The Bladen Reserve

The Bladen Reserve

1 BACKGROUND

Bladen Reserve is a small country located in southern Belize, Central America. The region contains large area of rainforest and highly diverse flora and fauna. Its economic relies on forestry, agriculture industry, tourism and researches. The government wants to create more nature reserves in the four area within the upper Bladen Branch watershed but concerned over the economic trade-offs and impact on timber industry.

2 CUT OR KEEP THE TREE

Facts and Figures of Forest and its industry in Bladen reserve:

- Being threatened by rural population growth and slash and burn agriculture method

- Accessible timber area 3,000 ha (30 km2) which is 7.5% of Bladen reserve total area

- Low quantity of high valued trees

- Primary species 45,000 ft3

- Secondary species 3,857,500 ft3

- Timber industry is important which contributes to government royalty 22.5% and 14% of the total annual salary income.

- Low quality of product and no value added chain industries

To make the decision, the government has to aware about direct/indirect cost and benefit for cut down or keep the tree.

2.1 CUT THE TREE

Direct cost and benefit

Minimum Approximation Maximum Approximation

Revenue 10,564,000 10,564,000

Cost 7,500,000 12,240,000

Profit/Loss 3,064,000 (1,676,000)

Indirect cost and benefit

Indirect