3.4: Average Non-Timber Forest Product Revenue for Forest Concessions, 2000- 2016………………………………………………………………………………………44 Table 3.5: Annual Average Tourists……………………………………………………..47 Table 3.6: Estimated Annual Foreign Tourist Expenditure……………………………...49 Table 3.7: Total Land Rent Returns in Concessions……………………………………..51 Table 3.8: Agricultural Rent Returns…………………………………………………….52 Table 4.1: Actual and Estimated Xate Revenue…………………………………………72 Table 4.2: Difference Between Xate Estimated Revenue and Actual Average Net Revenue…………………………………………………………………………………..73 Table 5.1: Estimated Returns with Carbon Rent and Increased NTFP Production……...89

1 Conversion rate: Average exchange rate between US Dollar and Guatemalan Quetzal in September 2017, 1:7.28 viii

List of Figures

Figure 1.1: The Maya Biosphere Reserve…………………………………………………7 Figure 2.1: Annual carbon rent for community forest concessions calculated at the social cost of carbon. Calculated using (Baccini et al., 2017; Hansen et al., 2013)………….…30 Figure 3.1: Average Timber Net Revenue 2004-2016………………………………...…40 Figure 3.2: Cedar Average Extraction Capacity…………………………………………41 Figure 3.3 Mahogany Average Extraction Capacity……………………………………..42 Figure 3.4 Average Non-Timber Forest Product Revenue for Forest Concessions, 2000- 2016…………………………..…………………………..………………………………45 Figure 3.5: Estimated Annual Tourism Revenue ………………………………………..49 Figure 3.6: Average Net Revenue, Land Rent Returns………………………………….51 Figure 4.1: Imported Xate Stems Source: USDA.gov…………………………………...68 Figure 4.2: Estimated Xate Potential…………………………………………………….75 Figure 4.3: Difference in Estimated and Actual Xate Earnings…………………………76 Figure 5.1 Estimated Land Rent Returns 2016…………………………………………..91

Chapter 1:Introduction Land-use change is a continual threat to the carbon stocks and expansive biodiversity present in Latin American tropical forests. Conversion of forest to cropland and pasture results from a number of economic, political, and social mechanisms on both global and local scales (Geist & Lambin, 2002). However, the underlying pressures, types of land cover change, and understanding of the indirect and direct processes affecting tropical deforestation have changed dramatically over time (Rudel, Defries, Asner, &

Laurance, 2009). Population, poverty, and agricultural expansion was seen as the primary root of forest loss in the late twentieth century, however this has been found to be an over-simplification of the complex causes of land-use change (Lambin et al., 2001).

Economic globalization has increasingly motivated deforestation in Latin America due to international demand for agricultural products and large-scale outsourcing of raw materials production (Lambin & Meyfroidt, 2011). Some authors have suggested that environmental policies aimed to improve domestic forest cover in developed economies has lead to leakage and increased pressure in obtaining forest products from resource rich regions (Meyfroidt, Lambin, Erb, & Hertel, 2013). But, other studies (Sohngen,

Mendelsohn, & Sedjo, 1999) found that typical policies promoting environmental conservation in developed countries would have very small impacts on unprotected forests in developing countries. However, resource extraction is not the only pressure motivating land-use change in Latin America. Remotely sensed data shows that from

2001-2013, 57% of new pastureland replaced forests throughout Latin America

(Graesser, Aide, Grau, & Ramankutty, 2015). Regionally, rates of the expansion of new

1 crops and pastures into forested areas vary considerably by ecosystem type, region, and preexisting agricultural activities. While underlying global trends can influence changes in production, regional diversity in economic and topographical characteristics considerably affect land-use outcomes. Thus, particular attention must be paid to local and regional context under which deforestation occurs (Rudel et al., 2009).

Many policies and management tactics have been employed to address agriculturally driven deforestation in tropical Latin America. Strictly protected areas are one strategy that has been implemented in numerous regions, however there is difficulty associated in evaluating the success of these projects(Oldekop, Holmes, Harris, & Evans,

2016). In many cases, the lack of a proper counterfactual creates significant uncertainty in evaluating the extent each protected area had in preventing deforestation (Andam,

Ferraro, Pfaff, Sanchez-Azofeifa, & Robalino, 2008; Miteva, Pattanayak, & Ferraro,

2012). Some assessments have found protected areas to be successful at preventing forest-clearing and reducing effects of illegal logging (Bruner, Gullison, Rice, &

Fonseca, 2001; Nolte, Agrawal, Silvius, & Soares-Filho, 2013), but the success rates are dependent on deforestation pressures and legal enforcement. Successful protected-area scenarios cannot be replicated in all circumstances and thus other solutions, such as forest certification (Blackman & Rivera, 2010; McDermott, Irland, & Pacheco, 2015; Miteva,

Loucks, & Pattanayak, 2015) and community-based property management (Fortmann,

2014), have also been utilized to address deforestation.

Certification programs emerged out of concern for the pressures placed on tropical forest due to exotic wood trade as a driver for forest loss. Programs established

2 through organizations like Forest Stewardship Council (FSC) attempt to provide options to producers to voluntarily certify wood products to be sold at an increased premium if they meet sustainability and socially responsible practices (Bowler, Castka, & Balzarova,

2017). These certifications can be extended to industrial producers in both tropical and temperate forests, as well as larger integrated community development projects, like that in the Maya Biosphere Reserve in Petén, Guatemala. In 2011, a reported ten percent of timber and seven percent of coffee traded on international markets was certified by organizations like FSC and the Rainforest Alliance (RA). A recent report by the World

Wildlife Fund that examines the effects of certification programs noted that of the numerous supply-chain programs, most focus on countering deforestation without substantive plans. The report also discussed that most practice assessments are not quantitatively rigorous (Mo, 2017). Assessing the benefit to producers of these certification programs is difficult, as rigorous quantitative data examining counterfactual outcomes are not available in many studies examining outcomes in banana, coffee, forest product and fish industries (Blackman & Rivera, 2011). Burivalova et al. (2016) utilized comparisons of 318 case studies to evaluate impacts of joint use of certification with community forest management. Findings in Burivalova et al. (2016) suggest a limited effect on economic variables for the observed cases, and most of the benefits of joint community forest management and certification relates to social outcomes (Burivalova,

Hua, Koh, Garcia, & Putz, 2017). Other studies have focused on the perception of certification programs in the communities themselves. Negative perceptions of FSC

3 certification find that communities feel conditions were difficult to meet and that certification is expensive to maintain ((Humphries & Kainer, 2006).

While forest certification assists in increasing utility for sustainable harvest and social practices, in most cases it only addresses the value of extracted materials and does not address climate or regulating services provided by forests. Ecosystems services are the benefits (both direct and indirect) that people obtain from natural ecosystems

(Assessment, 2005). These can include systems of multiple ecosystem functions that build upon each other, such as nutrient cycling, climate regulation, water regulation, recreation and cultural value. However, because these are often public goods that occur over large areas and at varying temporal scales, they are not captured by markets and adequately reflected in household decisions, and thus may be underprovided. The valuation of payments for ecosystem services (PES) in principle provides a mechanism to incentivize actors to provide and protect existing services to achieve both environmental and human development objectives (Engel, Pagiola, & Wunder, 2008).

PES is a policy mechanism that has gained traction in the last several years. Some have attributed this to the concept of “utilitarian values of nature, which resonate in developing nations, where reducing poverty and growing the economy are paramount concerns,” (Ferraro, Lawlor, Mullan, & Pattanayak, 2012, p. 21). Valuing the ecosystem services in an area can help policymakers in land management decision making when combined with other assessments (Polasky, Nelson, Lonsdorf, Fackler, & Starfield,

2005). However, in practice outcomes for PES vary depending on their context and implementation. This can cause policies using PES to be less effective in achieving

4 environmental goals and operating efficiently as an economic incentive to promote conservation (Wunder et al., 2018).

A “nested approach” of local projects and international initiatives like reducing emissions from deforestation and degradation (REDD+), can allow for greater participation and input of developing countries in large scale efforts to reduce deforestation (Pedroni, Dutschke, Streck, & Porrúa, 2009). It is important to develop a strategy that provides support to local forest dependents who then, in turn, can assist with the preservation of the forest. This practice can be seen in action in the Maya Biosphere

Reserve (MBR) in northern Guatemala, a community-based conservation management scheme of forest concessions that rely on extraction of FSC-certified forest products. The

MBR relies on a multiple titling of land-uses, granting legal authority for extraction rights to several community groups and two industrial companies as well as maintaining a large designation of strictly protected areas. The area has seen mixed success in forest protection, with the community forest concessions effectively reducing advancing deforestation in concession boundaries while protected areas continue to experience agriculturally led deforestation (Blackman, 2015). However, MBR lacks an established payment system to generate a market for the ecosystem services provided through forest preservation in both concessions and protected areas.

The Maya Biosphere Reserve:

The Maya Biosphere Reserve is located in the Petén Department of northern

Guatemala and was established in 1990 under the advising of the Guatemalan

5 government. The reserve was created to “combine the conservation and sustainable use of natural and cultural resources in order to maximize the ecological, economic, and social benefits for Guatemala,” utilizing assistance from international conservation and aid organizations (Protegidas (Guatemala), 1992; Radachowsky, Ramos, McNab, Baur, &

Kazakov, 2012). The total area of the MBR is as nearly one fifth of Guatemala’s territory, comprised of lowland moist tropical forest over three zones of land use. The first zone is the core zone, occupying 40% of the total MBR at 821,700 hectares, consisting of national parks and biotopes and is strictly protected from any extraction activities. The buffer zone dominates 22% of the MBR as a 15-kilometer band along the southern border of the reserve with the purpose of deflecting encroachment from the core zone. Last, the multiple-use zone (MUZ) occupies over 779,500 hectares (38% of the reserve) and allows low-impact activities, such as sustainable extraction of forest products (Blackman,

2015). The MUZ is comprised of forest concessions that hold usufruct rights and land tenure under the restrictive watch of the Consejo Nacional de Areas Protegidas (National

Council of Protected Areas–CONAP). The forest concessions illustrate an example of an integrated conservation and development project that aims to reduce forest loss through the support of forest stakeholders.

Figure 1.1: The Maya Biosphere Reserve

The community forest concessions are further divided into several types within the

MUZ, dependent on the managing rules established by CONAP. Since the inception of the MBR, 14 concessions have been granted in the MUZ, with groups attempting to acquire permission for additional concessions (Blackman, 2015). The number and delineation of concession types are:

• Long-inhabited residential concessions (n=2)

• Recently-inhabited residential concessions (n=4)

• Non-resident concessions (n=6)

• Industrial concessions (n=2)

Two of the recently-inhabited concessions had their status officially revoked for non- compliance by CONAP in 2006, however much of the existing literature still includes them in analyses of the forest concessions (Blackman, 2015; Fortmann et al., 2017, 2017;

Radachowsky et al., 2012; P. L. Taylor, 2010). The concessions are operated through contracts with 25-year terms by separate community organizations that have acquired the usufruct tenure through CONAP. The concessions also receive substantial assistance through the organization the Association of Forest Communities of Petén (ACOFOP).

ACOFOP, established in 1995, provides economic and political support for the concessions. They support the coordination of forest product exports with international clientele, negotiating with government oversight, and managing relationships with international donors (Radachowsky et al., 2012; P. L. Taylor, 2010). The concessions are also aided by numerous other international organizations, including international non- governmental organizations (The Nature Conservancy, the Rainforest Alliance) and international governmental agencies (USAID) for stakeholder development and conservation support.

Several studies have sought to examine the effectiveness of the community forest concessions in achieving sustainability goals and meeting the requirements for maintaining the concession contracts (Blackman, 2015; Fortmann, 2014; Fortmann et al.,

2017; Radachowsky et al., 2012). Some of these assessments provide greater quantitative rigor in evaluating the ability of the concessions to reduce deforestation. (Blackman,

2015) utilized quasi-experimental techniques (regressions and matching) to explore whether the mixed-use forest management in the MBR reduced forest loss. After creating and testing eight models with varied parameters, the study demonstrated that the MUZ is most effective at reducing deforestation. In addition it demonstrated that long-inhabited and non-resident community concessions most substantially reduce deforestation.

(Fortmann et al., 2017) also examines the effect of the concessions, utilizing a combination of matching difference-in-different estimators to assess deforestation rates and leakage in the region. The study also examined socio-economic differences within the concessions themselves, finding that non-resident concessions hold the largest income

(on-average) and maintain higher levels of education than other concessions. Overall, the concession policy reduced deforestation in all types of concessions opposed to if the policy was not implemented, with varying affects between each type. Non-resident concessions were found to have the smallest effect of the concession types at 4.3% reduction in deforestation, while recently-inhabited concessions had the largest reduction at 7.7%. Leakage was also found to occur within primarily near concessions managed by recent migrants, with rates 13% higher compared to matched-control areas.

Using mostly qualitative methods, other studies focus more comprehensively on the combined outcomes of governance, social development, and political autonomy as they relate to conservation goals of the concessions (e.g. (Radachowsky et al., 2012),

(Hughell & Butterfield, 2008), and (Peter Leigh Taylor, 2012)). Radachowsky et al.

(2012) focus on a holistic assessment of the governance, ecological integrity, and social development of the MBR and forest concessions in Forest Concessions in the Maya

Biosphere Reserve, Guatemala: A decade later. The functionality of governance within the concessions is varied in its success, as only ten of the original fourteen concessions remain fully operational. This is due to the full cancelation of La Colorada and San

Miguel and periodic suspension of Cruce a la Colorada and La Pasadita. These four concessions also contain the highest rates of deforestation, primarily due to expansion of pasturelands for cattle and other land speculation. Regarding the social development in concessions, financial returns are primarily derived from timber and non-timber forest product (NTFP) activity. However illegal cattle-ranching and agriculture also provide some income in recently-inhabited concessions.

Hughell & Butterfield (2008) examine on the impact of FSC certification on deforestation and wildfire incidence in the MBR. In 2007, all active forest concessions were certified through the FSC process, comprising approximately 500,000 acres while accounting for the area that was lost when concessions were decertified. Concessions maintaining FSC certification show consistently smaller incidences of wildfire than other areas of the MUZ and protected core zone. In 2007, the outcome of burned area in each land use zone was found to be 10.4%, 0.1% 5.0% and 10.3% for the protected core zone, certified concessions, remaining area of the MUZ and buffer zone respectively. The authors suggest that the repeated and increased nature of these fires rest on increases of human presence in an ecosystem not ordinarily prone to fires. It is important to note that these findings were published in a report produced by the Rainforest Alliance and, unlike

Blackman (2015) and Fortman et al. (2017), analysis utilizing counterfactual assessment of matched plots for fire incidence were not used.

Large areas of land have been cleared and converted to agricultural uses in the

Petén in general, as well as more specifically in buffer zone and interior of the Maya

Biosphere Reserve (Carr, 2005; Radachowsky et al., 2012; Shriar, 2001). In Shriar

(2001), residents of three areas spanning eleven communities located in the buffer zone were examined for demographic characteristics and agricultural practices. Few of those interviewed in the study were native to the area, echoing other similar studies of residents in the MBR, showing a strong tendency for migration in the region (Carr, 2005; Shriar,

2001). Most farmers within the buffer zone manage several plots of parcels for agricultural tendencies in a variety of land tenure categories that range from rented, squatted, communal, and privately-owned plots (Shriar, 2001). Very few farmers in the buffer zone grow cash crops, such as watermelon or pineapple, and instead rely primarily on subsistence agricultural practices. In Shriar (2001), 118 farmers were interviewed and declared interest in raising cattle, however only 16 percent actually did so. Nearly all farmers interviewed cultivate maize for both consumption and sale. Carr (2005) also examined the practices of agriculturalists in the MBR, focusing on settlements of farmers in the protected area of Sierra de Lancandón National Park of 241 heads of household.

Most held farms of 30-45 hectares, cultivated 4-8 hectares of maize or sometimes beans, and 25% of those surveyed own cattle. Utilizing regression analysis, Carr found that several factors significantly contributed to deforestation within Sierra de Lancandón

National Park at higher rates than others. Of socioeconomic factors, the farm characteristics of holding additional agricultural fields and cultivating velvet bean were significant at the 0.01 level at contributing to an additional reduction of 4.0 and 3.03

11 hectares, respectively. Of household characteristics, Mayan descendants were significantly more likely (0.01) to deforest than non-Mayans (Carr, 2005).

One area lacking in the literature examining the ecological sustainability and social development of the MBR is an analysis of the returns to land from all concession activities and value of all ecosystem services. To address this, in this thesis I develop a detailed summation of ecological, socio-cultural, and economic services present in the

Maya Biosphere Reserve, and map those services spatially. Ecosystem services are divided into several types: provisioning services, such as extractable resources; regulating services that affect climate and water quality; cultural services, such as recreation; and, supporting services like soil formation and photosynthesis (Assessment, 2005). All of these services are provided by the community forest concessions: Provisioning services are the yield of timber and NTFP, like rubber latex and incense. The forest exists as an expansive carbon stock, providing numerous regulating benefits as well as habitat for a diverse number of species (Figueroa, Cortave, & Fuentes, 2015; Hodgdon, Hayward, &

Samayoa, 2013). There exist also a large number of culturally significant sites, both natural limestone caves and Mayan ruins that attract thousands of tourists annually. The use, non-use, and option values these services provide can be summed to establish the total economic value that the Maya Biosphere Provides.

I use market and non-market evaluation approaches to capture the monetary value of ecosystem services. By valuing both market and non-market ecosystem services present in the Maya Biosphere Reserve, I provide a more comprehensive account of the benefits provided by forests in the area. This value can then be compared to the value of

12 agricultural rents threatening the intact forest within the reserve for evaluating the rivaled utility of both activities and use in policy-making decisions. I hypothesize that valuing and including multiple dimensions of ecosystem services will raise the value of intact forested ecosystems above the economic threshold of agriculture, one of the largest threats to the forested region. I also hypothesize that ecosystem values vary across several scales, including human boundary conditions (e.g., tenure rights), household characteristics, the physio-geographic characteristics of the landscape and ecological boundaries. My first objective is to quantify and value these activities of the community forest concessions. I apply market and non-market valuation approaches to the provisioning services of timber and non-timber forest products, the regulating services provided via carbon sequestration, and the value of cultural sites and tourism in the concessions and MBR as a whole.

My second objective is to create maps of these services that allow me to illustrate the pattern of their value in the Maya Biosphere Reserve. Maps of the use-value of timber, non-timber forest products, and tourism will be created to demonstrate the per- hectare value of returns in each of these activities. The third objective is to estimate the potential financial returns of increased non-timber forest product harvesting for items already being produced. This will provide an indicator of how much land returns could increase with additional output. I also will determine the value of annual rent of stored, above-ground forest carbon for the community forest concessions. The total carbon sequestration potential has been calculated for the MBR previously, but current literature does not estimate these values at an aggregate level. The final objective is to create a map

13 demonstrating the value of all ecosystem services, accounting for additional production and value of carbon sequestration in the MBR. The resulting data can help policy makers develop new measures to protect remaining forests. By displaying the value of returns in various activities of the community forest concessions, management decisions can be adjusted to maximize benefit in conservation efforts. In the discussion and conclusion of this thesis, I offer insights into policies and measures that could be considered.

Research Questions:

The following study addresses the valuation of ecosystem services and land use activities in the Maya Biosphere Reserve.

• Are the land returns of community forest concessions FSC-certified extraction

activities greater than the land use return of agricultural activity per hectare in

the region? This question serves to address land rent theory, which maintains that

landowners will seek maximum rent for land use activities to achieve the greatest

level of utility. Therefore, if forest concession activities provide more benefits

than agricultural alternatives, this may supply an explanation as to why forest

concessions have been successful at diminishing rates of deforestation in line

with land rent theory.

• Would increasing production/harvest of non-timber forest products in forest

concessions contribute substantially to raising land returns? This question was

prompted after exploration of current NTFP harvesting practices and interest of

several concessions in expanding production of these activities. NTFP harvest

sees low financial returns, so this research question attempts to examine whether

the economic efficiency could be improved or if efforts should be devoted to

other activities.

• Could new policies, such as payments for ecosystem services, be implemented to

enhance forest protection in the Maya Biosphere Reserve? While more general,

this research inquiry functions to utilize the analysis of the previous two research

questions and provide a discussion on the implications derived in the quantifying

of land use returns and ecosystem services.

The remainder of this thesis is organized as follows: Using remotely sensed data,

Chapter 1 estimates the value of carbon sequestration potential in the Maya Biosphere

Reserve. Chapter 2 focused on quantifying the benefits from the forest, tourism, and agricultural land uses. The impact of a potential increase in the production of NTFP is discussed in Chapter 3. By discussing options to incentivize forest conservation in the

MBR, Chapter 4 concludes.

Chapter 2: The Value of Carbon Sequestration Potential in the Maya Biosphere Reserve

The Maya Biosphere Reserve provides a vital, climate-regulating resource through the carbon sequestration capacity of the Selva Maya, one of Mesoamerica’s largest forests. However, land use change and deforestation rates in the Petén department, where the MBR is located, were the highest in Guatemala between 2001 and 2006

(Blackman, 2015). Deforestation has also led to new findings that tropical carbon losses now exceed carbon gains, particularly in the American tropics. These tropical forests have demonstrated the largest carbon loss globally between years 2003 and 2014 (Baccini et al., 2017). Patterns and dynamics vary at the national level, but changes in largest forests exert the greatest influence on average continental trends. As a result, it is important to examine each forest individually to reveal change in forest cover over time.

Forests such as the Selva Maya provide an important global public benefit through carbon sequestration, benefitting more than local stakeholders living in the region (Chhatre & Agrawal, 2009). Land use change and positive feedback loops that further intensify the effects of climate change, such as forest fires, threaten current standing stocks of forest. Carbon storage and other benefits potentially can be enhanced by providing incentives to local stakeholders, who can manage forests to increase carbon, or at least reduce losses. Studies have shown that local land ownership, or autonomy in land use decisions, likely advance carbon storage benefits (Chhatre & Agrawal, 2009), although this result is likely to depend on the location and the relative productivity of agriculture versus forests. Compensating local stakeholders for protection of forests can potentially increase the value of standing forest stocks enough to help reduce

16 deforestation (Nepstad et al., 2007). Unfortunately global carbon markets do not provide significant incentives for standing forest stocks, but some programs, such as REDD+

(Reducing Emissions from Deforestation and Forest Degradation) through the World

Bank may provide some funding. Community forest management (CFM), such as the forest concessions in the MBR, hold arrangements that promote and maintain sustainable resource use. With the proper incentives, it may be possible to utilize existing institutional arrangements and successful CFM to implement a payments for carbon sequestration arrangement (Newton et al., 2015).

The first step to evaluate the carbon sequestration benefits within the Maya

Biosphere Reserve is to evaluate the annual rent per hectare provided by carbon sequestration in each concession. There have been some initiatives to calculate reduced emissions from deforestation reductions in the region (Figueroa et al., 2015; Fortmann et al., 2017), but there is currently no literature available that prescribes a monetary value to these savings. One accounting project is GuateCarbon, a program that has sought to calculate reduced emissions from avoided deforestation within the multiple use zone

(MUZ). This is a step towards establishing a payments for ecosystem services program within the MBR (Figueroa et al., 2015). This is an initiative led by the National Council of Protected Areas (CONAP) that has support by the Rainforest Alliance and Wildlife

Conservation Society and began monitoring sequestered carbon in 2010. In addition to calculating current carbon stocks, as well as the reduced emissions from prevented deforestation, the project sought to improve management to promote best practices into

17 the future. For the purpose of this analysis, sequestered carbon will be calculated separate from the findings of the GuateCarbon project.

Methodology:

The calculation of sequestered carbon for the Maya Biosphere Reserve relies on two spatial datasets, (Baccini et al., 2017; Hansen et al., 2013) which present remotely- sensed data on global forest canopy cover and above-ground biomass. Of these two data products, several smaller datasets were acquired: The Baccini et al. aboveground biomass for year 2000, Hansen et. al. tree cover in years 2000, as well as Hansen et al. forest gain years 2000-2012 and forest loss years 2000-2016. The spatial data provided by Baccini et al. presents a map of global above-ground live woody biomass at a spatial resolution of

30X30 (900m2) meter pixels for areas where deforestation occurred between year 2000 and 2012. Each pixel holds a value of metric tons of biomass, ranging from 0 to 272 tons in the Maya Biosphere Reserve, for the biomass value in year 2000.The remotely sensed data was then verified utilizing plot examinations and the Hansen et al. dataset to help control inaccuracies and uncertainties due to remote error. The Hansen et al. data assess global forest loss, particularly in the tropics, using remote sensing data to evaluate tree cover. Each data product utilizes a pixel size of 30x30m (900m2). The tree cover dataset gives a percentage value of total forest cover over the pixel of tree canopy greater than 5 meters tall. The forest loss files yield a measure of pixels that experience a full stand replacement of previously documented forest, corresponding to each year between 2000 and 2016. The forest gain files present a measure of areas where forest fully recovered 18 from limited or no prior canopy coverage. Both datasets required a moderate amount manipulation to be utilized together.

The first step to calculate the asset value and annual rent of the stored carbon present in the Maya Biosphere Reserve requires identifying the total biomass present in year 2000. This required the use of both the Baccini and the Hansen data. First, the spatial data raster files were acquired for both datasets for the Petén, which occupies two separate tiled locations (20 degrees north, 90 degrees west; 20 degrees north, 100 degrees west). Cutoff divisions representing “forest” and “no forest” values were identified to establish which biomass pixels would be considered forested areas in year 2000. As the

FAO designates forest cover as “25 percent or more coverage”, a biomass measure of

25% of the maximum (272 tons) was identified to be 68 tons per pixel (900m2) (Sexton et al., 2016). Non-forested areas in this assessment with biomass 68 tons or less per pixel occupy 15% of the pixel area of the MBR and 3.27% of the total biomass present in the region. For non-forested areas, the median value is 34 tons biomass (17 tons carbon) and average of 60 tons biomass (30 tons carbon). Therefore, pixels demonstrating 69 tons or greater were assumed to be forested cover. Forested areas represent 84.7% of total pixel area and 96.73% of total biomass in the MBR. The median value of forested area is 163 tons biomass (81.5 tons carbon per pixel) and average 160 tons biomass (80 tons carbon).

The baseline biomass for forested and non-forested areas were then determined from the

Baccini dataset by calculating zonal statistics within the boundary of each concession, buffer zone, and aggregate protected areas. The stored carbon for forested and non- forested areas was then approximated as 50% of the total biomass for each corresponding

19 area, as summed in the zonal statistics (the suggested estimate of carbon detailed in the metadata of the Baccini dataset). The value of stored carbon was transformed in values of carbon dioxide equivalent (CO2e), for greater ease of calculating monetary value, by multiplying stored carbon estimates by 3.67.

To determine the value of biomass, carbon, and CO2e in 2016 requires the use of the Hansen et al. tree cover, forest loss, and forest gain datasets. After obtaining the value of biomass, carbon, and CO2e per hectare in year 2000, the spatial raster file for forest loss was layered over the Baccini et al. forested biomass layer, which depicts areas with biomass 69 tons or greater. This forest loss layer holds stand-replacing forest loss, which can be displayed by year or cumulatively for the period 2000 to 2016. The cumulative loss was spatially attributed to the corresponding biomass layer and then “clipped”, selecting the areas where the Hansen data of forest loss overlaps the forested Baccini data. The cumulative areas of biomass loss were then assumed the median value of pixels representing non-forested areas (34 tons per pixel) as opposed to the forested value. The difference of original forested biomass of the loss areas and median non-forested biomass per pixel of the loss areas was then subtracted from the summed zonal statistics for each concession, buffer zone, and aggregate protected area. This estimates the biomass in year

2016 after accounting for forest loss, which is then transformed into stored carbon and

CO2e values. However, this does not fully represent carbon storage in the region. While carbon pool sizes increase with forest age, thus increasing the amount of carbon storage in living biomass for older forests, younger forests also contribute to carbon storage

(Pregitzer Kurt S. & Euskirchen Eugénie S., 2004). Despite smaller contributions of

20 stored carbon, young forests hold high rates of initial net primary production that reduces after a stand reaches maturity (Berger, Hildenbrandt, & Grimm, 2004; Wang, Li, Fan,

Yu, & Chen, 2018). Therefore, it was also important to account for the gained reforestation to present an accurate picture of stored carbon in the forest concessions.

Calculating the gained carbon from reforested areas utilizing both datasets required more extensive calculations and transformations than calculating forest loss.

Again, the calculations began with the Baccini biomass dataset. To estimate forest gain, the biomass areas determined to be “no forest”, holding biomass values 68 tons or less per pixel was layered underneath the Hansen gain layer. It is important to note that the

“forest gain” layer provided by Hansen only displays forest gain between years 2000 to

2012 (instead of the forest loss layer, which shows loss through 2016). The biomass pixels of year 2000 “no-forest” were then “clipped” from the forest gain layer for each corresponding area. These pixels were assigned the median year 2000 “forest” value, which is 163 tons of biomass per 900m2. The zonal statistics for each of these forest gain areas were then applied to sum the total biomass gain for each concession, buffer zone, and aggregate protected areas. Then, the forest gain biomass (from non-forested areas), forest loss biomass (from forested areas), and total biomass in year 2000 were then used to calculate the net biomass present in year 2016. These calculations account both for deforestation and for regrowth in areas that were previously non-forested during the assessment period, mimicking areas that may have been previously harvested for timber or deforested in slash-and-burn agriculture that were then allowed to return to canopy cover.

The asset value and annual rent of the value of carbon sequestration is calculated relying on the social cost of carbon (SCC), representing the present value of damages avoided by each ton of carbon sequestered (Nordhaus, 2017). The 2016 value of SCC is

$37 per CO2e, which relies on a value of $36 established in 2015 by the US

Environmental Protection Agency calculated with the three percent discount rate

(Interagency Working Group on Social Cost of Greenhouse Gases, United States

Government, 2016). The total asset value for carbon sequestration was calculated in 2016 by finding the total aggregate amount of CO2e stored in the forest concessions at the price of $37 per metric ton of CO2e. The value of annual rent was then found for each concession at a three percent interest rate in perpetuity to provide a parallel analysis to the other ecosystem services in the paper. The annual rental value is thus $1.08 per ton

CO2e per year (calculated as 37 - 37/1.03).

Results:

The asset value and annual rent of stored carbon in the Maya Biosphere Reserve in 2016 is collected in Table 2.1 This table demonstrates the value of stored carbon at the social cost of carbon in 2016, at $37 per ton CO2e. Asset values range from $4,398 to

$18,018 per hectare. The buffer zone holds the lowest asset value per hectare, at $4,398.

The largest asset value and annual rent per hectare is seen by the non-resident concession

Rio Chanchich, followed by non-resident concession Yaloch. Non-resident concessions hold the largest average for carbon rent and asset values per hectare, followed by long- inhabited concessions and then recently-inhabited. Asset values per hectare average

$13,042, $10,343 and 9,270 for non-resident, long-inhabited, and recently inhabited concessions respectively.

Observing the geographic distribution of the 2016 carbon rent, calculated from patterns of forest loss between year 2000 and 2016, several patterns emerge. The categorical divisions of the indicators for annual rent values are displayed by quartile.

Figure 2.1 displays that the non-resident concessions of Rio Chanchich, La Unión,

Yaloch, and industrial concession La Gloria maintain the highest value of carbon per hectare, in addition to limited visible forest loss (demonstrated by red pixels in the map).

This is noteworthy in particular with the concession Yaloch, as forest loss within Belize is very apparent along the eastern border of the concession. The lowest carbon rent values are in seen in the Buffer Zone, aggregate Protected Areas, and concessions of La Pasadita

(recently inhabited), San Miguel (recently inhabited), and Uaxactún (long-inhabited). La

Pasadita in particular shows the largest visible forest loss as well, reinforcing the CONAP decision to eliminate the concession for non-compliance.

Table 2.1: Value of CO2e Rent at the Social Cost of Carbon in the Concessions

Aggregate Value Average Value Per (millions of US Hectare Dollars) US Dollars Asset Asset Concession Annual Annual Management Unit Value Value Type Rent Rent 2016 2016 Carmelita Long-inhabited $592 $17 $11,121 $325 Uaxactún Long-inhabited $780 $23 $9,565 $279 San Miguel la Recently- $57 $2 $7,956 $232 Palotada inhabited Recently- La Pasadita $143 $4 $7,596 $222 inhabited Recently- Cruce a la Colorada $221 $6 $10,821 $316 inhabited Recently- La Colorada $239 $7 $10,706 $313 inhabited Rio Chanchich Non-resident $220 $6 $18,018 $526 Chosquitán Non-resident $234 $7 $11,983 $350 San Andrés I Non-resident $617 $18 $11,927 $348 San Andrés II Non-resident $286 $8 $11,610 $339 Las Ventanas Non-resident $748 $22 $11,515 $336 La Unión Non-resident $264 $8 $12,595 $368 Yaloch Non-resident $350 $10 $13,651 $398 Paxbán Industrial $706 $21 $10,892 $318 La Gloria Industrial $788 $23 $12,132 $354 Buffer Zone $2,039 $60 $4,398 $128 Protected Areas $8,879 $259 $8,312 $243 Net carbon loss in each concession, as well as the value of that carbon loss, valued at $37 per ton CO2, is shown in Table 2.2. It is important to note here that the cumulative loss of carbon value from 2000 to 2016 is not discounted over time—it is listed in 2016 dollars. The change in carbon as a percentage of total carbon occurred on the now defunct concessions La Pasadita and San Miguel la Palotada, which saw net change of -38.12% and -36.21%, respectively, of total carbon in year 2000. This equates

24 to a loss of 127.52 tons of CO2e per hectare for La Pasadita and 122.20 tons of CO2e per hectare for San Miguel. The average loss in CO2e for the entire Maya Biosphere Reserve was 25.10 tons CO2e per hectare during this time period. The smallest net losses were in the concessions San Andrés II (non-resident) and Las Ventanas (non-resident), at -0.03% of total carbon (0.01 tons CO2e /Ha) and -0.04% total carbon (0.19 tons CO2e /Ha), respectively. This is not surprising, as the concession organization managing San Andrés primarily focuses extraction efforts in the spatial area of San Andrés I, while still holding extraction rights to the area of San Andrés II. The results illustrate that carbon losses are occurring throughout Maya Biosphere Reserve, and have potentially been significant, particularly in concession areas that have not been successful. The losses amount to over

$2.53 billion in lost asset value, with a loss of 18.6 million tons CO2e. This is a large loss, but the loss amounts to only around 12.9% of the total value of the carbon asset in the reserve over the 16-year period, or less than 1% per year.

The social cost of carbon was utilized in this analysis because we are interested in valuing carbon according to the present value of damages that climate change may cause

(see (Falk & Mendelsohn, 1993)). Of course, in reality, the actual willingness to pay for carbon by interested buyers will differ from the social cost of carbon because the political system has not put significant constraints on carbon emissions. If actual policies emerge to effectively reduce carbon emissions at levels that are consistent with the social cost of carbon studies, then one would expect the price of carbon in markets to coincide with the social cost of carbon. As yet, no such policies have been enacted globally, so market

25 prices for carbon remain relatively low, reflecting the presence of free riders in the fact of ineffective global governance.

Table 2.2 Value of CO2e Loss at the Social Cost of Carbon in the Concessions

Metric US Dollars Tons Concession Net CO Management Unit Hectares 2e Value of Loss Type Loss Carmelita Long-inhabited 53,222 106,614 $3,944,721 Uaxactún Long-inhabited 81,545 131,091 $4,850,371 San Miguel la Recently- 7,185 878,057 $32,488,096 Palotada inhabited Recently- La Pasadita 18,876 2,406,992 $89,058,688 inhabited Cruce a la Recently- 220,404 788,167 $29,162,184 Colorada inhabited Recently- La Colorada 22,347 812,113 $30,048,171 inhabited Rio Chanchich Non-resident 12,184 8,563 $316,832 Chosquitán Non-resident 19,500 5,604 $207,355 San Andrés I Non-resident 51,770 10,943 $404,891 San Andrés II Non-resident 24,594 2,344 $86,721 Las Ventanas Non-resident 64,919 7,365 $272,518 La Unión Non-resident 20,933 6,472 $239,448 Yaloch Non-resident 25,643 31,873 $1,179,293 Paxbán Industrial 64,848 53,702 $1,986,980 La Gloria Industrial 64,967 12,274 $454,142 Total Concessions 752,937 5,262,173 194,700,412 Buffer Zone 463,576 29,040,456 $1,074,496,857 Protected Areas 1,068,193 34,026,691 $1,258,987,585 Total: 2,284,706 68,329,320 $2,528,184,854

First, while voluntary markets have been developed to pay for carbon, prices for carbon are variable depending on the country in which the market is located. It has also been found that forestry-based carbon offset programs also sell at lower prices, even more so when located in developing countries (Conte & Kotchen, 2009). In some cases, this may mean that the local voluntary price premium inaccurately reflects the value that carbon sequestration supplies as a global public good. Additionally, political economy constraints further emphasize the mismatch of the value of mitigation and the private costs of carbon sequestration to stakeholders (Jenkins, 2014). Several studies cited in

Jenkins (2014) have utilized contingent valuation and quasi-experimental methods to establish willingness to pay of US citizens for carbon mitigation, providing reasonable evidence to assume that political opposition would quickly mount at prices rising above a range of $2 to $8 per ton. However, the range of acceptable prices in the US approximate a range of “…roughly 60 percent to roughly two orders of magnitude lower than the high range estimates” of the social cost of carbon (Jenkins, 2014, p. 474). Other reports show that the average market value of forest project carbon to be approximated at $5 per ton

CO2e, with improved forest management projects valued slightly higher at $9.5 per ton

CO2e (Hamrick, 2017). Still, both of these estimates fall far below the 2015 range presented in the studies highlighted in Jenkins (2014), at $12.85-$42.08 for models with relatively higher discount rates. A modest discount rate of 3% was utilized to calculate annual rent for carbon sequestration, mimicking the Barack Obama US Environmental

Protection Agency social discount interest rate. This is slightly lower than the most recent update to Nordhaus (2017) Dynamic Integrated model of Climate and the Economy

(DICE model), which selects a slightly higher rate of 4.25% to account for climate damages on the global economy.

An important consideration to keep in mind is the assumption of reforestation within the community concessions and the corresponding gains to carbon sequestration.

The Hansen et al. data only qualifies “forest gain” as full canopy replacement at 5 meters or more and thus the gains of partial regrowth or other ecosystem types are not accounted for in this assessment. As a result, the full estimation of stored carbon and carbon sequestration here is likely an under-estimation of the actual amount of carbon in the forests of the Maya Biosphere Reserve by 2016. In addition, this assessment only accounts for above-ground storage of forest carbon found in forest biomass, ignoring the contributions of soil carbon sequestration. Soil carbon is difficult to estimate, due to large variances in the biological and physical processes occurring during re-vegetation. Soil carbon accumulation also occurs over much longer time scales. Carbon accumulation does occur when agricultural or vacant land is allowed to return to natural or perennial vegetation (Post & Kwon, 2000). Both of these factors contribute to the under-estimation of forest carbon sequestration potential in the MBR. It is also important to note some of the other criticisms of the Hansen et al. dataset. Mitchard et al. (2015) highlight the assumption that all “treecover” over 5 meters tall is considered to be natural forest, however, a multitude of other vegetation may also reach this height. This is an important consideration, as this vegetation may have vastly different rates of carbon storage or even be a monoculture (such as industrial palm oil plantations, tea, or other crops). Mitchard et al. also point out that while in most cases a 30-meter resolution is small enough to detect

28 most major deforestation, in some areas smaller scale “patchy” deforestation may dominate and not be detected at this coarse level.

Another important assumption made in this assessment is the idea of carbon permanence. While the forest concessions have been more effective than strictly protected areas in the MBR, the region does have a tumultuous political and social past

(Blackman, 2015). The region has suffered from a multi-decadal civil war conflict, ending in 1996. This had a profound effect on in-country migration as many migrants came to the Petén to escape the conflict (Carr, 2005; Radachowsky et al., 2012). The historical context of the region and external pressures from deforestation along the border with Belize (see Figure 2.1) and higher rates of deforestation in western protected areas pressure the concessions’ ability to resist agricultural land clearing. Additionally, timber extraction is the most lucrative economic activity in the forest concessions, requiring the removal of timber stock biomass from the area. Social and political pressures leading to deforestation and the business-as-usual extraction activities will contribute to the removal of stored carbon from the concessions. However, this assessment does not control for dynamic changes of carbon in the future within the assessment of annual rents, providing only a static snapshot of the asset value of carbon in 2016. Thus, it can be assumed that there will be fluctuations of the asset value of the social cost of carbon in the future.

Figure 2.1: Annual carbon rent for community forest concessions calculated at the social cost of carbon. Calculated using (Baccini et al., 2017; Hansen et al., 2013)

This figure presents average value of carbon at the social cost of carbon in 2016 for 2016 value of carbon storage. The value is presented in US dollars.

Chapter 3: Value of Community Forest Concession Activities The impacts on community welfare determine the success of concessions as a forest protection intervention. As a result evaluating community forestry management projects require an evaluation of the social development of forest stakeholders. More than

10% of global forests are managed by community forest ventures and 18% of global forests are relied upon by local communities for livelihood benefits (Chhatre & Agrawal,

2009). Forests exist as a resource that provide a “low barrier to entry” for many local, impoverished groups, largely because they are not actively controlled by the governments that claim property rights (i.e., forest resource exclusion is often difficult to achieve in tropical forests of developing countries). There exists a link between forest quantity, quality, and social development of rural dependents, but often dependents are politically weak and crowded out from resource benefits (Sunderlin et al., 2005). Chhatre

& Agrawal (2009) have found that local rule-making autonomy and forest size contribute positively to both livelihood benefits and carbon storage. When forest dependents benefit from forests, they become invested in protecting them from over-extraction.

In the case of the Maya Biosphere Reserve, community heterogeneity can contribute to different outcomes in terms of forest protection and livelihood benefits.

Fortmann et al. (2017) found that despite sustainable management of forest resources directly benefitting concessions, community concession characteristics have variable outcomes on forest protection, as individual incentives contributed to land conversion for some concessions. The differences in demographic characteristics of these concessions appear to influence sustainability outcomes, as other literature focusing on the Maya

Biosphere Reserve also suggest (Blackman, 2015; Bray et al., 2008; Radachowsky et al.,

2012). The differences in forest protection and social development between concession types are also seen in this analysis, when observing financial and forest loss returns from concession activities.

A comparison of land rent returns between forest concession activities and agriculture in the contiguous region can help in the assessment of the performance of concessions in preventing against agriculturally-driven deforestation. Land rent theory suggests that land owners allocate land to activities most profitable to them. While other factors also influence motivations for deforestation, this is an important component in assessing the sustainability of forest management.

There are several income-generating activities available to forest concession members: timber extraction, non-timber forest product harvesting, and tourism. The majority of forest concession income is derived from timber extraction of primarily

Spanish cedar (Cedrela odorata) and mahogany (S. macriophylla), with a few other species also being harvested on a smaller scale. Timber is managed through requirements set forth by CONAP, requiring permitting and management plans to monitor extraction.

Contracts are managed on 25-year terms, with annual and 5-year harvest plans with detailed inventories required by CONAP to be filed from each concession. The Forest

Stewardship council also works with concessions and CONAP to ensure sustainable compliance and certification of timber. As a result, harvesting intensities in the MBR are

1.2 to 3.0m3 per hectare as opposed to 2000-2008 average of 110m3 per hectare in North

America (Masek et al., 2011; Radachowsky et al., 2012). While timber extraction is the

32 primary activity of the concessions, financial and labor resources are devoted to other activities as well.

Non-timber forest product harvesting is another income-generating activity in the concessions that spans the collection of several primary forest products. The Petén

Department, particularly in Uaxactún and Carmelita, has historically harvested chicle, which is the processed rubber-like latex of the M. zapota. The first settlements in

Uaxactún were developed to assist in exporting chicle for use in chewing gum and other products, and the original airplane runway can still be seen in the settlement center today

(Primack, 1997). Today, chicle is primarily exported to Japan (Radachowsky et al.,

2012). Another non-timber forest product that is harvested heavily in the region is several varieties of the palm frond called xate (Chamaedorea spp.). Xate is collected and bundled for export to the United States, Canada, and Europe for use in floral arrangements as

“filler greens”. Other NTFP that are harvested to a lesser degree in the region include

Allspice (P. dioica), utilized as fragrant oils; Ramon, from the seeds of the tree Brosimum alicastrum, used to make flour for cooking; Guano, a large palm (Sabal mauritiiformis) used to make thatched roofs; as well as numerous other medicinal plants and vines. In many cases these products are not sold commercially, only collected for personal use by concession members. In recent years, several concessions are expanding collection and commercial exportation of these products within guidelines established for ecologically sustainable collection by CONAP.

The last revenue-generating activity found in the forest concessions is through ecotourism and the visitation to cultural sites. The largest tourist site in the region is

Tikal, which is a national park. While that park is part of the Maya Biosphere Reserve, it is not managed like the concessions, so not considered in this analysis. Tourism occurs nearly exclusively in Carmelita and Uaxactún. In Carmelita, guides offer assistance to tourists hiking the several-day trek to the site of El Mirador, an active dig site that houses the pyramids La Danta and the Jaguar Paw Temple. Tourists to Carmelita are few in numbers, between 25 and 150 per year. Uaxactún, which can only be reached by passing through the guarded gates of Tikal, is the site of several temples called Group E. These temples are currently in process of being restored and additional camping infrastructure provided to further attract more tourists to the site. In addition to visiting ruins, guides are sometimes hired to take groups of international bird watchers in search of tropical birds that can be found in the Selva Maya. While there are numerous cultural sites found in the

MBR, most sites are considered protected areas and do not fall under the management of forest concessions (Primack, 1997).

Methodology:

The information utilized to calculate the land rent returns and production of timber and non-timber forest products was derived primarily from forest concession management plans and annual reports. These documents are required by CONAP in order to assess production within each concession and vary in detail and organization for each product type. We hold documents providing information on timber, non-timber forest products, and tourism between years 2004 and 2016 for nine of the fourteen original concessions. For timber production information, seven of the nine concessions provide

34 information permitting calculation of net revenues for more than one year. Examining non-timber forest products, five concessions (Carmelita, Chosquitan, San Andrés,

Uaxactún, and Yaloch) report information in at least one year on products xate, chicle and honey. Other documents were used in some cases to estimate net revenue when both cost and gross revenues were not detailed in final reports. Net revenue returns were calculated for both timber and non-timber forest products.

Timber

Timber production costs were divided into separate categories to determine transportation and harvesting costs, as well as sawmill costs. Transportation and harvesting costs and sawmill costs were further subdivided into labor and operating costs.

Transportation and harvesting costs dominate expenses, of which the mean value as a proportion of the total cost is roughly 63.5%, ranging from 45.3% to 76.4%. Labor, on average, accounts for 41.1% of total transportation and harvesting costs (range: 8.5%-

73.2%). Sawmill operational costs are interpreted as “value-added” inputs of the production process, encompassing wood-cutting, chemical treatment and processing into final board form. For concessions reporting both labor and operation costs for sawmill activities, value-added (operational) costs account for an average of 41.9% of the total sawmill costs (ranging 19.7%-77.8%). The exact division of these costs can be seen in

Table 3.1.

Timber gross revenues, in most cases, were already calculated and detailed in annual reports. In some circumstances, it was necessary to calculate gross revenue based

35 upon total production and unit pricing for board feet (what was commonly noted in reports). The non-resident concessions have the most complete data, with four of five concessions reporting at least three years of cost and revenue data. No production information, neither gross revenue or costs, were obtained from industrial concessions.

Long-inhabited concessions had some sparse data as well, with data only in one year from Uaxactún and Carmelita detailing information primarily between 2011 and 2016.

Last, of the recently-inhabited concessions, only information in 2006 was obtained for

Cruce a La Colorada and no other years or concessions.

Table 3.1: Transportation and Harvesting

Average Costs Management Management Transportation Transportation Transportation Unit Type Unit and and and Harvesting Harvesting Harvesting Total Labor Operating Long-Inhabited Uaxactun 364,55. Q 133,657 Q 498,214 Q ($46,573) ($17,075) ($63,648) 23 Long-Inhabited Carmelita 575,058 Q 539,643 Q 1,114,701 Q ($73,465) ($68,941) ($142,406) Non-Resident Chosquitan 761,9826 Q 603,0389 Q 1,365,021 Q ($97,345) ($77,040) ($174,385) Non-Resident Las 159,636 Q 608,441 Q 768,077 Q Ventanas ($20,394) ($77,731) ($98,124) Non-Resident San 454,476 Q 617,706 Q 1,072,183 Q Andres3 ($58,061) ($78,914) ($136,974) Non-Resident La Union 236,475 Q 566,620 Q 803,095 Q ($30,210) ($772,387) ($102,598) Non-Resident YalochA 233,927 Q 624,574 Q 858,502 Q ($29,845) ($79,791) ($109,676) Non-Resident Rio 735,180 Q 472,525 Q 1,207,706 Q Chanchich2 ($93,921) ($60,366) ($154,288) Recently- Cruce a La 38,280 Q 426,028 Q 451,548 Q Inhabited Colorada ($4,890) ($54,426) ($57,687)

2 Estimated values used in calculations 3 Few recorded costs 36

Table 3.2: Sawmill and Operating Costs4

Average Costs Management Unit Management Sawmill Sawmill Sawmill Total Type Unit Labor Operating Long-Inhabited Uaxactun 457,385 Q 144,198 Q 601,583 Q ($58,432) ($18,422) ($76,854) Long-Inhabited 56 404,700 Q Carmelita ($51,702) Non-Resident Chosquitan 195,986 Q 684,652 Q 880,638 Q ($25,038) ($87,466) ($122,504) Non-Resident Las 124,551 Q 215,044 Q 339,596 Q Ventanas ($15,912) ($27,473) ($43,384) Non-Resident San 266,351 Q 65,347 Q 331,698 Q AndresB ($34,027) ($8,348) ($42,375) Non-Resident La Union 298,403 Q 123,071 Q 420,505 Q ($38,122) ($15,723) ($53,721) Non-Resident YalochA 429,966 Q 242,144 Q 672,110 Q ($54,929) ($30,935) ($85,864) Non-Resident Rio 226,792 Q 173,056 Q 399,848 Q ChanchichA ($28,973) ($22,108) ($51,082) Recently-Inhabited Cruce a La 457,010 Q 457,010 Q

Colorada ($58,384) ($58,384)

Results:

Timber:

Figure 3.1 displays the average net revenue of timber per hectare for all concessions where data was obtained and are displayed according to quartile divisions.

The quartiles are separated at US$2.74, US$6.57, US$13.33, and US$27.13 for first through fourth respectively. Non-resident concessions in the east show the highest returns per hectare, with Chosquitan maintaining the highest returns of the concessions at

US$27.13 per hectare. The average revenue per hectare is US$9.07. Long-inhabited

4 Conversion rate: Average exchange rate between US Dollar and Guatemalan Quetzal in September 2017, 1:7.28 5 Estimated values used in calculations 6 Few recorded costs 37 concessions (Carmelita and Uaxactún) average US$2.11 per hectare for timber extraction values, while non-resident concessions average US$54.01 per hectare.

Table 3.3: Average Net Revenue Timber

Average Net Revenue Timber (2000-2016) Concession Type US Dollars Hectares Dollars/Ha Carmelita Long-inhabited $88,495.21 53,221.51 $1.66 Uaxactún Long-inhabited $208,400.54 81,545.09 $2.56 La Union Non-resident $253,327.35 20,933.23 $12.10 Yaloch Non-resident $169,540.45 25,642.96 $6.61 Rio Chanchich Non-resident $206,250.46 12,184.19 $16.93 Chosquitan Non-resident $528,973.49 19,500.15 $27.13 Las Ventanas Non-resident $212,816.17 64,918.96 $3.28 San Andrés I Non-resident $337,910.97 51,770.29 $6.53 San Andrés II Non-resident $337,910.97 24,593.65 $13.74 Cruce a La Colorada Recently-inhabited $33,406.08 220,403.67 $0.15

There are several important notes about the methodology and results of the timber values. It is important to note the limited data on timber returns for Cruce a La Colorada and Uaxactún, as both concessions contain only a single year of data. In addition, as mentioned in previous chapters, while San Andrés concession manages both areas of San

Andrés I and II, the production information is not spatially explicit as to where the extraction materials occur. The net revenue values for this concession are normalized by hectares separately for San Andrés I and San Andrés II, contributing to the different values seen in the map. Table 2.2 below displays average net revenues for each of the concessions.

Another valuable tool of examining the performance of the community forest concessions extraction activities is to examine production capacities of timber.

Production capacity here is defined as the proportion of actual extraction of timber from maximum allotted extraction amounts, as designated by CONAP. The maximum allotted extraction amounts are defined by CONAP forest managers based on biological growth rates and impact assessments to determine sustainable harvest levels. In addition, this assessment of capacity can also reveal which concessions are most likely to violate guidelines for sustainable harvest. The following maps Figure 3.2 and Figure 3.3 demonstrate the quartile breakdown of extraction capacity between 2002 and 2008 for mahogany and cedar. For mahogany extraction, the highest capacities occur in the eastern non-resident community forest concessions. On the other hand, for cedar extraction, capacities are not as geographically concentrated. The capacity percentages for cedar and mahogany also differ, with cedar holding a wider range of values (38.77% to 88.16%).

Figure 3.1: Average Timber Net Revenue 2004-2016

Figure 3.2: Cedar Average Extraction Capacity

Figure 3.3 Mahogany Average Extraction Capacity

Non-timber Forest Products:

Cost and revenue data for non-timber forest products were also primarily derived from the annual reports mandated by CONAP. The information depicted in annual reports regarding financial information for the harvesting of xate, honey, and chicle was limited. While other NTFP are harvested, no information was reported regarding the collection or commercialization of other products like ramon, guano, or allspice.

Financial information was detailed for years 2004 and 2008-2016 for five concessions.

Several years rely on estimated of NTFP, calculated from documents other than annual reports. The average net revenue return per hectare for each concession type was then calculated for all listed non-timber forest products.

Estimations of xate net revenue were conducted utilizing another report developed by ACOFOP, which discussed the growth in xate production within the forest concessions. Estimations were calculated using the reported number of xate “paquetes” containing 600 palms, and the per unit prices for each paquete reported in each year for the concessions of Uaxactún and Carmelita. The costs were estimated from a detailed assessment of the operational and labor costs provided by ACOFOP, which were used to determine approximated net revenue. Xate net revenue was estimated in 2008, 2009,

2010, 2012, 2013, and 2014 for Uaxactún and in years 2008 and 2010 for Carmelita. In the case of Carmelita, actual reporting of xate revenue was obtained for years 2009,

2011-2016, so only years 2008 and 2010 were estimated. The ACOFOP report did not detail exact actual paquetes sold for other concessions in the report, so they were not estimated.

Overall, net revenues from non-timber forest product harvesting are lower than returns for timber harvesting. There are more years of net revenue information on harvesting of xate than any other NTFP, with the most instances of net revenue for

Carmelita. Yaloch held the highest NTFP net revenue values, but had only one year of data for xate and chicle in 2012. Carmelita follows Yaloch in highest net revenue from

NTFP, with Chosquitan holding the lowest net revenue returns. Average returns are detailed in Table 3.4.

Table 3.4: Average Non-Timber Forest Product Revenue for Forest Concessions,

2000-2016

Average Net Revenue NTFP Concession Type US Dollars Hectares Dollars/Ha Carmelita Long-inhabited $43,638.90 53,221.51 $0.82 Uaxactún Long-inhabited $46,538.81 81,545.09 $0.57 Yaloch Non-resident $154,730.01 25,642.96 $6.03 Chosquitan Non-resident $11,388.95 19,500.15 $0.58 San Andrés I Non-resident $31,757.78 51,770.29 $0.61 San Andrés II Non-resident $31,757.78 24,593.65 $1.29

Figure 3.4: Average Non-Timber Forest Product Revenue for Forest

Concessions, 2000-2016

Tourism:

The only concession where reporting on tourism could be acquired is the long- inhabited concession of Carmelita. Information on tourism in Carmelita was reported by the concession for years 2011 to 2016, allowing net revenue to be calculated. On average,

45 there were 85.83 tourism services performed in this time period, ranging from 33 to 126 services. The average net revenue from tourism services is 8,512.64 quetzals (US

$1,087.92). The average ranges widely from a loss of 83,517.99 quetzals (US$10,790.52) to a profit of 48,670 quetzals (US$6,220.08). While Carmelita is the only concession where tourism information could be obtained, there are numerous other cultural sites in the MBR that attract domestic and foreign tourists.

The Maya Biosphere Reserve attracts numerous domestic and foreign tourists to the region, primarily to visit Tikal National Park, but also to visit other cultural sites throughout the region. A state Guatemalan tourist agency provided information to Dr.

Brent Sohngen, tourism visitation in the Petén Department, breaking down tourism for national and international visitors. The large site of Tikal National Park attracts an average of 144,263 tourists a year, of which roughly 56 percent are international tourists.

The second-highest visited tourist site in the MBR is the site of Yaxha, which attracts an average of 17,037 tourists to the region (51% foreign tourists). El Mirador is the third most-visited tourist site, although there are far fewer visitors to the site than to Yaxha or

Tikal. The remote location of El Mirador and the limited infrastructure attract an average of 1,389 tourists per year. Only two other sites register more than 1,000 tourist visitors per year–Tayasal-San Miguel and El Tintal–where others only manage a few hundred annually. The average visitor data was collected from the same tourist agency during

2008 to 2012.The majority of sites in the MBR also do not collect entrance fees from tourists, as few sites are guarded and have a formal entrance. Tikal, Yaxha, and El

Mirador collect fees to assist in the cost of employing park attendants, guards, and

46 maintaining infrastructure. Individual park fees and gross revenues can be seen in Table

3.5. It is important to note that in the case of Tikal and Yaxha, there are additional fees collected for being in the park at dawn or at sunset, or to visit the museum in Tikal. As a result, the average gross revenue depicted for Tikal and Yaxha in Table 3.5 is a lower- bound estimate.

Table 3.5: Annual Average Tourists

Tourist Entrance Fees US Dollar Annual Average Tourists Per Unit Per Unit Gross Average Park Domestic Foreign Total Domestic Foreign Total Tikal 62,863 81,400 144,263 $3.20 $19.17 $980,478.59 Yaxha 8,357 8,680 17,037 $5.11 $10.22 $ 86,003.79 El Mirador 523 866 1,389 $2.56 $10.22 $ 3,505.84

There have been a few attempts to examine the choices of foreign tourists visiting cultural sites in the Maya Biosphere Reserve. Hearne and Santos (2004) employed a behavioral choice experiment to evaluate tourist and local preferences for development of cultural and eco-related tourism. At the time of their survey and choice examination

(April to June 2000), there were no fees collected for entrance to any cultural sites within the MBR. The study sample relied on the administration of questions in the departure lounge at the international airport in Santa Elena, Petén to two distinct populations:

Guatemalans and foreign tourists. Of the 192 foreign tourists surveyed, tourists from the

US, Canada, and Europe dominated the respondents, at 37.2% (US and Canada) 32.6%

(Europe). These tourists most frequently spent US$30 ($43.41 in 2018 dollars) or less

(41.1%) or greater than US$50 (20.9%) ($72.35 in 2018 dollars). The outcome of study found that both Guatemalans and foreign tourists demonstrated statistical significance in a willingness to pay for entrance fees to parks. Both also supported management in the park, wildlife exploration with guides, and both maintained preferences for at least satisfactory conservation levels (with Guatemalans preferring more intensive conservation).

A more recent survey performed in July 2017 (Sharrer, 2017) performed in the tourist area of Flores, Petén also interviews foreign tourists on activities and expenditures in the

MBR. This survey of 55 persons found that the average expenditure in the region for tourists was approximately US$35 per person per day. The average stay in the region was five days, with 98% of those surveyed visiting Tikal, roughly 30% also visiting Yaxha, and also 5% visiting El Mirador. Table 3.6 presents an estimate of these expenditures, assuming the average stay of 5 days and US$35 expenditure amounts while in the region.

It was assumed that 30% of the foreign tourists at Yaxha also visited Tikal, as well as 5% of the foreign tourists at El Mirador.

Figure 3.5: Estimated Annual Tourism Revenue

Table 3.6: Estimated Annual Foreign Tourist Expenditure

Park Estimated Tourist Expenditure Tikal US$ 14,244,965 Yaxha US$ 1,063,275.50 El Mirador US$ 143,972.50

Total: US$ 15,452,213

The total land rent returns for each concession sum the return values for timber, non-timber forest product harvesting and tourism, displayed in Table 3.7. Again similar to timber harvesting revenue, Chosquitan holds the highest land rent returns per hectare at

US$27.71, followed by Rio Chanchich. However, in examining gross returns, San Andrés earns the largest amount of revenue. Carmelita is the only concession to report tourist- related returns to be calculated into their land rent returns. Cruce a La Colorada has the lowest reported returns, both gross reporting and per hectare. However, Cruce a La

Colorada reported only timber returns, and information on earnings from NTFP could not be obtained. Mean returns per hectare were $10.06, with a median value of $9.62. Last, in discussing returns per hectare for San Andrés I and San Andrés II: the net revenue returns are the same for the concession organization but quite different in regard to value per hectare due to the size of hectares managed. Assuming all production occurs in San

Andrés I yields a value of US$7.14 per hectare, whereas assuming all production occurs in San Andrés II equates a value of US$15.03 per hectare. Utilizing the entirety of land available to San Andrés concession and the net returns sees a value of US$4.84 per hectare.

Figure 3.6: Average Net Revenue, Land Rent Returns

Table 3.7: Total Land Rent Returns in Concessions

Average Net Revenue

Concession Timber NTFP Tourism Total: Hectares: Dollars/Ha

Carmelita LI $88,495.21 $43,638.90 $1,087.92 $133,222.03 53,221.51 $2.50 Uaxactún LI $208,400.54 $46,538.81 $254,030.35 81,545.09 $3.12

La Union NR $253,327.35 $253,327.35 20,933.23 $12.10

Yaloch NR $169,540.45 $154,730.01 $324,270.46 25,642.96 $12.65

Rio Chanchich NR $206,250.46 $206,250.46 12,184.19 $16.93

Chosquitan NR $528,973.49 $11,388.95 $540,362.44 19,500.12 $27.71

Las Ventanas NR $212,816.17 $212,816.17 64,918.96 $3.28

San Andrés I NR $337,910.97 $31,757.78 $369,668.75 51,770.29 $7.14

San Andrés II NR $337,910.97 $31,757.78 $369,668.75 24,593.65 $15.03

San Andrés Combined NR $337,910.97 $31,757.78 $369,668.75 76,363.94 $4.84 Cruce a La Colorada RI $33,406.08 $33,406.08 220,403.67 $0.15

The final land value to compare in the community forest concessions is that of agricultural land returns in the Maya Biosphere Reserve. This value was obtained from a

2012 survey of concession communities (Fortmann, 2014), which inquired about household income and occupational activities. The survey has a sample size of 494 MBR residents, of which 57% are concession members. For this analysis, the focus is primarily on household income. The returns per hectare for agricultural and pastoral activities are approximately 222.86 (recently-inhabited concessions) to 212.02 (non-resident concessions) quetzals, or US$27.04 to US$28.43. This is higher than concession returns in nearly all concessions, except Chosquitan.

Table 3.8: Agricultural Rent Returns

Average Concession Average Agricultural Returns Return Difference Long -inhabited $2.81 - Non-resident $13.55 $27.04 $(13.94) Recently-inhabited $0.15 $28.43 $(28.28)

Discussion:

Comparing the land rent returns between the community forest concession activities and agricultural land use reveals a substantial difference in net revenue potential. Non-resident forest concessions are the highest-earning concession type, but averaged values still fall short of the agriculture in the region. Non-resident forest concessions are comprised of concession members that, by in large, hold other sources of 52 income outside of concession returns. Additionally, non-resident concessions are “for- profit”: members receive dividend payments instead of in-kind benefits. Recently- inhabited communities are particularly lower than agriculture activities, as only low values from timber harvesting were accounted in the net returns. These lower forestry returns provide a weaker incentive to uphold regulations established by the concession charter. As a result, this could contribute to why deforestation is more advanced in the recently-inhabited concessions, as residents here are seeking to maximize land rent activities through agriculture. Demographically-speaking, Fortman et al. (2017) found that those in recently-inhabited concessions historically originate from agricultural communities. Their lack of experience with forestry and identity tied to agricultural labor, in addition to living closer to the Buffer Zone, could contribute further to the pressures of agricultural land use.

While all concessions maintain lower land rent returns from permitted activities than from agriculture, it is less likely that long-inhabited or non-resident concessions would participate in illegal agricultural activities. Some subsistence agriculture is permitted in long-inhabited concessions, but large-scale commercial agricultural activity is strictly prohibited. Non-forested areas around town centers both hold large clearings for small plane runways, the only way of reaching these communities before roads extended from the Buffer Zone. Now, a few unpaved roads extend into forest concessions, but are unreliable in inclement weather. Additionally, long-inhabited communities historically have participated in forest extraction activities, from chicle and xate extraction to small-scale forestry. Many residents have lived in these communities

53 for multiple generations and strongly identify as foresters (Fortmann, 2014). Non-resident communities are also less likely to experience greater rates of deforestation at the hands of concession members. Since no members live within the concessions and must travel to reach them, it is less likely that they would utilize the plots for subsistence agriculture. In addition to the highest returns of concession types, most non-resident concessioners hold other sources of income beyond the returns they receive from extraction activities.

Despite the discrepancies in land rent returns, concessions have remained successful in diminishing deforestation in comparison to other locations in the Maya

Biosphere Reserve. Both Blackman et al. (2015) and Fortmann et al. (2017) have emphasized this reduction in deforestation in the forest concessions relative to observationally similar areas. But, it is surprising that this is in spite of such stark differences in land rent returns between concession and agricultural activities. This suggests that other factors contribute to the value of concessions. One deterrent of agricultural conversion is the threat of losing the concession charter and usufruct rights to the land, as has occurred with concessions San Miguel and La Pasadita (Radachowsky et al., 2012). Another reason may be that concession members hold a high utility for their position as members and are unwilling to compromise that to participate in higher income activities. Or it may be simply too costly in both labor and resources to clear and manage enough land for commercial agricultural success. As a result, this discrepancy in returns and success in forest conservation demands more investigation.

Chapter 4: Non-timber forest product harvesting and commercialization in the Maya Biosphere Reserve

The discussion of non-timber forest products as a sustainability tool for providing income to forest dependents and valuing tropical forests is not a new concept. Peters et al. first brought attention to this topic with the study Valuation of an Amazonian Rainforest

(1989), in which non-timber extractive products were examined for their potential commercial value. The study relied on a multiplicative value of plot-sampled inventories of NTFP at their localized market prices. While groundbreaking in its attention to NTFP, the study approach has been criticized for an inflated value of actual returns from these products (Godoy, Lubowski, & Markandya, 1993; Sheil & Wunder, 2002). The manner in which resources are valued can have direct and indirect implications in policy and land management, thus it is important to avoid over- or under-inflating the value of NTFP.

Other studies have emphasized the importance of accurate valuation of NTFP by concentrating on the direct economic flow derived from the commercialization of these products (Godoy et al., 1993; Gram, 2001; Jensen, 2009; Tewari, 2000). Economic flow of NTFP as opposed to stock of NTFP helps to account for local market elasticity of products and the feasibility for harvest, something unaccounted for in the study by Peters et al.

Valuation of non-timber forest products provides recognition of the importance these products provide to large numbers of forest stakeholders. Millions of indigenous and underprivileged stakeholders rely on NTFP for livelihood benefits, with as many as

80% of the developing world projected to depend on these products (Tewari, 2000).

Many of these beneficiaries do not rely on the commercialization of these products, instead relying on direct consumption or bartered trade after harvest (Gram, 2001).

However, integrating the management of NTFP consumption and commercialization into land management practices for both can foster greater forest conservation. Market transactions of NTFP can provide income for the development of forest people, an alternative to intensive commercial clear-cutting for timber harvesting.

While non-timber forest product harvesting has potential for substantially contributing to the livelihoods of forest dwellers, it does need to be evaluated cautiously to ensure positive outcomes. Integrated, site-specific assessment is required, as value per hectare can vary widely with geographic location, even in similar ecosystem types

(Godoy et al., 1993). Methods relying on inventory assessment can create pressures for maximum harvesting beyond what is deemed sustainable and place undue stress on ecosystems (Arato, Speelman, & Van Huylenbroeck, 2014; Gram, 2001). Necessary institutional arrangements and governance of NTFP to promote successful commercialization may be incompatible with existing customs and norms (Wilsey &

Radachowsky, 2007). Changes in social outcomes as a result of commercialization can also erode success, particularly in circumstances with uncertain land tenure or usufruct rights. However, certification programs may be able to address these issues in certain circumstances. Wiley & Radachosky state that “improved market access, environmental sustainability, and social justice are…frequently cited benefits of certification [and] other benefits include increased efficiency, organization, transparency, accountability, safety, and education,” (Wilsey & Radachowsky, 2007, p. 47). Other assessments find that

“certification has substantial environmental benefits, typically achieved at a cost of reduced short-term financial profit, and accompanied by some improvement to welfare of neighboring communities,” (Burivalova et al., 2017, p. 4).

As discussed previously in brevity in the proceeding chapters, there are a number of non-timber forest products in the community forest concessions upon which members and non-members rely. The primary NTFP reported in management plans, literature, and annual reports are as follows:

• Xate • Allspice • Ramon (Chamaedorea spp.) (Pimenta dioca) (Brosimum alicastrum)

• Guano • Copal • Chicle (Sabal mauritiiformis) (Protium copal) (Manilkara zapota)

Those living in the MBR collect other herbs and medicinal plants for personal use, but those items are not widely commercialized. Honey was also reported as a low-earning

NTFP in several of the annual reports. The following discussion regarding NTFP will focus on the harvesting and commercialization of xate for several reasons: there is a greater abundance in reporting of xate as a NTFP and information regarding extraction in general; some concessions devote great attention to xate harvesting as a source of income; there is an established export market present for xate, with arrangements and access varying for different concessions.

Xate Harvesting and the Community Forest Concessions

Xate is the local name given to several species of the lush, green plant falling into the genus Chamaedorea, and are harvested in Guatemala, Mexico, and Belize. The

Chamaedorea genus is large, with up to 100 species belonging to this group (Bridgewater et al., 2006). In the community forest concessions of the Maya Biosphere Reserve, a few species dominate harvests and commercial sales: C. elegans, C. ernesti-augusti, C. nerochlamys, and C. oblongata. Each are referred to by local names, C. elegans is xate hembra, C. ernesti-augusti is xate cola de pesca, and C. oblongata is xate jade (Wilsey &

Radachowsky, 2007). The plants are typically harvested in the forest understory as opposed to intentional cultivation, although both methods are seen in Maya Biosphere

Reserve. Consumer demand for different species at different times of year causes some variation in the quantities that each are harvested, xate jade remains the most harvested and exported from the concessions. Xate is harvested both for seed and for leaves, but the emphasis is on leaves (hojas) that are harvested several times a year in the forest concessions.

Men called “xateros” are responsible for the collection of the plant in the forest.

Xateros are primarily comprised of concession members and occasionally contracted workers. The number of xateros differs slightly between concessions, but generally sees thirteen to fifteen men but no female xateros. In Cruce a La Colorada, there are about fifteen regular xateros that work strictly for the concession. In Carmelita, there are

58 typically thirteen or fourteen men that alternate as xateros with other concession roles, like guiding tourists or working in the sawmill.

In the concessions, xateros must adhere to strict harvesting guidelines. These guidelines are determined by plans proposed by concession managers with the assistance of the organization ACOFOP and some oversight by the FSC. Management plans must be approved by CONAP to ensure they follow appropriate sustainability guidelines. Once approved, management plans must be reviewed every two years and completely reevaluated every five years. Any changes to NTFP or xate management require approval from CONAP, even if previous plans had already been in place. The plans divide the entire concession into at least four sections, of which harvest is rotated to adequately rest mature plants and allow for regeneration. The management plan outlines the schedule for section rotation by species, so one month is spent in each section before moving on and then allowing three months in between repeat harvests.

During harvest, xateros are only armed with simple tools on foot in the forest

(Hernandez-Barrios, 2008). Leaves are cut according to management plan guidelines, which include specified characteristics for adhering to quality standards. These standards include: minimum length requirements of at least 30 centimeters, dark green appearance, absence of damage by fungi or insects, and unbroken sheet of leaves (Radachowsky,

2004). Currently, to receive payment, xateros must meet these standards at an eighty percent or higher rating to receive payment. As a result, it is important that the leaves do not suffer any damage while being transported and great care is taken to ensure quality transport.

The harvesting process varies between concessions, depending on the location and type of the concession, and time of year. Non-resident concessions, such as La

Union, Yaloch, and Chosquitan in the eastern area of the MBR harvest and manage xate different than resident concessions. Trips into the concession to harvest xate require more extensive travel arrangements and supplies. For Custocel (La Union), there is a minimum of seven xateros needed for a time period of 8-10 days to harvest enough xate to cover the costs of the travel and supplies for harvest. At the end of a trip when a xatero returns, he brings the xate and money to his family before traveling back to the harvest site.

Sometimes a xatero will take time to rest in between trips, but this seems to vary based on personal preference. In resident concessions like Cruce a La Colorada or Carmelita, xateros travel into the forest to stay at camps. However, these stays are often at maximum two or three days. In some cases, a xatero may even leave early one morning to return late in evening from a single-day harvest. In Carmelita, one productive camp was located about a “four hour walk” into the forest, according to xatero manager, Santiago Juarez.

The location and distances to camps vary greatly between each concession. Some concessions that place greater emphasis on xate harvesting, like Uaxactún, see a greater number of camps at distances farther from the urban center. The time of year also impacts the ability to travel to productive xate areas. During the rainy season, high water and excessive mosquitos can compromise access to some areas of the concession. In

Custocel, this causes fewer xateros to harvest during the rainy season.

While in the field, the xateros stay in established camps and harvest the surrounding area. Although those staying at the camp do not harvest together in groups,

60 two xateros will harvest in nearby areas together (personal communication, concession member). This is to provide a “buddy system” in case of an accident or encounter with hazardous wildlife, like the highly venomous snake the Bothrops asper. The camps are selected to be closer to a water source, if possible. Camps also must meet evaluation guidelines established by CONAP, ensuring proper waste disposal and minimal impact on the forest.

Harvesting xate is a tiring and time consuming process, requiring xateros to cover long distances in difficult terrain. A study by Ponce et al. (2008), analyzed the average distance traveled by xateros during a harvest. This study attached GPS receivers to xateros as they traveled through the forest. The results showed a range of 1.9 to 14.8 kilometers traveled to harvest the xate, occupying between 7.2 and 9.9 hours of harvesting time. A xatero from Custocel expressed that the average time harvesting was approximately eight hours, echoing the study by Ponce et al. (2008). Concessions like

Carmelita, which offer alternatives to xate harvesting, expressed that xate harvesting is less preferred than other jobs, such as sawmill work or guiding tourists. However, all concession members involved with the xate extraction process have expressed that they appreciate the opportunity for elevated income that it provides.

Xateros return to villages in different ways, depending on the concession. In some concessions where xate is a larger activity, there are vehicles available to bring in harvests. For the Custocel concession, the harvest is bundled and floated down river to pick-up points before taken to the xate bodega in Melchor de Mencos. Other concessions, such as Cruce a La Colorada, rely only on foot, whereas Uaxactún utilizes motorcycles

61 and bicycles for its xateros. In Carmelita, a donkey or mule train is used to return bundles of xate to the village. To assist in alleviating damage to the marketable palms, the xate is wrapped in plastic tarps, lined with guano palm leaves to prevent them from scorching or wilting during transportation

When the xate is brought into the villages, it is taken to a centralized location where it is sorted and bundled for its next step in the production process. In concessions with lower production of xate, this may be a room in a private residential home. For concessions that produce and export larger amounts of xate, such as Uaxactún, Carmelita, or Cruce a La Colorada, this can be a concession-owned bodega. Once at these xate salons or bodegas, women typically manage the sorting and bundling processes. The number of women employed at the xate bodega varies by seasonal demands, but often there are between four and seven regular classificadoras. During occasions when large quantities of xate are harvested, more female concession members are recruited to assist in sorting. This is due to the time-sensitive nature of exporting the product via the refrigeration houses. The labor hours also vary by concession and demand, with some concessions receiving harvest deliveries only two days a week (typically non-resident concessions) and others nearly every day (Uaxactún). The larger the harvest, the longer hours the women work. Each woman works to sort xate individually, preparing market- quality leaves and receiving payment for bundling them into manojas (groups of 20 leaves). The women receive their payment per bundle and efficient classificadoras can sometimes earn more than xateros. The xate manojas are then collected and wrapped into paquetes, which are groupings of 30 individual manojas, totaling 600 hojas.

The payments xateros receive for their harvest has changed in the concessions from traditional processes. Prior to the start of this payment shift in 2005, xateros were paid by weight of bundles of xate, called gruesas, which are comprised of 80 leaves each.

This payment system created a very unsustainable process that incentivized overharvesting of healthy plants and low-quality leaves. As a result, sorting had to be more selective at the xate salons and large portions of leaves were discarded.

Several studies have reported on the waste and threat of sustainability of the quantity-based harvest system, such as “Efectos Poblacionales de la Extracción de la

Palma de Xate (Chamaedorea sp.), en el Norte de Guatemala” (2004). This study analyzed the population of xate in Uaxactún, as well as the harvesting habits of xateros located there. One finding of the study was that for harvested xate in 2002, 2003, and

2004, the percentage of discarded leaves ranged between 27.0% and 75.4% across all years. The study also uncovered a wide variance in percentage of exportable leaves across 13 camps for xate jade. The most productive camp exported just over 80% of harvested leaves, whereas the least productive managed to only export roughly 40%.

Variation in the number of exported leaves as a percentage of harvested leaves also is present across contractor locations. In an average of the years 2002, 2003, and 2004, the range of exported leaves as a percentage of the total was 50.2%, 48.7%, 42.0%, 47.3% and 42.7% respectively for contractors located in Camelita, La Gloria, Melchor,

Uaxactun, and Yaloch. Lastly, there was a significant variation in the exported leaves as a percentage of those harvested between leaves that were transported by mules and those that were not transported by mules to xate salons. In 2003, leaves that were transported

63 by mule saw only roughly 50% of leaves exported, whereas those transported by other methods saw over 60%. This suggests that transportation methods also matter in preserving quality of xate.

The change in payment schemes to xateros has shifted from based on quantity of leaves to higher quality standards for the leaves for most of the concessions. This has been an attempt to preserve the existing resource stock, which was beginning to be harvested at unsustainable means. As a result, plants were unable to flower or produce fruits as they focused their energies on growing new leaves (Radachowsky, 2004). In ecological studies examining the regrowth of varying levels of defoliation, palms can survive removal of 50% of leaves before suffering in terms of leaf production and leaf quality (Hernández-Barrios, Anten, & Martínez-Ramos, 2015). These studies helped motivate the change in management policies enforced by CONAP in 2005, emphasizing xate quality over quantity.

The implementation of management plans requiring quality-based payment schemes have attempted to end the high amounts of waste, increase sustainability, and promote better income for the xate trade. To better streamline the exportation process and increase wages, CONAP eliminated contractors unaffiliated with the concessions from buying xate. The enforcement of quality-based payments has been strengthened as well; now all xate harvested in each concession is purchased by the concession. This prevents sustainable harvest from being undercut in the concessions by contractors accepting lower quality xate and paying xateros by weight. Now, it is required that eighty percent of xate harvested must be of export quality. Despite requiring additional time to seek out

64 the quality leaves before picking, xateros have expressed that they understand why it is necessary. Before switching to the quality-based system, xateros met with concession managers and underwent training to learn the quality standards. This process also was aided by NGOs that operate in the MBR, such as the Rainforest Alliance (RA) and

Wildlife Conservation Society (WCS). These organizations assisted with training of concession managers and members. Since this switch, currently four concessions maintain FSC certification for harvesting xate: Uaxactún, Yaloch, Cruce a la Colorada,

Carmelita, San Miguel, San Andrés and Chosquitan (“FSC Public Search,” n.d.).

The WCS also analyzed the transition from quantity to quality-based payment scenarios from August 2005 to March 2008 in the concession of Uaxactún (Wildlife

Conservation Society, n.d.). During the analysis period, 17 samples were collected with information on the delivered hojas per xatero and the quantities of non-marketable hojas for Chamaedorea oblongata, or xate jade. The report provides some enlightening information on the monthly fluctuations in number of xateros in Uaxactún, appearing to have greater numbers in the months of September 2005, September 2007 and August

2005 than others in the 17 sample periods. The highest percentage of quality leaves accepted to be sold occurred in July 2007, at 98.16%, contrasted with the lowest in April

2007 with 72.31%. Even at the lowest percentage sampling in this report, it is more than double than the averages found in Radachowsky et. al. (2004), reporting that 75.4% of leaves were harvested and discarded, leaving only 25.6% available to be sold. The report also collected samples from the xate bodega of AFISAP in October 2007 and January through March 2008. The samples show a range of xateros three to nine xateros with

65 quality ranging from 71.60% (February 2008) to 81.10% (March 2008) of the total harvest being exported. As there are fewer samples and no other reports available for comparison, it is difficult to draw any concrete conclusions. However, it is encouraging to see the increase in number of marketable leaves following the use of quality-based payment standards and concession-controlled buying.

There also seems to be positive wage effects for the xateros as well. One xatero from Cruce a La Colorada reported that before switching to this payment system, xateros would receive roughly Q 2.50 per gruesa (80 palms) as payment. Now, with the quality requirements for payment, xateros in Cruce a la Colorada are paid Q 1.20 per twenty palms, or Q 4.80 per gruesa, a 92% increase in payment. In a round-table discussion with other xateros at the ACOFOP office, several xateros state that their average daily wage is approximately Q100 (US$12.96) per day.

After harvest and sorting in the concessions themselves, the xate is shipped to the main refrigeration house where it will await exportation. Xate is transported by refrigerated box truck to ensure that the leaves do not become wilted or damaged. The xate committee of ACOFOP manages the refrigeration house in Santa Elena and has two buyers that aid the sale of the xate. One buyer is located nationally and one is located internationally, in Miami, Florida. At the refrigeration house, the bundled gruesas are organized and stored in the cooler with different colored string representing the origin of each bundle. Here, they remain under the care of a single employee, who waits to load them for export at least every eight days. To be exported, they are sent to two locations.

Some shipments are sent to Puerto Santo Tomas de Castilla in the Municipality of Puerto

Barrios, which lay on the Amatique Bay off the Gulf of Honduras, to be transported by boat. Other shipments are transported by semi-trucks to Guatemala City and are shipped by air.

The Demand Side of Xate

Xate is exported for use as a decorative plant. The plants are used in church celebrations, as ornamental accompaniment in floral arrangements, and as a common houseplant. The demand for the plant peaks around the Christian holiday Easter, where it is most frequently used in large decorative displays. Interest in the plant began in the

1950s and since progressively increased, becoming one of Central America’s most important NTFP (Bridgewater et al., 2006). The plants are popular options for use as accompanying floral greens due to the long shelf life, which can be several weeks after reaching the end consumer. Xate, or commodore products as they are often called in the

US market, also thrive as low-light houseplants due to their natural cultivation as an understory plant.

The import market for xate is primarily composed of demand from the United

States and Europe. In a report developed by USAID in 2006, it was found that the 2005 xate market saw Holland as the largest importer, followed closely by the United States

(Rodas & Wilshusen, 2006). Xate was also imported in much smaller amounts to Mexico,

Croatia, Germany, France, and Canada. Examining trends of xate importation in the

United States, Current & Wilsey (2001) analyzed US imports of xate between 1971 and

1999. Here, they find imports range between 250 million and 450 million stems annually. 67

More recently, imports of Chamaedorea products have fluctuated from 7.42 million packages of stems in 2013 to 19.1 million packages of stems (containing 20-25 stems per package) in 2017. On average, 97.9% of these imported stems come into the US through

Florida (US Department of Agriculture, n.d.).

Figure 4.1: Imported Xate Stems Source: USDA.gov

Packages of Imported Stems into US

25,000,000.00

20,000,000.00

15,000,000.00 Packages of Stems 10,000,000.00 Xate Stems

5,000,000.00

- 2013 2014 2015 2016 2017

One company, Continental Floral Greens (CFG), has worked with the community forest concessions since 2010 to source xate and other floral greens products.

Procurement manager for CFG, Paulo Dos Santos, works primarily with the concession

Carmelita to source xate jade, xate hembra, and xate elegans for the US-based company.

CFG typically places quarterly orders that are modified on weekly basis to adjust for fluctuations in consumer demand. Dos Santos stated that CFG prefers working with

Carmelita because they provide the highest quality product, in addition to sustainably sourcing the plant.

Continental Floral Greens sources all of their xate products from the forest concessions. CFG places approximately US$13,000 worth of orders every 2 weeks with the concession, seeing approximately US$838,000 in orders annually. CFG makes purchases of the plants by “bundle.” Each bundle contains 30 “bunches”, which are comprised of 25 stems per bunch, or 750 palms per bundle. Each bundle is purchased for

US$14.50, seeing a price per palm of US$0.02. Each bunch containing 25 palms is sold for between US$0.99 to US$1.50, depending on the quality and location of the purchasing retailer. On average, CFG sells 25 stem bunches to retailers for about

US$1.23 per bunch to remain competitive to other wholesale suppliers. Since they offer a wide variety of other floral green products, CFG can purchase xate from the concessions at a static, consistent price but allow for some flexibility in sales to retailers.

The highest volume orders occur around the Christian holiday Palm Sunday.

During this time, CFG works closely with EcoPalm and Hermes Floral (both based in

Minnesota) to supply churches that want to support sustainable extraction. EcoPalm and

Hermes Floral are willing to pay higher premiums for certified palms, and as a result

CFG is able to pay the concessions bonuses for meeting production orders during this time period. In 2017, CFG was able to pay Carmelita US$50,000 in bonuses following

Palm Sunday.

Working with Carmelita has not been without difficulty for Continental Floral

Greens, as Dos Santos also highlighted supply chain issues with the concession. One

69 issue seen is what Dos Santos describes as “a cultural disconnect in business practices” in understanding “cash on delivery” business practices. Dos Santos described difficulty with the concessions as the concessions expect that they will be paid in full for xate when it leaves Carmelita, instead of upon arrival to CFG. In some cases, short delays in payments has caused the concessions to halt production altogether. This creates a cycle in which customers of CFG pursue orders with competitors, then requiring CFG to reduce orders with the concessions. Other issues include difficulty in ensuring product quality and quantity: ensuring every “bundle” purchased by CFG has the correct number of palms, or that xate is packaged in a way that will not damage plants. Another issue is insuring

“follow-through” with business practices. Dos Santos also mentions difficulty in ensuring that when CFG place an order with Carmelita that if a competitor offers a higher price for the xate being collected, the concessions will not sell the contracted xate. Despite these difficulties, CFG remains interested in continuing to work with the forest concessions as the primary provider of their xate products.

Estimating Potential For Increased Revenue

This analysis estimates revenue potential for increased extraction of non-timber forest products by examining additional extraction of xate. The increase in extraction is estimated from assuming maximum capacity extraction of xate as denoted by the management plans of community forest concessions that are filed with CONAP. This assumes concessions would be harvesting the entirety of their allotment of the sustainable

70 extraction of xate, as determined by forest managers. The net revenue for this increase in production is then estimated by applying the per unit value of xate to the increased production amount. Estimated costs were calculated by using reported fixed and variable costs found in a report by the Xate Committee, which is affiliated with the organization

ACOFOP. It is important to note, however, that this assessment does not account for the opportunity cost associated with diverting concession member labor from other tasks

(such as timber harvesting) to increased xate production. Additionally, the losses of xate damaged during harvest and transportation are not fully accounted in this assessment, which only examines the value of harvested xate that was actually purchased.

To calculate the returns of xate per hectare for each concession, several steps were required to obtain accurate estimates from information provided in management plans.

Xate management plans detail the total number of plants and total number of harvestable plants within each concession sector. The harvestable plants are reported in plants per hectare, per sector within the management plans. The gross annual in-situ revenue of the xate can be determined easily from the total annual harvest of leaves and the per unit value. Most management plans report the harvestable amount of xate for three primary varieties: xate hembra, xate jade, and xate cambray. In the cases where multiple management reports were available, any variation in harvestable amounts per hectare was averaged between by species across multiple years. After these calculations, the total annual gross returns per concession sector were calculated and then summed to arrive at the estimated gross revenue. The results are presented in Table 4.1.

Table 4.1: Actual and Estimated Xate Revenue

Estimated Xate Only Net Revenue Average Annual Revenue Revenue per Hectare Concession Hectares Quetzales US$ Quetzales US$ Cruce a La Colorada 20,403.67 66,210.27 $ 8,355.74 3.25 $ 0.41 San Andrés I 51,770.29 207,549.75 $ 26,192.78 4.01 $ 0.51 San Andrés II 24,593.65 207,549.75 $ 26,192.78 8.44 $ 1.07 San Andrés Average 76,363.94 207,549.75 $ 26,192.78 2.72 $ 0.34 Carmelita 53,221.51 584,366.61 $ 73,747.07 10.98 $ 1.39 Yaloch 25,642.96 204,683.56 $ 25,831.07 7.98 $ 1.01 Uaxactún 81,545.09 1,359,786.87 $ 171,605.10 16.68 $ 2.10 Chosquitan 19,500.15 450,373.56 $ 56,837.14 23.10 $ 2.91 La Union 20,993.23 498,391.49 $ 62,897.01 23.74 $ 3.00 Las Ventanas 64,918.96 404,308.67 $ 51,023.75 6.23 $ 0.79 La Gloria 64,967.48 1,079,885.31 $ 136,281.53 16.62 $ 2.10 Actual Average Xate Net Revenue Average Annual Revenue Revenue per Hectare Concession Hectares Quetzals US$ Quetzals US$ Cruce a La Colorada 20,403.67 San Andrés I 51,770.29 318,771.10 $40,738.95 6.16 $0.79 San Andrés II 24,593.65 318,771.10 $40,738.95 12.96 $1.66 San Andrés 318,771.10 $40,738.95 4.17 $0.53 Average 76,363.94 Carmelita 53,221.51 343,905.97 $43,951.18 6.46 $0.83 Yaloch 25,642.96 74,515.94 $9,523.14 2.91 $0.37 Uaxactún 81,545.09 364,153.48 $46,538.81 4.47 $0.57 Chosquitan 19,500.15 39,309.57 $5,024.65 2.02 $0.26 La Union 20,993.23 Las Ventanas 64,918.96 La Gloria 64,967.48

Table 4.2: Difference Between Xate Estimated Revenue and Actual Average Net

Revenue

Average Annual Revenue Revenue per Hectare Concession Hectares Quetzals US$ Quetzals US$ Cruce a La Colorada 20,403.67 San Andrés I 51,770.29 -111,221.35 -$14,546.17 -2.15 -$0.28 San Andrés II 24,593.65 -111,221.35 -$14,546.17 -4.52 -$0.59 San Andrés Average 76,363.94 -111,221.35 -$14,546.17 -1.45 -$0.19 Carmelita 53,221.51 240,460.64 $29,795.89 4.52 $0.56 Yaloch 25,642.96 130,167.62 $16,307.93 5.07 $0.64 Uaxactún 81,545.09 995,633.39 $125,066.29 12.21 $1.53 Chosquitan 19,500.15 411,063.99 $52,543.24 21.08 $2.69 La Union 20,993.23 Las Ventanas 64,918.96 La Gloria 64,967.48

There are several key caveats regarding actual reported average xate revenue and

estimated revenue from increased xate production presented in Table 4.1. First, it is

important to note that, as in previous financial analysis, the community concession

organization that manages San Andrés manages both San Andrés I and II. However, in

management plans and reports, there is no clear designation of where production is

occurring. So, in the information presented in Table 4.1 shows net revenue per hectare

assuming production occurring in only San Andrés I, only San Andrés II or in both (San

Andrés Average). It is also important to point out here that San Andrés holds much

higher actual returns than estimated xate returns at maximum capacity. This is translates

to a difference of between US$0.19 to US$0.28 per hectare, or nearly US$15,000.

There are several implications of the differences in returns between estimated and

actual returns from xate harvesting, as demonstrated in Table 4.2. First, this could

73 indicate that there may be some inconsistency or over-inflation in the reporting of xate harvest revenue for the concessions of San Andrés. When comparing the actual average net revenue to Carmelita or Uaxactún, the values for San Andrés are similar, which may suggest that they are extracting comparable quantities of xate. Unfortunately, in the annual reports disclosing financial returns, precise annual extraction amounts are not indicated. As a result, there is no confirmation of whether San Andrés is harvesting a comparable quantity of xate to Uaxactún or Carmelita, which would likely be above the allotted amount permitted by CONAP. Comparing estimated and actual average extraction amounts for the concessions of Yaloch, Uaxactún, and Carmelita, harvesting maximum capacities of xate would contribute to increased returns. The highest returns would be achieved in Uaxactún, which would add an additional US$1.53 per hectare to land value. Overall, the increase in returns for increased xate production is relatively small. The spatial distribution of estimated xate potential can be seen in Figure 4.2.

Figure 4.3 demonstrates the spatial distribution of the difference between current xate production values and the estimated xate potential, created using values found in Table

4.1.

Figure 4.2: Estimated Xate Potential

Figure 4.3: Difference in Estimated and Actual Xate Earnings

Discussion

While increasing production of non-timber forest product harvesting provides a means of increasing land use returns while maintaining forest canopy completely intact, it does not substantially contribute to raising land returns. Most likely, to meet maximum capacity harvesting for xate in the concessions, labor resources would have to be diverted from other activities, such as timber harvesting and sawmill processing. Increasing production also assumes a consistent demand from importers of xate in the United States,

Europe, and Canada and that there would be no price effects seen in an increase of xate

76 on international markets. Currently, there remain few other exporters of xate in

Guatemala, both from natural harvesting or cultivated crops, providing little competition for the community forest concessions. Xate is exported from Mexico and Belize, but Dos

Santos expressed that the concessions maintain the highest quality product by comparison to competitors. However, if another supplier were able to provide a comparable quality product at a more competitive price, concessions may lose xate as a source of income altogether. Last, xate or commodore products are utilized as accompanying greens for a luxury product: floral arrangements. As a luxury good, sharp fluctuations in the global economy or economies of importing countries may see decreased demand for xate as a non-timber forest product. Other accompanying greens may shift to become preferred to xate in floral arrangements, such as the leather leaf fern, which can be commercially grown throughout Central America and southern Florida. Overall, it would be more advantageous for concessions to focus less on increasing production of NTFP, maintain and improve efficiency of higher-value activities, such as sustainable harvest of timber, to increase land rent returns.

Chapter 5: New policies in the Maya Biosphere Reserve: How to build on existing success for protection in the future? While the Maya Biosphere Reserve has been successful at reducing deforestation in some areas through community-based management, shifts in the global economy, political regime change, and social upheaval can modify deforestation pressures. To ensure lasting conservation impacts, management practices must be evaluated and modified to adjust to dynamic threats towards forest resources. As a result, new policies must be considered to continue existing success in maintaining tropical forests in Latin

America. One element of forest management that could reinforce conservation and development goals in the Petén department but has yet to receive considerable emphasis is payment for ecosystem services (PES). Reducing emissions from deforestation and degradation (REDD+) is one policy mechanism that utilizes PES in Latin American forests to provide incentives for maintaining forest cover.

While not currently established to yet provide payments for carbon sequestration, the implementation of a REDD+ framework for Guatemala has been in the early stages for several years. At the national level, the Inter-Institutional Coordination Group for

Climate Change (GCI) has coordinated support for REDD+ activities by forming a coalition of multiple organizations. The National Institute of Forests (INAB), the

Ministry of Agriculture, Livestock, and Food (MAGA) the Ministry of Environmental and National Resources (MARN), and CONAP work with a number of other actors to assist in the implementation, coordination, and monitoring of REDD+.

Under the recent initiatives of REDD+ applications in Guatemala, one of the keystone projects in the MBR is the formation of GuateCarbon. This project was formed

78 in 2006 as a combined effort of CONAP and ACOFOP, with support from the Rainforest

Alliance and Wildlife Conservation Society to validate and estimate potential carbon storage in the MBR (Figueroa et al., 2015). The official title of the project is “Reduced

Emissions from Avoided Deforestation in the Multiple Use Zone of the Maya Biosphere

Reserve in Guatemala,” but is referred to as GuateCarbon. Financial support for the project has been secured through several large donor agencies that include USAID, the

Inter-American Development Bank, the Guatemala Exporters Association, the World

Conservation Union and more (Hodgdon et al., 2013). The preliminary implementation stage of this project saw several key tasks; the governance structure was formed, project components were outlined, and initial carbon stock was validated. The entire project lifetime is thirty years, from January 2012 through January 2042, with three main objectives that address climate, community, and biodiversity while aiming to offset approximately 33 million tons of CO2 equivalent. The objectives are evaluated through established smaller benchmark indicators, ranging from greenhouse gas reductions, financial support to schools, and preservation of local flora and fauna.

Performance indicators aid in the evaluation of progress assessment meeting the objective goals of GuateCarbon and were developed by project stakeholders in 2014.

Rainforest Alliance and CONAP directors met to establish formalized procedures, evaluation methods, and appoint personnel. To assist in monitoring progress of the project, CONAP formed the Center of Monitoring and Evaluation of the National

Counsel of Protected Areas (CEMEC) to collect and process remote sensing data of land, air, and satellite images. Local communities have also been involved in the project to

79 assist with a variety of tasks, ranging from forest resource management to protection and control of territory, working with stakeholders to meet project goals.

A report by Figueroa et al. (2017) details the early progress of the GuateCarbon project, revealing positive net impacts during the monitoring period of 2012 to 2014. The report demonstrated a correlation in deforestation reduction of up to 40% for the project region, with some leakage into nearby areas. Studies conducted by CEMEC, the Wildlife

Conservation Society, and Rainforest Alliance indicated that recorded emissions were below the project GHG baseline. Deforestation during the monitoring period was greatest in the low humidity, medium to high height low-humidity, broadleaf forest at 4,641.30 hectares, with an additional 505.98 hectares of low height broadleaf forest deforested.

This sums to a cumulative loss of 5,147.28 hectares of forest, falling below the projected deforestation of 9,452.52 hectares of forest. The result was a net reduction of 1.23 million tons of CO2 during the monitoring period of 2010-2012.

Despite the success of the first portion of the project, there are some shortfalls in the facilitation of the program. The collaboration of many different stakeholders has created issues regarding the equity of payments to be distributed by the program. With the complicated structure of land tenure and usufruct rights to land in the MBR, there has been some debate about the legal ownership of forest carbon. The Rainforest Alliance in particular has been working to establish a mechanism to distribute dividend payments for the carbon stock payments. This process has been complex, as Guatemalan government stakeholders initially viewed the payments as being property of the state. This is due to the technical legal ownership of the MBR forest which is state-owned, and communities

80 only hold usage rights to forestland. However, after influence from NGO stakeholders like the Rainforest Alliance, an agreement was reached declaring the rights of credits be granted to established community forest concessions (Hodgdon et al., 2013).

Progress on the project towards additional monitoring and disbursement of carbon payments has stalled since 2016. The last report detailing the project progress was released in July 2016, only detailing the reductions found in the monitoring period of

2010-2012. Deforestation continues in the region and can be seen in the Hansen et al.

(2013) forest canopy loss maps, which present remotely sensed data through 2016. At this time, there is still no established system of payments being disbursed in the region.

Potential for Payments for Ecosystem Services

The use of disbursed carbon payments of other payments for ecosystem services has been successfully utilized in other Central American countries, drawing support from federal governments, intergovernmental agencies, and non-governmental organizations(Alix-Garcia, Janvry, & Sadoulet, 2008; Montagnini & Finney, 2011;

Wunder et al., 2018). Successful programs in other locations throughout Latin America can be used to model program implementation in the Maya Biosphere Reserve. In the following, I describe the structures of payments for ecosystem services and highlight suggestions in literature for the use of PES in other contexts. Finally, I conclude this discussion by describing how the specific characteristics of the concessions in the MBR and stakeholder involvement can be utilized to establish similar programs in the Petén department. 81

Payments for ecosystem services are a forest management tool that provides compensation for ecological benefits of intact tropical forests beyond the value of extractable resources. There are many definitions of PES, but generally each definition focuses on voluntary action relying on incentives to induce behavior change for management of natural resources or ecosystems for social good (Sattler & Matzdorf,

2013). More broadly, Engel et al. (2008, p. 664) describes “…in many cases, the term

PES seems to be used as a broad umbrella for any kind of market-based mechanism for conservation…” Ecosystem services can be found in both plantations of non-native and primary stand forests in the benefits provided by carbon storage, water quality, biodiversity, and forest succession processes (Montagnini, Cusack, Petit, & Kanninen,

2005). In reforestation and plantation forestry, the initial fixed cost of establishing new plantations creates a barrier to entry for many small, rural farmers. PES is a viable tool to assist forest stakeholders by supplementing the costs of biological restoration and encouraging rural social development by instilling positive environmental attitudes in local residents (Montagnini & Finney, 2011). In most PES schemes, payments are made for a bundled service actions taken by stakeholders, with forest conservation and reforestation being the most common (Martin-Ortega, Ojea, & Roux, 2013).

Most PES schemes in Latin America emphasize water-oriented goals, as reflected in an extensive review of available literature by Martin-Ortega et al. There are several key characteristics regarding water-oriented PES schemes in Latin America. Most peer- reviewed and grey literature published between 1984 and 2011 on PES in Latin America focuses on local projects, with a high emphasis on projects in Costa Rica (Martin-Ortega

82 et al., 2013). This review detailed 310 distinct transactions that occurred over 40 different

PES schemes. Payments are almost always made on actions taken by stakeholders, as opposed to results of those actions. Most PES schemes are prepared and coordinated by multiple actors, typically by NGOs, who make “top-down decisions” regarding payment.

Cash payments to stakeholders are most common, but some in-kind benefits are also transferred. Many of the studies in this analysis fail to report average or median contract duration or area under contract, but of those that do report, see durations of 29.3 years and a median area of 1000 hectares. Overall, most PES schemes evolve over time as new price factors are introduced, transactions between buyers and sellers change, and the size of area is enlarged.

Prior to the distribution of payments, there must be established procedural mechanisms to assist program beneficiaries, provide administrative structure, and mitigate disputes. Preliminary investigations prior to establishing operational systems of

PES are very important, as outcomes can vary greatly depending on the methods used to estimate opportunity cost (Kosoy, Martinez-Tuna, Muradian, & Martinez-Alier, 2007).

Systems must be capable of addressing issues of land tenure, non-compliance, equity issues, and liaison between finding sources and recipients (Montagnini & Finney, 2011).

Procedural efficiency is important to avoid high transaction costs that erode the payments received by low-income participants. Support must be provided to landowners in adopting and continuing required management practices dictated by the PES.

Additionally, objectives or indicators to evaluate quality and compliance for the PES

83 must be easily identified and understood by non-expert stakeholders (Montagnini &

Finney, 2011).

The design and implementation of efficient PES payments are important to the return on investment in conservation. (Alix-Garcia et al., 2008) compare tradeoffs in efficiency and equity, and define three main types of PES schemes:

• Flat payment per hectare: a flat payment over all forested hectares, limited by a

maximum cap on hectares per participant.

• Risk-weighted flexible payments: payments for all at-risk of deforestation area

consider level of income potential equivalent to deforested land payment, without

any other constraints.

• Benefit-maximizing payments: payments that maximize anticipated

environmental benefits that are calculated using environmental index and

potential income generated by at-risk hectares, constrained by a specified budget.

Using simulations, Alix-Garcia et al. found that although the flat payments per hectare is the most egalitarian application, it is the most inefficient for the return on investment of environmental benefits. The risk-weighted scheme sees higher returns on investment than the flat payments, however the benefit-maximizing scheme appears to provide the greatest return over the flat-rate payments. As a result, the objective function of a PES must either aim to maximize environmental benefit or provide an equitable outcome for all participants.

Payments for ecosystem services have seen success in mixed agroforestry, pastoral, and conservation applications. Costa Rica has seen positive outcomes associated

84 with PES through extensive forestry legislation providing funding for incentivizing and establishing plantations. Forestry law in Costa Rica provides recognition of environmental services being provided by forests and plantations (Montagnini et al.,

2005). The law created several schemes of payments for environmental services, sponsoring projects for the mitigation of greenhouse gas emissions, protection of water, protection of biodiversity, and guarding of natural sites for tourist and aesthetic purposes

(Montagnini et al., 2005). Payments are financed through a combination of gasoline taxes, international, sales of carbon credits, and international loans to land owners through the National Forest Finance Fund (FONAFIFO). This program first began extending contracts to landowner participants in 1997 for forest properties between 2-300 ha, with an approximate of 40,000 ha project total calculated in 2007 (Montagnini &

Finney, 2011). Industrial forestry was also incorporated into the program, with participation types defined as: timber trees, multi-use trees planted in blocks, wind breaks, live fences, and improved fallow land and crop intercropping within reforestation projects. Since 2003, the program has seen over 7,000 contracts granted to NGOs and individual farmers. Miteva et al. (2012) find that the effectiveness of PES schemes depend heavily on several factors: the program design, the degree of compliance, and leakage levels of the program. Additionally, Miteva et al. found that few studies examine the change in quality of forest impacted by PES programs (Miteva et al., 2012)

PES in the Maya Biosphere Reserve

An attractive feature held by the Maya Biosphere Reserve in considering the establishment of a PES policy is the large number of stakeholders involved in providing financial and administrative support for conservation and development. The existing structure of forest concessions and the administrative support they receive from a variety of organizations and international government funding would serve as a beneficial starting point for policy implementation. The forest concessions have been successful in reducing deforestation and are currently supported from a variety of organizations to aid with forest management. Support from agencies like The Nature Conservancy and The

Rainforest Alliance, as well as funding from sources like USAID and the World Bank, provide financial and administrative assistance to aid concession activities. This can aid in the implementation of PES, by helping to establish markets or provide funding for initial payments and also to incentivize more participation as the program grows

(Montagnini & Finney, 2011). The addition of a REDD+ program in Guatemala would compliment activities of the Rainforest Alliance in Colombia, Mexico, and Brazil. The current level of support, combined with the proven success of the forest concessions in reducing deforestation, makes the forest concessions in the MBR a viable model to support a carbon-trading program.

The community forest concessions in the MBR also participate in multiple income-generating activities that could fit well within several types of PES. (Montagnini

& Finney, 2011) suggest that to maximize benefits, layering multiple types of PES can help ensure success. This would fit well with the diverse ecological characteristics of the 86

MBR, the mission of stakeholders involved and revenue-generating activities of the forest concessions. First, the MBR provides ample benefits in potential for carbon sequestration, as demonstrated in Chapter I and reductions in deforestation (Blackman,

2015; Fortmann et al., 2017; Hodgdon et al., 2013). Carbon benefits are also provided in reforestation and commercial forestry measures. Programs, such as Reforest the Tropics in Costa Rica, can provide extra payments to small landholders and foresters growing a mixture of high-value, fast-growing commercial species. This can then supplement the cost of waiting to harvest slower-growing, higher carbon-value tree species. The PES program in Costa Rica cannot cover the entire cost of forest plantations, but assists in early return on investment for farmers who cannot afford to wait until the final harvest of high-value species (Montagnini et al., 2005). The MBR also holds expansive biodiversity that attracts tourists for a variety of activities, ranging from permitted sport hunting, bird watching, and other ecotourism excursions (Radachowsky, 2004). PES for maintaining high biodiversity in the Petén would reinforce deforestation prevention by protecting habitat, a goal also embraced by NGOs like the Rainforest Alliance and The

Nature Conservancy. As a result, there may be positive impacts on tourism in concessions like Uaxactún and Carmelita by ensuring that highly valued species, such as howler monkey populations, are maintained as an attraction for ecotourism. Last, sustainable forest management is a method of PES for protecting watershed services

(Porras, Grieg-Gran, & Neves, 2008). Linking payments to water quality benefits can be another method of reinforcing sustainable management practices, reforestation, and improving quality through payments to upstream landholders or managers. This practice

87 has been utilized in Colombia, Costa Rica, Nicaragua, and Bolivia. The combination of small PES for each environmental benefit detailed here can aid in the success through reinforcing goals that increase total land values, complimenting existing sustainable harvest activities.

Land Rent Returns

This assessment of land rent return and ecosystem services in the Maya Biosphere

Reserve presents the value of all land rent returns of the community forest concessions.

The comprehensive summation of the social cost of carbon, increased estimated non- timber forest product harvesting, timber harvesting, and tourist for the community forest concessions show an average of US$3,228.64 per hectare. This value is comprised primarily of the annual rent of the social cost of carbon, reflecting the benefits that the community forest concessions provide, averaging a rent per hectare of US$3,720.81. If forest concessions were paid just twenty percent of this value per hectare, the value of carbon annual rent would be greater still than double the value of agriculture within the region. Table 5.1 demonstrates the summed land use returns for this assessment, which include the social cost of carbon annual rent, estimated increase in NTFP harvesting, timber harvesting and tourism for the forest concessions. The asset value for each concession per hectare is also included in the table, but is not summed in the total annual rent. The values of annual rent returns range from US$2,580.18 per hectare to

US$5,860.61 per hectare. Non-resident forest concessions hold the greatest average

returns and most complete information, with every concession except Rio Chanchich

holding estimates for carbon rent, estimated NTFP and timber production.

Table 5.1: Estimated Returns with Carbon Rent and Increased NTFP Production

Value Per Hectare Total Annual Estimated Actual Return Management Concession Annual Hectares Asset Value NTFP Timber Tourism Unit Type Rent Carmelita Long-inhabited 53,222 $11,121 $325 $1.38 $1.66 $0.02 $327.68 Uaxactún Long-inhabited 81,545 $9,565 $279 $2.10 $2.56 $283.86 San Miguel la Recently- 7,185 $7,956 $232 Palotada inhabited $232.22 Recently- La Pasadita 18,876 $7,596 $222 inhabited $221.72 Cruce a la Recently- 220,404 $10,821 $316 $0.41 Colorada inhabited $0.15 $316.41 Recently- La Colorada 22,347 $10,706 $313 inhabited $312.51 Rio Chanchich Non-resident 12,184 $18,018 $526 $16.93 $542.86 Chosquitán Non-resident 1,659 $11,983 $350 $3.27 $27.13 $380.18

San Andrés I Non-resident 51,770 $11,927 $348 $0.33 $6.53 $354.99

San Andrés II Non-resident 24,594 $11,610 $339 $0.70 $13.74 $353.33

Las Ventanas Non-resident 64,919 $11,515 $336 $0.79 $3.28 $340.18

La Unión Non-resident 20,933 $12,595 $368 $3.00 $12.10 $382.74

Yaloch Non-resident 25,643 $13,651 $398 $6.67 $6.61 $411.74 Paxbán Industrial 64,848 $10,892 $318 $317.92 La Gloria Industrial 64,967 $12,132 $354 $2.10 $356.21 Buffer Zone 463,576 $4,398 $128 $128.37 Protected Areas 1,068,193 $8,312 $243 $242.61

Concessions Average Value/Ha $11,472.49 $334.87 $2.08 $9.07 $0.02 $342.30

Figure 5.1 reveals the spatial distribution of the estimated values of ecosystem service, in addition to the forest loss between 2000 and 2016, as demonstrated by Hansen et al. (2013). It is apparent as to why San Miguel and La Pasadita would hold the lowest value of ecosystem services, due to the expansive loss of forest canopy cover marked in red pixels. The concessions are grouped by quartile, with yellow representing concessions with ecosystem services values in the first quartile and dark green representing the fourth quartile values. Each concession is also marked with the respective value of US dollar per hectare. The spatial distribution is most strongly influenced by the values of the social cost of carbon, so the quartile distribution of the concessions follows the same pattern as the previous map.

Figure 5.1 Estimated Land Rent Returns 2016

Discussion

This thesis finds that the inclusion of multiple dimensions of ecosystem services into the holistic value of land rent returns raises the value of the community forest concessions to concession members above the value of agriculture in the region. The value of these returns relies heavily on the annual rent calculated at the social cost of carbon, of which several implications can be drawn. First, the sustainable extraction activities of the community forest concessions are not substantial enough to surpass the economic threshold of agricultural returns in isolation. This suggests that there is a financial incentive, according to land rent theory, for concession members and residents to abandon the sustainable harvest activities in favor of more lucrative agricultural activities. As a result, this may be one of the motives that increased deforestation pressures in the now-defunct, recently-inhabited concessions of La Pasadita and San Miguel. Second, this may suggest that the more successful concessions (those that have diminished the rate of deforestation) receive a higher utility from participating in sustainable extraction activities–a level of utility unable to be financially quantified in this assessment. It could also suggest that the cost, either in opportunity cost or capital investment, or risk of converting forested land to agricultural or pastoral land in some concessions is higher than others. The success of the concessions may be attributed also to the access to markets and cost of accessing those markets varies between concessions. Third, the spatial visualization of these land rent returns may provide a tool for future policymakers in the region to decide which concessions are most demanding of receiving carbon payments. As it is unlikely that all concessions would be able to be funded at the social cost of carbon in annual rent, it is important to assess the financial returns of each concession in conjunction with where deforestation is likely to continue to occur. For concessions like Cruce a la Colorada, which is experience greater rates of deforestation than Chosquitan, it may be advantageous to focus carbon payments there to remove financial incentives for land use 92 conversion. Conclusion:

This analysis has successfully answered several primary research questions by addressing five key objectives about the community forest concessions within the Maya

Biosphere Reserve in northern Petén, Guatemala. The previously presented analysis has found that land use returns of the community forest concessions sustainable extraction activities are not greater than the land return of agricultural activity in the region. Concession land rent returns are much lower than agricultural returns, at best averaging only half of agricultural returns in the region and at worst less than one percent of returns in the region. The analysis also revealed that increasing the production of the most lucrative non-timber forest product will also not significantly contribute to land use returns. In fact, it is unknown if increasing production of NTFP would decrease returns overall, due to high opportunity cost and diverting labor from more lucrative activities like timber harvesting. Last, the final portion of the analysis addresses potential policies to aid in forest protection in the Maya Biosphere Reserve. New policies addressing the benefits of stored carbon and carbon sequestration in the MBR could assist in protecting the forest by compensating concessions for diminishing deforestation. If compensated at the social cost of carbon, this would raise land rent returns much higher than the value of agriculture in the region.

The value of ecosystem services has been found to vary spatially across human boundary conditions, such as the characteristics of the community forest conditions. The

93 examination of financial returns of extractive activities, such as timber and non-timber forest product harvesting, tourism, and rate of carbon storage differs between concession types. The demographic of concession members and contract constraints of tenure rights vary between each concession type, which could lead to the differences seen in returns.

Overall, non-resident forest concessions see the highest and most consistent returns for extractive activities and carbon storage value. This also creates a distinct spatial pattern, as all non-resident concessions tend to be grouped in the eastern edge of the MBR, concentrating the highest financial stability and success in one area.

Finally, there are some limitations of this analysis that could be addressed in future research exploration. First, there are several returns of the community forest concessions that were unable to be acquired, but would benefit the analysis substantially.

There were few returns for recently-inhabited concessions, only in Cruce a La Colorada, so conclusions about these concessions must be made cautiously. For long-inhabited concessions, there were only multiple years of information available for timber harvesting in Carmelita, but not Uaxactún. It would be beneficial to acquire agricultural returns for the long-inhabited concessions as well. No financial returns were able to be acquired for the industrial concessions, only permitted xate harvesting by these groups.

This limits the assessment of financial stability in land rent returns for these concessions.

Another topic that would benefit from future exploration is the investigation of carbon gains through regrowth of vegetation during the concession contract. The data that was used to calculate carbon storage in the MBR relies heavily on the use of datasets by

Baccini et al. and Hansen et al. The Hansen et al. dataset provides three qualitative data descriptors,: forest canopy coverage above 5 meters in height, complete “stand-replacing” forest loss, and forest gain defined as “inverse of forest loss.” As a result, the dataset demonstrates the areas of most intensive forest loss, but does not provide a thorough quantitative assessment of forest gain. This was estimated in this assessment utilizing the

Baccini et al . data, but likely still underestimates the gain due to the qualifying constraints of the Hansen et al. dataset. Additionally, a loss of forest canopy does not constitute a total void of carbon storage in a land plot. Areas experiencing canopy loss may still store carbon in ground vegetation or shrub that is lower than the five-meter canopy coverage cutoff. Finally, stand replacement due to naturally occurring phenomena, such as the flooding of savannahs and change in wetland area may also contribute to loss of canopy. This may falsely be detected by the methodology employed by Hansen et al., contributing to an exaggeration of deforested area or indication of deforestation by human condition where there is none. Addressing the weakness of these items can modify the estimated value of stored carbon in the region.

The Maya Biosphere Reserve provides many environmental services at local, regional, and global scales that demand protection through policy intervention to prevent deforestation. Evaluating the pressures experienced by forest beneficiaries can help to reveal solutions for management decisions in the future. Enforcing regulation of threatening activities and providing stability to stakeholders through increased land use returns can promote protection of forest canopy in the future.

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