ESTIMATING THE ECONOMIC VALUE OF ECOTOURISM AREAS: A CASE STUDY OF AWASH NATIONAL PARK, ETHIOPIA

Abstract

Awash National Park is one of nature-based recreational sites in Ethiopia for its impressive landscape and diversity of fauna. But this park has been in danger due to heavy settlement by farmers, declining numbers of wildlife population, widespread deforestation and continuous reduction in recreational qualities of the site. Furthermore, the site has been unable to improve the qualities of ecotourism experience and expand the types and variety of its recreational services for a long time because of lack of sustainable income from internal sources. Moreover, the value of the park in terms of its recreational service to the society is not known. Thus, there is a need for valuation of the park to know how much value the people attach to the park so as to demonstrate how the site managers can extract revenue so as to improve the qualities of the national park and expand the types and variety of the services. These in turn enables to establish a sustainable and efficient level of operations for the maintenance of the park. In doing so, to attach quantitative estimates to the on-site recreational benefit of the park, the study applied two standard procedures of Environmental Economics, i.e. travel cost and choice experiment methods, using primary data collected from a survey of 195 on-site visitors at Awash National park. By applying the Travel Cost Method the study estimated the demand function for the site using the amount of money and time people spent in getting to the site, which in turn was used to calculate recreational benefits associated with the site. Accordingly, the expected aggregate annual recreational economic benefit gained by visitors of the site is estimated at ETB 4,987,965.14 out of which the site authority capture only about 12.1% of the true economic recreational benefit of the site. On the other hand, the Choice Experiment Method was used to estimate the value of improvement of the site’s quality in terms of the attributes selected (namely; wildlife population, afforestation and additional service to visitors) and one monetary attribute (gate fee). Multinomial and random parameter logit models were used for estimation and from this the marginal willingness to pay and welfare impact of the visitors were estimated. The finding indicate that all the attributes included were significant factors in affecting the probability of choosing an alternative scenario. The results of this study indicates that even the conservative estimate of the economic value of recreation benefit from the site is very big and it also indicates that the domestic recreation demand to the site is high. Therefore, it can be suggested that alleviating the major problems that reduce the quality of the site and supporting improvement and expansion projects by extracting revenue out of the excess benefit are essential.