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Economic Analysis of Rhino Conservation in a Land-Use Context within the SADC

Authors:
Economic Analysis of Rhino Conservation
in a Land-Use Context within the SADC
region
Anna Spenceley and Jon Barnes
September 2005
SADC RPRC Task 6.3-1.2 (Phase II)
PUBLICATION CREDITS:
Title:
Economic Analysis of Rhino Conservation in a Land-Use Context within the SADC
region
Author:
Anna Spenceley and Jon Barnes
Date:
September 2005
Special
acknowledgements:
See page 5
This report is an output from a task of the
SADC Regional Programme for Rhino Conservation
.
ABOUT the SADC Regional Programme for Rhino Conservation:
The Programme is funded by the Italian Ministry of Foreign Affairs, Directorate General for Development Cooperation
(Project AID 5064).
The Programme is contracted to CESVI and implemented through a regional consortium which comprises:
The Secretariat of the Southern Africa Development Community (SADC)
IUCN-ROSA (The World Conservation Union - Regional Office for Southern Africa)
The IUCN African Rhino Specialist Group
WWF-SARPO - (World Wide Fund for Nature - Southern Africa Regional Programme Office)
CESVI (Cooperazione e Sviluppo)
The Programme goal is to contribute to maintain viable and well distributed metapopulations of Southern African rhino
taxa as flagship species for biodiversity conservation within the SADC region.
The Programme objective is to implement a pragmatic regional rhino strategy within the SADC region following the
acquisition of sound information on, firstly, the constraints and opportunities for rhino conservation within each range
state and secondly, the constraints and opportunities for rhino metapopulation management at the regional level.
DISCLAIMER
The information, opinions and materials presented herewith do not necessarily reflect the official views of any of the
organisations involved, including the Italian Ministry of Foreign Affairs, SADC, CESVI, IUCN-ROSA, WWF-SARPO,
AfRSG or governments of SADC member countries.
CONTACT DETAILS FOR THE PROGRAMME:
SADC Regional Rhino Programme Coordinator
IUCN-ROSA
6 Lanark Road Belgravia PO Box 745 Harare,
Zimbabwe
Tel: 263-4-728266 Fax: 263-4-720738
CESVI Zimbabwe Office
9 Northwood Rise, Mt Pleasant, Harare, Zimbabwe
TEL/ FAX: 263-4-882243, 884492, 850898
EMAIL: cesvi@africaonline.co.zw
PROGRAMME WEB SITE:
We invite you to vist our web site : www.rhino-sadc.org
Market value of rhino in Southern Africa 1
SADC REGIONAL PROGRAMME FOR RHINO CONSERVATION
Economic Analysis of Rhino Conservation
in a Land-Use Context within the SADC region
Anna Spenceley and Jon Barnes
September 2005
SADC RPRC Task 6.3-1.2 (Phase II)
Dr Anna Spenceley
Research Fellow
Transboundary Protected Areas Research Initiative
University of the Witwatersrand
Private Bag X3, 2050, South Africa
Tel/fax: +27 (0)31 2085523
Mobile: +27 (0)72 3115700
annaspenceley@hotmail.com
www.anna.spenceley.co.uk
Dr Jon Barnes
Coordinator, Economics Unit
Directorate of Environmental Affairs
Ministry of Environment and Tourism
PO Box 25942, Windhoek, NAMIBIA
Tel: +264 (0)61 249015
Fax +264 (0)61 240339
Mobile +264 (0)81 285 7638
jibarnes@iafrica.com.na
www.dea.met.gov.na/met
Market value of rhino in Southern Africa 2
CONTENTS
1. Executive summary ...................................................................................................................................................3
2. Introduction ...............................................................................................................................................................6
3. Methodology............................................................................................................................................................10
4. The Added value of rhinos to existing wildlife operations in state and private areas..............................................11
4.1 State protected areas.......................................................................................................................................12
4.2 Private protected areas ...................................................................................................................................18
5. How protection and monitoring of rhino affects other wildlife...............................................................................22
6. The impact of rhino on community-based tourism and local livelihoods................................................................25
7. The extent to which rhino influence change of land use to wildlife production......................................................39
8. Discussion ...............................................................................................................................................................43
8.1 Do rhino add value to wildlife operations in state and private areas?............................................................43
8.2 Does the protection and monitoring needs of rhino confer blanket protection for other wildlife components?
45
8.3 Do rhino contribute to community-based tourism and rural livelihoods?......................................................46
8.4 Have rhino catalysed the change of land use from livestock to wildlife? ......................................................47
8.5 Implications of consumptive and non-consumptive uses of rhino within the SADC region..........................47
9. References ...............................................................................................................................................................48
10. Appendix 1: Questionnaire for tourist guides.....................................................................................................52
11. Appendix 2: Inflation and exchange rates used for constant 2004 values ..........................................................53
Tables
Table 1: Numbers of white and black rhino in Africa as of 31 December 2003 by country and subspecies ......................7
Table 2: Financial and economic values attributable to full use of black rhino in the Torra community conservancy
investment, Namibia dollars (N$), 2004..................................................................................................................33
Table 3: Financial and economic values attributable to the introduction and full use of black rhino in the Puros
community conservancy investment, Namibia dollars (N$), 2004..........................................................................34
Table 4: Financial and economic values attributable to black rhino in trophy hunting joint ventures, Torra and Puros
conservancies, Namibia dollars (N$), 2004.............................................................................................................35
Table 5: Financial and economic values attributable to black rhino in two wildlife viewing lodge joint ventures, Torra
and Puros conservancies, Namibia dollars (N$), 2004............................................................................................36
Table 6: Total of all financial and economic values attributable to full use of black rhino in the Torra conservancy,
Namibia dollars (N$), 2004.....................................................................................................................................37
Table 7: Total of all financial and economic values attributable to establishment and full use of black rhino in the Puros
conservancy, Namibia dollars (N$), 2004...............................................................................................................38
Table 8: Total incremental operating costs (Z$) associated with rhino conservation (Nominal data) ..............................42
Figures
Figure 1: Real turnover from white and black rhino sales at KwaZulu-Natal Game Auctions (2000-2005)......................9
Figure 2: Average real price of white and black rhino sales at KwaZulu-Natal Game Auctions (2000-2005)...................9
Figure 3: Black rhino population in Hluhluwe-Imfolozi (1989-2004)..............................................................................12
Figure 4: White rhino population in Hluhluwe-Imfolozi (1973-2004) .............................................................................13
Figure 5: Black and white rhino sold and donated from Hluhluwe-Imfolozi (2000-2005)...............................................13
Figure 6: Average real purchase price for Hluhluwe-Imfolozi’s rhino at auction sales (2000-2005)...............................14
Figure 7: Total real turnover for Hluhluwe-Imfolozi’s rhino sold at auction sales (2000-2005) ......................................15
Figure 8: Average real rhino capture cost in Hluhluwe-Imfolozi (2000-2005).................................................................16
Figure 9: Animals that visitors to Hluhluwe-Imfolozi wanted to see (n=153)..................................................................17
Figure 10: Total real waived turnover from donated rhino (2000-2005) ..........................................................................18
Figure 11: Poaching incidents in Hluhluwe (all species) (1999-2005) .............................................................................23
Figure 12: Species poached in Hluhluwe (2002/3) ...........................................................................................................24
Figure 13: Real budgets for Hluhluwe-Imfolozi (2000-2005) ..........................................................................................24
Figure 14: Real conservancy and household income to the Torra conservancy (1999-2004)...........................................27
Figure 15: Real conservancy and cousehold income to the Puros conservancy (1999-2004)...........................................28
Figure 16: Total real financial benefit to Torra and Puros conservancies (1999-2004)....................................................29
Figure 17: Number of jobs in Torra and Puros .................................................................................................................29
Figure 18: Total real turnover for Hluhluwe-Imfolozi’s rhino sales compared with total park expenditure (2000/1-
2004/5).....................................................................................................................................................................43
Market value of rhino in Southern Africa 3
1.
EXECUTIVE SUMMARY
In December 2004 IUCN Regional Office for Southern Africa commissioned an economic analysis
of rhino conservation in southern Africa. The aim of the analysis was to explore the rationale for
regarding rhino as "flagship species" in terms of:
The extent to which they might “add value" to existing wildlife operations in state and
private areas;
The extent to which their protection and monitoring needs might confer blanket protection
for other wildlife components that might be vulnerable to human pressures (notably
poaching, and including the converse possibility, that rhino may attract poachers into an area
where other wildlife is then poached);
The extent to they might contribute to community-based tourism and thereby to rural
livelihoods, including comment on the opportunities for "direct incentives" payments to
landholders or communities who ensure breeding opportunities for this species;
The extent to which, in view of the above, they might be catalytic to land-use changes that
entail a move towards wildlife production from alternative land-uses such as livestock
production.
Economic analyses were to concentrate on market values of relevant goods and services rather than
non-use values, and to outline the issues and implications of consumptive uses of rhino within the
SADC region.
The analysis was essentially a pilot study that was designed to achieve an initial general insight into
economic issues surrounding black and white rhino in southern Africa. Therefore rather than
providing a comparative analysis between sites, or longitudinal evaluations, the study is largely
descriptive for one or two case study sites within each part of the analysis. Where the availability
of data has allowed, economic scenario analyses have been performed to generate realistic
predictions for revenue generation in the future for enterprises and reserves that support rhino
populations. In addition to presenting economic data regarding rhino around southern Africa, the
discussion attempts to outline the issues and implications of consumptive and non-consumptive use
of rhinos within the SADC region.
The study considered whether rhino added value to wildlife operations in state and private areas by
evaluating revenue generating activities and costs associated with rhino in South Africa and
Namibia. Hluhluwe-Imfolozi, a park run by the provincial conservation authority KwaZulu Natal
Wildlife in South Africa, generates revenue by auctioning wildlife including live rhino. On
average, between 2000 and 2005 these sales raised the equivalent of 60% of the park’s conservation
budget. However, this revenue does not accrue directly to the park, but enters the conservation
authority’s central budget. By contrast, Phinda is a private reserve in South Africa that has
generated a net financial benefit of US$221,041
1
through live sales of white rhino since 2002.
Tourists at Phinda can participate in white rhino darting activities, and their fees are used to finance
the process of inserting identification chips into their horns. Palmwag is a private sector enterprise
in Namibia where the central attraction for visitors is tracking desert rhino. This tourism experience
directly finances conservation and monitoring activities undertaken by the Save the Rhino Trust,
and is essentially the reason for the lodges ex istence. The evaluation concluded that both black
and white rhino provide a net benefit to both state and private protected areas through both
consumptive and non-consumptive use.
1
Constant 2004 US$ values. Note that where possible values have been converted to constant 2004 US$ values to
facilitate comparisons over time. Appendix 2 contains the exchange rates and inflation multipliers that were applied
throughout this report. Where values have not been changed these are indicated as nominal values.
Market value of rhino in Southern Africa 4
Conservation managers at Hluhluwe-Imfolozi reported that the protection and monitoring
requirements of rhino was integral to the protection and monitoring of other species, because
conservation was focussed on the integrity of the reserve, rather than any particular species.
However, 67% of the conservation staff of Hluhluwe-Imfolozi live in communities within 20-30 km
of the park, which may have positive implications for the protection of rhino and other wildlife
species.
A detailed economic and financial analysis of the value of rhino in the Torra and Puros
conservancies in arid western Namibia revealed that, in addition to current benefits from rhino
tourism, it would be possible to generate very significant new community benefits from the rhino,
through hunting of black rhino (as part of the new CITES allocation), live sales and guided rhino
tracking. In Torra, which already has a black rhino population, rhino can contribute more than half
of the annual community income from wildlife and tourism. Rhino can contribute annual local
community income amounting to N$2.70 (US$0.43
2
) per hectare. The annual economic
contribution of rhino to the GDP could be N$3.78 (US$0.60
3
) per hectare. In Puros, which currently
has almost no rhino, positive rhino values would be possible, but initially these would be much less,
due to the need to invest capital in rhino establishment. Evaluations of the attitudes and perceptions
of people living in conservancies near Torra (#Khoadi-//Hoas, //Huab and Omatendeka) certainly
indicate a general support for economic activities based on rhino, and for their re-introduction into
areas of their historical range. Comparative evidence suggests that more productive (semi arid and
sub-humid) environments, in Zimbabwe and KwaZulu-Natal, could have rhino values per
hectare roughly four to eight times higher, than those measured in arid Namibia.
Considering the development of conservancies in Namibia and Zimbabwe, rhino have played a
pivotal role in motivating land-use change. In Namibia the community-based natural resource
management program embraces a major portion of all communal lands in the country, so that large
areas are now allocated to wildlife uses, alongside livestock. In Zimbabwe financial benefits
associated with the presence of rhino on private land catalysed the change in use from livestock to
wildlife. A series of factors combined to bring about this change, which included an enabling
political environment and legislation, support by WWF and appropriate financial assistance, the
unsuitability of the habitat for livestock production and co-operation between neighbouring
landowners.
Both consumptive and non-consumptive uses of rhino have the potential to generate significant
amounts of economic income and to contribute to the livelihoods of rural people. As land uses, they
tend to be complementary and not mutually exclusive. This and other studies have shown that
combinations of both non-consumptive and consumptive uses will generate maximum benefits. To
provide the incentives needed for massive investment in rhino conservation, all possible uses should
be explored for rhino.
2
Constant 2004 US$ values.
3
Constant 2004 US$ values.
Market value of rhino in Southern Africa 5
ACKNOWLEDGEMENTS
The authors would like to thank many people and institutions across the region that provided
valuable contributions, logistical support and access to information for this study:
African Rhino Specialist Group: Richard Emslie
Busico cc: Richard Davies
Conservation Corporation Africa: Kevin Pretorius and Les Carlisle
IUCN: Priscilla Mutikani
KZN Wildlife: Peter Thomson, Craig Reid, Sue van Rensburg, Sihle Nxumalo, Jeff Cooke and
Allan Smale, Sandy Bellringer, Ian Rushworth, John O’Brian and Rahman Devduth
Ministry of environment and Tourism (Namibia): Pierre du Preez
Integrated Rural Development and Nature Conservation (IRDNC): Karen Nott
Namibian Professional Hunters Association (NAPHA): Almut Kronsbein, Vaughan Fulton, Bryan
and Maggie Connock, Ernst- Ludwig Cramer, Mr. Folton
Save the Rhino Trust: Simson !Uri-#Kob
South African National Parks: Guy Castley and Joop Stevens
Wilderness Safaris: Dave van Smeerdijk, Rob Moffett and Phillip Nicholls
WWF: Raoul du Toit, Jacques Flamand and Pamela Sherriffs, Theunis Pietersen and Andee
Davidson.
Market value of rhino in Southern Africa 6
2.
INTRODUCTION
Four subspecies of rhinoceros are present in southern Africa: the South-western, South-central and
Eastern black rhino and the Southern white rhino. Significant populations of the South-western
black rhinoceros (Diceros bicornis bicornis) have been conserved in the desert and arid savannah
areas of Namibia, and populations have been re-established in other areas of Namibia and south-
western South Africa. The South-central black rhinoceros (D. b. minor) is the most numerous of
the black rhino subspecies, and has strong populations in South Africa and to a lesser extent
Zimbabwe, with smaller numbers in Swaziland, Tanzania, Malawi, Botswana and Zambia (Emslie
and Brooks, 1999; AfRSG, 2004). The Eastern black rhinoceros (D. b. michaeli) is present in
northern Tanzania and South Africa (pers. comm. R. Emslie, 2005; AfRSG, 2004). South Africa is
also the stronghold of the Southern white rhino (Ceratotherium simum simum), while much smaller
reintroduced populations occur within its former range in Botswana, Namibia, Swaziland,
Mozambique and Zimbabwe, and outside their historical range in Zambia (Emslie and Brooks,
1999; AfRSG, 2004).
According to the IUCN 2004 Red List of Threatened Animals, the South-central and Eastern black
rhino are classified as Threatened-Critically Endangered, while the South-western black rhino has
Threatened-Vulnerable status (IUCN, 2004). Although in the 1960s it was estimated that over
100,000 black rhino were still roaming Africa, a combination of poaching and inadequate field
protection has decimated populations to around 3600 in 2003 (Emslie and Brooks, 1999; IUCN
SSC AfRSG, 2003) (see Table 1). Poaching pressure escalated during the 1970s and 1980s as a
result of the rising demand for rhino horn in Asia and the Middle East. Economic and political
instability in a number of rhino range states gave commercial poachers the freedom to hunt rhino
with little chance of being caught, and between 1970 and 1992, there was a 96% reduction in black
rhino numbers. The decline has eased recently, and some of the most effectively protected and
managed populations have shown healthy increases. Although some believe that the increases are
due to good levels of protection within small areas, others suggest that international and domestic
bans on trade in illegal rhino horn are starting to work.. The only two countries that showed a net
increase in black rhino numbers between 1980 and 1997 were South Africa and Namibia, which
made large investments monitoring and law enforcement. Although they only had 6% (930) of
Africa’s black rhino in 1980, in 2003 this had increased to 70% (2524) ( Emslie and Brooks, 1999;
IUCN SSC AfRSG, 2003). The south-central black rhino is now the most numerous sub-species,
although there are only an estimated 1,770 remaining (IUCN SSC AfRSG, 2003) (see Table 1).
The southern white rhino was rescued from near extinction a century ago. Numbers were
decimated by rhino hunting for sport and meat by Europeans, and also through the killing of rhino
areas being opened up for agriculture (Emslie and Brooks, 1999). From a single population of
barely 20 animals in 1885 (Emslie and Brooks, 1999) in the area that is now the Hluhluwe-Imfolozi
Park in South Africa ('t sas-Rolfes, 1996) there were more than 1,802 in 2002 (KZN
Wildlife/Earthwatch Institute). The recovery of the population was due to the protection and
subsequent growth of the Hluhluwe population, and in 1961 surplus animals were routinely
translocated from the Park to establish new populations (Player, 1972). “Operation Rhino”, as it
was known, re-introduced rhino to areas of their former range ('t sas-Rolfes, 1996) and South Africa
hosts 93% of this population (IUCN SSC AfRSG, 2003). Numbers have continued to increase in
the wild, and the white rhino is now classified as Near Threatened (IUCN, 2004). The in situ
population in southern Africa of some 650 animals in 1960 increased to 11,120 in 2003 ('t sas-
Rolfes, 1996; IUCN SSC AfRSG, 2003).
Market value of rhino in Southern Africa 7
Table 1: Numbers of white and black rhino in Africa as of 31 December 2003 by country
and subspecies
Species
White rhino
Black rhino
Subspecies
C.s.cottoni
(northern)
C.s.simum
(southern)
Total
Trend
D.b.bicornis
(south-western)
D.b.longipes
(western)
D.b.michaeli
(eastern)
D.b.minor
(southern-
central)
Total
Trend
Botswana
67
67
Up+Intro
5
5
Intro
Cameroon
5?
5?
?
DR Congo
22
22
Down
Ethiopia
4 D.b.bruceii?
4
?
Kenya
218
218
Up
437
437
Up
Malawi
8
8
Up+Intro
Mozambique
2
2
?
0?
0
Extinct?
Namibia
186
186
Up
1,238
1,238
Up
Rwanda
1
1
Down
South Africa
10,306
10,306
Up*
71
36
1179
1,286
Up
Swaziland
61
61
Up
15
15
Up
Tanzania
42
24
66
Up
Zambia
3
3
Down
5
5
Intro
Zimbabwe
250
250
Up
536
536
Up
Totals
22
11,090
11,120
Up*
1,310
5?
520
1,770
3,610
Up
Table excludes speculative guesstimates
Numbers primarily compiled at (SADC RPRC and WWF funded) IUCN SSC AfRSG Meeting held in Kenya 6-11 June 2004
Numbers of D.b.minor in Tanzania, D.b.bicornis in Namibia, D.b.longipes in Cameroon and C.cottoni in DRC may be higher but this requires
confirmation.
White rhino trend is up but numbers down due to sampling error associated with estimate for largest population of southern white rhino
(Kruger NP).
The numbers of southern white rhinos outside Kruger has increased by 606 (+10%) over the last 2 years and there is no evidence of an actual
decline in Kruger.
Subspecies totals >500 rounded to nearest 10 rhino.
Exact Swaziland numbers of D.b.minor given to AfRSG but are being kept confidential until authority is obtain to release them. In the
meantime the table shows an approximation to the true number.
Source:
IUCN SSC African Rhino Specialist Group, 2004
Internal threats that arise within rhino’s range states inc lude wars, poverty, rising protection costs,
declining conservation budgets, varying attitudes of politicians and local communities to
conservation and land claims. These threats both improve opportunities for poachers to kill rhino
without being caught and also entice more people towards poaching because of the financial
returns. Reduced conservation management budgets mean that there are insufficient field rangers
available to effectively monitor and protect rhino (Emslie and Brooks, 1999). In 1999 the head of
the IUCN Species Survival Commission, Simon Stuart stated that African conservation agencies
could become self-sufficient by . . . developing strategies where revenue raised from the
sustainable use of rhinos can be used to offset their high conservation cost” (Emslie and Brooks,
1999: v). Self-sufficiency is important, and in South Africa, it has been estimated that a park of
500 km
2
needs to spend about US$1,000 / km
2
per year to control poaching (Conway in litt., Herbst
and Emslie in litt.)
4
The demand for rhino horn has been primarily responsible for the decline in rhino numbers
globally. Despite international legislation and domestic bans on trade in rhino horn, rhino are still
under threat from poachers who believe they can make money easily from their horn (Emslie and
Brooks, 1999). The two main uses of rhino horn are medicinal (as an ingredient in traditional
Chinese medicine) and ornamental (as highly prized material for making handles of jambiyas -
ceremonial curved daggers worn in some Middle East countries). Some consider that inflated
reports regarding the market value for Asian rhino horn are encouraging speculative poaching in
Africa, while there are indications from South African police reports that black rhino horn is worth
4
At nominal prices
Market value of rhino in Southern Africa 8
R7,530 (US$1,215) per kg (Swanepoel 1996)
5
. However, Emslie and Brooks (1999) point out that
if dealers received between US$100 625 for each rhino horn
6
, that this is only a small percentage
of the value that live rhino fetch at auctions (Figure 2). It is considered highly unlikely, for political
reasons, that legal sale of rhino horn will be permitted in the near future, and this has been left out
of our analysis of possible uses for rhino.
Approaches for trading live wildlife in South Africa include game auctions (with live and catalogue
auctions); independent sales made by game capture companies; and private individuals negotiating
deals. Live game auctions tend to sell higher quality and scarcer animals, while in catalogues
buyers can request certain ages and sex ratio of animals, but do not physically inspect their
purchases before delivery (Scriven and Eloff, 2003). Auctioneering companies advertise the live
sale event and wildlife on offer, and base their commission on the auction turnover with additional
charges paid by game farmers to game capture companies to transport their purchases (ibid).
During the 1990’s the Natal Parks Board (NPB) (which became KwaZulu Natal Wildlife)
experiences of selling white rhino to the private sector were not successful for conservation.
Prospective buyers registered on a waiting list, and the rhino were sold on a first come, first serve
basis. The price was set by the NPB (R9,900 in 1980
7
), and was significantly less than the price
obtained from trophy hunters (R64,350
8
). This led to landowners purchasing rhino and then selling
them on for trophies rather than to breed them. The waiting list grew dramatically during the
1980s as the demand for trophies increased, and NPB increased the set price. However, during the
first public game auction in 1986 black rhino were sold for R47,600
9
. This led to NPB holding its
own auction in 1987 and obtaining almost R63,150 per rhino
10
. Once auctioning was introduced as
a pricing mechanism the purchasing price rose and private landowners had the incentive to breed
their own rhino populations ('t sas-Rolfes, 1996).
At the KZN Wildlife Game Auctions in 2003 generated the highest real turnover between 2000 and
2005. During that year eighty-three white rhino drawn from reserves across the province were sold
for a total of US$1,538,599 (average price of $18,537)
11
. That same year six black rhino were sold
for a total of $361,897 (average price of $60,316)
12
(pers. Comm. R. Devduth, 2005). Figure 1
shows that the real turnover from sales of white rhino by far exceeded the turnover from black
rhino, and that none were sold in 2002 or 2005. In 2005 rather than being sold, a population of
black rhino were donated to Phinda (see section 4.1.2).
Emslie and Brooks (1999) reported that the annual turnover from all game sales from the Hluhluwe-
Umfolozi Park represented 22% of the total cost of running the Park in 1998/99
13
and that rhino
sales contributed a high proportion of this revenue. In 2001 boma and catalogue auctions by KZN
Wildlife generated 15% of the organization’s management costs (Scriven and Eloff, 2003).
5
At nominal prices
6
At nominal prices
7
In constant 2004 values
8
In constant 2004 values
9
In constant 2004 values
10
In constant 2004 values
11
In constant 2004 values
12
In constant 2004 values
13
This calculation included the cost of repaying loans for building Hilltop camp and a tarred road
through the reserve (pers. comm. R. Emslie, 2005).
Market value of rhino in Southern Africa 9
Figure 1: Real turnover from white and black rhino sales at KwaZulu-Natal Game
Auctions (2000-2005)
Data source: Pers. comm R. Devduth, 2005
Figure 2 illustrates the average real price of black and white rhino sold between 2000 and 2005 at
the KZN Wildlife game auctions. Although it may appear that the value of black rhino dramatically
between 2003 and 2004, this is actually a reflection of the quality, age and gender of the animals
sold: e.g. three young male black rhino were sold in 2004 (pers. comm. R. Devduth, 2005).
Figure 2: Average real price of white and black rhino sales at KwaZulu-Natal Game
Auctions (2000-2005)
Data source: Pers. comm R. Devduth, 2005
Important sources of revenue on game reserves include game viewing, hunting, retail operations
and live game sales. Porter et al (2003) found that among 12 reserves in KwaZulu-Natal operating
both game viewing and hunting - hunting generated 51.4% of their revenue, compared with 16.8%
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
2000
2001
2002
2003
2004
2005
Year
Turnover (constant US$ 2004 prices)
White rhino
Black rhino
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
2000
2001
2002
2003
2004
2005
Year
Turnover (constant US$ 2004 prices)
White rhino
Black rhino
Market value of rhino in Southern Africa 10
for game viewing and 12.3% for live game sales. Not only do the sales of live rhino generate
revenue for conservation management, but they also provide a mechanism for re-introducing
species into areas where they may have become locally extinct, provides options for genetic
diversification and to strengthen population sizes (Scriven and Eloff, 2003).
Despite limited sport hunting, the amount of land available for white rhino and their populations on
private land have increased over time (Buys 1987, Emslie 1994a, Buijs and Papenfus 1996, Buijs
1998, Buijs, in press, cited in Emslie and Brooks, 1999). Given that there is limited capacity for
state-run protected areas to hold more rhino, future population growth will need to depend upon
private sector land availability. Therefore, maintaining incentives for the private sector and
communities to host white rhino populations is very important (Emslie and Brooks, 1999). In 1996
it was estimated that over 20% of South Africa’s white rhino population was in private hands ('t sas-
Rolfes, 1996).
Within the context of this economic analysis, it is interesting to ask whether private landowners are
primarily motivated by profit with regard to managing wildlife. In their survey of the profitability of
nature-tourism in KwaZulu-Natal, Porter et al (2003) found that while 19 out of 23 (39%) private
reserve managers in the province were primarily motivated by business, 11 businesses (48%) stated
that nature-tourism was equally a business and way of life. Three reserve managers (13%) declared
that it was more of a way of life than a business. With regard to operational goals, Porter et al
(2003) found that while 26% of managers ranked maximizing profits as their most important
operational goal, 61% rated the protection of threatened species as most important.
Little has been written on the potential socio-economic impacts of rhino on local livelihoods.
Understandingly, studies undertaken around national parks and reserves tend to concentrate on the
impact of predators and those that damage crops and infrastructure (e.g. lions, elephants, baboons)
rather than rhino. Enhancing net benefits to local people from wildlife and conservation is
recognized as increasingly important. The IUCN SSC recognizes that conservation of Africa’s
wildlife cannot be separated from people’s livelihoods: “The more local communities benefit from
the protection of rhinos, the more secure will be the future of these magnificent animals.” (Stuart
cited in Emslie and Brooks, 1999: v). More critically, when the expansion of potential habitat for
rhino extends to communal land and conservancies (as in the case of Namibia), the perception of
rhino and net benefits derived from their consumptive and non-consumptive use become critical.
3.
METHODOLOGY
A desk study was conducted on market issues and rhino from literature available through the IUCN
Species Survival Commission African Rhino Specialist Group, the internet and reports sourced
from stakeholders working on rhino conservation in the region. Wherever possible nominal values
have been inflated or deflated to 2004 price levels, and converted to US$ to facilitate comparisons.
The multipliers used to do these conversions can be found in Appendix 2.
Case study sites were selected by identifying locations that would allow comparison of turnover and
expenditure in relation to different or varying rhino populations from the availability of data, and
which were amenable to participating in the study. Site visits were made to Hluhluwe-Imfolozi,
Phinda and Windhoek to collect pertinent data and interview relevant stakeholders. Data collection
approaches included interviews with key stakeholders and observation of rhino management
activities, coupled with reviews of financial and management reports. Information was collected on
revenue from hunting, photographic tourism and live sales; rack rates for services to tourists;
occupancies; cost of sales; management and antipoaching costs due to rhino; external funding, and
tourist demand studies where available. Where possible information was also collected regarding
local financial and livelihood benefits from rhino.
Market value of rhino in Southern Africa 11
A detailed financial and economic model, previously developed for the Torra conservancy, on
communal land in arid north west Namibia, was modified to estimate the financial and economic
values for black rhino in both the Torra and neighbouring Puros conservancies. As described in
more detail below, these two conservancies are very similar, but while Torra has an established
population of black rhino, Puros does not. No previously developed model was available for Puros.
The Torra model was one of five used to measure the financial viability and economic efficiency of
conservancy investments in Namibia (Barnes et al., 2002). They consist of detailed budget and ten-
year cost-benefit spreadsheets, with the parameters based on empirical data concerning conservancy
performance to date and conservancy plans projected into the future. These conservancy models
estimated returns to the investments made in the conservancy project by donors, government and
the community. They also estimated returns to the specific investment of the community in the
conservancy. Finally they estimated the contributions these investments made to the national
economy (gross domestic product and net domestic product), and to employment.
Where conservancies have entered into joint ventures with private sector partners, as in the case of
Torra, these, themselves, generated further financial returns in terms of private profits, community
wages, and economic returns to the national economy. These additional joint venture values were
included in Torra model to estimate rhino values. The Torra model was first used to estimate the
values of a fully utilised rhino population in Torra itself, and then the values of rhino in Puros, if the
species was introduced, established, and fully utilised.
The Torra/Puros rhino valuation models estimated financial returns to the capital invested in the
conservancy and joint ventures, in terms of annual net income (profit), financial internal rate of
return over five and ten years, and financial net present value of the investment over five and ten
years. Net present value included the value of wealth created in the period. The financial values
reflect actual transactions. To derive economic values, the financial costs and benefits were adjusted
to reflect their true worth to Namibian society, in terms of economic growth. For this, shadow
pricing was employed. Thus, the costs of unskilled and semi-skilled wages, were adjusted
downward to compensate for job creation in the economy, the values for tradable goods were
adjusted upwards to accommodate excess demand for foreign exchange, and transfers, such as taxes
and subsidies, were removed as costs and benefits. Details of the specific assumptions applied in the
rhino valuation exercise are provided in section 0. The key economic values were the annual value
added to the gross and net national products as well as the ten-year net present value of value added
contributions to net national product, including the creation of wealth. Value added represents the
returns to internal factors (labour, capital and entrepreneurship) of the enterprise, or the gross output
minus inputs from outside the enterprise.
The report that follows is divided into four main sections that address the key aims of the analysis
outlined in section 1. These are followed by a discussion of the results in relation to the implications
of the study for consumptive and non-consumptive uses of rhino within the SADC region,
limitations and constraints of the work and proposed areas for further research.
4.
THE ADDED VALUE OF RHINOS TO EXISTING WILDLIFE
OPERATIONS IN STATE AND PRIVATE AREAS
To evaluate the value that rhino add to wildlife operations in state and protected areas, three key
sites were regarded: Hluhluwe-Imfolozi in South Africa; Wilderness Safaris operations in Namibia
(Ongava and Palmwag); and CCAfrica’s Phinda ope ration in South Africa. The financial benefits
and cost associated with rhino and tourism in these areas have been quantified below, where data
has been available.
Market value of rhino in Southern Africa 12
State protected areas
Hluhluwe-Imfolozi is a state protected area managed by KwaZulu-Natal Wildlife, the provincial
conservation agency. This 71,000 ha South African reserve is noted for its scenic views, grassy
hills, deep wooded valleys and rich fauna (Pooley and Player, 1995).
The reserve has been implementing a strategy to harvest and sell or translocate 5-8% of the black
rhino population annually (pers. comm. C. Reid, 2005). This approach has been driven because
numbers exceeded the estimated Maximum Productive Carrying Capacity (eMPCC) in 2000 and a
reduction in performance was the consequence. Subsequent removals have contributed to the
reduction in numbers as the population adjusts to a lower density that can support these offtake
levels (although actual average decline of 4.7% per annum between 1997 and 2004 indicates that
KZN Wildlife have been under-harvesting: see Figure 3). There are indications are that
underlying performance is starting to increase again, although is still well below the desired target
of 5% per annum (pers. comm. R. Emslie, 2005).
Figure 3: Black rhino population in Hluhluwe-Imfolozi (1989-2004)
Data Source: KZN Wildlife data supplied to SADC Rhino Management Group, pers. comm. R. Emslie, 2005
NB Net losses include mortalities, removals and introductions
By contrast, since 1999 the white rhino population in Hluhluwe-Imfolozi has grown by an average
of 3.8% per annum
14
. The reason for the dramatic decline in white rhino between 1980 and 1985
seen in Figure 4 was a major drought. Large numbers of rhino were translocated out of the park at
this time to prevent further impact on the habitat and prevent elevated mortalities. Between 1979
and 1981 an amazing 803 white rhino were removed from Hluhluwe-Imfolozi (Brooks and
Macdonald, 1983). Since 1985 the population has steadily increased to nearly 2000 animals in
2004 (KZN Wildlife/Earthwatch Institute)
14
This growth rate includes mortalities and removals.
0
50
100
150
200
250
300
350
400
450
89/90
90/91
91/92
92/93
93/94
94/95
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
RMG Ye a r
Number of rhinos (accepted figure)
Black rhinos
Net Losses
Market value of rhino in Southern Africa 13
The number of Hluhluwe-Imfolozis black and white rhino either sold at auction or donated to other
KZN Wildlife reserves since 2000 are shown in more detail within Figure 5
15
.
Figure 5: Black and white rhino sold and donated from Hluhluwe-
Imfolozi (2000-2005)
Data Source: KZN Wildlife Game Capture Unit game disposal returns
NB: note that the 2005 figures are correct up to May 2005
15
Note that rhino from other KZN Wildlife reserves is also sold during these auctions, but only those captured in
Hluhluwe-Imfolozi are shown here. A summary of rhino prices and turnover from all the reserves is shown in Figure 1
and Figure 2.
Figure 4: White rhino population in Hluhluwe-Imfolozi (1973-2004)
Data Source: KZN Wildlife / Earthwatch Institute, supplied by S. van Rensburg
NB Net losses include mortalities, removals and introductions
0
10
20
30
40
50
60
70
80
2000
2001
2002
2003
2004
2005
Year
Number donated or sold
BR sold
BR donated
WR sold
WR donated
0
500
1000
1500
2000
2500
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Year
Number of rhinos (accepted figure)
White rhinos
Net Losses
Market value of rhino in Southern Africa 14
Figure 5 shows that numbers of black rhino disposed of by sale or donation annually have ranged
between 0 and 28, and cumulatively since 2000 have numbered 50. Numbers of white rhino
disposed of annually have ranged between 25 and 95, and cumulatively since 2000 have numbered
327 (mortalities are not indicated in this graph).
In general, the auction prices achieved by Hluhluwe-Imfolozi’s white rhino has declined since
2000, from an average price of US$34,888 to $17,393 in 2005
16
(a decline of 50% over six years)
(see Figure 6).
Figure 6: Average real purchase price for Hluhluwe-Imfolozi’s rhino at
auction sales (2000-2005)
Data Source: KZN Wildlife Game Capture Unit game disposal returns
By contrast, the average auction price for black rhino dropped by 21% from US$66,575 in 2000 to
$52,562 in 2001
17
. After two-year gap when the reserves rhino were not sold, the average price
dropped to $22,199
18
(when only males were sold: pers. comm. R. Emslie, 2005).
The total turnover for white rhino sales
19
the ranged from a peak of US$1,474,441 for 76 animals in
2003 to $452,230 for 26 animals in 2005 (up to May 2005)
20
. For black rhino the turnover declined
from US$401,602 for 6 animals in 2000 to $46,471 for 2 animals sold in 2004
21
(see Figure 7)
16
Constant 2004 US$ values.
17
Constant 2004 US$ values
18
Constant 2004 US$ values
19
Including costs charged by KZN Wildlife to transport them to the purchaser’s property.
20
Constant 2004 US$ values
21
Constant 2004 US$ values
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
2000
2001
2002
2003
2004
2005
Year
Average auction price
(constant 2004 US$ prices)
Black rhino
White rhino
Market value of rhino in Southern Africa 15
Figure 7: Total real turnover for Hluhluwe-Imfolozi’s rhino sold at auction
sales (2000-2005)
Data Source: KZN Wildlife Game Capture Unit game disposal returns
Note: Turnover includes transportation fees charged by KZN Wildlife
In order to ascertain the net profit from rhino sales, it is important to look at the costs associated
with capturing white and black rhino. These costs include helicopter time, drugs, staff time, vehicles
and equipment. KZN Wildlifes Game Capture Unit records show that these costs have risen
steadily over the past six years, and that the capture cost for black rhino is 56% more than white
rhino: in 1994 it cost US$2,245 to catch a black rhino, and $1,268 to catch a white rhino
22
(see
Figure 8). However, these ratios are not necessarily applicable elsewhere, as the method of capture,
habitat and rhino density will affect the cost. The majority of the rhino capture cost in Hluhluwe-
Imfolozi is attributable to the use of helicopters. In 2004 these represented 77% of the white rhino
and 72% of the black rhino capture cost. KZN Wildlife can catch more white than black rhino in a
day (6 white versus 2 black), which would contribute to overheads being higher for black rhino
capture. These costs are underestimates, since the KZN Wildlife Game Capture department does not
allocate its operational costs (e.g. staff time, telephone, administration) to different species, and
therefore they were unable to calculate all costs associated with rhino and game capture operations
(pers. comm. J. Cooke, 2005).
22
Constant 2004 US$ values
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
2000
2001
2002
2003
2004
2005
Year
Turnover rhino sales & transport
(constant 2004 US$ prices)
Black rhino
White rhino
Market value of rhino in Southern Africa 16
Figure 8: Average real rhino capture cost in Hluhluwe-Imfolozi (2000-
2005)
Data Source: KZN Wildlife Game Capture Unit species capture costings
In 2000 the average white and black rhino capture costs were just under 2% of the average selling
price, but in 2004 these had risen to 10% for black and 7.3% for white rhino. This decline in
average profit has been due to the decline in average rhino prices coupled with the rise in associated
capture costs.
In light of the associated capture costs, the cumulative net profit from the sale of 243 white rhino
from Hluhluwe-Imfolozi since 2000 was US$4,995,441 while the net profit from 13 black rhino
was $687,731
23
. However, it should be noted that this revenue does not accrue directly to
Hluhluwe-Imfolozi Park, but is accrued centrally to KZN Wildlife. Therefore the profit generated
by the increased rhino population due to conservation management in Hluhluwe-Imfolozi is used
for the benefit of other protected areas in the province too.
Informal discussions were held with landowners who were interested in purchasing white rhino at
the 2005 KZN Wildlife game auction. In one instance the rhino were to be purchased to
supplement an existing population of four habituated rhino in the Western Cape at a photographic
safari operation, and in another instance to start a new population in Botswana where hunting of
other species took place. Discussions with a wildlife broker indicated that one of the reasons people
purchased rhino from the game auction was that KZN Wildlife bore the risk until animals were
delivered to the buyer, where buyers requested KNZ wildlife to organise the transportation. At other
auctions sellers would transfer all risk to the buyer on the ‘fall of the hammer’. The broker
considered that prices for white rhino had dropped over time because there were more animals
available on the market not only from the game auction and was also related to the number of
trophy males on sale (the 2005 auction only had one trophy male on offer). WWF indicated that
people were generally motivated to buy rhino either for photographic tourism, hunting or for their
aesthetic’ value.
23
Constant 2004 US$ values. Figures do not include transportation turnover, as the associated transportation costs are
not known.
$0
$500
$1,000
$1,500
$2,000
$2,500
2000
2001
2002
2003
2004
2005
Year
Rhino capture cost
(constant 2004 US$ prices)
Black rhino
White rhino
Market value of rhino in Southern Africa 17
Recently, under the Convention on the International Trade in Endangered Species (CITES), South
Africa and Namibia were been granted an annual allocation of five black rhino that may be hunted
for trophies and their trophies exported (Black, 2004). In anticipation of this the IUCN African
Rhino Specialist Group proposed a set of guidelines to ensure that any black rhino hunting is carried
out on a sustainable basis (Leader-Williams et al., 2005). These essentially involved making sure
that off-takes are biologically sustainable, well monitored and controlled, and making sure that the
process confers maximal incentives for, and rewards for, good biological management. The park is
now under pressure to raise additional funds from their black rhino population, by selling some as
hunting trophies. Some of KZN Wildlife staff are concerned that approach is incompatible with
their work with WWF to conserve the species (pers. comm. S. Nxumalo, 2005), but WWF do not
oppose safari hunting provided certain conservation criteria are satisfied (pers. comm. R. du Toit,
2005).
In February 2004 a study was undertaken under the Black Rhino Range Expansion Project to
ascertain the level of demand from tourists in Hluhluwe-Imfolozi to view rhino. Participants
include 153 tourists from 14 countries, 50% of whom were South African. The survey revealed
that the majority of visitors were aware of two kinds of rhino being present in South Africa.
However, when asked which (if any) animals they were specifically hoping to see in the reserve,
29% mentioned “rhino” and only 3% mentioned black rhino specifically (see Figure 9) (Sherriffs,
2004).
Figure 9: Animals that visitors to Hluhluwe-Imfolozi wanted to see
(n=153)
Source: Sherriffs, 2004
Interestingly, none of the respondents said that the presence of black rhino in the reserve would
affect their decision to visit (Sherriffs, 2004). Although this was a short study, it implies that none
of the tourism turnover in Hluhluwe-Imfolozi is directly attributable to the presence of black rhino.
However, it would have been useful to know what responses would have been given to the same
question regarding ‘rhino’ in general for context.
Hluhluwe-Imfolozi absorbs the transportation, capture and ‘capital’ cost s for rhino translocated or
donated to other KZN Wildlife reserves in the province. Between 2000 and 2005 the total value of
0
10
20
30
40
50
60
70
80
90
100
lion
elephant
leopard
"rhino"
cheetah
wild dog
black
rhino
Animals
number of responses
Market value of rhino in Southern Africa 18
revenue ‘waiveddue to donations or internal translocations amounted to US$1,672,999 for black
rhino (n=37) and $2,012,495 for white rhino (n=84)
24
(see Figure 10).
Figure 10: Total real waived turnover from donated rhino (2000-2005)
Data Source: KZN Wildlife Game Capture Unit game disposal returns
Includes waived rhino, transportation and capture costs
Some conservation management activities are done for the benefit for rhino and other species, so
that it is difficult to separate out proportion of the cost is directly attributable to rhino. For example,
he park has a program to clear the invasive alien plant Chromolaena sp., and between 2003 and
2004 the provincial government and Department of Agriculture and Environmental Affairs
provided around US$ 1.64 million, and it was anticipated that between $1.2 and $1.9 million would
be received in 2005
25
. Although the clearance has benefits for other species do, it has a particular
benefit for improving black rhino habitat (pers. comm. S. van Rensburg, 2005).
Private protected areas
4.1.1 Wilderness Safaris in Namibia: Palmwag and Ongava
Wilderness Safaris operates two camps, under private concession and ownership, in the north of
Namibia that are particularly related to black rhino: Palmwag and Ongava.
Palmwag Rhino Camp is located within the private Palmwag Reserve in Damaraland, north-west
Namibia, and has populations of desert-adapted black rhino and elephant (Wilderness Safaris,
Undated-a). Wilderness Safaris and Savé the Rhino Trust (SRT) have forged a partnership to
promote tourism that generates revenue to finance black rhino monitoring costs. A SRT monitoring
team is based at the camp which leads tourist safaris and provides information to guests on their
work (Hearn and Bakkes, undated). Tourists follow the monitoring team in a separate vehicle, and
track the animals on foot when spoor are seen (pers. comm. P. Nicholls, 2005). The SRT also built
an indaba centre near Palmwag for community leaders to come and discuss conservation matters
with their colleagues (Wilderness Safaris 2005a). The 16-bed camp has been running for two years
24
Constant 2004 US$ values
25
Constant 2004 US$ values
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
2000
2001
2002
2003
2004
2005
Year
Waived turnover
(constant 2004 US$ prices)
Black rhino
White rhino
Market value of rhino in Southern Africa 19
with 19 staff from all over Namibia and should be operationally break-even at 38% occupancy
within six months. The US$340,000
26
capital costs should be paid off within the concession period.
Wilderness Safaris pay wages for four SRT staff in addition to financing their vehicle and
operational costs. In addition, 5.5% of the income from tourist’s accommodation is donated to SRT.
On average visitors pay US$223
27
per person for a night’s full board at the camp, and last year 1480
guests participated in the tracking (all of the guests). Wilderness Safaris also owns part of a 44-bed
road lodge and campsite nearby, which caters to self-drive tourists and overland trucks. Each year
around 700 visitors each year (approximately 70% of guests) also undertake the tracking activity
(pers. comm. P. Nicholls, 2005). The Palmwag operation shows that there is a market for black
rhino tracking in Namibia, and also that tourism revenue from this activity can be used to subsidies
substantial conservation and monitoring costs through an NGO partnership.
Wilderness Safaris’ Ongava lodge is located within a 30,000 ha private reserve located along
Etosha’s southern boundary, and is marketed as a location where both white and black rhino can be
observed (Wilderness Safaris, undated-b). Wilderness Safaris have operated the camp since 1995,
by which time white rhino and black rhino were already present (pers. comm. R. Moffett, 2005).
The reserve has also been selected to participate in the Ministry of Environment and Tourism
(MET) black rhino custodianship scheme. Four rhino from Etosha were released into Ongava, with
the translocation costs borne by WWF, MET and the reserve (Wilderness Safaris, 2005b). There
are three camps on the reserve, with a total of 48 beds and the camps employ 85 staff from all over
Namibia. The rack rates vary from US$279 to $796 per person, sharing, depending on the season
and camp chosen
28
. Wilderness Safaris report that the reserve is operationally break-even, with
between 47% and 60% occupancy at the three camps over the past year (including the conservation
management costs for rhino, which are estimated to cost US$160,000 annually
29
) (pers. comm. R.
Moffett, 2005).
To estimate the level demand for rhino viewing among Ongava’s guests, a small survey was
conducted among the guides. Five guides with cumulatively 8 years experience in the reserve
completed a simple questionnaire (see Appendix 1) and reported that although the majority wanted
to see rhino (either black or white), none of them reported that the presence of rhino motivated their
trip. As one guide, Wilson Garafa stated “Most guests do not understand the difference between
black and white rhinos but they understand that black rhino is very aggressive and [it is] difficult to
see them. A rhino is a rhino because it is an endangered species.” Despite this, there is a perception
that without the presence of rhino, the camp would generate approximately half the level of current
income: although the same number of tourists would visit, the day rates would be halved (pers.
comm. R. Moffett, 2005). Therefore, rather than the presence of black or white rhino in particular,
tourists may be willing to pay higher rates if there are rhino within a destination. These
observations support evidence of tourist behaviour in Zimbabwe, where it is reported that, “. . .the
presence of rhinos is a . . .top rating for a wildlife operation, like 4 stars” (pers. comm. R. du Toit,
2005). Similarly, a cost-benefit study applied to South Africa parks in 1992 suggested that tourists
were motivated to visit a . . .real Big 5 park, rather than specifically to see rhino” (pers. comm. R.
Emslie, 2005).
4.1.2 Phinda, KwaZulu Natal, South Africa
Phinda is a privately owned reserve covering 12,699 ha located within the 18,100 ha Munyawana
conservancy in KwaZulu-Natal (pers. comm. K. Pretorius, 2005). Phinda’s four lodges and walking
safari operation have a total capacity of 104 beds. Starting in 1991, Conservation Corporation
26
Constant 2004 US$ values
27
Constant 2004 US$ values
28
Constant 2004 US$ values
29
Constant 2004 US$ values
Market value of rhino in Southern Africa 20
Africa worked to rehabilitate degraded agricultural and pastoral land and also supplemented wildlife
populations with over 1500 head of game, including white rhino (CCAfrica, undated a). Phinda
currently has a population of 72 white rhino, and in 2004 received a seed population of black rhino
(pers. Com. K. Pretorius, 2005).
Phinda is involved in the Rhino Range Expansion Project, and in October 2004 received 15 black
rhino from KZN Wildlife (pers. comm. K. Pretorius, 2005). The rhino worth an estimated US$1.05
million
30
(KZN Wildlife game capture returns) were received by Phinda at no capital cost, while
WWF-Netherlands supported the capture and translocation to the value of almost US$38,087
31
(pers. comm. J. Flamand, 2005)
32
. Phinda did not pay for the rhino because they are their
custodians, and KZN Wildlife retains ownership and management control over them. Phinda is
obliged to pay for ongoing monitoring of the rhino that are in their care and make regular reports
regarding their behaviour for a period of 25 years. The reserve is also obliged to maintain the
quality of habitat, browse and water availability for the safe custody, survival and growth of the
black rhino population (Anon, 2004).
Phinda estimated that they had spent US$23,821 capital expenditure on equipment and upgrades for
their black rhino monitoring program (e.g. GPS, telemetry vehicle, upgrade accommodation and
vehicle), and at least US$870 on consultancies
33
. In addition US$2,332
34
expenditure was allocated
to hosting site inspection trips, KZN wildlife staff and a media launch (pers. comm. K. Pretorius,
2005).
Operational vehicle and maintenance costs associated with black rhino were estimated at US$544,
per month and an estimated US$171 per month is spent of management time on black rhino
35
.
Also, since their arrival four additional employees have been employed to monitor the black rhino:
three of who are from local communities. The monitors are paid US$1,794 per month cumulatively
and local staff earn US$1,477 of this, or US$17,722 annually
36
(pers. comm. K. Pretorius, 2005).
Therefore operational costs associated with the black rhino are US$2,509
37
per month.
Extrapolation of this information indicates that Phinda incurs approximately US$171
38
expenditure
per black rhino each month. In addition, the black rhino have had a small but clear and immediate
financial benefit on the local economy through wages. With regard to white rhino, approximately
once a year a rhino has to be darted and tranquillised to undergo some form of veterinary
treatment
39
.
There has been no increase in the rates for accommodation or activities at Phinda since the black
rhino were introduced (pers. comm. K. Pretorius, 2005). An analysis of the tourism turnover and
gross operating profit at Phinda for six months after the introduction of the black rhino, compared
with the same period for the previous two years failed to reveal either additional revenue or costs
associated with their presence. In fact both turnover and expenditure declined over this period. It is
highly likely that wider factors such as the exchange rates, pricing, marketing and consumers
disposable income have had a greater impact on the turnover and gross operating profit than rhino.
30
Constant 2004 US$ values
31
Constant 2004 US$ values
32
WWF-Netherlands also provided US$23,214 (at constant 2004 US$ values) worth of staff time and logistical support
to the development of the agreement (pers. comm. J. Flamand, 2005)
33
Constant 2004 US$ values
34
Constant 2004 US$ values
35
Constant 2004 US$ values
36
Constant 2004 US$ values
37
Constant 2004 US$ values
38
Constant 2004 US$ values
39
The veterinary and drug costs of such a capture are estimated at R2,000 per animal (pers. comm. K. Pretorius, 2005).
Market value of rhino in Southern Africa 21
In return for their custodianship, Phinda benefit from an equal share in the proceeds from any
growth in their population with KZN Wildlife (pers. comm. J. Flamand, 2005). Potential revenue
generated from live sales of the progeny will not be sufficient to offset the operational costs of
managing the black rhino. Assuming a 5% annual growth in the rhino population, Phinda would
have 24 animals after 10 years. Therefore 8 could be sold and Phinda would retain the revenue from
four. Assuming live sale values for black rhino remain constant at 2004 levels, this would on
average generate US$8,861
40
annually for Phinda. Assuming that operational expenditure at Phinda
remain constant for additional wages, staff time, vehicles and maintenance would mean annual
costs of US$30,113
41
. The net financial loss annually associated with monitoring the rhino would
therefore be an estimated US$21,252
42
. Other sources of rhino-related revenue (e.g. tracking,
donations) aside from live sales may also be required to generate sufficient income to cover
Phinda’s expenditure. Given that the conservation and population growth of black rhino is a
motivation for private landowners to participate in the custodianship program, it is possible that
Phinda is not only interested in generating income from the animals. However, future private
landowners wishing to participate in the custodianship program should undertake a market-related
scenario analysis so that they are aware of the likely costs of their participation.
Since 2002, Phinda has sold 14 white rhino through negotiated sales. The average price over 3 year
has been US$17,256 providing a total turnover of US$241,000, and a net profit of US$192,800
when the capture costs are deducted
43
. It is interesting to note Phinda’s perception that customers
pay premium values for Phinda’s rhino because they we re habituated to vehicles (pers. comm. K.
Pretorius, 2005).
In a long-term management process, Phinda’s white rhino gradually all being darted in order to
insert microchips in their horns and perform ear notching for future identification. To help finance
this monitoring work, Phinda aims to offers