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Understanding the economic benefits and costs of controlling marine debris in the APEC region (MRC 02/2007).

Authors:
Understanding the Economic Benets
and Costs of Controlling Marine Debris
in the APEC Region
April 2009
APEC Marine Resources Conservation Working Group
DEWHA
MOERI/KORDI
MOERI/KORDI DEWHA
McIlgorm
Single Colour Black (Solid)
APE C
Single Colour Black (Solid) on Black
APE C
ii
iii
Reference for citation:
McIlgorm, A., Campbell H. F. and Rule M. J. (2008). Understanding the economic benefits
and costs of controlling marine debris in the APEC region (MRC 02/2007). A report to the
Asia-Pacific Economic Cooperation Marine Resource Conservation Working Group by the
National Marine Science Centre (University of New England and Southern Cross University),
Coffs Harbour, NSW, Australia, December.
APEC Project MRC 02/2007
Produced by
The National Marine Science Centre, is a joint centre of the University of New England and
Southern Cross University, New South Wales, Australia.
for
APEC Secretariat
35 Heng Mui Keng Terrace Singapore 119616
Tel: (65) 68919 600 Fax: (65) 68919 690
Email: info@apec.org Website: www.apec.org
© 2009 APEC Secretariat and United Nations Environment Programme (UNEP)
APEC#209-MR-01.3
iv
Acknowledgements
We would like to thank the following individuals and organisations for their assistance with
this project:
The APEC economy contacts who were able to provide information and contacts for
the study.
Mr Ljubomir Jeftic for his translated synopsis of the Alfaro (2006) paper.
Michael Gristwood, Sunderland Mutual Marine Insurers, Astrid Seltmann, Central
Union of Marine Underwriters Norway, Fritz Stabinger, International Union of Marine
Insurance, Zurich Switzerland and David W. Taylor, International Underwriting
Association of London, for assistance with insurance information.
Dr Tonny Wagey and Ms Sitti Hamdiyah of the Indonesian Ministry of Marine Affairs
and Fisheries (Badan Riset Kelautan dan Perikanan-DKP) for assistance in hosting
and organising the outreach workshop in Jakarta.
The workshop participants for their valuable perspectives.
Ms Srisuda Jarayabhand, East Asia Seas Regional Coordinating Unit, United Nations,
for the invitation to present to the 2nd COBSEA Marine Litter Workshop and Cleanup
Campaign, 18–20 September 2008, Pattaya, Thailand.
The APEC MRC Working Group and the Project Steering Committee for their
comments, especially Ms Angela Williamson, Ms Fran Murray and Dr Ilse Kiessling
of the Department of the Environment, Water and Heritage Australia (DEWHA).
UNEP for assistance with project publicity and workshop program.
We also thank the draft document reviewers, Dr Anthony Cheshire and Mr Steve
Raaymakers, for their comments. However the normal disclaimer applies—any errors remain
the responsibility of the authors
.
v
Glossary
ANZECC Australia and New Zealand Environment and Conservation Council
APEC Asia-Pacific Economic Cooperation
COBSEA Coordinating Body on the Seas of East Asia
DAFF Department of Agriculture, Fisheries and Forestry, Australia
DEWHA Department of the Environment, Water and Heritage, Australia
DFAT Department of Foreign Affairs and Trade, Australia
DFG Derelict fishing gear
FAO Food and Agricultural Organisation of the United Nations
GDP Gross domestic product
GRP Gross regional product
GSP Gross state product
GT Gross tonnage
HKSAR Hong Kong Special Administrative Region
HKD Hong Kong dollars
ICC International Coastal Cleanup (Ocean Conservancy)
IUA International Underwriting Association of London
IUMI International Union of Marine Insurers
MARPOL Marine Convention for Pollution at Sea
MB Marginal benefit
MBI Market-based instrument
MC Marginal cost
MDC Marginal damage costs
MOMAF Ministry of Fisheries and Marine Affairs (Republic of Korea)
MOU Memorandum of Understanding
MR Marginal revenue
MRC Marine Resource Conservation
vi
MRCWG Marine Resource Conservation Working Group
NOAA National Oceans and Atmospheric Administration
NOEP National Ocean Economics Program
NGO Non-government organisation
NOWPAP North West Pacific Action Plan
PEMSEA Partnerships in Environmental Management for the Seas of East Asia
P&I Protection and indemnity – marine insurance
SMMI Sunderland Mutual Marine Insurance
ToR Terms of Reference
UNEP United Nations Environment Program
US$ United States dollars
vii
Executive summary
Increasing levels of debris in the world’s seas and oceans is having a major economic impact.
In 2008, marine debris was estimated to have directly cost the 21 Asia-Pacific Economic
Cooperation (APEC) member economies approximately US$ 1.265 billion.
Fishing, transportation, tourism and insurance industries suffered along with governments and
communities.
Controlling marine debris is a challenge shared by all APEC economies. In 2007 the APEC
Marine Resource Conservation Working Group (MRCWG) approved a study to:
improve awareness amongst governments, communities and industry within the
APEC region of the economic implications of marine debris and provide
guidance and practical advice for governments, communities and industry
within APEC economies on targeting resources to mitigate the impacts of
marine debris and adopting economic instruments (and non-economic
incentives where relevant) for preventing the incidence of marine debris.
This report documents the findings of that study. It focuses on the situation of the APEC member
economies, but also refers to relevant data, methods and experiences from non-APEC
economies. The report is designed to assist the understanding of the economic costs and
benefits of controlling marine debris and empower governments, industries and the
community to take action.
Marine debris, also known as marine litter, marine garbage and ocean debris, is defined in this
report as, any manufactured or processed solid waste material that enters the marine
environment from any source whether on land or at sea.
Research suggests that 6.4 million tonnes of debris reach the world’s oceans each year, and
that around eight million items enter the sea every day. Plastics consistently comprise 60 to
80% of total debris recorded. Levels and rates of debris input are increasing despite measures
to control the problem.
Globally, as much as 80% of marine debris entering the ocean each year is thought to come
from land-based sources, with the remainder arising from shipping and other maritime
sources.
Marine debris is an avoidable cost. Preventing debris entering water courses will therefore
reduce the economic impact, including clean-up costs. Simple debris stock-flow models
confirm that intercepting debris early in the marine debris cycle, prior to dilution at sea, can
reduce the damage cost.
Preventative measures such as boom devices placed across rivers and estuaries can be
effective and have positive cost-benefit ratios. However, further information on costs and
benefits of such devices, plus the development of new devices is urgently needed for
dissemination and uptake across APEC economies.
In many cases improved marine debris outcomes could come from improved land debris
control, hence the need for a joint land and marine agency approach.
viii
As part of its study, the MRCWG consultants examined literature to identify different
economic instruments that could be applied in controlling marine debris. There are limitations
on the applicability of some market-based instruments (MBIs) to marine debris control as
marine debris is a non-point-source pollutant. The following MBIs are recommended as being
most suited to controlling marine debris:
deposit-refund systems
user and administrative charges, and
sales taxes and cost sharing.
Some measures have to be implemented on land, to prevent debris entering the sea and
require cooperation with land agencies. Cost sharing shows promise for national and
international situations where collective action can allow the clean up marine debris to
proceed. Under a cost sharing agreement the cost is divided between adjacent economies
under a previously agreed formula.
The consultants contacted each APEC economy regarding the costs, benefits and economic
incentives in controlling marine debris. This report highlights six of the case studies from that
process and includes: Hong Kong Special Administrative Region (HKSAR); the economies
adjacent to the Yellow Sea—China, Korea, Japan; the west coast of the United States of
America, Alaska and Hawaii; Peru; the east coast United States of America; and Indonesia.
The MRCWG held three workshops to raise awareness of incorporating costs and benefits
into the control of marine debris.
The case studies show signs of some technical and policy innovation in the face of increasing
marine debris and derelict fishing gear issues. However there are only a minimal amount of
economic data used in the marine debris control process and the report makes several
recommendations to enhance this deficiency.
Measures to control and prevent debris need to be implemented by governments and the
private sector. Given the nature of the marine debris problem a larger effort needs to be
applied by the APEC economies to prevent debris entering the sea, including the use of
market based instruments, replacing plastic packaging with paper and the implementation of
litter traps in river and estuarine areas.
Marine debris damages marine industries, but is also an economic cost to society and the
environment. All bodies working to control marine debris need to identify expenditure, assess
the most effective use of funds and communicate and cooperate more effectively with each
other to control and lower levels of marine debris in the APEC region.
ix
Table of contents
Glossary iv
Executive summary vi
PART1: Introduction 1
1.1 Aims and objectives 1
1.2 Definition of marine debris and the geographic scope of the study 2
1.3 Sources, types and the fate of marine debris in the APEC region 2
1.3.1 Sources and composition of marine debris 5
1.3.2 Types of marine debris 5
1.3.3 The fate of marine debris 8
1.3.3.1 Floating debris 8
1.3.3.2 Seabed debris 8
1.3.3.3 Wildlife marine habitats and ecosystems 9
1.3.3.4 Ghost fishing and derelict fish gear 9
PART 2: Compiling the existing economic impacts on communities, governments and
selected industries in the APEC region. 10
2.1 Methods 10
2.2 Results 10
2.2.1 The marine economy 11
2.2.2 Direct, indirect and non-market economic impacts of marine debris 12
2.2.3 Categories and costs of damage 13
2.2.3.1 Fishing industry 13
2.2.3.2 Transportation industry 15
2.2.3.3 Tourism industry 17
2.2.3.4 Damage to leisure craft 17
2.2.3.5 Insurance industry 18
2.2.4 Summary of industry impacts 19
x
2.3 Conclusions and recommendations 19
PART 3: An economic-based model to estimate the costs and benefits of controlling
marine debris for communities, governments and industries in the APEC region 21
3.1 Methods 21
3.2 Results 21
3.2.1 The costs of control 21
3.2.1.1 The benefit of controlling marine debris 22
3.2.1.2 The optimal volume of marine debris 23
3.2.1.3 Economic decisions and the control of marine debris 25
3.2.1.4 Economic costs, benefits and the control of marine debris 26
3.2.2 Benefit-cost analysis 27
3.2.2.1 Benefit-cost analysis and marine debris 27
3.2.2.2 A hypothetical example of distributional issues impacting
marine debris mitigation 28
3.3 Conclusions and recommendations 30
PART 4: Identify economic incentives and other measures that are targeted at policy
makers to prevent or mitigate the impacts of marine debris 32
4.1 Methods 32
4.2 Results 32
4.2.1 Economic responses to marine debris impacts 32
4.2.1.1 Regulation 32
4.2.1.2 Economic instruments 33
4.2.1.3 Community 36
4.2.1.4 Enforcement 38
4.2.2 How can economics instruments add to current marine debris controls? 39
4.2.2.1 Discussion 40
4.2.3 The benefits and costs of alternative marine debris policies 42
4.2.3.1 Prevention 43
xi
4.2.3.2 Reducing the marine debris stock level 43
4.2.3.3 Clean up 44
4.2.3.4 Discussion on prevention and clean up costs and benefits 44
4.3 Conclusions and recommendations 45
PART 5: Disseminate the results through an outreach program highlighting the costs
and benefits of controlling marine debris 47
5.1 Methods 47
5.2 Results 47
5.3 Conclusions and recommendations 48
PART 6: References 49
PART 7: Appendices 57
Appendix 1: Sources of marine debris 57
A1.1 Land-based sources of debris and composition 57
A1.1.1 Discharges of stormwater 57
A1.1.2 Sewer overflows 57
A1.1.3 Municipal landfills 57
A1.1.4 Industrial activities 57
A1.1.5 Coastal tourism 58
A1.1.6 Ports and marinas 58
A1.2 Ocean-based sources of debris 59
A1.2.1 Commercial fishing vessels 59
A1.2.2 Merchant shipping, ferries and cruise liners 59
A1.2.3 Recreational boating and fishing 59
A1.2.4 Offshore oil and gas platforms 59
Appendix 2: Marine debris project response from APEC economies 60
Appendix 3: Extracts from the report of the APEC MRCWG outreach workshop
Jakarta, Indonesia 63
xii
Appendix 4: Case studies of economics in marine debris control programs
in APEC economies 71
A.4.1 Case study one: The Korean approach to solving watershed and
coastal marine debris. 71
A4.2 Case study two: Controlling marine debris in a Shipping Port -
example Hong Kong SAR. 72
A4.3 Case study three: Controlling marine debris in a trans-national
regional context 74
A4.4 Case study four: The costs and benefits of cleaning up derelict
fishing gear (a) Puget Sound (b) Alaska (c) Korean and Hawaii 76
A4.5 Case study five: Can local municipal authorities meet the costs of
collecting marine litter? An example from Peru 79
A4.6 Case Study six: The value of a beach and the economic impact of
marine debris US, and marine tourism economies 80
A4.6.1 Discussion of case studies 82
List of figures
Figure 1: A conceptualisation of the sources, stock and fate of debris in the
marine debris cycle. 4
Figure 2: A plastic bottle, discarded ropes and braided fishing twines, typical
of beach debris found in many economies in the APEC region 6
Figure 3: The marginal cost of prevention and clean up. 22
Figure 4: The annual total damage cost caused by the stock of marine debris. 23
Figure 5 Marginal annual damage cost of marine debris. 23
Figure 6: Optimal stock of marine debris showing marginal cost (MC) and
marginal benefit (MB). 24
Figure 7: An ecotourism vessel in Nha Trang Harbour, Viet Nam 25
Figure 8: Marine debris held in common waters between three adjacent
marine island economies. 29
Appendix Figure 1: Some of the 18 registered participants at the MRCWG
workshop in Jakarta, August 63
Appendix Figure 2: A scavenging vessel collecting marine debris in Hong Kong
harbour 71
xiii
Appendix Figure 3: Trawling debris study sites in the Yellow and East China Sea
as reported by Lee et al. (2006) 73
List of tables
Table 1a: The different marine debris sectors in the International Coastal
Clean up day results across in 14 APEC economies. 7
Table 1b: A further breakdown of the most frequent items collected in the
14 APEC economies participating in the International Coastal Clean up day 2007. 7
Table 2: The GDP of the APEC marine economy sectors in 2008 terms with the
GDP of debris impacted sectors and damage estimates for those sectors. 12
Table 3: Different types of debris damage and cost estimates in different
APEC economies 14
Table 4: The value of fish production in APEC economies in 2006 with the
imputed estimate of damage from marine debris 15
Table 5: Summary of MARPOL Annex V regulations regarding dumping
of waste at sea 16
Table 6: Distribution of Benefits and Costs of Marine Debris Control. 29
Table 7: Summary of the types of debris from each of the major land and
ocean based sources, and options for control. 34
Table 8: A Table illustrating the different types of Market Based Instruments. 36
Table 9a: The participation and quantity of rubbish removed and
area cleaned, on land and underwater, in the ICC up day 2007. 37
Table 9b: The value of total volunteer days and the average cost of clean up per
tonne at three shadow labour rates using the ICC up day 2007 data in the APEC region 37
Table 10: Areas where marine debris is found, the responsible enforcement
agency and a rating of enforcement capacity. 39
Table 11a: The estimated benefits, costs and likely benefit-cost ratios
of different type of marine debris prevention measures. 43
Table 11b: The estimated benefits, costs and benefit-cost ratios of different
types of marine debris clean up measures. 44
Appendix Table 1: The workshop program for the APEC workshop 64
Appendix Table 2: Outline of Korean approach to managing marine debris 69
Appendix Table 3: Some examples of the economic effects of marine debris 79
1
PART 1. Introduction
This report responds to a call for improved understanding of the ‘harmful effects and costs of
marine debris’
1
and the need to identify control and prevention measures and incentives for
use by the 21 APEC economies
2
. The report focuses on experiences within the Asia Pacific
region, however data limitations mean that on occasions non-APEC economy data examples
are used if they contribute to the project objective.
The report seeks to:
1. enhance the understanding of the economic costs and benefits of controlling marine
debris
2. fill a significant gap in literature, and
3. provide information necessary for decision making in managing the problem.
Much of the literature on marine debris examines the prevalence and forms of marine debris,
but little mention is made of the costs that are imposed on society by marine debris. The
effectiveness of control measures is usually examined from a technical point of view and the
economic benefits of removing marine debris are often assumed, but not normally measured.
We propose that many of the benefit-cost decisions about the control of marine debris are
happening intuitively, but may not be the best use of limited resources when alternatives are
considered. There are also occasions when regulatory approaches to control can be substituted
by economic instruments. These approaches to the marine debris problem are in their infancy.
The introduction outlines the terms of reference for the MRCWG study that underpins this
report and describes the sources, types and fate of marine debris.
1.1 Aims and objectives
The aims and objectives of the study were to:
improve awareness amongst governments, communities and industry within the
APEC region of the economic implications of marine debris and provide
guidance and practical advice for governments, communities and industry
within APEC economies on targeting resources to mitigate the impacts of
marine debris and adopting economic instruments (and non-economic
incentives where relevant) for preventing the incidence of marine debris.
1
Part Ib., paragraph ix of the APEC Bali Plan of Action 2005
2
The 21 APEC economies are Australia; Brunei Darussalam; Canada; Chile; People’s Republic of China; Hong
Kong, China; Indonesia; Japan; Republic of Korea; Malaysia; Mexico; New Zealand; Papua New Guinea; Peru;
The Republic of the Philippines; The Russian Federation; Singapore; Chinese Taipei; Thailand; The United
States; and Viet Nam.
2
The Request for Proposals required a consultant to address the following Terms of Reference
(ToR):
1. Compile existing data on the direct and (where possible) indirect economic impacts of
land and marine-sourced marine debris on communities, governments and selected
industries (fishing, shipping and transport, tourism, insurance) in the APEC region.
2. Using available data, develop an economic-based model to estimate the costs and
benefits of controlling marine debris for communities, governments and selected
industries (fisheries, shipping and transport, tourism, insurance) in the APEC region.
3. Identify economic incentives and other measures (where appropriate) that are targeted at
policy makers, managers and/or marine-based industries within the APEC region to:
a. limit or prevent the incidence of marine debris, and
b. direct available resources to effective mitigation of the impacts of marine debris.
4. Disseminate project results through an agreed outreach program to governments, relevant
industries and the public in the APEC region and project partners, highlighting the
benefits and costs of controlling marine debris and appropriate measures for limiting
these costs in the future.
1.2 Definition of marine debris
The definition of marine debris for the purpose of this project is:
marine litter, marine garbage and ocean debris, is defined as any
manufactured or processed solid waste material that enters the marine
environment from any source whether on land or at sea (APEC MRCWG).
The term marine debris is used in the text and includes marine litter, which may refer to
domestically produced beach litter only (Cheshire et al. 2009).
1.3 Sources, types and the fate of marine debris in the APEC
region
While there are no certain statistics, it is estimated that worldwide approximately 6.4 million
tonnes of debris reach the ocean each year and that around eight million items enter the sea
every day (UNEP 2005). Cheshire et al. (2009) consider this a low estimate, and although it is
based on a comprehensive assessment, it is now quite dated (National Academy of Sciences
1975). In the APEC region the information on marine debris is limited and is most available
in the more industrialised economies. Plastics are the most prevalent debris items and
consistently comprise 60 to 80% of total debris recorded in marine debris surveys (Derraik
2002). It is generally agreed that both the current levels and the rates of input are increasing
(eg, Ryan and Maloney 1993; Barnes 2002; Derraik 2002) in spite of measures targeted at
controlling the problem (Williams et al. 2005; National Academy of Sciences 2008). It is
estimated that globally as much as 80% of marine debris entering the ocean each year comes
from land-based sources, with the remainder arising from shipping and other maritime
sources (UNEP 2005). This percentage varies in different locations and with the effectiveness
of debris emission regulations on land and at sea. Derelict fishing gear is a major part of
3
fishing boat sourced marine debris. On reaching the ocean it is estimated that 15% of marine
debris floats on the sea surface, 15% remains in the water column and 70% rests on the
seabed (UNEP 2005).
Debris may enter the sea directly (either deliberately or accidentally), or be indirectly
transported to the ocean via rivers, sewers, stormwater drains or wind (UNEP 2005).
The natural capacity of the ocean to decompose inorganic marine debris is not well
understood, or readily measurable. Paper and cardboard can decompose, but plastics break
down into smaller pieces and tend to be long lasting with residual damage to the marine
environment. Replacing plastics with paper may reduce overall residual marine debris.
4
Box 1. Economic issues in the control of marine debris
Figure 1 is a conceptualised diagram that can help explain the economic issues in the control
of marine debris. In the diagram there are four points (1, 2, 3, 4) at which the economies of
intervention for marine debris can be measured and compared. The details of each point are
given below:
1. The debris entering the sea from land and sea sources can be measured and the volume
reduced through prevention and control measures.
2. The stock of marine debris in the ocean may be estimated using ambient debris levels and
the various types of damage costs it inflicts can be measured.
3. The cost of reducing the stock of debris by various types of removal measures can be
measured.
4. The rate of decomposition can be changed by having decomposable debris, through
substituting plastic with paper.
Figure 1: A conceptualisation of the sources, stock and fate of debris in the marine debris cycle (not
to scale).
If the volume of debris entering the oceans is more than the volume cleaned up, there will be
cumulative growth in the residual stock of marine debris. The stock of marine debris at time
(t) can be represented by the following equation:
Stock (t) = Stock (t-1) + Volume of debris entering the sea (t-1) - Volume cleaned up (t-1) -
Volume decomposed in the environment (t-1)
The equation describing the process in Figure 1 shows that the stock at time t, is related to the
amount of debris entering the sea after preventative measures in time (t-1), less the volume of
debris decomposing and the volume cleaned up in (t-1).
Annual
volume of
debris from
land and sea
sources
entering the
ocean
2
Stock of
marine
debris
(surface,
water column
and seabed)
Decomposition
Entry to the sea
Cleanup
Annual
volume of
debris
cleaned up
Damage from marine
debris $
1
3
4
5
1.3.1 Sources and composition of marine debris
Developing marine debris prevention and clean-up initiatives first requires an understanding
of where marine debris comes from. Land-based activities are recognised as a major
contributor to marine debris particularly in populated areas (Slater 1994). It is estimated that
as much as 80% of marine debris entering the ocean each year comes from land-based
sources. These include municipal landfills, public littering, discharges of sewage and
stormwater, industrial activities, ports and marinas, construction and coastal tourism. Debris
originating from land-based activities includes medical waste, stormwater debris, sewage and
associated waste,
3
landfill debris and litter. A fuller description of each of these is presented
in Appendix 1.
Ocean-based sources of debris include merchant shipping, ferries and cruise liners,
commercial fishing vessels, military and research vessels, recreational boating, offshore oil
and gas platforms, and aquaculture facilities (UNEP 2005). Ocean-based debris, or land-based
debris originating from ocean-based activities, includes recreational fishing and boating
waste, commercial fishing waste, waste from shipping or ocean-going vessels and legal and
illegal discharge at sea. In many nations military vessels are exempted from debris regulation
(Cheshire et al. 2009). A fuller description of each of these is presented in Appendix 1.
1.3.2 Types of marine debris
Industrialised society generates solid wastes in many forms, as goods are transported, sold by
retailers and used by consumers. Some of the waste finds its way to the oceans where it ends
up as marine debris. Debris is ubiquitous in the world’s oceans, and is now recognised as one
of the most insidious pollution issues facing our oceans (Sheavly 2005a). Over the past 50
years, the nature of disposed waste has changed and organic materials, which once comprised
the majority of discarded wastes, have largely been replaced by synthetic materials which are
durable and may persist in the environment for many years (Sheavly 2005b; Allsopp et al.
2006). In addition, many synthetic materials are buoyant and can be transported over large
distances, impacting on environments a long way from their point of origin.
Estimates suggest that on average, 13,000 pieces of debris are floating on every square
kilometre of ocean surface (UNEP 2005). Despite efforts made across regional, national and
international scales the problem of debris continues to increase (Uneputty and Evans 1997b;
UNEP 2005).
There are a wide variety of items that become debris in the ocean. According to Fanshawe and
Everand (2002) the main types of debris found in the ocean are as follows:
plastics (fragments, sheets, bags, containers)
polystyrene (cups, packaging, buoys)
rubber (gloves, boots, tyres)
wood (construction timbers, pallets)
3
Under the definition of marine debris, sewage is generally not considered marine debris although they may be
in association with each other.
6
metals (beverage cans, oil drums, aerosol containers)
sanitary or sewage-related items (condoms, tampons)
paper and cardboard
cloth (clothing, furnishings, shoes)
glass (bottles, light bulbs)
pottery/ceramic, and
munitions (phosphorous flares).
Of all the debris types listed above, plastics consistently comprise 60 to 80% of total debris
recorded in marine debris surveys (Allsopp et al. 2006). Plastics have become extremely
important in modern society, and usage has greatly increased over the past three decades
(Derraik 2002). Plastic production in the US increased from 2.9 million tonnes in 1960 to 47.9
million tonnes in 1985 (Robards et al. 1997). Plastics are lightweight, strong, durable and
cheap to produce (Derraik 2002), and it is these properties that make plastic such an issue in
the marine environment. Plastics pose a great threat to marine systems as once released into
the ocean they do not degrade and may persist in the environment for many years. In addition,
many plastics are buoyant, and therefore can be travel great distances.
Figure 2: A plastic bottle, discarded ropes and twines, typical of beach debris found in many
economies in the APEC region. (Photograph: A. McIlgorm).
Table 1a indicates the frequency and relative percentages of marine debris collected in the
APEC Region economies in the 2007 International Coastal Cleanup (ICC) day.
7
Table 1a: The different marine debris sectors in the International Coastal Cleanup day results in 14 APEC
economies
4
(Source: ICC 2008).
Marine debris activity sector Frequency Percentage of total by
number (%)
Shoreline and recreational activities 3,388,742 55.5
Ocean/waterway activities 360,408 5.9
Smoking-related activities 2,179.870 35.7
Dumping Activities 132,775 2.2
Medical/personal hygiene 45,463 0.7
Total number of items 6,107,258 100
Shoreline and recreational activities generate over 3.38 million items of debris and smoking-
related debris generates 2.18 million items. These exceed the number for dumping activities,
but a further breakdown of the items in the dumping activities category (shown in Table 1b)
suggests that many of the items in this category are probably heavy.
Table 1b: A further breakdown of the most frequent items collected in the 14 APEC economies participating in
the International Coastal Cleanup day 2007
5
(Source: ICC 2008).
Shore line and
recreational activities Frequen cy Ocean /Waterway
activities Frequency Smoking-R elated
activities Frequency
Food wrapper/containers 599,833 Rope 92,863 Cigarettes/filters 1,907,71 7
Caps/Lids 550,961 Fishing line 58,071 Cigar tips 169,629
Bags 443,064 Plastic sheet /tarp s 50,422 Tobacco pack s/wraps 70,041
Bevera ge bottles plastic 378,535 Strapping bands 29,421 Cigarette lighters 32,483
Bevera ge bottles glass 31 1,074 Bait containers /pack aging 26,222 Total 2,179,870
Cups, plates 288,953 Buoys/Floats 22,835 Dumping activities
Bevera ge cans 272,092 Bleach/Cleaner bottles 18,570 Building mat erials 78,064
Straws/Stirrers 22 8,800 Fishing lures /lights 15,612 Batteries 20,679
Clothing/Shoes 83,989 Oil/Lube bottles 14,520 Car/Car parts 13,803
Pull tab s 74,978 Fishing nets 9,773 Tires 12,610
Balloon s 55,098 Crab/Lobster/Fish traps 6,344 Appliances 6,342
Toys 52,230 Light bulbs/tubes 6,039 55-Gallon drums 1,277
Six-Pack holders 28,419 Pallets 5,836 Total 132,775
Shotgu n shells 20,716 Crates 3 ,947 Medical/Pers. Hygiene 45,643
Tot al 3,388,742 T otal 360,408 T otal 45,463
Totals 6,107,258
4
The economies were Australia; Canada; China; Hong Kong, China; Indonesia; Japan; Korea; Malaysia;
Mexico; New Zealand; Peru; The Philippines; Thailand; and the United States of America.
5
Note the total data for the 14 APEC economies reflects a greater number of ICC program participants from the
United States than in other nations with fewer participants likely over representing the US results.
8
The prevalence of plastics can be seen in shoreline and recreational activities. In the ocean
and waterways debris categories, ropes, fishing lines and plastic sheets are most frequent, but
are followed by a range of ancillary categories of commercial fishing items. Smoking-related
items are frequently encountered in all APEC economy beach cleanups. Though low in
number, building materials, batteries and car parts make a significant contribution to the
volume of debris (ICC 2008).
Derelict fishing gear is another type of marine debris. It enters oceans either accidentally
during the course of normal operations (eg, storms or through entanglement on reefs), or
through deliberate dumping (Kiessling 2003). Most modern fishing gear is constructed of
synthetic materials and is relatively inexpensive. Therefore, there may be an economic
incentive for fishermen to discard gear rather than spend time in repairing old or damaged
gear (Kiessling 2003). Derelict fishing gear causes severe problems through entangling larger
fauna such as seals and turtles, and through damaging sensitive habitats. In addition, it can
pose a navigational hazard or cause damage to vessels through collision, or fouling of water
intakes and propellers.
1.3.3 The fate of marine debris
Around 70% of debris entering the sea sinks to the seabed while 15% floats on the sea
surface. Another 15% remains in the water column (UNEP 2005).
1.3.3.1 Floating debris
Floating debris generally comprises plastic bags, plastic items and woody debris, and it may
be transported by currents and winds over great distances before sinking or being cast ashore.
Marine organisms such as seals, birds and turtles can become entangled in, or ingest floating
debris. In addition, floating debris poses a risk to vessels which may be damaged through
collisions with larger debris (such as cargo containers and oil drums), or by having ropes and
nets foul propellers and water intakes leading to engine damage.
In more remote locations, floating debris from commercial fishing operations is often washed
ashore and may cause significant problems to local wildlife (Johnson 1989; Kiessling 2003).
In addition, a large volume of litter from land-based sources remains on beaches, and in
coastal habitats. General litter (eg, cigarette butts, paper, food wrappings) often makes up
most of the items in beach clean ups (Sheavly 2005b). Debris on beaches and shorelines poses
problems to wildlife and local tourism, and potentially presents a hazard to the health of beach
goers (Wagner 1989). Loss of amenity on beaches and in shallow coastal habitats can cause
significant economic impacts.
1.3.3.2 Seabed debris
Studies of seabed debris have revealed that heavier types of debris may sink when discarded
and come to rest on the seabed or become incorporated into soft sediments (Moore and Allen
2000). Debris on the seabed is very often derelict fishing gear, metal, cans and plastics,
mainly from vessels and fishing activity (Moore and Allen 2000; Lee et al. 2006). In a study
of seabed debris by Chiappone et al. (2002), 90% of debris encountered in the Florida Keys
was derelict fishing gear. Debris on the seabed poses a threat to sensitive habitats such as
coral reefs which can be damaged by fishing gear and other forms of debris (Chiappone et al.
2005). Guidelines for Monitoring Marine Litter on the Beaches and Shorelines of the
9
Northwest Pacific Region have been prepared by the North West Pacific Action Plan forum
(NOWPAP 2007a and b).
1.3.3.3 Wildlife marine habitats and ecosystems
Marine debris also has an impact on wildlife, marine habitats and ecosystems. The ecological
impacts of marine debris have been extensively studied in all but the deep oceans. These
impacts include injury and death of wildlife through entanglement and ingestion, the
destruction of fragile habitats such as coral reefs, and the potential spread of invasive species.
Estimates suggest that as many as 40,000 Northern Fur Seals may be killed in the Bering Sea
annually through entanglement in plastic debris (Derraik 2002).
While marine debris damages environmental amenity, it also has direct economic impacts.
For example, the death of marine animals from ingesting or becoming entangled in debris is a
loss of natural capital. Habitats such as coral reefs can also be damaged by physical abrasion,
being covered or being negatively impacted by chemical residues. Derelict fishing gear can
become entangled on corals, and can abrade the delicate skeleton.
Plastic debris probably has most impact on the marine environment. Plastics enter the marine
environment as, for example, waste plastic bottles or containers, and they gradually
deteriorate over years and decades to become pieces and eventually small plastic fragments.
These can be ingested by marine mammals, birds, fish and benthic life and remain in the
animals.
Marine debris can also be part of the introduction of invasive species. Any floating object in
the ocean is capable of distributing species into non-native habitats. Dispersal of invasive
species has been greatly increased by the introduction of large quantities of floating plastic
which can act as ‘rafts’. The presence of invasive species can have devastating ecological
consequences to local marine communities, and Barnes (2002) suggests that biological
invasions pose one of the greatest threats to marine biodiversity. In addition, the cost of
cleaning or removing invasive species and the potential loss of fisheries can have serious
economic consequences for coastal human communities.
1.3.3.4 Ghost fishing and derelict fishing gear
Lost fishing nets, such as gill nets, can ‘ghost fish’, continuing to trap fish until they have
settled and become ineffective. They do not readily break down and can entangle wildlife and
rocky habitat such as reefs including corals. Worldwide, at least 267 vertebrate species have
been affected by becoming entangled in derelict fishing gear or plastic packaging, or through
the ingestion of plastic debris (Laist 1987; Laist 1997). This includes 86% of all sea turtle
species, 44% of all sea bird species and 43% of all marine mammal species. It is likely that
this is an underestimate of the number of species affected by debris, as many would die and
sink or are consumed by predators before being observed (Derraik 2002). During periods of
wave action, debris can cause corals to break. If left in place for long periods, debris can be
incorporated into the reef structure (Donohue et al. 2001).
Costs of disposing of fishing gear can be high, so fishing gear is sometimes dumped as a low-
cost disposal method (Pooley 2000). Proper disposal can be encouraged by providing low-
cost reception facilities and this would also lower the amount and impact of debris.
10
PART 2.
Compiling the existing economic impacts on
communities, governments and selected industries in the APEC
region
Compile existing data on the direct and (where possible) indirect economic impacts of land-
and marine-sourced marine debris on communities, governments and selected industries
(fishing, shipping and transport, tourism, insurance) in the APEC region
2.1 Method
The economic impacts of marine debris are generally seen in either marine debris reports, or
are noted by industries. The marine debris and associated grey literature was examined for
economic or financial examples of impacts from marine debris on communities, government
and industries in APEC economies. Other marine industry publications were researched for
references to economic impacts from marine debris in the APEC economies.
The current study concentrates on the 21 APEC member countries on the Pacific Rim. The
MRCWG used its nominated contacts to seek information on the economic impacts of marine
debris in each APEC economy.
We also cite information from other regions when it can add to the objectives of this study
and fill gaps in the information provided by the APEC economy respondents. The industries
impacted by marine debris include secondary industries like vessel insurance. Several of the
largest global shipping underwriters were contacted regarding the impacts of marine debris on
shipping and fishing and hence on marine insurance.
Other sources such as the International Coastal Cleanup data (Ocean Conservancy 2008) and
data on the fishing industry were also obtained.
2.2 Results
The methods chosen to identify information on the economic impacts in industries included
literature searches, contact with APEC nominated representatives, and industry enquiries.
Appendix 2 summarises the economies contacted and their responses. The nine replies from
economy representatives indicated that economic data on marine debris is available in five of
those nine economies. Information on the economic costs of various types of damage caused
by marine debris is limited, or may not be held centrally by government. The low number of
responses limited the data available to the consultants.
The study identified that much of the information on the economic impacts of marine debris is
not held by central government, and is not recorded by industry, as there is no statutory or
industry obligation to do so. Data on the economic impacts is often held by local and state
governments and is not generally gathered nationally. Some of the economic impact
information is gathered by non-government organisations (NGOs).
There is also a lack of land agencies issuing economic impact data as it essentially a measure
of pollution, even though this is the data required to estimate the economic cost of debris
prevention. They were also some references in the literature that enabled fishery production
data to be utilised to scope the potential cost of marine debris damage across the APEC
economies.
11
Box 2: The agreed APEC list of industry categories in the marine economy (McIlgorm 2004):
1. Oil and Gas (minerals)
2. Fisheries / Aquaculture (living resources including sea plants)
3. Shipping (transport and shipbuilding)
4. Defence / Government (government services)
5. Marine Construction (coastal defences and restoration)
6. Marine Tourism (leisure services)
7. Manufacturing (equipment, medicines, etc)
8. Marine Services (mapping, surveying, consulting)
9. Marine Research and Education
2.2.1 The marine economy
Marine debris may potentially have a negative impact both on the economies of industries
using the oceans and on the economic values of the ocean itself. The value of the marine
economy has been investigated by several projects (NOEP 2000; McIlgorm 2004) and these
studies indicate the economic value being generated by activities associated with the oceans.
In the APEC region the marine economy is typically between 2% and 4% of total Gross
Domestic Product (GDP) for economies such as the United States, Canada, Australia and
New Zealand (McIlgorm 2004; NOEP 2005; New Zealand statistics 2006). The industry
sectors contributing to GDP in the marine economy are reported in Box 2. Fisheries, shipping
and marine tourism industry sectors are most impacted by marine debris.
The total APEC GDP in December 2008 was US$29,329 billion at current prices (Department
of Foreign Affairs and Trade (DFAT) 2008). Of this total for all economies, the value of the
marine economy across APEC economies is approximately 3% of total GDP
6
(McIlgorm
2004)—a sum of US$879 billion at 2008 price levels. Within this, the total APEC GDP for
the fishing, shipping and marine tourism sectors is estimated at 48% of the marine economy
or US$421.9 billion (McIlgorm 2004).
7
It is this US$421.9 billion of GDP generated by
marine industries that is vulnerable to being impacted by poor control of marine debris in the
APEC region.
Takehama (1990) estimates that damage from marine debris in Japan is 0.3% of the annual
gross value of the fishing industry catch. If we apply this observed percentage to the value of
6
This assumes the marine economy as a percentage of total GDP is as the US, Australian, Canadian and New
Zealand studies. The marine economy contribution in other less industrialised and coastal island economies will
like exceed this, but has not been measured.
7
This is an average of the percentages of the total marine economy for these sectors in Australia, Canada, New
Zealand and United States.
12
different sectors in the marine economy,
8
we can estimate that damage from marine debris
across the APEC region for the fishing, shipping and tourism industries is US$1.265 billion
annually. The next section uses different data to compare with this estimate.
Table 2: The GDP of the APEC marine economy sectors in 2008 terms with the GDP of debris-impacted sectors
and damage estimates for those sectors (DFAT 2008; McIlgorm 2004; Takehama 1990).
Sector of the Marine Economy
Percentage of
the Marine
economy (Aus,
Canada, NZ and
US)
Sector GDP in
APEC at 2008
price levels
(billions USD)
The GDP of
Debris Impacted
Sectors (billions
USD)
The estimated
value of damage
from marine
debris in the
APEC region
(billions USD)
i. Oil and Gas ( minerals) 26.5% 233.31 n/a n/a
ii. Fisheries / Aquaculture ( living resources) 13.8% 121.48 121.48 0.364
iii. Shipping (transport and shipbuilding) 10.6% 93.14 93.14 0.279
iv. Defence / Government (government services) 17.0% 149.27 n/a n/a
v. Marine Construction (coastal defences/ restoration) 3.6% 31.51 n/a n/a
vi. Marine Tourism ( leisure services) 23.6% 207.33 207.33 0.622
vii. Manufacturing (equipment, medicines, etc) 4.1% 35.78 n/a n/a
viii. Marine Services (mapping, surveying, consulting) 0.4% 3.52 n/a n/a
ix. Marine Research and Education 0.4% 3.52 n/a n/a
Total 100% 879.00 421.95 1.265
Key - n/a not applicable.
These values do not account for non-market value estimates of beaches or marine animals.
These non-market values are partially expressed in the value added by tourists visiting the
coast and ocean, therefore contributing to the marine economy. The marine economy data
illustrates the economic contribution from the marine sector of the economy to decision
makers at the political level.
2.2.2
Direct, indirect and non-market economic impacts of marine debris
Economic costs are lost benefits to society. The economic impacts of marine debris can be
measured by the diminished opportunities to exploit the marine environment for pleasure or
profit (Faris and Hart 1994).
Impacts can have either direct or indirect costs. The different categories of economic costs in
the marine debris are as follows:
Direct economic costs: those costs which arise from damage to an industry or to an
economic activity, for example the costs of vessel downtime due to marine debris
entanglement on a vessel propeller. These costs are readily measured.
Indirect economic impacts: those costs which arise indirectly, for example from
marine life ingesting plastic waste and contaminating the food chain, therefore
impacting on fish and even humans. These costs are not so easily measured.
8
There are no equivalent data for shipping and marine tourism. Takehama’s observation is a guide to the
dimension of damage, giving a point estimate with high error boundaries. Caution should be taken in using these
data for more than indicating the dimensions of marine debris damage. In the literature single references to
damage, anecdotal information and insurance contacts align with these estimates.
13
Non-market values: those costs which arise when marine debris compromises non-
market values such as scenic values, or the values placed on the marine environment,
or marine activities by people who do not necessarily access them. Marine debris is of
concern to the community and there can be a willingness to pay, even on the part of
non-users, to have the beaches cleaned (Faris and Hart 1994). For example, the levels
and value of recreational activities in the marine environment are reduced by marine
debris. Beach goers finding a variety of marine wastes on beaches will reduce their
visits, or length of stay, with losses to tourism in the local economy. Measuring such
non-market losses is not straightforward, as visitors may travel to another beach that
has no marine debris, and it is the relative loss between beach sites that determines the
loss of economic value.
When seeking to remedy the marine debris problem costs of prevention and cleanup should be
considered. Prevention can involve waste management schemes, technical intervention and
regulations. The costs of cleanup include expenditures to remediate coastlines, beaches and
ports impacted by marine debris.
Values can also be measured for non-market impacts such as the impacts of plastics on
marine animals. This would require specific non-market valuation studies of the costs of harm
to and reduction of populations of various marine species.
2.2.3 Categories and costs of damage
An overview of the categories of damage by marine debris is reported in Table 3. Fishing
vessels, leisure craft, commercial shipping, tourism, and wildlife and the marine ecosystem
are all impacted by marine debris and damaged to some degree.
2.2.3.1 Fishing industry
The fishing industry is particularly impacted by marine debris (Hall 2000; Takehama 1990).
There have been several studies of the marine debris damage to fishing boats in the APEC
region. In Japan, Takehama (1990) estimated the cost of damage to fishing vessels caused by
marine debris, based on insurance statistics available through the Japanese fishing insurance
system. Such damage includes accidents, collisions with debris, entanglement of floating
objects with propeller blades and clogging of water intakes for engine cooling systems.
Losses in 1985 across all fishing vessels less than 1,000 gross tonnage (GT) were ¥6.6 billion.
Takehama estimates that the annual vessel damage of ¥6.6 billion is 0.3% of total national
fishery revenue in Japan.
14
Table 3: Different types of debris damage and cost estimates in different APEC economies (* notes non -APEC economies).
Category Type of damage/loss Type of debris APEC
Economy
Estimated cost Source
FISHING Damage to fishing boats Drifting objects Japan 6.6 billion Takehama (1990)
Loss of fisheries production Nets “ghost fishing”
US Loss of $250m in
lobsters UNEP
(Raaymakers
2007)
Loss of fishing gear and down time Entanglement with derelict
fishing gear
CDA $10m for retrieval of nets (Slater 1994)
Damage to leisure boats Entanglement of propellers US $792m (Ofiara and
Seneca 2006)
Human injury/fatality/rescue costs Rescues due to debris
UK* 440 000/yr Fanshawe (2002)
SHIPPING Damage to ships Korea Vessel loss of 292 lives Cho (2005)
Damage to intake line for cooling Plastic ingested to intake
lines for cooling
UK* >100 000 Fanshawe (2002)
COASTLINE/
TOURISM
Loss of amenity to beaches and reefs Plastics, fishing and general
debris
US US$1-28m/yr (Ofiara and
Seneca 2006)
WILDLIFE and
MARINE
ECOSYSTEM
Loss of environmental amenity, death of
animals, Coral reef habitat damage
Plastics, fishing nets Unknown Recovery /animal rescue
- costs unknown
(Fanshawe and
Everand 2002)
15
Takehama also found that in analysis of the frequency of fishing boat accidents, ‘drifting
objects’ was the largest single category at 10%—double that of any other cause. Vessels in
the 5 to 20 GT size class had highest frequency of accidents with drifting objects, engine
cooling systems and entanglement of foreign material in propellers. Generally the frequency
of these accidents was less in larger vessels as they work offshore. Vessels below 5 GT have
relatively fewer accidents which may reflect use of outboards, close attention by drivers
avoiding marine debris, and less fishing at night than larger fishing vessels.
Takehama (1990) noted that fishing vessels damage is 0.3% of the value of the Japanese fish
catch. Table 4 presents the value of the fish catch for 21 APEC economies for 2006. From this
we use the 0.3% value of fish catch to impute the value of fishing boat damage in the APEC
region. It is found that for a total catch value of US$89.4 billion by APEC economies in 2006
the imputed cost of damage to vessels is US$268.2 million across the APEC region. This is an
estimate made from fishery data, provided as a best available estimate of the scale of damage
to fishing vessels from marine debris across the APEC region.
Table 4: The value of fish production in APEC economies in 2006 with the imputed estimate of damage from
marine debris (FAO 2007; Takehama 1990).
Economy 2006
Value of fish
production
USD million
Imputed
value of
marine
debris
damage
USD
million
Economy 2006
Value of fish
production
USD million
Imputed
value of
marine
debris
damage
USD
million
Australia 1,873 5.6 New Zealand 983
2.9
Brunei Darussalam 31 0.1 Papua New Guinea 135
0.4
Canada 5,524 16.6 Peru 1, 803
5.4
Chile 3,815 11.4 T he Philippines 521
1.6
China 13,338 40.0 Russian Federation 3,576
10.7
China, Hong Kong 2,452 7.4 Sin gapore 1,153
3.5
Indonesia 2,162 6.5 Chinese Taipei 2,023
6.1
Japan 15,715 47.1 Thailand 6,818
20.5
Korea 3,817 11.5 United States of America 17,589
52.8
Malaysia 1,221 3.7 Viet Nam 3,644
10.9
Mexico 1,183 3.5 Grand total 89,385
268.2
The value of damage to the APEC fish sector of US$268.2 million is less than the estimate in
Table 2 of US$364 million. The APEC categories are a wider interpretation than just the
value of fish catch and this accounts for most of the difference.
2.2.3.2 Transportation industry
Marine debris is known to be a hazard to marine vessels in various ways. Floating containers
are a navigational hazard to coastal and ocean shipping, and derelict fishing gear and ropes
may represent a threat to fishing and smaller vessels. Entanglement with ropes has on
occasions led to propeller damage and sinking of vessels via stern tube damage causing an
influx of sea water.
The literature on vessel damage from marine debris is disparate and was examined in the hope
of being able to estimate the annual damage to marine boats and ships from marine debris. It
16
became apparent that insurance underwriters’ data tend to record only ‘total loss’ of vessels,
whereas much of the marine debris damage incurred by vessels is less severe, but nonetheless
disruptive to operations and requires maintenance expenditure; for example, ingestion of
plastics into engine cooling water intakes or recreational craft having propellers fouled and
needing to be towed back to port or hiring a diver. The value of debris damage to shipping is
reported in Table 2 and is US$279 million per annum.
In Korea, Cho (2005) identified that marine debris was involved in 9% of all Korean shipping
accidents in the 1996–98 period. Of the 204 accidents, 111 were operational delay and 56
were propeller damage. The highest fatality was associated with the 110 GT Ferry M/V Soe-
Hae in 1993. The vessel capsized and sank with 292 deaths. The Korean Maritime Accident
Investigation Agency reported that fishing ropes around the shafts and propellers and over
loading were the causes of the accident (Cho 2005).
The shipping industry is regulated by MARPOL 73/78 International Convention for the
Prevention of Pollution from Ships (MARPOL 1973). Annex V: Prevention of Pollution by
Garbage from Ships came into force in 1988 and it prohibits the discharge of all plastics into
the ocean from ships. This includes items such as plastic fishing lines and nets, synthetic
ropes, plastic bags, as well as items such as food waste and any floating garbage within
specified distances from land (Table 5). Annex V also requires that ports and terminals
provide adequate waste reception facilities. All ships over four GT are required to have a
waste management strategy, including for incineration and compaction.
Table 5: Summary of MARPOL Annex V regulations regarding dumping of waste at sea.
Waste type All ships Offshore platforms
Plastics—includes synthetic ropes and fishing
nets and plastic bags
Disposal prohibited Disposal prohibited
Floating dunnage, lining and packing materials >25 nm from shore Disposal prohibited
Paper, rags, glass, metal etc. comminuted or
ground
>12 nm from shore Disposal prohibited
Food waste not comminuted or ground >3 nm from shore Disposal prohibited
Food waste comminuted or ground >12 nm from shore >12 nm from shore
The following APEC economies are not signatories of MARPOL: Hong Kong, China,
Chinese Taipei and Thailand.
The costs from meeting the requirements of MARPOL have been borne by shipping
companies. There is no data available on the benefits arising from these measures. Some
vessels do not appear to comply and to cite a vessel for illegally discharging garbage or
plastics into the seas an individual must witness the event and report, or provide sound
evidence, that such a discharge occurred. Many pollution violations go unreported or are
never fully pursued due to lack of evidence. This is a weakness of the regulatory approach.
However Shealvy (2005b) considers that ‘without a doubt, MARPOL has helped to reduce the
amount of trash on the beaches and oceans of the world’.
17
2.2.3.3 Tourism industry
Studies in the APEC region have shown the value of the marine economy and the marine
tourism sector in particular (NOEP 2005; McIlgorm 2004). Table 2 shows that 23.6% of the
value of the marine economy (US$207.3 billion) is the GDP attributable to the marine tourism
industry in the APEC region. It is estimated that damage by marine debris to the tourism
sector in APEC is US$622 million (see Table 2).
Marine debris such as ropes, plastics and derelict fishing gear can end up on the seabed, on
beaches and along the coastline. This negatively impacts the aesthetic values of the coastline
and beaches for marine tourism visitors and residents. This can translate into a reduction in
the amenity value of beaches for tourists and may mean that tourists will be less willing to
pay to go to a tourist location.
The perceived loss of amenity can cause consumers to move to other beaches and coastal
areas with a loss of expenditure to the region. The economic loss to the whole economy
considers the relative change in values by consumers using a substitute beach. Marine debris
is a concern for municipalities when tourists go elsewhere, manifesting as a loss in the local
economy (if not the national economy).
On an international scale, tourists may chose between holiday locations in different countries
on perceptions of aesthetic coastal values. An anecdotal example known to the report authors
is of a tourist who did not intend to return to a holiday resort site in an APEC economy
because ‘on entering the water the sea was full of marine debris’ (pers. comm. Dr Lindstrom).
The importance of tourism expenditure in many economies may provide the private sector
with an incentive to contribute to keeping the beaches clean. Given the importance of marine
tourism to many national economies, national governments should also see beach litter and
marine debris in the sea as prejudicing their marine tourism industries.
2.2.3.4 Damage to leisure craft
Marine debris also has an impact on leisure boats, causing loss of operational time. Johnson
(2000) relates one case:
This twin screw motor yacht caught a line during a routine trip for fuel. It wrecked
propeller shafts, stern gear and flexible couplings on both engines. It was out of
operation for a significant part of a busy charter season. Drifting while disabled or
having to go overboard with a knife to wrestle with a rope can have tragic
consequences…
Data on the economic impacts of marine debris on small vessels in the APEC is limited.
There are data on small boat safety in most APEC economies, but little economic information.
There are over 13 million registered recreational vessels in the United States as reported by
the US Coast guard national survey of small boat safety (SRA 2003). No data on damage was
available.
We know from the previously presented data on the marine economy and marine tourism that
leisure craft are part of the marine tourism category. Therefore the damage by marine debris
to the leisure boat industry is some unknown fraction of the US$622 million of damage
estimated earlier in the tourism sector.
18
2.2.3.5 Insurance industry
One aspect the current study investigated was the impact of marine debris on the insurance
industry. Given the prevalence of ropes and plastics that can impede vessels’ functions we
approached the insurance industry for their perspective, starting with fishing vessels.
Fishing vessel insurance
Contact was made with Sunderland Mutual Marine Insurance (SMMI), one of the largest
insurers of fishing vessels in the APEC region. They confirmed that fishing vessels were
known to be impacted by marine debris, but the insurance claims data does not specifically
identify any interaction with marine debris as the cause, with flooding or sinking being
recorded. Again, claims are made by vessels that have collided with some object at sea and
many times, while a floating container is suspected, the fishing vessel remains unaware of the
exact nature of the item. Entanglement of vessels in ropes and fishing nets is the most
frequently identified interference from marine debris. On some occasions those ropes may be
those of the fisher’s own vessel. Plastic bags are also cited in claims where engines have
overheated due to blocked inlets (Pers. comm., Michael Gristwood, SMMI).
While marine debris is a cause of damage to fishing vessels, the insurance industry appears
not to be able to estimate the extent. They indicate that marine debris contributes to many
vessel claims and that the insurers regarded it as part of the risk of insuring fishing vessels.
Shipping insurance
For large ships the project made contact with the International Union of Marine Insurance
(IUMI) Zurich, which underwrites US$20.3 billion of premiums annually. On asking about
the impacts of marine debris on insurance claims, senior representatives indicated that:
... it is difficult to obtain such data. We produce statistics by claim type such as
grounding, fire, engine failure etc., and to a certain degree have some information on
what caused the accident, but it is not so detailed that I could tell which accidents
might be due to marine debris. Neither do I know of any other source giving that type
of information. The leading insurer or claims handler on an individual claim will
probably have that type of information in his claim file, but I don't know of any source
where this would be compiled for statistical purposes (Astrid Seltmann and Fritz
Stabinger pers. comm.).
The project also made contact with the International Underwriting Association of London
(IUA) which stated:
Sixty per cent of marine hull cover is written in Europe and Asia and 22% in the Asia
Pacific and 18% in North America. Lloyds and IUA account for 20%” (Taylor 2007).
The IUA view was that marine debris is not seen as a significant contributor to hull
losses although containers in the sea are known to cause hull damage, but not on a
scale that is significant. Underwriters investigate claims thoroughly and the results
tend to remain in their files unless it is extracted on a market basis because of
a growing problem (P. Taylor pers. comm.).
There was general agreement among insurers that fishing vessels are more prone to marine
debris impacts than large ships. Fishing vessels are seen as an unattractive insurance risk for
19
large shipping companies and they tend to be covered by specialist mutual insurers such as
Shipowner protection and indemnity clubs (P&I clubs). Insurers of fishing vessels may be
more open than insurers of larger ships to considering the impacts of marine debris on fishing
vessel insurance.
2.2.4 Summary of industry impacts
In summary, the best available estimates of direct damage from marine debris are from two
sources. From data on the marine economy, the damage from marine debris on the fishing,
shipping and marine tourism sectors has a damage value of US$1.265 billion per annum in the
APEC region. The marine debris damage is estimated as US$364 million to the fishing
industry, US$279 million to shipping and US$622 million to marine tourism. Using APEC
fishing catch values data, an estimate of damage of US$268.2 million was made for the
fishing industry.
We would consider the estimates to be reconcilable, the gap being represented by the marine
economy estimate including marine tourism, usually a larger segment of the marine economy
than shipping, and also small vessel activity. As a scoping figure estimated on best available
information, the total direct damage from marine debris to industries in the APEC region is
US$1.265 billion per annum in the APEC region. As previously discussed this does not
include indirect costs and impacts on non-market values.
2.3 Conclusions and recommendations
The study found there are a range of direct, indirect and non-market economic impacts of
marine debris on government, communities and the fishing, transportation, tourism and
insurance industries. From the information supplied, six case studies in APEC economies
were prepared.
Economic data on the damage caused by marine debris needs to be collected by industry and
government so as to help control the impacts of marine debris. At the coastal level all across
the APEC region, municipal authorities and harbours spend funds cleaning up debris. This
sum needs to be determined, so as to make clear how much marine debris clean up costs
society. The effectiveness of expenditure can then be increased through larger scale
cooperative national or regional initiatives.
The total APEC GDP in December 2008 was US$29 329 billion at current prices (DFAT
2008). The value of the APEC marine economy, as reported in a previous APEC Marine
Resource Conservation (MRC) study, is approximately 3% of total GDP, a sum of US$879
billion at 2008 price levels. Within this, the total APEC GDP for the fishing, shipping and
marine tourism sectors is estimated at 48% of the marine economy, US$421.9 billion. It is this
US$421.9 billion of GDP generated by marine industries that is vulnerable to being impacted
by poor control of marine debris in the APEC region.
From data on the marine economy and debris damage estimates from Japan, the damage from
marine debris on the fishing, shipping, and marine tourism sectors is estimated to have a
damage value of US$1.265 billion in the APEC region. The marine debris damage is
estimated as US$364 million to the fishing industry, US$279 million to shipping and US$622
million to marine tourism. Japanese fishing studies indicate that, within the shipping industry,
marine debris has a greater impact on small vessels than on large ones.
20
Using a different data set of fishing catch values in the APEC region, an estimate of damage
of US$268.2 million was made for the fishing industry. This supports the previous estimates
made from aggregate marine economy data.
The study makes the following recommendations on targeted application of economic
measures to address marine debris by APEC economies:
Recommendation 1: APEC economies prioritise the inclusion of measures to prevent
debris from land-based sources entering the sea in new and amended marine and coastal
sectoral and integrated policies and management plans. This action would require joint
action between marine agencies and municipal and government authorities in charge of
land waste to work together on reducing land debris and hence marine debris.
Recommendation 2: APEC economies establish and implement an information system
and guidelines for monitoring the national cost of cleaning up marine debris involving
data from national, state and municipal government levels. Industry could also contribute
information to this system, including data on the costs of damage from marine debris. This
information would enable a more effective allocation of resources to be made nationally
on debris issues.
Recommendation 3: Industries within the APEC economies should consider the use of
paper and biodegradable packaging materials in place of plastic materials to reduce the
load of debris entering the marine environment.
21
PART 3. An economic-based model to estimate the costs
and benefits of controlling marine debris for communities,
governments and industries in the APEC region
Using available data, develop an economic-based model to estimate the costs and benefits of
controlling marine debris for communities, governments and selected industries (fisheries,
shipping and transport, tourism, insurance) in the APEC region.
3.1 Method
In this section, two economic modelling approaches to analysing the economic benefits and
costs of controlling marine debris are used. Both approaches use the conceptual model of the
debris cycle in Figure 1, to illustrate the costs and benefits of intervention at alternative points
of the debris cycle.
The first approach compares the marginal costs and marginal benefits from altering the level
of prevention and clean up considering the stock levels of debris. This approach has not
previously been applied to the understanding of marine debris. The second approach uses
benefit-cost analysis to compare the net benefits of different options for controlling marine
debris.
3.2 Results
3.2.1 The costs of control
The total annual costs of prevention or clean up of marine debris increase with the amount of
prevention or clean up activity being undertaken. The cost of a sustained reduction in the
stock of debris by one unit, either through a sustained program of prevention, or of clean up
activity, is referred to as the marginal cost
9
(MC).
The marginal cost of prevention or clean up increases with the level of activity. As more and
more debris is prevented from joining the stock, the cost of preventing the addition of another
unit of debris to the stock rises; and as the stock of debris declines, and debris becomes more
inaccessible or harder to locate, the cost of cleaning up an extra unit of debris also rises.
A cost effective program of reducing the stock of marine debris would strike a balance
between the levels of prevention and clean up activities which equated their marginal costs.
Such a balance would ensure that an extra dollar of program expenditure would have the same
impact on the stock of debris irrespective of whether the dollar was allocated to prevention or
to clean up activity.
In these circumstances the marginal cost of debris stock reduction can be referred to without
specifying the method of stock reduction employed. Figure 3 indicates the expected
relationship between the marginal cost of stock reduction and the stock of debris. It indicates
that the marginal cost of stock reduction is lower in the presence of a large marine debris
stock. As the stock of marine debris reduces, the cost of further reductions through increased
levels of prevention and clean up is likely to rise. It is also worth noting that because marine
9
The additional cost of prevention or clean up of one additional tonne of debris.
22
debris is diverse in nature, these conceptualised relationships will vary with different debris
types. For example the marginal cost per tonne of retrieving deep sea derelict fishing gear
would be represented by a higher schedule than for the marginal cost of cleaning coastal
marine debris.
Figure 3: The marginal cost of prevention and clean up.
What level of stock of marine debris is efficient from an economic point of view? The
relationship between marginal cost and the level of the stock suggests that preventing or
removing marine debris so as to reduce the stock level towards zero would involve
successively higher marginal costs. Totally clean seas would cost a great deal to achieve, and
annual expenditure to this end would need to be balanced against the annual benefits from
maintaining a lower stock of debris.
3.2.1.1 The benefits of controlling marine debris
The benefits of controlling marine debris are measured as the reduction in the annual damage
costs attributable to the stock of marine debris. This is due to the avoided cost nature of
marine debris.
The relationship between the total annual damage cost and the size of the stock of marine
debris is illustrated in Figure 4, and the marginal damage cost is illustrated in Figure 5. Figure
4 shows that the total annual cost of damage is highest when the stock of marine debris is
high. However, the total damage cost function is rising at an increasing rate. At stock level
‘X’, the marginal damage cost (MDC) is the change in the total damage cost as a result of one
extra unit of debris being added to the stock. Figure 5 illustrates the marginal cost of damage
as a function of debris stock size. This figure indicates that, as the stock of marine debris
increases, the annual damage cost imposed by each unit of debris added to the stock becomes
steadily higher.
Marginal
clean up or
prevention
costs
$pa/tonne
Marginal
cost
Stock of debris (tonnes)
23
Figure 4: The annual total damage cost caused by the stock of marine debris.
Figure 5: Annual marginal damage cost of marine debris.
3.2.1.2 The optimal volume of marine debris
The two relationships (annual marginal cost of prevention/clean up and annual marginal
damage) previously identified, are the two key control and economic decision making
relationships for policy makers. In Figure 5 marginal damage rises as the stock of debris
increases. Since the marginal benefit of prevention/clean up is the avoided marginal damage
cost, the marginal benefit of prevention/clean up falls as the stock of marine debris falls.
Figure 6 combines the marginal benefit and marginal cost functions and indicates the optimal
sustained level of marine debris at stock level ‘Q*’.
Stock of debris
(tonnes)
Annual
marginal
damage
$ pa/
tonne
MDC
X
Total annual
damage
$ pa/tonne
Total
damage
cost
MDC
X Stock of marine
debris (tonnes)
24
Figure 6: Optimal stock of marine debris showing marginal cost (MC) and marginal benefit (MB).
It would not pay to reduce the marine debris stock below this level because the extra annual
cost of the prevention/clean up measures required to reduce the stock by an extra unit would
be higher than the additional annual benefit (avoided damage cost) generated by the additional
debris control measures.
It is likely that ‘Q
c
’ illustrates the initial level of the marine debris stock (relative to the
optimal level) in the APEC region. Here, at ‘Q
c
’, the annual marginal cost of clean
up/prevention required to reduce the stock of debris by one unit is less than the annual
marginal benefit of the reduction in the debris stock (the extra damage prevented). The stock
of debris should be reduced to ‘Q*’, at which level marginal benefit equals marginal cost of
prevention/clean-up.
To the left of ‘Q*’ in Figure 6, the marginal clean up or prevention costs exceed the marginal
damage cost and a larger marine debris stock is economically efficient under this framework.
The model is indicating that, given the costs and benefits described, it is unlikely that zero
marine debris will ever be an efficient objective from an economic viewpoint. However,
containing the marine debris stock at an optimal level is a realistic goal which efficiently uses
resources. Without highly detailed modelling, we are unable to specify the optimum marine
debris stock level. However, a simple example to illustrate the issue is given in relation to
Figure 7.
$ pa/
tonne
MC
MDC=
MB
Stock of marine
debris (tonnes)
Q
c
Q*
25
Figure 7: An ecotourism vessel in Nha Trang Harbour, Viet Nam (Photograph: A. McIlgorm) .
The photograph in Figure 7 shows up to seven pieces of marine debris of different sizes. Is
this more or less than the economic optimum? Taking some pieces away would involve
general debris clean up of the harbour with a marginal cost, but there would also be a
marginal benefit by reducing the level of debris and therefore, damage. In practice the
marginal damage is measured approximately ‘by eye’ (see the Hong Kong case study at
Appendix 4). A proposal to clean all the debris in the harbour would have a high marginal
cost and may exceed the marginal benefit. It is likely that the optimum economic level of
marine debris would leave some debris, given the high marginal cost of cleaning the last unit
of debris. This is one reason we should not put debris into pristine marine areas. There will be
a very high cost to remediate the environment back to a pristine standard. The economically
optimal standard will have some debris.
3.2.1.3 Economic decisions and the control of marine debris
Often the economics of marine debris control is over simplified to an assessment of finding
the lowest clean up cost per tonne. The economic decision to intervene with clean up action is
often made from necessity with little consideration of alternatives.
In the longer term it is desirable to compare the benefits from spending additional funds on
prevention. This will take cooperation on a wider area or national scale. The stock flow
approach indicates that when the total stock of marine debris is low, then a local approach
may be adequate, but this will become more expensive and more inefficient as global debris
stock grows. For example in Hawaii,
... in 2006, the project transitioned from a large-scale clean up aimed at removing
historical accumulations of debris to a maintenance mode effort aimed at keeping
pace with annual accumulations. We have since learned that our maintenance mode
effort is not keeping up with annual accumulation (estimated at 52 metric tons per
year), and that remains a gap (Seema Balwani, NOAA).
26
The two control variables for economists and policy makers to use in reducing the stock of
marine debris are prevention and clean up. Two principles are recommended:
1. in any control program the marginal costs and marginal benefits of spending resources
on prevention and clean up, should be compared, and
2. annual clean-up and prevention activities should be carried to the point at which their
marginal costs are equalised.
For example, suppose a small coastal local authority has to find an additional $10,000 per
annum to be spent on marine debris stock reduction. The short-term response is to spend the
funds on clean up. This cannot continue each year and links with national debris prevention
initiatives need to be made. A strategy of contributing additional funds with many other local
authorities to increase debris prevention in an adjacent polluting city estuary, may reduce the
marine debris load coming down the coast giving several communities additional clean up
costs. The example suggests that at times one marginal dollar spent on debris prevention on
the land/sea may yield marginal savings of greater than one dollar when clean up costs are
considered. This would represent an economy that could be gained by greater prevention. The
link between sources and deposits of marine debris is important in assessing the economics of
alternative interventions.
3.2.1.4 Economic costs and benefits and the control of marine debris
The cost of cleaning up marine debris is important in developing economic strategies for
controlling marine debris. Marine debris is not a uniform waste product and the cost of clean
up varies with the type of debris, the location and the methods used. Clean up costs are
expressed in dollars per cubic metre, dollars per kilometre of coast or beach, or preferably
dollars per tonne. In this section we wish to derive an average clean-up cost per tonne for use
in generating APEC economy estimates.
Clean up cost data estimates in the APEC region range from $100/tonne under volunteer
labour (Hwang and Ko 2007) to $25,000/tonne for derelict fishing gear (Raaymakers 2007).
Cho (2005) and (Hwang and Ko 2007) report an average clean-up cost of US$1,300 per tonne
over a six-year period. These values are confirmed by data from outside the APEC region.
Outside of the APEC region, Kalaydjian et al. (2006) report 11 sites along the French coast as
having between 400 kg and 4.0 tonnes of debris per kilometre of shoreline, the highest density
being in the Mediterranean. The cost of mechanical cleaning up was estimated at €4000 per
kilometre or €1000–10,000 per tonne in 2003 (US$1,140–$11,400). Manual collection is
twice the cost of mechanical clean up (Kalaydjian et al. 2006).
From available cost information, the average cost of clean up in the APEC region for typical
shoreline clean up is approximately US$1,500 per tonne in 2007 terms. This is likely an
under-estimate for urbanised areas in developed countries and an over-estimate for less
developed countries.
27
3.2.2 Benefit-cost analysis
Benefit-cost analysis is a technique for undertaking an economic appraisal of a proposed
project or program. Any expenditures on scarce resources, whether of a capital or recurring
nature, involve an opportunity cost—the value of the goods and services which the scarce
resources could have produced in alternative uses. The benefit-cost analysis compares the
value of the output of the project with the value of output which the resources involved could
have produced in their alternative uses. Benefit-cost analysis relates to economic and
environmental impacts analyses.
First, an economic impact analysis measures the effects of undertaking a project on GDP or
gross regional product (GRP). All expenditures have an impact on economic activity (GDP or
GRP) through the market system and the associated multiplier effect, but these expenditures
should not be confused with net benefits.
An example presented by Kirkley and McConnell (1997) illustrates this point. Suppose that
beach ‘A’, which involves $50 in travel cost per visit, is closed because of marine debris;
consumers now switch to visiting beach ‘B’ which offers identical recreational benefits,
although it is further from the city and involves a $55 travel cost. The cost of the marine
debris is the extra $5 per beach visit, whereas the economic impact may well be zero: the
original $50 travel expenditures—on fuel, food, accommodation—continue and the extra $5
expenditure is diverted from some other part of consumers’ budgets.
An environmental impact statement is a detailed analysis of the physical effects of the
proposed project or program. Examples of these effects include changes in pollution levels,
habitat extent, and wildlife populations, expressed in physical units such as percentage of
dissolved oxygen, hectares, or biomass. While measured in physical units, these changes
affect economic welfare and should be included in the benefit-cost appraisal in terms of dollar
costs or benefits, an issue which will be discussed further.
3.2.2.1 Benefit-cost analysis and marine debris
An economic appraisal reveals whether the value of the benefits of a proposed project or
program exceeds the opportunity cost. In other words, it indicates whether allocating
resources to the project generates more value, in terms of the project output, than the value the
additional goods and services the resources would have produced in their alternative uses. The
appraisal can also contribute to the design of the proposed project; to maximise the net value
of the project or program its various elements should be extended to the point at which
marginal benefit equals marginal cost, but not beyond that. This point has already been
illustrated by Figure 6.
In calculating the MC and MB for comparison, the inclusion of non-market and other values
in the analysis must be addressed. A pragmatic approach in a world where little such
comparison is undertaken is to start with market costs and see where the optimum level is.
The inclusion of more non-market values will increase the marginal benefit and give an
analysis with a lower target debris stock level.
A benefit-cost analysis of a program of reducing marine debris starts by identifying the
benefits and costs. The benefits consist of ‘avoided costs’—the reduction in costs imposed by
marine debris which will occur as a result of the reduction in the volume of marine debris
achieved by the program. Such cost reductions include lower costs to shipping, fisheries, and
28
recreationists (such as preventing the extra $5 travel cost identified in the beach example
described above) as well as more general environmental costs associated with damage to
coastal ecosystems.
Some of the costs of prevention or removal of marine debris can be measured by market
prices. For example, an expansion of refuse collection and storage facilities may involve
improved stormwater disposal systems, more landfill sites, and storage facilities on vessels
and at docks, while removal of debris will involve labour and equipment. These costs of the
program, consisting of the opportunity costs of the scarce resources involved, are generally
measured by the market value of the resources allocated to the program. In some situations
resources may be over-priced (eg, otherwise unemployed labour) or under-priced (eg, carbon-
emitting fuels) by the market, and will need to be shadow-priced in the program appraisal.
Other costs are not directly measured by the market although market prices may allow an
indirect measure to be generated. Less readily measured by market prices are the adjustment
costs faced by consumers when, for example, they substitute reusable bags for plastic grocery
bags.
Having identified the types of benefits and costs involved, a benefit-cost analysis of a
program of marine debris removal would proceed to value these in dollar terms. Some outputs
or inputs would be valued at market prices, some would be valued at market prices adjusted
for those imperfections which drive a wedge between market price and marginal benefit or
marginal cost, and some would be valued using non-market valuation techniques based on
revealed or stated preference approaches.
The summary measure of the performance of the program is the present value of the net
benefit stream, where net benefits are expressed in dollars, but measured in the ways
described above. If the net present value is positive, adopting the program will increase
economic welfare, in the sense that the gains associated with the program exceed the losses
that would be imposed. In principle the gainers could compensate the losers and still remain
better off. This criterion of welfare gain is known as the Kaldor-Hicks criterion and it is the
basis of recommendations based on program appraisal by means of benefit-cost analysis.
3.2.2.2 A hypothetical example of distributional issues impacting on marine debris
mitigation
A conceptualised model of marine debris circulation among three economies, A, B and C, is
shown in Figure 8. The ocean circulation distributes the stock of marine debris among the
three economies as well as in the high seas. It is often assumed in policy that each economy
will compare its costs and benefits independent of other economies, which may be true in a
case where there is little ocean water movement as any interactions are reciprocal. In Figure 8
the prevailing tides and currents means the amount of marine debris deposited in each
economy is different, as indicated by the shaded area on each island economy.
In Figure 8 the prevailing ocean circulation leads to less marine debris being deposited on the
shores of economies A and C, and more in economy B. This represents a net transfer of
marine debris from economies C and A, to B. Given that the deposited debris comes via the
stock in the ocean which is in common, unequal deposits from the common stock can cause
potential inequity issues between economies, and can lead to slower and more costly policy
development.
29
Figure 8: Marine debris held in common waters between three adjacent marine island economies with prevailing
ocean circulation (shaded arrows) which impacts the level of marine debris deposited from the ocean (shaded
areas) in each economy. The shaded rectangle in each island economy represents the level of debris experienced
by each economy.
If economies A, B and C each engage in debris control measures, with their associated costs,
they will each benefit in the form of reduced damage costs. However, because of the
prevailing ocean currents, the benefits may not be in proportion to the costs incurred. For
example, the following table of hypothetical data shows the distribution of benefits (reduced
damage costs) and costs (control costs) of a proposed marine debris reduction program
involving the three economies.
Table 6: Distribution of benefits and costs of marine debris control.
Economy Control costs Reduced damage
costs (benefits)
Benefits net of costs
A 300 (0) 250 (10) -50 (+10)
B 200 (200) 260 (210) +60 (+10)
C 150 (150) 160 (140) +10 (-10)
Total 650 (350) 670 (360) +20 (+10)
It can be seen from the values (unbracketed) in Table 6 that it is not in economy A’s interests
to participate because the benefits it receives are lower than the costs it incurs. If A does not
participate, but economies B and C were to go ahead with their own debris control measures,
the total benefits and costs of the amended program would be lower and might be distributed
as shown by the values reported in brackets in the table. Now it can be seen from the
bracketed values that it is not in economy C’s interests to participate. If economy C drops out
of the program there will be a further reduction in benefits to economy B which may lead to
economy B dropping out as well. As a result, a series of measures which are to the general
good of the three economies are not undertaken because of self-interest and the distribution of
program benefits and costs. Self-interest can be expected to endure, but the distribution of
benefits and costs can be altered by a cooperative program involving inter-economy transfers
A
B C
Prevailing
Current
Prevailing
Current
Marine debris in
common waters
30
so that it is in all economies’ interests to participate. This example underlines the importance
of estimating and reporting the distribution of benefits and costs among participants when
evaluating a proposed marine debris control program.
The practical implications of this example are that cost-sharing agreements between
economies to reduce marine debris levels will require significant negotiation where tidal
patterns and water movements are complex. The hypothetical data in Table 6 also shows that
in some circumstances it may seem irrational to work together. These difficulties in allocating
clean up costs between economies reinforce the view that each economy should reduce their
marine debris at source by national prevention programs.
3.3 Conclusions and recommendations
Two economic models were used referencing the conceptual model of the debris cycle in
Figure 1. The first approach compares the marginal costs and marginal benefits from altering
the level of prevention and clean up, considering the stock levels of debris. The second
approach uses the benefit-cost analysis to compare the net benefits of different options to
control marine debris.
In the first model the stock-flow lifecycle is used to analyse the marginal costs and marginal
benefits of the debris control problem. Two principles for debris control are proposed: In any
control program the marginal costs and marginal benefits of spending resources on
prevention and clean up should be compared (this prevents wasting resources); and the
annual clean-up and prevention activities should be carried out to the point at which their
marginal costs are equalised.
Generally, as an avoidable cost, the cost of marine debris clean up is greater than the cost of
prevention. Debris entering the sea can be limited by technical boom devices across rivers and
estuaries. The collation of information about the costs and benefits of such devices is
prioritised. The model assumes all debris has a similar rate of decomposition. Replacing
plastics with paper will reduce the marginal damage cost and reduce the amount of residual
marine debris.
The second approach is cost-benefit analysis. Actual clean-up costs were obtained, though the
costs of prevention are less available, possibly residing in land-based government or waste
management agencies. For a given project program the net benefits are appraised. The study
contacted APEC economies for examples of the costs and benefits in marine debris control
policy and these six case studies are presented in Appendix 3. These case studies showed
signs of innovation, in the face of increasing marine debris and derelict fishing gear issues,
but there is usually only a minimal amount of economic data available for use in the control
process.
To illustrate how benefit-cost analysis can assist marine debris clean up operations in waters
held jointly by three states, a hypothetical case is shown that illustrates that while cost sharing
of clean-up operations is advocated for potential cost savings, its effectiveness may be
reduced by different incentives accruing to each of the participating economies.
Recommendation 4: Information on the impacts of marine debris on the non-market
values of the marine environment is limited and requires site-specific studies in APEC
economies.
31
Recommendation 5: APEC economies should attempt to record weight or volume
units of measurement from any marine debris prevention and clean up cost data to
calculate the cost per tonne, or cost per cubic metres m
3
.
Recommendation 6: APEC economies should introduce arrangements for return of
debris and fishing gear into harbour waste reception facilities at ports, including low
cost recycling arrangements or disposal for old fishing nets and fishing gear.
Recommendation 7: MRCWG should liaise with appropriate representatives from the
insurance industry to encourage them to collect data on accidents and incidents caused
by marine debris.
32
PART 4. Identify economic incentives and other measures
that are targeted at policy makers to prevent or mitigate the
impacts of marine debris
Identify economic incentives and other measures (where appropriate) that are targeted at policy
makers, managers and/or-marine based industries within the APEC region to:
a. limit or prevent the incidence of marine debris, and
b. direct available resources to effective mitigation of the impacts of marine debris.
4.1 Methods
Marine debris has normally been controlled by regulations. Alternative control measures for
controlling marine debris were sought. Each economy was contacted regarding their
experience in regulating marine debris and alternative approaches. Case studies which
involved the measurement of the costs and benefits of controlling marine debris were
requested from APEC member economies.
Use of economic incentives in controlling marine debris is a new development. The natural
resource and other literature was investigated to identify different economic instruments and
how these could apply in controlling marine debris.
4.2 Results
The economic incentives to control marine debris come from the fact that debris is avoidable,
and therefore damage and clean up costs can be reduced. Stopping debris entering the marine
environment has a double cost saving. Economic instruments can be part of the measures to
control marine debris, being potentially most effective in addressing prevention of debris.
Much of this marine impacting activity requires policy changes on land.
4.2.1 Economic responses to marine debris impacts
There are different approaches to controlling environmental issues. These involve regulation
(authority), market instruments (exchange), community (persuasion) (Stavins 2003; Martin
2006), management measures, and imposition of technical and operational procedures.
4.2.1.1 Regulation and marine debris
Regulation has been the favoured approach of governments in reducing marine litter due to
the public good and common property nature of the debris in the sea. In the last two decades
market instruments have been introduced to environment and resource management planning,
problems and policy responses (Martin 2006). Some market instruments have been used in
controlling marine debris, although there is limited literature on this method. The community
has been encouraged to be involved in public beach clean-ups by NGOs. The literature
suggests that in addition to a core of regulation, there is a range of diverse policy tools that
can assist the control of marine debris as reported in Table 7. Few of these have had explicit
economic content and are presented to give context to the use of market-based instruments.
33
A step-wise policy development process is recommended by Hoagland and Kite Powell
(1997):
1. disposal standards (prohibitions on littering)
2. provision of disposal facilities
3. tax/subsidy programs
4. moral persuasion
5. education programs
6. beach clean ups, and
7. research.
The need is also to prevent and minimise marine debris creation.
4.2.1.2 Economic instruments
Using economic instruments to control marine debris has received relatively little attention,
possibly due to the avoidable cost nature of the issue which may lend itself to regulation,
rather than the remedial use of economic instruments. In many areas of policy, market-based
instruments (MBIs) are developed to use the market mechanism to create incentives and
disincentives to bring about more positive environmental outcomes. ‘MBIs allow any level of
pollution clean up to be realised at the lowest overall cost to society’ (Stavins 2003).
‘Most applications of MBIs have been at the input or emission point of regulatory
intervention, although few have focussed on ambient concentrations’ (Stavins 2003). Wide-
based source pollutants are more difficult to address due to the disconnect between the
pollutant and the source or sources. Marine debris is impacted by this non-point-source issue.
MBIs can be categorised as charge systems, tradable permits, market friction reductions and
government subsidy reductions (Stavins 2003). Different types of MBIs used in general
environmental policy are shown in Table 8.
34
Table 7: Summary of the types of debris from each of the major land- and ocean-based sources, and options for control (references as stated).
Source of debris Types of debris Control mechanism Source
Discharges of
stormwater
General litter, paper, plastics, construction
material, woody debris
Litter traps to prevent litter entry at outfalls or use floating fences (McKay and Marshall 1993; Cho 2005)
Waste facilities (including facilities for the collection of recyclable
material) on streets and beaches
(McKay and Marshall 1993; Topping
2000; Gordon 2006)
Education (Gordon 2006)
Municipal landfills General litter, paper, plastics Better designed land-fills (Topping 2000)
Update regulations for land-fills to include controls to minimise debris
release
(Gordon 2006)
Address littering caused during transport of litter (Gordon 2006)
Industrial activities Resin pellets, oil drums Reduce discharges of raw materials through increased enforcement
of stormwater regulations
(Gordon 2006)
Encourage the substitution of packaging materials (Slater 1994; Gordon 2006)
Encourage commercial waste audits to reduce waste (Topping 2000)
Coastal tourism General litter, food waste, food packaging,
cigarette butts, plastic toys
Beach/reef clean up (Topping 2000; Sheavly 2007)
Provision of waste facilities (eg, bins on public beaches) (McKay and Marshall 1993; Hall 2000;
Topping 2000; Gordon 2006)
Install litter traps on waterways known to contribute to beach debris (McKay and Marshall 1993)
Education and tourist information notices (Hall 2000; Gordon 2006)
Local authorities define litter management standards for beaches (Hall 2000)
Increase enforcement of anti-littering laws (Gordon 2006)
35
Commercial fishing
vessels
Derelict fishing gear (nets, lines etc), floats,
buoys, general litter, buckets, rope,
Education (Kiessling 2003; Allsopp et al. 2006)
Law enforcement (Allsopp et al. 2006)
Biodegradable gear (eg, pots with sections that will break down,
plastic-free bait boxes)
(Slater 1994)
Incorporate debris management requirements into fisheries
management plans
(Kiessling 2003)
Ensure adequate waste reception facilities in ports and marinas (Recht and Lasseigne 1989; Gordon
2006)
Retrieval of gear at sea (as clean up) (Cho 2005)
Provide incentives to fishermen to retrieve gear or return damaged
gear to port
(Kiessling 2003; Cho 2005; Raaymakers
2007)
Mandatory reporting/logging of lost gear (Kiessling 2003; Brown and Macfadyen
2007)
Mandatory tagging or coding of gear to allow identification of source (Kiessling 2003)
Attachment of tracking devices to gear (Brown and Macfadyen 2007)
Recycling of nets (Recht and Lasseigne 1989)
Merchant shipping,
ferries & cruise liners
General litter, food waste Ensure adequate waste reception facilities in ports (ANZECC 2003; Gordon 2006)
Recreational boating Fishing debris (nets, line, lead etc.) General
litter
Ensure adequate waste reception and recycling facilities in areas
used by recreational boaters
(Gordon 2006)
Introduce waste minimisation strategies into boating curriculum (Gordon 2006)
Table 8: Different types of market-based instruments (Stavins 2003; Department of Agriculture, Fisheries and
Forestry (DAFF) 2008).
Category and instrument Brief explanation of general principle
Charge systems Assign a price to desired environmental outcomes
Effluent charges Payment of fees to pollute
Deposits-refund systems Repay a deposit for items returned
User and administrative charges Product disposal and municipal costs
Auction or tender Of a right to create pollution
Tax incentives/differentiation Tax rebates for collection or waste prevention
Sales taxes To restrict use of inputs and generate revenue
Insurance premium taxes Oil tankers asked to take additional insurance
Tradable permit system Deciding on a quantity limit
Create a right A right for trading a pollution quantity
Cap and trade A limit on pollution forcing trade
Credit programs Use of environmental credits
Offsets Alternative areas used to meet quota obligations
Reduce market friction Improve how markets function
Market creation /conservation
agreements
Creation of voluntary exchange systems to reduce
pollution
Levering private investment May be elements with private sector benefits
Liability rules and risk Firms consider the damage from their actions
Product differentiation Market premium for eco-labelled products?
Revolving funds Buying capital areas to protect
Government subsidies May be used to address environmental problems
Reducing government subsidies Can be reduced to provide an efficiency gain
There are a range of economic instruments that have not generally been applied to marine
debris policy. Their use to control marine debris will be examined later in the report.
4.2.1.3 Community
The community role in marine debris policy comes from the widespread impact of debris
once it enters the sea, eventually falling on many coastlines and beaches. While regional
37
municipal government often have responsibility for coastal clean up, the available resources
leave ambient levels of debris that over time have attracted the attention of community
groups. The collective action of community groups including non-government organisations
is a feature of the APEC countries being assisted by many international initiatives.
Programs established by the Ocean Conservancy such as International Coastal Cleanup (ICC)
(www.coastalcleanup.org) involved 100 countries and 5.9 million participants in 2004. With
the beach clean up also came data recording via an international data card for recording
debris. Other special days such as World Environment day and Clean Up the World day
(www.cleanuptheworld.org) also led to beach clean ups by the community. Table 9a shows
the effort of communities in the ICC day 2007 in 19 APEC economies.
Table 9a: The participation and quantity of rubbish removed and area cleaned, on land and underwater, in the
ICC day 2007 (Source: ICC 2007).
APEC Economy*
People Kgs Kms Peop le Kgs Kms People Kgs Kms
Australia 190 1,922 2,1 86 26 0 579 161 450 2,501 2,347
Canada 28,708 100,173 5,058 429 6,125 33 29,137 106,298 5,091
China 232 432 23 - - 232 432 23
Hong Kong, China 396 495 1 58 175 56 454 670 57
Indonesia 179 79 6 14 11 7 552 23 296 1,348 37
Japan 15,930 34,056 46 520 3,219 2 16,4 50 37,275 48
Korea, Republic of 4,361 1 07,301 27 311 6,556 1 4,672 113,857 28
Malaysia 710 1,678 1,701 289 1,404 17 999 3 ,082 1,718
Mexico 7 ,842 76,773 1,805 168 5,752 45 8,010 82,525 1,850
New Zealand 35 426 3 55 178 43 90 604 47
Peru 2,500 4,659 4 2,500 4,659 4 5,000 9,318 8
Philippines 50 ,526 114,079 350 721 3,182 51 51,247 117,261 400
Russia 32 4 5 0 32 45 0 64 89 1
Singapore 3,032 10,13 2 27 5 0 27 5 3,082 10,159 32
Chinese Taipei 193 1,281 732 98 810 91 291 2,092 823
Thailand 3 ,186 7,184 2,297 319 3,322 126 3,505 10,506 2 ,422
United States 187,454 1,772,51 3 15,712 2,74 2 22,751 559 190,196 1,795,264 16,271
Vietnam 16 2 2 11 1 6 22 11 32 44 23
Totals 305,522 2,233,968 29,998 8,685 59,358 1 ,228 314,207 2,293,326 31,226
* No entry for Brunei Da russalam, Chile, Papua New Guinea
Land Underwater To tal
The contribution of NGOs is clearly seen in each of the APEC economies. This can be valued
on the basis of the imputed value of a volunteer day multiplied by a shadow price for a day’s
volunteer’s labour. For example, for the 314 207 persons volunteering one day this has a value
of US$15.71 million @ US$50 per day, a value of US$31.42million @ US$100 per day, and
a value of US$47.13 million @ US$150 per day as reported in Table 9b. Given there was
2284 tonnes of debris collected, this had an average clean-up value per tonne of between
US$6879 and US$20 636 per tonne, depending on assumptions.
Table 9b: The value of total volunteer days and the average cost of clean up per tonne at three shadow labour
rates using the ICC day 2007 data in the APEC region (ICC 2007).
Category Labo ur value 1 Labour value 2 Labour value 3
Persons/Volunteer days 314,207 314,207 314,207
Inputed $ per day of labour 50$ 1 00$ 150$
Total value of labour 15,710,350 31,420,700 47,131,050
Tonnes of debris collected 2,284 2,284 2,284
Average cost per tonne 6,879$ 13,758$ 20,636$
38
The commitment of many people in cleaning debris from beaches on a volunteer basis is a
significant contribution to the removal and containment of marine debris. The cost of
collection by NGO volunteers has a monetary value, even though zero rated by the volunteers.
It is important that data is collected on volunteers and time used in clean up, so that this
policy alternative is properly costed by policy makers. In the APEC region, as Table 9b
indicates, on International Coastal Cleanup day the shadow value of labour was likely
US$31.42 million. This is a large contribution to the region’s clean-up expenses.
The community also produces some alternative approaches to marine debris control. Topping
(2000) suggests from the Canadian experience that,
The majority of marine debris is released as a result of human behaviour—such as
littering or dumping—behaviour which has been historically accepted in many
communities. Community-based initiatives are often the most effective means to
address environmental issues, including marine debris, but require support to build
and maintain networks and have access to sound science. It requires a set of strategies
for behavioural change.
Other community policy alternatives call on moral suasion and designing policies that reduce
the cost of ‘doing the right thing’. For example, garbage pick up facilities can be designed and
located in a way that increases the amount of garbage collected.
Some of the Asian experience points to a need for increased community understanding and
awareness of marine debris issues (Ohkura and Kojima 2006). Education is also a significant
way to improve behaviour in the long term and Japanese schools have involvement in
programs. Japanese and Korean experience points to prompt information sharing on marine
debris which can make government and non-government clean up response much more
effective (Tanaka 2006; Jung 2007).
4.2.1.4 Enforcement
A major problem identified in the potential application of many regulatory marine debris
policies, is their dependence on enforcement. Table 10 reports an overview of different areas
where marine debris is found, the responsible enforcement agency and a ranking of
enforcement capacity to address marine debris issues.
Enforcement at sea tends to be costly, and while technical advances linking debris items to
their sources can raise the effectiveness of enforcement in some situations, marine debris
monitoring would require high levels of observer coverage. The cost of enforcement is an
economic cost of any regime and may differ between debris control methods.
39
Table 10: Areas where marine debris is found, the responsible enforcement agency and a rating of enforcement
capacity.
Location of debris Responsibility Enforcement
capacity
Comment on enforcement
Urban landfill Municipal authority High -by land
authorities
Land legislation can be applied
Harbour (internal
waters)
Port authority High -by Port
authority
Port legislation can be applied
Urban coastline Municipal authority/rural
councils
Lower - by land
authorities
Lower in rural coastal areas
Tourist coastline Tourism venture/ rural
council
Low Private beach resort may clean
debris
Residual coastline Rural town councils Low Rural communities are
recipients of debris
Inshore of 3 or 12
miles
National responsibility Low Coastal patrols may intercept
vessels
Outside of 12 nmiles in
EEZ
National responsibility Very low Occasional vessel interception
Outside EEZ International conventions Negligible Require record keeping but are
‘self enforced’ at sea
4.2.2 How can economic instruments add to current marine debris controls?
There have been few MBIs that have been used directly to control marine debris. The existing
instruments tend to be applied in the management of land debris. The potential of each
market-based instrument to be involved in the control of marine debris was examined for their
potential to control marine debris. Some measures are recommended, others are recommended
as secondary instruments that could be part of a mature system and finally some instruments
were not felt to be appropriate for the control of marine debris.
1. Recommended: Deposit-refund systems, user and administrative charges, sales taxes
and cost sharing.
Deposits-refund systems A deposit system on drinks containers can have a refund condition
to minimise the loss of containers to debris. Deposit systems can also ensure 100% recycling
while reducing marine pollution. This also transfers the cost of reducing litter to the drinks
manufacturer. This could be implemented to prevent marine debris.
User and administrative charges Municipal waste can be charged at a fixed amount, or on a
‘pay-as-you-throw’ system, where users pay in proportion to the volume of their waste and
the environmental damage. Product disposal can have special charges for car tyre recycling
and car battery disposal (Martin and Verbeek 2006). This system can reduce the generation of
debris that may ultimately have become marine debris. Implementing systems where new
40
charges apply for disposal of municipal debris requires education, fines and enforcement to
detect non compliance problems.
Sales taxes Sales taxes can be applied to products with environmentally damaging contents
(ozone depleting chemicals etc). Taxes on plastic bottles and plastic containers could reduce
the use of plastic, and force innovation in alternative cardboard packaging. For shipping,
implementing payment of a fee at port for vessel rubbish reception, whether it is used or not,
may ensure use of the reception facilities. Plastic bags and alternatives have a sales tax
applied in Denmark, the proceeds going to the general budget (Stavins 2003). A tax or ban on
plastic bottles was proposed by Kirkley and McConnell (1997) with paper being substituted
where possible. Sales taxes on other disposable items commonly found in marine debris could
be considered (plastic containers, aerosols etc). These are readily implemented by government
and can reduce marine debris.
Cost sharing Cost sharing agreements are made between parties to divide the total cost of a
future course of action into proportions to be paid where a municipality and a port authority
agree to divide the costs of debris clean up equally, or by some other agreed percentage, for
the coming year. In the international arena three neighbouring countries could negotiate cost
sharing the total costs of a joint remedial program. (Ha et al. 2006) The cost sharing
agreement can enable a single joint clean up operation to take place at less total cost than
three individual programs.
2. Recommended as a secondary design feature in more mature systems: Credit
programs, offsets, levering private investment, liability rules and risk, product
differentiation, market creation/conservation agreements, reducing government
subsidies, and tax incentives/differentiation.
Credit programs In a mature environmental or marine debris control scheme, government can
give credits for environmentally beneficial behaviour. Marine debris prevention could be
included in such a scheme.
Offsets An offset is a positive environmental action on an alternative location that
counterbalances the environmentally degrading issue at a given environmental site. The offset
action can be contracted to another party to perform. Total environmental outcomes can be
achieved at lower cost than by on-site mitigation. For example, a city has been identified as
the source of 500 tonnes of marine debris arriving annually on the coastline of local coastal
towns, who seek reimbursement for the clean up cost from the polluting city. The city could
offer to spend funds to prevent 1000 tonnes of debris per annum entering the water course in
the city. This may well be a more effective use of funds.
Levering private investment Cleaning up marine debris may also create commercially
attractive benefits to private investors (beaches and tourism) able to gain from a differentiated
product, such as a clean beach.
Liability rules and risk In industries with insurance and risk, such as shipping and fishing, the
adoption of industry practices to reduce the risk of damage from marine debris can reduce
insurance premiums.
Product differentiation Differentiating a product can alter incentives. A marine tourist resort
may advertise a clean ‘no marine debris resort area’. This can provide a commercial premium,
and maintain and improve visitation rates.
41
Market creation/conservation agreements These are voluntary legally binding agreements
with industry to keep pollutants as agreeable levels (DAFF 2008). A port authority may enter
such an agreement with government in respect of acceptable levels of marine debris, as a
condition of operating the port.
Reducing government subsidies Subsidies from government can promote inefficiency and
environmentally unsound practices (Stavins 2003). Most governments pay for cleaning up
marine debris and effectively subsidise those creating it, but also meet the gap caused by
market failure associated with marine debris. The intervention of government through
subsidised clean up needs to be reduced, with more emphasis being put on government
assisting the prevention of debris to reduce the clean up requirement.
Tax incentives/differentiation Tax deductions for the prevention of debris or rebates for
returned debris, could be considered by government. It is possible to investigate higher
taxation for items that cannot be recycled and subsidies for those that can be (Laist and
Liffmann, 2005).
3. Not recommended: controlling marine debris through tradable permits and cap and
trade systems and effluent charges. These are of less applicability to the APEC
economies due to implementation issues.
Tradable permit and cap and trade systems Permits to release a quantity of debris, that is, the
cap, are created to be a tradable right that could be purchased by emitters. However marine
debris is generally a non point source pollutant, as opposed to, for example, a large chemical
factory or power station. If applied to marine debris, a total quantity of marine debris, the cap,
would be set. Trading would ensure efficiency in allocation of the marine debris right,
providing the cap is enforced. The funds raised could be used for remediation. Tradable
permits and cap and trade systems are not applicable to most marine debris situations. While
the idea of being able to cap and subsequently reduce marine debris is appealing, the
fundamental identification of those generating marine debris makes this approach problematic
in most situations.
Effluent charges Charges can be applied at the point of waste generation, or entry to the
watercourse, if the debris is attributable to a specific source. Charges can be either fixed or
preferably related to the volume of debris. The ‘polluter pays principle’ creates an incentive to
reduce the discharge of debris, but may increase illegal dumping also (Stavin 2003). It has
long been accepted that an external cost, or market failure, can be corrected by applying a tax
that will internalise the external costs on to the polluter (Pigou 1920). The taxation approach
is, however, less applicable to controlling marine debris due to the difficulty in identifying
point source polluters generating marine debris.
4.2.2.1 Discussion
The use of MBIs for control of marine debris is a new development and overlaps with some
economic policies in use on land to control waste. Stavins (2003) does not consider marine
debris but, from other pollution examples given, there appear to be two key issues policy
makers should be aware of in trying to apply market-based policy instruments:
42
Firstly, if a pollutant can be regulated at a point source by input or
emission interventions, before it receives a great degree of mixing in the
environment, it is suited to MBIs. Secondly, intervention in the marine
environment may be ‘focused on ambient concentrations, at a minimum.
Marine debris does not generally meet the point source criterion. However the second
criterion assesses the density of marine debris by area or volume, and is a usual criterion for
commencing clean ups. For example the use of a technical boom device on rivers can gather
debris for removal before going into the ocean (Nam and Jung 2005).
Regulatory approaches to control marine debris have been popular as the governance system
is used to make rules restricting marine debris pollution. Such rules have low transaction
costs as people mostly comply. Community approaches to clean ups often come from the
voluntary non government organisation sector and getting people to work cooperatively in
clean up of marine debris involves high transaction costs.
MBIs for marine debris are in their infancy and need to be tested. MBIs are envisaged for a
range of environmental problems but,
…this should not leave the impression that market-based instruments have replaced,
or have come anywhere close to replacing, the conventional, command-and-control
approach to environmental protection (Stavins 2003).
We propose that some MBIs can play a selective role in the control of marine debris, given
the context of the control problem. They have potential gains in the prevention of land
generated debris. Trials are required to compare MBIs with the benefits from alternatives,
such as a preventative river boom. In some cases MBIs may not be economically viable for
the implementing authority, but may have external benefits though reducing avoidable costs
in the whole economy. MBIs could also be evaluated with regulatory and community
alternatives.
4.2.3 The benefits and costs of alternative marine debris policies
Due to the ‘avoided cost’ nature of the marine debris, benefits accrue when the level of
marine debris reduces. A program to clean up marine debris has an operational cost which can
be measured, but the measurement of the benefit from the program would require a specific
market and non-market valuation exercise.
We propose that the economic decision for the policy maker is given by a comparison of the
marginal costs and marginal benefits at the point where policy makers make decisions and
with the information available to them. Marginal benefits/marginal costs comparisons were
examined in Figure 6 illustrating that if marginal benefits exceed marginal costs then the
policy step should be applied—the stock of debris reducing. Economics uses the marginal
approach to set the direction of policy action. For example if the marginal benefit exceeds the
marginal costs, then the clean up can proceed and it will reduce the stock of debris, the
objective being to keep the stock of debris at the optimal level. In the Hong Kong Harbour
case study at Appendix 3, the funds spent on clean up, the marginal cost, are being compared
to the cleanliness index of the harbour, a proxy measure of the marginal benefit.
So where should APEC debris managers look for the most effective return on scarce resources
when addressing the control of marine debris? The preference would be to follow initiatives
43
where the marginal benefits exceed the marginal costs or which have potentially positive
benefit-cost ratios. Given the lack of empirical data, the benefit/cost estimates in the
following sections should be treated with caution.
10
The approach follows Figure 6 and we
examine generation/prevention, ambient stock levels and clean up.
4.2.3.1 Prevention
Prevention addresses sources of debris generation and the different approaches with
estimated benefit and costs as reported in Table 11a.
Table 11a: The estimated benefits, costs and likely benefit-cost ratios of different type of marine debris
prevention measures
Type of policy Benefits Costs Benefit/cost ratio
estimate
Regulation of waste Reduces waste More enforcement
cost
Positive, reducing
MBIs—waste charges (if
polluter is evident)
Reduced volume of
waste and revenue
generated
Administrative and
enforcement costs
Positive
MBIs—deposit refund
system
Less bottles or plastic
containers
Administering the
scheme and recycling
Positive/marginal
*TBC
Regulation/MBIs
Prohibition/sales tax on
plastic bags
Less plastic bags as
problem from landfill,
revenue from sales tax
Alternative types of
bag
Positive
Technical devices—
booms, waste traps
preventing debris entering
sea
Gathers and
concentrates floating
debris for removal
Significant
construction, and
maintenance costs
Positive ? TBC*
Regulation via industries
(shipping and fishing)
Rules to bring back
marine debris to port for
disposal
Cost to ship of waste
management and
carriage
Positive, reducing
Community-conservation
agreements
Debris levels are
reduced
Industry bears costs of
not dumping debris
Positive/marginal
Key: *TBC–to be confirmed
4.2.3.2 Reducing the marine debris stock level
Once debris is in the inshore, offshore and ocean arena, the main monitoring tool is the
ambient level of the marine debris stock and whether there are ‘hot spots’ where litter gathers.
Similarly the flux, or turnover of debris after removal, can be measured at a given site to
10
The benefit /cost ratio in Table 11a and Table 11b is to be interpreted as a marginal benefit for a marginal cost,
when at a given starting point. This will enable policy direction to be determined, but the extent of the policy,
requires a fuller specific benefit cost study. For example if a beach resort area finds that several popular beaches
have high debris levels, then the MB exceeds the MC of clean up and the beach cleaning is initiated.
44
indicate the local abundance debris. Knowledge of stock levels and marine debris deposits is
important if governments decide to ‘go fishing’ to clean up marine debris aggregations.
4.2.3.3 Clean up
The benefits and costs of clean-up policies are shown in Table 11b.
Table 11b: The estimated benefits, costs and benefit-cost ratios of different types of marine debris clean-up
measures.
Type of policy Benefits Costs Benefit/cost ratio
MBI-product
differentiation
private leverage
Tourists respond to
cleaner beach bringing
more revenue
Cost of cleaning the
beach of debris
Positive (depending on
the value of the beach)
Fishers paid by
government to
clean up debris
Cleaner marine
environment
Cost to pay fishers, plus
government
administration costs
Marginal/Loss
Subsidy—fishers
given subsidised
recycling for old
fishing gear
Fishing reefs cleaned,
environment improved
Costs for fishers of
retrieving old gear
Marginal/Loss
(depends on the level of
damage)
4.2.3.4 Discussion on prevention and clean up costs and benefits
From the limited information it appears the benefit-cost ratios for clean up are not as great as
those for prevention. This is driven by the avoided cost nature of the problem, and the high
costs of cleaning up dispersed marine debris. However, both prevention and clean-up
measures are required for control. The stock of ocean debris could take many years to reduce
by either clean up or prevention alone. In some cases clean up may only mitigate debris
accumulating locally.
Currently, clean-up decisions are driven by the immediate perceived benefit from cleaning an
area, relative to the cost of clean up. The economic approach, with more data, would evaluate
the extent of clean up relative to alternative use of funds for preventative measures. There are
also alternative ways to provide the actual clean-up services in order to reduce costs.
The removal of derelict fishing gear has led to some government agencies paying fishers to
clean up fishing debris (see the Korean and Hawaiian case studies at Appendix 3). The
Korean example indicates that the cost of the payment to fishers to collect rubbish on a
volume basis, is much less than the cost of the government agency for the same task. It may
be more efficient for fishers to be paid to remove fishing gear. This would have to be
reconciled with the current approach which imposes penalties and polices activities.
The study has introduced the need to be aware of the stock of debris in the oceans. As the
debris stock levels reduce it is expected that the marginal benefit of retrieving debris will
decrease and the marginal cost of collecting more diverse debris will increase.
45
4.3 Conclusions and recommendations
The use of economic incentives to control waste practices on land is gaining momentum and
is now being extended to the control of marine debris. However, in many cases improved land
debris control practices would also benefit the marine environment. Linkages in management
measures and between these issues need to be strengthened, as does establishing collaborative
relationships between the different institutions with management and legislative authorities.
There are some limitations on the applicability of market-based instruments to marine debris
control. As marine debris is a non-point-source pollutant, some instruments such as effluent
charges are not automatically feasible.
After evaluation the following market-based instruments are recommended as being most
suited to controlling marine debris:
deposits-refund systems
user and administrative charge, and
sales taxes and cost sharing.
Some of these would have to be implemented on land to prevent debris entering the sea and
require cooperation with land agencies.
A second set of instruments have design features to augment debris control programs and
could be considered, including:
credit programs
offsets
levering private investment
liability rules and risk
product differentiation
market creation-conservation agreements
reducing government subsidies, and
tax incentives-differentiation.
These could be used in different APEC economies as part of designed solutions to control
marine debris.
Thirdly, the following are not recommended for controlling marine debris at this point due to
a range of implementation issues: tradable permits, cap and trade systems and effluent
charges. Although effluent charges follow the polluter pays principle, marine debris is a non
point source pollutant, making the polluter difficult to identify.
46
The implementation of market-based instruments to control marine debris involves an overlap
with initiatives by land-based agencies to control debris on land. These common interests
should be developed through joint programs developing market-based instruments.
Recommendation 8: APEC MRCWG to undertake two case studies exploring the
design and implementation of market-based instruments to reduce marine debris
involving land and marine agencies in APEC economies. These case studies could
explore deposit-refund system and a sales tax on plastic bags and plastic bottles at a
site where changes in marine debris can be easily assessed.
Recommendation 9: APEC MRCWG to undertake a case study involving several
adjacent APEC economies, examining the feasibility of cost sharing of clean up, and
how it can benefit each economy.
Recommendation 10: APEC economies to encourage municipal authorities to work
jointly with the private sector to share the costs of beach clean up, ie, where private
sector tourism enterprises clearly benefit from clean beaches in tourist resorts.
47
PART 5. Disseminate the results through an outreach
program highlighting the costs and benefits of controlling
marine debris
Disseminate project results through an agreed outreach program to governments, relevant
industries and the public in the APEC region and project partners, highlighting the benefits
and costs of controlling marine debris and appropriate measures for limiting these costs in
the future.
5.1 Method
This study included an outreach phase which was intended to take the draft results of the study
into the field to workshop with participants in different APEC economies. The preliminary
results of the project formed the basis for instruction and feedback from those involved in the
control of marine debris.
The first workshop was held in Indonesia in August 2008 and was followed by a presentation at
the Second Coordinating Body on the Seas of East Asia (COBSEA) Marine Litter Workshop,
held 18-20 September 2008 in Pattaya, Thailand. A final workshop will be held at the World
Ocean Conference in Manado, Indonesia, in May 2009.
The outreach method was to expose relevant policy makers to the need to take account of the
economic costs and benefits of controlling marine debris in the APEC region. Each outreach had
a range of participants, with differing perspectives on the costs and benefits of controlling marine
debris.
5.2 Results
This study includes an outreach component to share the current report findings with interested
parties in APEC economies and to explore the economic incentives and approaches to prevent
marine debris.
The first workshop was in Indonesia in August 2008 and was followed by presenting at the
Partnerships in Environmental Management for the Seas of East Asia (PEMSEA) maritime
litter forum in Thailand in November 2008. It is intended to conduct a final workshop at the
World Ocean Conference in Manado, Indonesia, in May 2009.
The outreach program worked with Indonesia, the host APEC economy, to run a National
APEC MRC workshop on the Control of Marine Debris. This was held in Jakarta, on 14 and
15 August 2008. The workshop was focused around a challenge statement:
The ‘Understanding the economic benefits and costs of controlling marine debris in
the APEC region’ report finds APEC economies could reduce the economic impacts of
marine debris by introducing economic incentives and a more integrated policy
approach with land sources and the use of additional policy instruments.
The workshop was intended for staff involved with marine debris policy at the national,
provincial and municipal levels of government, in departments such as the environmental
protection authority and waste disposal, ports, marine safety, shipping, fishing/aquaculture,
48
land planning and tourism. It was also intended for industry associations such as those in the
shipping, fishing and marine tourism sectors.
A workshop report is at Appendix 3.
The workshop was appreciated by the participants. They indicated that the workshop would
give the economic benefits and costs of controlling marine debris more profile in Indonesia.
They also indicated that the uptake of the project results would be best if discussed and
actioned by several different government departments. The participants were keen to have a
larger outreach based on controlling the marine debris in Jakarta Bay.
Part of the outreach that participants identified with was the case study material (Appendix 3).
One of the expectations of participants was that APEC economies could share the information
on the effectiveness of debris barriers and control programs more effectively.
5.3 Conclusions and recommendations
The outreach method was to meet with various policy makers from industry, government and the
community involved in the management of marine debris in APEC economies in a workshop
setting.
From materials presented and discussed the participants developed an understanding of the
economics of controlling marine debris. In Indonesia they were interested in the economics of
technical devices to prevent litter and in solving the difficulties facing Jakarta with marine
debris, and the link to general debris issues faced by the municipal authorities. Participants also
identified the lack of a coordinated approach across all agencies and industries suggesting a more
coordinated approach between land and marine agencies.
The workshop was appreciated by the participants and would give the economic benefits and
costs of controlling marine debris more profile in Indonesia. They also indicated that the
uptake of the project results would be best if discussed and actioned by several different
government departments. The participants were keen to have a larger outreach workshop
based on controlling the marine debris in Jakarta Bay.
Recommendation 11: APEC MRCWG to consider a follow up project that explores
technical effectiveness and operational costs of litter devices, such as litter traps and
river and harbour booms, to make information and experience in technical controls for
marine debris available to many communities in the APEC economies.
Recommendation 12: APEC MRCWG to identify major urban marine debris ‘hot
spots’, by area or issue, that may benefit from targeted marine debris control
workshops and prioritise funding for delivery.
49
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