Economics and Biodiversity Conservation in Bulgaria

Carollyne Hutter

Summary

Bulgaria is in the process of moving from a centrally planned economy to a market economy. At present, elements of both systems can be found. Most prices have been liberalized, trade policy has been reformed, and private businesses have come into existence. However, very little privatization has occurred; the means of production are still owned and operated primarily by the state. The country has also inherited a huge foreign debt from the previous regime.

It is a difficult time for Bulgaria. A viable financial infrastructure is still being developed. The potential for political instability exists. And inflation continuously erodes purchasing power and the value of salaries. The danger during this period is that many people have placed their faith in a "business first" approach - that is, emphasize economic development first, and give thought to environmental considerations later. "Such reasoning only increases the cost of later restoration of the environment and often has the effect of defeating the very economic benefit sought." This part in the Bulgarian Natural Biological Diversity Conservation Strategy will provide an overview of biodiversity conservation in Bulgaria and its economic implications.

The report comprises five sections. Section one discusses the value of biodiversity and explains how economists place values on goods and services that do not pass through the market. Section two examines Bulgaria's forestry sector (and, briefly, those of some other countries). Section three explores the role of incentives and disincentives in government policy. Section four addresses the issues of private property and land use. The final section looks at additional economic considerations: Bulgaria's foreign debt situation; the use of appropriate discount rates; and modifications of national income accounting to reflect environmental degradation and natural resource depletion.

This report raises a number of questions about economics and biodiversity conservation. These are profound questions, however, and this report can provide only a beginning step. It will lead, I hope, to further investigations.

Value of Biodiversity

Economists have sought to define the value of biodiversity as reflected both in traditional markets and in nonmarket goods and services.

Market Goods and Services

Bulgaria's biodiversity directly provides a number of products, including timber, medicinal plants, mushrooms, fish, wild game and fauna, and livestock genetic resources. These various products are discussed in detail in several of the other background reports for the conservation strategy. So as not to duplicate their efforts, the information they provide will not be repeated here. The reader should refer to them for specific information on these products in Bulgaria.

It is fairly easy for economists to assign monetary figures to such products since they are bought and sold at a market. These products are what economists call "market goods." If products are harvested and consumed directly by a family or in the local community without going through a market, economists place a value on them by figuring out their prices as if they were sold in a market. Economists estimate the market value of these products by using surrogate market techniques.

Biodiversity may also generate income by attracting tourists, providing genetic resources, and serving as education material.

Recreation and nature tourism can both preserve areas of biodiversity and generate income. Every year in the United States millions of people leave their homes in cities and towns to enjoy the natural beauty of wilderness areas, national parks, and national forests. In just one year, between 700 and 800 million people visit state and national parks, while some 200 million visit national forests. A national survey by the U.S. Fish and Wildlife Service determined that 77% of the American population 16 years or older participate in some type of wildlife related recreation, including fishing, hunting, photography, and wildlife viewing and feeding. Americans spent almost $56 billion on wildlife-associated recreation in 1985. The money went to equipment purchases (56%); trip-related expenses (38%); and other expenditures, such as magazine subscriptions, membership dues, licenses, tags, and permits (6%).

Nature tourism and recreation is not the perfect solution to preserving biodiversity and generating income. The advantages and disadvantages of ecotourism depend on the type of activity and the distribution of the income these activities generate. In terms of disturbance to natural ecosystems and wildlife, there are great differences between, for example, bird watching and skiing. Bird watching, a quiet, nonintrusive, and nonconsumptive outdoor activity, can actually generate considerable income to the local economies that bird watchers frequent. A study of the Cape May Peninsula in New Jersey, U.S.A. by Paul Kerlinger and David Wiedner discovered that bird watchers directly contributed $6 million (based on absolute values, i.e., without using economic multipliers) to the local economy. More than 90,000 bird watchers visit Cape May each year. The researchers found other benefits to bird watching for Cape May: bird watchers come in non-peak seasons; they do not require supervision (game wardens or law enforcement officers); and they require low overhead. (3)

Investment and promotional activities are needed to encourage ecotourism; it is not enough simply to set aside areas of undisturbed natural beauty. (For specific recommendations regarding ecotourism opportunities in Bulgaria, see Nicholas Spall's report on eco and sustainable tourism in this volume).

Plant genetic material is essential for agricultural. One way to develop disease-resistant crops is to crossbreed cultivated species with the wild ancestors or relatives of cultivated plants. Genetic diversity of crop plants is also vital for developing new crops suited to varying climate patterns and other environmental conditions. Unfortunately, modern agricultural practices have led to a narrowing of the base of genetic diversity. This has happened as monocultural farming systems using a small number of modern hybrids have replaced traditional systems in which farmers selected and maintained thousands of different plant varieties.

How economically valuable are wild species to agriculture and the food product sector? Wild species can be very valuable. For example, the tomato industry in the United States relies on wild tomato species from South America. When two American scientists, Hugh Iltis and Don Ugent, accidentally discovered a new species of tomato in Peru in 1962, it turned out to be worth $8 million a year to the U.S. tomato industry. "The importance of plant genetic resources for the development of Bulgarian agriculture became clear in the beginning of the century," Dimitar Stoyanov states in his background report. (For a thorough examination of plant genetic resources in Bulgaria and their role in assisting agriculture, see Dr. Stoyanov's background report in this volume).

The pharmaceutical field has recently recognized the value of maintaining plant genetic material, since over 25% of modern prescription drugs contain at least one substance derived from a plant. These drugs vary from simple mouthwashes (which use wintergreen) to cancer treatments (such as taxol from the Pacific yew tree in North America). A unique agreement has been reached between the pharmaceutical company Merck & Co. and the Instituto Nacional de Biodiversidad (or InBio) of Costa Rica. Under this agreement, Merck will pay InBio one million dollars for the opportunity to screen collected organisms for compounds of potential medicinal use. The money will be used to further Costa Rica's conservation programs.

Natural ecosystems, such as forests and wetlands, can also be living classrooms for scientists and students. For example, every year many American and European ecologists travel to the tropical forests to pursue scientific studies, generating income for the local economy in the process.

Beside the value of consumptive and productive uses of biodiversity, economists identify other values of biodiversity.

Existence value, as identified by David Pearce and Anil Markandya, refers to the feeling of stewardship that biodiversity engenders. It is the value of knowing that something exists, even if one may never see it. The Himalayas, the pandas in the wilds of China, and rare species of cranes all have value to people who will never actually visit these areas or see these things themselves. People feel concern, responsibility, and a sense of well-being just knowing that these organisms or ecosystems survive. This value is very difficult to measure, but an indication of its extent is the amount of money people contribute every year to environmental organizations such as the World Wildlife Fund or to movements to save specific plant and animal species or ecosystems, such as tropical rain forests.

Option value. To quantify society's strategies of risk aversion, economists use the idea of option value - a type of insurance. People consider it essential, either for the immediate future or for future generations, to preserve ecosystems or species. They may want to preserve a natural ecosystem so that their children or others can visit it and enjoy its beauty. Or they may believe that a plant or animal species will have value in the future as a possible medicinal treatment or food source. As with existence value, it is very problematic attributing a monetary figure to option value. However, the agreement between Merck & Co. and InBio shows that option value can be considerable.

Nonmarket Goods and Services

Economists have developed a range of methods to determine the value of the nonmarket goods and services provided by biodiversity, such as soil conservation and flood control. These methods are categorized into three groups: (1) valuation methods based on observed economic behavior; (2) valuation based on surrogate values; and (3) valuation established from elicited responses.

Valuation based on observed economic behavior assigns values to environmental services by calculating how changes in environmental services are connected to the supply or productivity of goods and services that are traded in the market. Commonly used methods include: the changes-in-productivity approach; the loss-of-earning expenditure approach; the cost-effectiveness approach; the replacement-cost approach; the compensation approach; and the wage-differential approach.

Valuation based on surrogate values looks at prices for other market goods to estimate implicit values. The shadow-pricing approach, the best known of these approaches, examines the price of substitutes for the environmental service in the marketplace. Other approaches in this group are the travel-cost approach and the property value approach.

Valuation based on elicited response uses surveying methods. In this approach individual are asked how much are they willing to pay for high-quality water, endangered species conservation, and other environmental features.

Valuation of Ecosystems

Economists, when they place values on ecosystems, necessarily undertake their work with incomplete information about ecosystem functions and processes. It is relatively simply to ascertain the monetary value of an ecosystem function and process that supports a well defined product (for example, shrimp from the sea). Difficulties come when we attempt to determine the value of non-market goods such as flood protection or climate regulation.

However, even in the case of commodity goods, the market price may not represent the entire value of a good. In addition to their being a valued commodity, shrimp are also valuable as food for other fish and as unique species in and of themselves. Ecosystems, such as wetlands and forests, are very complex systems. The lack of both ecological and economic knowledge creates difficulty in the effort to value ecosystems. Problems arise in measuring the functions and process of ecosystems or assessing how various disturbances will alter these intricate systems. It is unlikely that complete information about complex ecosystems will ever be available. Moreover, no techniques exist to quantify the functions and processes for the many different types of ecosystems. The Ecosystem Valuation Forum, sponsored by the U.S. Environmental Protection Agency, concluded in a recent study that "generally, many experts feel that existing ecological models do not provide information in a form readily useful as information inputs either into valuation processes or as information inputs directly into the policy process."

Ecologists have reproached economists for not adequately including in their calculations the cost of irreversibility, since the destruction of an ecosystem is irreversible.

A Case Study: the Coastal Wetlands in Louisiana, U.S.A.

Despite the many difficulties involved in valuing ecosystems, economists have made a few attempts to do so. One example involves the coastal wetlands in the state of Louisiana in the U.S.A. A fundamental part of Louisiana's cultural identity, the coastal and inland wetlands are also an integral part of the state's economic base. The wetlands are vital sources of many market goods. Commercial and sport fisheries, which depend on wetlands, contribute over one billion dollars annually to the state's economy. Other market goods that depend on the wetlands include furs and hides (an annual value exceeding $17 million) and waterfowl (about $58 million annually).

The ecological services of the wetlands also have economic importance. To gain an understanding of the value of Louisiana's coastal wetlands that is more complete than that provided by market product figures alone, economists Robert Costanza and Steve Farber measured various wetland benefits using different techniques. One used willingness-to-pay surveys to calculate the benefits of commercial fishing, trapping, recreation, and storm protection. This calculation was obtained through two approaches. First, they simply interviewed recreational users about their willingness to pay for coastal wetlands. The problem with this approach, according to Costanza and Farber, is that interviewees will suggest a value too high or too low depending on the purpose to which they believe the information will be put. And so Farber and Costanza relied primarily on the travel-cost approach to measure user willingness-to-pay, examining the amount of money spent on plane fares, gasoline, boat rental, and so forth. Energy analysis was the other valuation technique used to measure coastal wetland values. The energy analysis technique calculates the value of an ecosystem by measuring the amount of solar energy captured and stored in plants. To obtain a monetary value, this figure was converted by estimating the cost of producing the same energy from fossil fuels.

Using these two techniques, Farber and Costanza produced an estimate for the value of Louisiana's coastal wetlands of between $2,500 and $17,000 for every acre of marsh. By comparison, the market price (not including mineral rights) is about $500 an acre.

Benefit-Cost Analysis

As noted, valuations of ecosystems by economists are at best partial efforts, but the findings are still important since they present some evidence of the value of ecosystems. If some value is not placed on an ecosystem or environmental service, they will often be treated as "free" public goods, and both the benefits they provide to society and the costs of their destruction are likely to be dismissed in making development or policy decisions. Moreover, the figures derived from valuations of ecosystems or environmental services can be used in performing modified Benefit-Cost Analyses (BCA).

John Dixon and Paul Sherman provide a precise definition of BCA(5):

A project analysis technique based on welfare economics theory that examines the present value of the stream of economic benefits and costs of an activity or project over some defined period of time (time horizon) using some predetermined discount rate. A boundary of analysis is also defined in order to indicate what effects are included in the analysis. The results of a BCA are usually present in terms of a net present value (NPV), a benefit/cost ratio (B/C ratio), or an internal rate of return (IRR). A benefit/cost analysis uses economic scarcity values (shadow prices) as opposed to the market prices used in a financial analysis.

Modified Benefit-Cost Analyses can be an important tool in deciding whether to carry out a proposed development project. This type of analysis examines all the benefits and costs of a project or policy to determine whether the benefits outweigh the costs. Included in the measurements are noncommercial components, such as environmental services, which place additional weight on the preservation side of the decision than would be the case in strict financial analyses that use only market prices.

Forestry

"Sustainable management of tropical forests is dependent on accounting correctly for all the economic uses of the forests." Correct valuation of forests, which Edward Barbier, Joanne Burgess, and Anil Markandya advocate in terms of tropical forests, is also important for temperate forests. Economically, forests are usually seen merely as potential sources of timber. But in addition, forests provide a variety of products and services that are valuable to society.

The forests in Bulgaria are considered fairly young. About 60% are new plantings (1-20 years old); 30% are of an intermediate age; 10% are older (over 80 years old). Although the natural mixture is one-third coniferous and two-thirds deciduous, the proportion of coniferous forests has increased since the majority of new plantings are conifers. The change in natural composition and the loss of hardwoods worries some Bulgarian foresters. Moreover, the shift from hardwoods to conifers may make the forests more sensitive to damage from air pollution, acid-rain, drought, and global warming. Theoretically, 40-45 percent of annual growth is harvested - 3.3 million m3 of timber, of which 60 percent is firewood and 40 percent is lumber. Replanting from 1986-1990 occurred at a rate of 30,000 ha/year, while previously (1980-1985) the replanting rate exceeded 40,000 ha/year.

State management of forests is performed by the Committee of Forests. Forests are classified as economic forests or "special purpose" forests, each with its own regulations. Economic forests are used for timber production and comprise about 70 percent of the forests managed by the Committee of Forests. Special purpose forests include national parks, reserves, and protected catchment areas. Logging also occurs in special purpose forests, although less intensively and frequently than in economic forests.

The Committee of Forest is hierarchically structured, with three levels the central body, district departments, and local (so-called state) forestry enterprises. The Committee decides how much timber is to be cut and prepares management plans for each local forestry enterprise to follow. The plans are prepared every ten years by teams of forestry experts who gather information on the forests. When the Committee approves a plan, a special commission - the majority of which consists of forestry personnel - must be called together. The Ministry of Environment is involved when the commission deals with protected areas; however, it has only one vote.

The local forestry enterprises of the Committee (with the assistance of temporary workers) perform the actual logging, and forward 55 percent of the revenue from the logging operations to the central body. About two-thirds of the employees of the Committee work in local forestry enterprises. Their salaries are derived from forest resources, primarily logging revenues.

The Committee, through the local forestry enterprises, is also responsible for selling the timber. Because timber is a natural resource, there are restrictions on the exporting of logs, particularly logs over 18 cm3. The logs are primarily bought locally. The price of the log includes the expenses of transportation, planting, administration, labor, and road construction and maintenance.

According to a draft version of the new forestry law [Article 7 (1)], "(T)he forest fund, regardless of who is their owner, is managed and used on the basis of the forest plans which shall be approved by the Committee on Forests, in cooperation with the departments concerned." This means that the Committee approves the management of all forest land, whether privately or publicly owned.

A number of issues regarding the forestry situation require further analysis. What follows is a brief overview of these issues. It is recommended that these issues be studied in greater depth.

According to Christo Bojinov's background report on forest resources in this volume, "The expenditures in the Forestry branch, which are not compensated by cash inflow from direct commercial exchange, are compensated through governmental subsidies." This statement leads to the question: what exactly does the government subsidize and how do these subsidies influence logging activities, the price of timber, and efforts to conserve biodiversity?

Another issue is whether the forestry sector is promoting economic development in Bulgaria. This question requires a complete market analysis of the Bulgaria forestry sector. There is, however, evidence even from a superficial analysis that the forestry sector is only providing limited contributions to the economy. The current system is almost a closed loop: the Committee logs the forest and the income from this activity returns to the Committee. Economic contributions are possibly coming from secondary industries, such as wood processing industries. However, the country uses 60 percent of the wood for fuelwood, which limits the potential for secondary industries.

The issue of the forestry sector and its actual contribution to economic development has been studied in a number of countries. Throughout the world, state forestry departments have not successfully utilized their forests in promoting development. In general, governments have lost primary forests (and the services and goods they provide) without even obtaining the full revenue potential of the timber.

In the United States, the federal Forest Service has been criticized severely for it management of national forests. It has been reproached for having taxpayers subsidize the harvesting of the national forests and the selling of timber at below cost. In addition, the "benefits of the forests to wildlife and recreation are inadequately protected." (7)

In Southeast Asia governments have failed to capture the revenue potential of their tropical forests. In these countries the actually logging is done by private companies who have signed timber concession agreements with the government. Usually the concession fees in the agreements have been set too low, artificially reducing the harvesting costs for concessionaires and encouraging more logging than would be the case with higher concession fees. This situation has allowed a few individuals and corporations to become wealthy at the expense of local people, the government, and social programs. Another problem with these concession agreements is that, due to their limited time frames, there is no incentive for concessionaires to manage the forests properly, since the benefits of such management will not will not accrue to them. According to Robert Repetto of the World Resources Institute, "Governments have typically sold off timber too cheaply, sacrificing public revenues and non-timber benefits of the standing forest while encouraging 'timber booms,' profiteering, and rapid logging exploitation." (8)

Another issue involves the question of whether the amount of forest logged is influenced by the fact that the salaries of the local forestry enterprises of the Committee are dependent on timber sales.

And there is also the issue of the age of the Bulgarian forests. According to Bojinov, the average age of the forests is 42 years old (which is fairly young). What effect does this have on biodiversity? Ornithologist John Terborgh has found from his various studies that a younger forest can not support as great a bird population as a mature forest.

There are also broader questions involving the consideration of biodiversity conservation in forest management - not just within protected areas, but also in economic forests. With regard to the forest management plans, are the values of recreation, environmental services, and non-timber goods recognized as the plans are created? Should the price of a log include a conservation fee?

The final issue pertains to local participation. The Committee of Forests follows a centralized and top-down approach toward the management of forests, which means that instructions and polices are prescribed at the top of the hierarchical structure and implemented at the lower level. But what about local participation and involvement? According to the draft version of the new forestry law [article 31], "The population, permanently living in the region of the state forestry board, may obtain wood per root for personal needs from the state forest fund at tariff tax, without the right to sell it." What about having the local population actually contribute to the decision-making process? Robert Repetto has described his experiences with local participation in forest management:

(W)hile national governments have overestimated their own capabilities for forest management, they have underestimated the value of traditional management practices and local governance over forest resources. Local communities dependent on forests for many commodities and services, not just timber, have been more sensitive to their protective functions and the wide variety of goods available from them in a sustainable harvest. (9)

Economics and Policy

Moving to a market economy can help raise environmental, social,and economic well-being through competition. Monopolies do not promote efficiency or innovation. However, conversion to a market system is not sufficient to ensure the conservation of biodiversity. Markets need to be coordinated with other institutions to address various societal needs. No country has an economic system that operates free of the influence of governmental policy. Every country makes decisions - conscious or not - that contribute to or detract from efforts to achieve long-term sustainable economic development and the conservation of natural wealth.

In an unfettered market system, it is usually only a small group of individuals that earns high returns from exploiting natural resources, and society - not the group of individuals - pays the costs of depleting these resources. This situation has been witnessed again and again in Southeast Asia, where large areas of tropical forest have been destroyed, benefitting only a small group of people while depriving the world of a cornucopia of biological wealth. As a report from the Humphrey Institute in the United States notes:

Markets tend to fail in the provisions of public goods, in accounting for environmental pollution, and in protecting fragile natural resources. Experience with unfettered markets has resulted in significant inequalities in the distribution of social welfare. (10)

This section will address how government policy can be used to internalize externalities and alter individual self-interest to incorporate societal needs. The way to accomplish this is by using a system of incentives and disincentives. Incentives are mechanisms or methods which promote conservation, while disincentives discourage activities which deplete natural resources.

One major obstacle to the conservation of biological resources in many countries has been that government policies encourage the depletion of natural resources. "Economic incentives have been far more pervasive in over-exploiting biological resources than conserving them," Jeffrey McNeeley from International Union for Conservation of Nature and Nature Resources notes. Incentives that encourage people to deplete natural resources are termed "perverse incentives." Examples of perverse incentives are easy to find. The Brazilian government's subsidies of cattle ranching led to the clearing of tropical forests for ranches and farms. The Indonesian government's transmigration policies moved millions of people from Java to outer islands, where primary forests where destroyed for their settlement. In such cases, the first requirement is to remove the perverse incentive, and then afterwards to adopt new incentives to counterbalance their harmful effects. (12)

Some perverse incentives are easy to detect since their effects directly cause damage to or depletion of a natural resource. In Costa Rica, for example, the availability of agricultural credits from banks is linked to the use of certain minimal amounts of pesticides. Some perverse incentives are much more subtle, their intent often having nothing to do with natural resources or the ecosystems they affect. In the United States, for example, subsidies for agriculture have lead to environmental degradation. "Agriculture was responsible for 82% of wetland conversion be-tween 1950 and 1980, and direct government subsidies were the main reason the conversion were undertaken." (13)

Bulgaria has removed some perverse incentives by liberalizing most prices. Under socialism, the prices for natural resources were artificially kept very low to promote industrialization. Natural resources were considered "free goods," leading to high depletion rates and inefficient use of resources. The socialist scheme emphasized energy-intensive heavy industry, which created high levels of pollution. By liberalizing prices and restructuring the economy, a shift has begun - away from heavy industries and toward lighter industries and lower per unit amounts of raw material inputs and energy consumption. For example, the prices for fertilizers and pesticides (major sources of groundwater pollution) have risen since prices were liberalized, causing a decrease in the use of fertilizers and pesticides by farmers.

It would be beneficial to perform an investigative study in Bulgaria to discover which perverse incentives still exist in Bulgaria and how they encourage the destruction of natural resources or high rates of depletion.

A system of effective incentives and disincentives is essential to conservation because law and enforcement are not enough to protect natural resources. This has been shown throughout the world. One cannot save a piece of wilderness simply by locking it up and putting guards on duty to save it. There need to be ways to persuade people to conserve natural resources and values. Various incentives and disincentives can be used. Not all of these are economic; social incentives and disincentives, such as peer pressure, can also be important. Even economic incentives do not have to be strictly economic or financial. Incentives can also include in-kind benefits, which provide material goods such as food and equipment or access to natural resources in restricted areas.

In the conservation strategy workshop, Wilbur LaPage explained that he found the idea of "partnership" useful for the New Hampshire state park system - the sharing of maintenance, costs, and benefits of the park system with others. LaPage manages one of the only state park systems in the United States that is totally self-supporting and does not use funds from the state budget. LaPage places park partnerships in six general categories: partnership with the public; private persons and benefactors; professional organizations and agencies; corporation and businesses; environmental and historical organizations; and park friends groups.

Examples LaPage provided examples of partnerships and their benefits:

Corporate Partnerships. A corporate partnership with Pepsi Cola has contributed to promotional programs for the park system.

It has been LaPage's experience that pride (whether local, national, or regional) in park land "has value which can be converted to an array of park assets, from volunteerism to fund raising and stewardship." The park's image can be a corporate asset for various business partnerships with local or national businesses. "The educational opportunities afforded by parklands have both short-term and long-term economic spin-offs through increased demand and the creation of more appreciative users.

Parks can and should receive some of the economic benefits that the tourism industry and recreation equipment industry reap from the parks, LaPage stressed. This in line with what the World Bank recommended in their 1992 environment strategy study for Bulgaria - a special "nature tax" for Balkantourist and other operators of facilities in or near parks. The revenue from this tax would be directed toward nature protection and public education activities.

LaPage also emphasized the importance of local involvement in the park system. "The best long-term guarantee of park protection is an appreciative public. Without awareness and understanding there can be no appreciation." It is essential to involve the public in park policies, plans, and practice, LaPage noted, and this involvement can lead to other partnerships. The importance of local involvement has been seen in various parks system all around the world. In park systems where the practices of local people have led to environmental destruction, such as the killing of wildlife, it is particularly important to involve the local people in a dialogue about stewardship of the park. Economic incentives are also often needed to preserve the park (e.g., having local people work as guides or in one of the service industries in the park).

Beyond the various parks, what other types of incentives and disincentives can promote the conservation of biodiversity? Here are some general ideas:

It should be noted that the Nature Conservation Fund proposed by the Ministry of Environment would derive some of its funding from a system of incentives and disincentives and incorporates some of the incentives and disincentives discussed in this section.

Property and Land Use

The shift from a centrally controlled economy to a market economy in Bulgaria also entails the reintroduction of private property. Bulgaria now has a series of options in terms of managing natural resources and property rights. The question is not only who owns the rights to resources (such as a forest), but who manages it, who benefits financially, and how all of this influences long-term sustainability. Many tropical forests, for example, are state-owned, but timber is extracted by private domestic or foreign companies. Agricultural land can be owned by one party but leased to others under various land tenure arrangements. Historian Patricia Poses notes:

Regarding property in India, there are people who own the property and there are people who have rights to use this property. The rights to use the property may be handed down from generation to generation and these rights can not be denied. During the Raj period the British were confronted with the fact that their property concepts did not translate well into Indian society. (15)

Economists often simplify property regimes by placing them in two categories - public and private - thereby dismissing the variation that may be found in land tenure schemes. Common property they regard as an "open access system," and discussion often revolves around the tragedy of the commons. Economist Daniel Bromley identifies four primary property regimes: public, private, common and open access. He argues that what others label as common property regimes are in reality open-access property regimes. According to his definition, the four property regimes are:

There is no way to determine which regime is appropriate for conserving natural resources and promoting sustainable utilization of these resources. Each regime is fraught with examples where resources been severely degraded and short-term financial benefits reaped. The problems of an open access system are obvious but the other three regimes are also problematic.

Forest resources are commonly managed under state property regimes. In tropical countries, particularly in Asia, there has been a movement over the last fifty years away from local community control and toward the nationalization of forest lands. Critics of this policy maintain that this movement has created both environmental destruction and economic inefficiency, and has opened up large areas of forest land to exploitation by forest departments, concessionaires, and local people. "Timber concessionaires seldom have a long-term interest in conserving forests, and local people who no longer have legal tights to harvest timber or forest products have few incentives to protect trees and strong incentives to clear land for agriculture." As previously discussed, throughout the world government forest departments, such as the U.S. Forest Service, have failed to collect the full revenue potential of timber sales. "According to (U.S). Forest Service budgets... seven national forests [with below-cost sales] had losses in fiscal year 1988 totalling $7.15 million." (19)

One problem with state property regimes is the centralization of management and exclusion of local participation that they usually entail. In Bulgaria, the decision-making and policy-making process under socialism was centralized. Part of the transition to a democracy involves decentralization and citizen participation. However, as the Humphrey Institute report points out, even today there is a tendency to have decisions made by the central authorities. "(R)egional and local bodies, non-governmental organizations (NGOs), entrepreneurs, churches, and others frequently have the best understanding of their needs," the report argues. "This is true as well in terms of sustainable development, environmental protection, land use, and economic development." (20)

Common property regimes are "neither private or public; neither commercial farm not communist collective, neither business firm nor state utility, neither jealously-guarded private plot not national or city park. Nor is it usually open to all. The relevant local community typically decides who uses it and how." (21) These regimes have been applauded for creating a system of checks and balance and for their successes in safeguarding their environments. The official National Report to UNCED for Pakistan found traditionally-managed communal forests better at environmental protection than state-owned and managed forests. (22) Bromley discusses a potential problem with common-property regimes:

...a breakdown in compliance by co-owners may be difficult to prevent because this will entail loss of opportunity arising from changes elsewhere in the economy. If spreading privatization precludes seasonal adaptation to fluctuating resource conditions, then overuse of a local resource may be necessary by members of the group. (23)

The advantage of private property is that the owner of property can make management decisions and investments knowing that he or she will receive the benefits of good care and stewardship. The difficulty with private properties is that the behavior of the individual or group regarding the property may not be of benefit to society. "If soil erosion, polluting smoke, clangorous sounds, or insufferable odors emanate from a private property regime then, once again, the sanctity of that particular institutional setup will be under close scrutiny." (24)

As land restitution continues, the issue of what type of strictures and obligations private land owners will face becomes more important. Moreover, with restitution land in some of the protected areas will be returned to previous owners or to their heirs. This will create a patchwork system of private and public land in these areas. Difficulties may arise with regard to management of protected areas that have two very different property regimes. According to a draft of the new forestry law, if the land is forest, then management plans must be approved by the Committee of Forestry. This situation could negate some advantages of private ownership.

Another question involving restitution is how private property ownership will influence the gathering of wild species of medicinal plants and mushrooms. Will private property ownership help to mitigate the problem of inappropriate gathering activities, which have led to the exhaustion of certain plant species? Or will it further exacerbate the problem?

And what about the development of the Black Sea coast? The Bulgarian coastline has been praised for not being as overly developed as other European coastal areas, and for containing a mixture of tourist complexes, agricultural and forest lands, and protected areas. This situation was due to the central government's control and management of the coastal area. Land reform and the establishment of private property will place pressures on the land and its resources as further development occurs along the coast. The World Bank's recommendation is for the government to set up a formal system of coastal zone management, a multi-sectoral management approach to ensure that the public's interest is incorporated into land and water use in the region.

National Income Accounting

As Bulgaria shifts toward a market-style economic system, it will be important to measure the economic status of the country. Figures from national income accounting methods - for example, gross national product (GNP) and net national product (NNP) - are important since they as employed in policy prescriptions and economic analyses. However, these methods have been severely criticized for not presenting an accurate image of a country's income or wealth, particularly in developing countries, where a significant amount of economic activity occurs within households or community markets without market exchange.

GNP increases when subsistence farmers join the labor force and stop producing their own food, when women join the labor force and hire domestic help and childcare, when the stock of housing and factories is destroyed by war and then replaced, and when the environment deteriorates and the government initiates corrective actions. (25)

National income accounting (NIA) has been criticized for its treatment of natural resource depletion and environmental costs. The United Nations System of National Accounts (SNA) could report that a country is economically growing, even though the country is depleting its natural resources and damaging its environment. Missing from the SNA is the question of whether economic growth is sustainable. In SNA, depreciation of man-made capital is measured, but not the depreciation of natural capital, renewable or nonrenewable. "If a country is exhausting its renewable or nonrenewable resources, its current income will thus be inflated by the sale of natural assets that will eventually disappear." (26)

Another problem with SNA, according to some economists, is the inclusion of defensive expenditures. Defensive expenditures are primarily spent on restoring or protecting the environment. For example, the money used to clean up an oil spill is a defensive expenditure and is considered to be an income-generating activity by SNA, even though there is no negative accounting for the environmental loss due to the spill.

The problem is that natural resources are assumed to be "free gifts of nature." A country can temporarily improve its income level by selling off its natural resources and then increasing its consumption. The "prosperity" the country experiences cannot be maintained, particularly when the additional income is not devoted to new productive investments. Policy makers, relying on income accounting figures in this situation, could base their analysis on a false image of the country and thereby make inappropriate decisions.

If a natural resource stock is privately owned, it may be recorded since a number of private companies "make provisions for the decrease in the capital stock or natural resources, and in certain countries tax legislation permits such provisions to be excluded from taxable income." (27) These types of provisions do not exist when resources are owned or used by the government.

To address the problems of NIA involving natural resource depletion and environmental degradations, scholars have begun to develop alternative systems for measuring the wealth of a country. This is a new field, with varying opinions on the best methods and approaches to use in amending the SNA and presenting a more realistic picture of economic development and sustainable income.

The depreciation approach and "user-cost" approach are two basic conceptual approaches used to take natural resource depletion into account. The depreciation approach basically adopts the same approach currently used to measure depreciation of man-made capital, with the depreciation of renewable and nonrenewable resources expressed in monetary rather than physical units. This translation from physical to monetary units can be done with various valuation methods based on the principle of replacement or willingness to pay.

Salah El-Serafy originally suggested the user-cost approach for mineral resources depletion. He advocates this approach since the depreciation method does not recognize the income advantage imputed to the natural resource owner. (28) Possession of a natural resource conveys on its owner an income advantage that is denied to those without a natural resource, and it not satisfactory to arrive at a measurement of zero net income, as proposed by the depreciation method.

Economists and national accountants disagree over not only the appropriate approach to take in resolving these problems, but also over what to measure when constructing environmental and natural resource accounts. The World Resources Institute (WRI) has been a leader in creating these accounting procedures. William Cruz explained their approach:

The usual distinction that people try to make is whether you examine productive natural resources (productive sectors), i.e. forestry, coastal fishing, and watershed resources, or whether you look at amenities, environmental concerns such as water quality, air quality, noise, or pollution. WRI focuses on the production sectors while others focus on the second. (29)

Henry Peskin suggests a broader approach than WRI by including environmental and other nonmarket factors.

Should expanded accounts be confined to environmental assets or should they attempt to cover the full spectrum of nonmarket assets? In principle, the latter approach is preferable, because a fully expanded accounting system will be able to show important relations between the use of environmental assets and other nonmarket activities.

Herman Daly of the World Bank advocates, instead of NNP or GNP, a new income concept of "sustainable social net national product" (SSNNP). SSNNP is defined as net national product minus both defensive expenditure and depreciation of natural capital. Anne Harrison suggests dealing with defensive expenditures in a conceptually different way by having water, air, soil, and other resources viewed as natural capital. Degrading such natural capital, according to Harrison's proposal, would be considered as consumption in the measurement of national income, independent of whether the situation had been improved by defensive expenditures or not. At the level of net domestic product, the depreciation of environmental capital would be noted.

Since economists and national accountants have not reached a consensus on how to best to improve SNA to represent sustainable income, a number of theorists in the field (including Ernst Lutz, Salah El-Serafy, and Peter Bartelmus) believe that a satellite system of environmental accounts should be published next to the existing SNA, but not incorporated into the SNA.

By having satellite accounts, the user could compute sustainable GDP and NDP (SGDP and SNDP). This half-way solution would not represent a threat to the historical continuity of GDP and has a fair chance of being adopted. Along these lines, the United Nations will be setting up environmental satellite accounts, and revising its "blue book" (the volume describing the core accounts of SNA) to include a section summarizing environmental satellite accounts.

At present, a number of industrial countries - France, Germany, Canada, Norway, Japan, France, the Netherlands, and the United States - are producing resource accounting systems.

Notes

1. Hubert H. Humphrey Institute of Public Affairs, Environment and Development in Bulgaria: A Blueprint for Transition (Prepared for the International Workshop on Institutional Design for Environmental Protection in Bulgaria, Shtarkelovo Gnezdo, Bulgaria, September 5-7, 1992. Minneapolis, Minnesota: Hubert H. Humphrey Institute of Public Affairs, University of Minnesota, 1992), 13.

2. For an extensive study on this topic see Elizabeth Boo, Ecotourism: The Potentials and Pitfalls (Washington, DC: World Wildlife Fund, 1990).

3. Paul Kerlinger and David Wiedner, "Birding Economics or Birders Mean Big Bucks," Living Bird Volume 11, Number 1, p. 9.

4. Gail Bingham and Paul DeLong, Valuing Ecosystem Functions and Processes: Issues Concerning How to Provide Information Useful in the Policy Context (Background Paper 1, Washington, D.C.), p. 4.

5. John Dixon and Paul Sherman, Economics of Protected Areas: A New Look at Benefits and Costs (Washington, D.C.: Island Press, 1990), p. 201.

6. Edward Barbier, Joanne Burgess, and Anil Markandya. "The Economics of Tropical Deforestation." Ambio, April 1991.

7. Tom Tietenberg, Environmental and Natural Resource Economics (New York: Harper Collins Publisher, 1992), p. 295.

8. Robert Repetto, The Forest for the Trees (Washington, D.C.: World Resources Institute, 1988), p. 2.

9. Robert Repetto, Forest for the Trees, pp. 16-17.

10. Hubert H. Humphrey Institute of Public Affairs, Environment and Development in Bulgaria: A Blueprint for Transition, p. 5.

11. Jeffrey McNeeley, Economics and Biological Diversity: Developing and Using Economic Incentives to Conserve Biological Resources (Gland, Switzerland: IUCN), x.

12. Ibid., xi.

13. Terry Anderson and Donald Leal, Free Market Environmentalism (Boulder, CO: Westview Press, 1991), p. 57.

14. Wilbur LaPage has just finished a book on partnerships that will be available soon. This book will provide an indepth look at partnerships and LaPage's experiences with the New Hampshire state park system.

15. Conversation with Patricia Poses on April 15, 1993.

16. David Bromley, Environment and the Economy: Property Rights and Public Policy (Oxford: Basil Blackwell, 1991).

17. Ibid., p. 23.

18. World Bank, Technical Paper Number 193, p. 23.

19. Anderson, Free-Market Environmentalism, p. 53.

20. Hubert H. Humphrey Institute of Public Affairs, Environment and Development in Bulgaria: A Blueprint for Transition, p. 16.

21. "Commons: Neither Public nor Private," The Ecologist, Vol. 22, No.4, July/August 1992, p. 125

22. "The Commons: Where the Community Has Authority," The Ecologist, Vol. 22, No.4, July/August 1992, p. 129.

23. David Bromley, p. 28.

24. David Bromley, p. 24.

25. Richard Norgaard, "Linkage Between Environmental and National Income Accounts." Environmental Accounting for Sustainable Development, Y. Ahmad, Salah El-Serafy, and Ernst Lutz, eds. (Washington, D.C.: World Bank, 1989), p. 55.

26. Salah El-Serafy and Ernst Lutz. "Environmental and Resource Accounting: An Overview." Environmental Accounting for Sustainable Development, Y. Ahmad, Salah El Serafy, and Ernst Lutz, eds. (Washington, D.C.: World Bank, 1989), p. 3.

27. Ibid.

28. Ibid., p. 4.

29. Carollyne Hutter, Guide to the Field of Environmental and Natural Resource Economics (Washington, D.C.: World Wildlife Fund, 1992), p. 21.

Institution Building to Protect Biological Resources: A Perspective from the United States Park Service

William J. Briggle

The United States National Park Service is honored to participate in the Bulgarian National Biological Diversity Conservation Strategy workshop. It is also my privilege to represent the director of the National Park Service as this group faces this most challenging opportunity. The National Park Service has a long history of involvement in the international community, assisting in the identification of resource protection issues, developing strategies to mitigate resource damage, and recommending options for management action. The Republic of Bulgaria deserves special commendation for its early attention to countryside protection and for its enactment of laws to establish protected areas. This effort to devise a national conservation strategy, including the establishment and expansion of protected areas, is a further expression of Bulgaria's commitment.

The National Park Service recently celebrated its 75th anniversary, which culminated in a symposium that attracted many international participants. Out of this symposium came a report with recommendations to guide the Service into the 21st century. I commend it to you.

The first national park in the United States, Yellowstone, was established in 1872. Prior to this, our nation's countryside contained large expanses of superlative scenery and rich biological resources that were under siege by western frontier inhabitants seeking private gain. Fortunately, the erosion of resources was slowed by the presence of the United States Army, which took up positions in Yellowstone until such time as the park could be turned over to civilian control. In 1916 an act of the U.S. Congress created the National Park Service, which immediately assumed responsibility for the parks that Congress had created and that the Army had administered. Thus, the United States sent a signal worldwide that it was embarking on a national strategy to protect and conserve its unique natural and cultural resources, while allowing for their use and enjoyment.

The purpose of the newly established National Park Service was to administer for the American people an extensive system of national parks, monuments, historic sites, and recreation areas. Its objectives are to manage the areas under its jurisdiction for the enjoyment and education of our citizens, and to protect and conserve them for the enjoyment of present and future generations.

The National Park Service is but one of several models that have been adopted in the United States. The mission of the U.S. Forest Service is to provide a continuous flow of natural resource goods and services to help meet the needs of the nation, while the programs of the Bureau of Land Management provide for the protection, orderly development, and use of the nation's public lands and resources. They operate under the principles of multiple use and sustained yield. The U.S. Fish and Wildlife Service has responsibility for wildlife refuges and related habitats. Memoranda of Understanding (MOUs) and cooperative agreements define areas of mutual assistance among these agencies and allow them to take advantage of available expertise.

The National Park Service is a large, multi-layered, decentralized organization comprised of career employees. It has full authority to manage all properties within its sphere of influence. The sheer size and complexity of the Service bureaucracy affects the range of perceptions, problems, and solutions among its employees and the public. For example, some believe that the Service should not be involved in managing recreation areas or urban parks, or should not allow historic uses to continue on inholdings within certain park areas. Scientists and resource managers believe that resource inventory, monitoring, and the expansion of research capabilities are paramount and take precedence over visitor use and enjoyment. These debates have not been ignored by the Service's top management, who recognize the importance of open dialogue with employees and detractors. We have come to understand that we cannot be all things to all people.

Administratively, the National Park Service is an executive branch office under the direct supervision of the U.S. Department of the Interior. As a result, the Service is subject to the strategies and political agendas established by the Secretary of the Interior and approved by the President. Consequently, the priorities established for the National Park system may fluctuate with changes in political considerations and concerns.

The United States Congress provides oversight and budgetary approval to the Service, and serves essentially as a watchdog over the actions and programs of the Service. It has the ability to increase or decrease budgets, to legislate new responsibilities, and to remove programs. The Service is under constant pressure to add new lands to the park system, and more often then not these areas (whose protection is sometimes politically motivated) do not meet national criteria for inclusion.

Today the Service is an institution shaped by its mandates to protect and conserve the resources under its control while allowing for their use and enjoyment. Mindful of its past, aware of its present position in the conservation and public use of the resources entrusted to its care, it is now engaged in the task of moving into the 21st century. As we do so, we can identify a number of components that have been and remain important for institution building to protect biological and cultural resources. These are:

While it is not critical that all of these components be in place and fully functional at the outset, it is essential that the protection of biological resources be held as a foremost goal.

In the National Park Service, the mandate to protect while recognizing the need for public enjoyment is followed by appropriate authorities who manage and regulate use. Authority and decision-making powers are vested in park and regional managers. Matters involving jurisdiction over resources are clear. The importance of developing organizational capabilities that embody protection and interpretation of the resources while providing the scientific data essential for decision-making and management is understood. Working relationships with NGOs are important, and every opportunity to strengthen these partnerships is explored. Outside funding sources are pursued to help manage and protect resources. Providing outreach services to school children and teaching the importance of national parks and reserves are of immense importance in developing public understanding and support.

Organizational effectiveness is enhanced by developing and maintaining a professional cadre of scientists, resource managers, law enforcement rangers, interpreters, and administrators. This entails training and the identification of requisite skills; constructive supervision and leadership; the provision of opportunities for career advancement in the protection and management of biological resources; and the education of various publics in the use and enjoyment of parks. To ensure that the quality of leadership and resource management does not slip, a process for evaluating staff performance and organizational effectiveness is essential.

Building a strong institutional commitment to the retention of biodiversity and the protection of resources does not necessarily ensure that these objectives will always be realized. What is important is that the "checks and balances" necessary to sustain the resource base be in place, that the capacity and commitment to learn from error or oversight are present, and that awareness and ability increase as a result.

To help us focus on our task I would like to offer some examples of strategic objectives for your consideration.

In summary, organizations cannot remain static if they are to remain viable in today's changing world. Strategic objectives and goals must be defined and implemented, and an informed public must be in place to support the concept and management of protected areas. Institutional success requires employees who are skilled at their work and well motivated, and who receive strong leadership and direction. National priorities must be responded to in a professional manner, and the organization must be politically astute to survive. However, the organization must guard against becoming internally politicized if its to retain its credibility and its sense of professional responsibility. This task can be made easier if public understanding and support is evident and nurtured.

The strategy that I have outlined for building a strong institution should be taken in context. That is, this is the view of an outsider looking in, and must therefore be weighed against current incountry conditions and attitudes. Some characteristics, however, can help define success under widely varying circumstances: flexibility and resiliency; holding true to the institution's vision and overarching objectives; if we err, to err on the side of the resources; and, finally, the capacity to develop future leaders to manage the institution and ensure its ability to "take it to the next level of excellence."

Remember - the U.S. Park Service has been at this for 76 years, and we are still seeking solutions in the wise management and use of our resources. There will always be differences of opinion on how we carry out our responsibilities as resource stewards. Weigh the costs and benefits involved and make allowances where you can.

Regional Planning and the Conservation of Biological Resources in Bulgaria

Plamena Borisova

To clarify the impact of regional planning on the conservation of biodiversity in Bulgaria, I shall focus my at-tention on the basic objectives, instruments, and norms foreseen by the national legislation in force at present.

The basic normative act that regulates regional planning is the Law for Territorial and Urban Planning (LTUP). According to this law, the objective of regional planning is to create the most favorable conditions for living, labor, and rest for the population of the country in accordance with the needs of society as a whole and in compliance with the requirements for environmental conservation.

The instruments for regional and land use planning are: the National Land Use Plan; regional land use plans for municipalities or groups of municipalities; and urban development plans for human settlements. The land use plans lay out the geographic basis for the socioeconomic development of towns, villages, and their zones of influence; the territories beyond the settlements (including the protected natural areas); industrial zones; forests and agricultural lands; and areas that are defined on the basis of specific geographic, ecological, demographic, or economic characteristics (for example, the Black Sea coastal zone and the area of the Danube River).

The urban development plans provide for the most advantageous building and development of urban areas according to their economic, natural, demographic, and social conditions. All plans under the LTUP are elaborated, approved, and affirmed using specific procedures and then come into force as normative acts.

The plans define directions for the protection of the environment, including biological resources, and (depending on the degree of detail to which the plans are elaborated) the specific measures to be taken. In coordinating plans, the general requirement is that the recommendations of every higher level of planning should be considered at the lower levels.

The regional planning process also defines regimes for land use and development in every part of the nation's territory. Each of these regimes constitutes a system of prohibitions, restrictions, and permissions to carry out certain activities. The objective is to promote sustainable development, conservation, and restoration of the environment. Planning is undertaken in compliance with the requirements of three macro-regimes, embracing seven regimes and fourteen sub-regimes. The macro-regimes are: the Natural and Forest Environment, the Agricultural Environment, and the Urbanized Environment.

The Natural and Forest Environment is the regime under which the most favorable conditions for the development of biological resources and for the conservation of biological diversity are ensured, through strict prohibitions and restrictions on human activities. This regime covers all the protected natural territories - natural reserves, national parks, protected areas, natural areas of particular significance, and historical sites.

The Urban Environment macro-regime embraces 4% of the territory of Bulgaria and includes practically all highly urbanized territories, including towns, industrial zones, and technical infrastructure. The damage to biological resources in these areas is the most significant.

Town parks and gardens are artificial tracts of green space within the environment and for some bioresources serve as the sole source of the conditions necessary for their existence and reproduction. For this reason, Bulgarian legislation requires that 15 to 30 m2 of green area per inhabitant be provided within every settlement. For the same reason, parks must be established around the settlements according to the standard of 500-700 m2 per inhabitant for 5-15% of its population.

At this point it should be noted that the process of restitution of private property is making the observance of these standards very difficult and even, in some cases, impossible. The development of a park restricts property rights and requires that the initiator (usually the municipality) buy land from the private owner at a price acceptable to the individual. At present the municipalities in Bulgaria do not have sufficient finances for this purpose.

Another type of standard used in regional land use planning that affects biodiversity conservation involves the permissible capacity for areas with significant recreational potential. For example, the sea beaches support a maximum load of one visitor for every 8-12 m2. Skiing areas carry a maximum of 10 skiers for each hectare.

According to the requirements of our legislation, the use of agricultural land for the expansion of settlements is allowed only after the need has been proven. Urban planning standards are used to define the additional area needed (depending on optimal settlement conditions) and to minimize the plundering of the land - and, in this way, to limit the damage to bioresources. In compliance with the Environmental Protection Law, every regional development plan must be accompanied by an assessment of environmental impact, including the impact on biodiversity. Additional standards are implemented to regulate investment activities that have a direct or indirect impact on biodiversity.

I do not assert that the existing legislation and regional land use plans are perfect. I will not comment further on this, but it should be noted that in their concrete implementation we have had certain negative results. These problems can be attributed to:

This brief analysis leads to the formulation of several important remarks concerning the Bulgarian National Biological Diversity Conservation Strategy.

Legislation should involve two types of conservation provisions: measures that protect the conditions necessary for the development of biological resources and measures that provide for their conservation and sustainable use.

Taking into consideration the existing consciousness and way of life of the Bulgarian citizens, their desire for rapid change, and the real pace of change in people, legislation, and government bodies, I think it will be more reasonable to seek a balance among the interests of the citizens, the municipalities, and the nation by observing two principles:

1) Do not seek a sharp transition from centralized government and the absolute priority of state interests to local self-government (which can degenerate into uncontrolled activity) and the absolute priority of the rights of private property.

2) Grant municipalities the possibility of expressing themselves as autonomous, self-governing communities in all their fields of activity and responsibility, including the conservation of biological resources.

An Eco and Sustainable Tourism Development Strategy for Bulgaria

Nicholas Spall

Introduction

Thus far delegates to this workshop have been hearing about Bulgaria's biological resources and discussing the need for their effective long-term conservation. One obvious and important question arises out of these discussions: how can the nation preserve and enhance these unique resources in the future? Eco and sustainable tourism provides a useful solution.

How can we develop a workable eco and sustainable tourism strategy for Bulgaria? This paper explores the background for a practical set of proposals. I will consider the country's tourist resources, their value in terms of expanding the tourist economy, existing tourism "image" problems, the need to link conservation and economic growth, immediate measures that can be proposed, and longer-term steps that can be taken to provide a growing and at the same time sustainable tourist economy for the country.

The Need for a Sustainable Tourism Approach

It is worth pausing to note relevant work that has already been undertaken. Several tourism studies relating to Bulgaria are now available. The Horwath Consulting report "Tourism Development Strategy for Bulgaria" (1992) (for which my planning practice, Sheppard Robson, provided assistance) is a starting point for a future sustainable and eco tourism strategy. This report focused on the development of commercial and marketing policies for tourism, but several of its recommendations are relevant to this workshop. I will explore these points later in this paper.

An important project now being prepared is the "Pirin and Rila Eco and Sustainable Tourism" Strategy (PREST). This United Kingdom "Know-How" Fund project is intended to provide a regional strategy for the Pirin/Rila National Park area. It was initiated at a workshop in Bansko in 1992 and will eventually result in the creation of an association of municipalities to implement a strategy of policies and guidelines for improving the tourist potential of the region and protecting the national parks and surrounding areas. If PREST works and the municipalities work together effectively, similar projects could be undertaken in other regions (for example, such an approach could be adopted in the Strandzha region).

The need for sustainability in any tourism strategy should be emphasized at the outset. It is often easier simply to consider tourism development and economic growth for its own sake - to the ultimate detriment of the tourism market. The damage done to the Spanish Costa del Sol coastline in the 1960s and 1970s testifies to this; many tourists eventually turn away from such areas.

It is important to note that a strategy of this type must take into account not only eco tourism, but also slightly less rigid (i.e. sustainable) forms of tourism development. The following definitions (after Professor A.S. Travis) can be applied to such a strategy.

"Eco Tourism is environmentally responsible travel and visitation to relatively preserved or natural areas that fosters conservation of nature and any cultural elements present there, has a low impact on the environment, and actively involves the local population so that they may share in the resultant economic 'benefits.' "

"Sustainable Tourism is all forms of tourism development, management, and activity that enable a long life for that cultural activity we call tourism, involving a sequence of economic tourism products compatible with keeping in perpetuity the protected heritage resource base - be it natural, cultural, or built - which gives rise to tourism."

I believe that these definitions emphasize the actual improvement and enhancement of current resources and should be maintained as a strategy is developed. A basic theme of this paper is that improvements in existing tourist facilities can be achieved through careful regional planning and practical attention to detail, and that future developments can be pursued in accordance with these plans and strategies.

Despite the freedoms related to land restitution and privatization that have been gained since 1989, and despite the continuing world-wide recession, investment and interest in tourism-related development in Bulgaria has not yet reached the peak of its expected growth. Interest is expected to expand in the next few years as international investors show increasing awareness of Bulgaria's unique environmental character, its national parks and nature reserves, and the quality of its countryside, coastline, and culture. Already interest is growing in major tourist developments, and these will have implications in terms of the environment and sustainability. Current examples include:

In view of these trends, work must be done before the next economic upturn. An effective and clear Eco and Sustainable Tourism Strategy is an important requirement for Bulgaria for three important reasons.

The Economic Importance of Tourism

In order to illustrate the economic gains to be obtained through tourism development in Bulgaria, it is worth looking at a few figures. World-wide, tourism has vastly affected national economies. To illustrate this, it should be noted that in 1991 there were 450 million international tourist arrivals (a provisional Work Tourism Organization figure), with a growth rate of approximately 8% per annum between 1960 and 1980. In terms of expenditures, tourism receipts were estimated at US$278 billion in 1991, having also grown by approximately 8% per annum during the 1980s. This growth can be expected to continue into the next century. Tourism is the second most important international trade receipt activity (oil is the first) and represents 12% of the world's gross national product.

Changes in the world share of tourism receipts indicate that significant potential exists in the Balkan region. In comparison with other parts of the world, the Balkan region has had one of the lowest rates of growth since 1980 (Africa and Asia have had the highest growth rates). Eastern and Central Europe attracted approximately 11% of the tourist arrivals (by comparison, North America attracted 12.5%), but has the lowest share of tourist investment (under 1%).

Tourism in Eastern Europe has benefited from the political and social changes of the last few years. The region's scenic beauty, cultural heritage, history, and art were largely undiscovered by the west until this time. Low costs and good values have allowed visits to Eastern Europe (particularly Hungary and Czechoslovakia) to continue to increase gradually. However, tourism to Bulgaria has been directly affected since 1990 by the decrease in tourists from the former Eastern Bloc countries as well as visitors from Turkey.

In 1990 the total of 10.3 million visitors to Bulgaria consisted of 51% "transit" visitors; only 22% visited for holiday and recreational purposes. In 1991 the total number of visitors decreased to 6.8 million (a decline of approximately 45% in one year). This was due to a decrease of 2.8 million visitors from the former Eastern Bloc countries and a decrease of 1.1 million visitors from Turkey. However, there was a growth in visitors from the UK and other Western European countries. The decline in tourism in 1991 led to the underutilization of many tourist accommodations, even at major resorts during the peak season. This underutilization can be expected to continue due to the current economic climate in Western European.

This excursion into statistics is important, for it shows two things:

(1) that Bulgaria will have to compete for the future tourist market and improve its market image, and

(2) that, despite steady growth in tourism world-wide, variable tourist choice and short-term economic factors indicate the need for a clear development strategy for the future. I believe that this strategy should focus on eco and sustainable tourism for market as well as environmental reasons.

Bulgaria's Tourism Potential

For many years tourism in Bulgaria was seen as a matter of satisfying domestic demand and demand from other Eastern bloc countries. The 1970s and 1980s saw much governmental activity in tourism promotion. Two key destinations in Bulgaria for outside tourists - the Black Sea coastline and mountain ski resorts - were identified for investment and development. Often development was of poor quality by Western European standards, and in many cases visual and environmental damage was done to the landscape and to countryside resources. The Black Sea coastline is an obvious example.

Bulgaria will inevitably continue to offer good value for money as a tourist destination. Skiing holidays in Bulgaria can be up to 40% cheaper than in other European sites. But there are three categories of tourism resources that Bulgaria will need to concentrate on in improving its image.

If a two-level approach is adopted - Eco and Sustainable Tourism - certain tourism activities can be highlighted and related to identified areas and regions according to their appropriateness. These "soft" tourism activities may include:

Existing Tourism Image Factors

In the course of the Horwath Consulting strategy work on a tourism development strategy for Bulgaria early in 1992, a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis was performed. This analysis identified the characteristics of the Bulgarian tourism product and compared it with others that had the benefit of careful planning and investment. The SWOT findings are described below (Tables 1 and 2).

It should be pointed out that the development strategy proposed in the Horwath study was market-led and advanced proposals to capitalize on the country's strengths and weaknesses (and to avoid the threats). Happily, conservation of the environment came out strongly as an effective means of both improving image and achieving market growth.

Table 1. SWOT Analysis of Bulgaria as a tourism destination

Strengths Weaknesses
Bulgaria has a diverse and scenic terrain, comprising spectacular costal, pastoral, and mountain landscapes Poor quality of the built product in terms of:
- finish
- landscaping
- maintenance
- design
Rich biodiversity
A diversity of tourist products by region and location The non-customer/service orientation of personnel
A rich heritage in terms of folklore, tradition, religion, architecture, and culture Poor management and operational skills within the tourist industry in all sectors and at all levels
A generally high level of education of the population Poor quality of infrastructure in term of:
- airports
- roads
- signs
- toilets
- telecommunications
- entry/exit procedures
A good location within Europe in terms of access from the heart of Europe as well as Asia and the new Asian republics
The orientation of the Black Sea coast for families and the ski resorts for adults
The low price of holidays and tourist related services, generating a strong perception of value Poor safety and hygiene standards in tourist facilities and areas
A strong competitive position vis a vis other Eastern European countries in certain markets Poor organization of tourism at a national level

Table 2. SWOT Analysis of Bulgaria as a tourism destination

Opportunities Threats
Virgin areas for development Financial constraints in statutory and non-statutory bodies for monitoring, guiding, promoting, and managing tourism options and developments

Developing international markets for special interest tourism such as:
- historical, cultural, and religious
- hunting
- spa and health
- wine and food

Economic, political, and social climate (currently perceived to be unstable)
Competition from other tourist destinations
Desire to attract international tourists Pollution
Easing of travel restrictions to and in Central and Eastern Europe Uncertainty regrading the future implementation of a visa requirement for all tourists
The potential for developing a thriving tourist industry from existing base Lack of governmental control and planning and uncertainty of future tourism strategies
Competing demands on land for forestry, agriculture, etc.

Economic Benefits and Action Items

There can be no doubt that the economic benefits resulting from tourist development have environmental consequences. In principle, the benefits are to be found in employment, national income (mainly in the form of taxation, duties, and other fiscal activities), foreign currency, infrastructure improvements, and domestic recreation facilities.

Investment in tourism is a good value. In England, for example, the cost of creating a job in tourism in 1980 was about US$10,000 (£5,000). This cost was substantially less than the cost of job creation in manufacturing, industry, and agriculture, and once tourist jobs are created they are relatively long-lasting. By comparison, the actual average cost of maintaining benefits for unemployed persons in Britain was $8-9,000 per annum. The tourism "multiplier" will therefore always help the national economy.

It is worth pointing out how the positive environmental effects of eco tourism and special interest tourism will occur. Hector Ceballos-Lascurain has described the consequences of eco tourism where marginal agricultural areas are conserved with natural vegetation cover as a consequence of an expanding eco tourism economy. Ceballos-Lascurain also points out that the Kenyan tourist experience shows how careful conservation of lions and elephants within national parks generates 162 times more income than crop agriculture (or indeed hunting trophy). One could extrapolate this argument to the Bulgarian situation with its birds, mammals, and excellent flora and fauna. The Strandzha region, for example, contains wild cats, wolves, otters, and marbled polecats, and is the only place in Europe where the wild medlar-tree occurs. (In 1992, the rare Eleanora's falcon was also sighted there).

What are the action items for tourism development? As part of work already undertaken in the Horwath study, a number of general but key medium-term tourist development measures were recommended. These were:

Transportation and communications infrastructure

Pollution

Environment and planning control

Physical/Built Environment

The Horwath study also recommended detailed action on marketing and management/staff training measures.

Changes in the Planning Structure

To implement an effective sustainable tourism strategy, certain key changes in the approach to the Bulgarian town planning system are necessary and clear guidance will be required from the central Government (in a form similar perhaps to that of the British Government Circular and "Guidance Note" advice). For example, the British Department of the Environment recently issued a Tourism Policy Guidance Note (PPG 21) that described "sustainable" intentions and requirements as a national policy. These sustainable policies are to be implemented by the municipalities and Regional Tourist Boards.

It is worth noting the changes that have recently occurred in the town planning system in Bulgaria. Until just a few months ago, Bulgaria followed a relatively centralized town planning approach. A National Plan existed that directed investment to specified areas and controlled major planning decisions in the municipalities. The National Plan was integrated with Regional Plans (covering "problem" areas such as the Black Sea coast and the Danube region). The Regional Plans in turn influenced the Land Use Plans for areas of up to 20 settlements and the large municipalities. The more detailed inner city master plans covered specific inner urban areas. Today the municipalities have much more control over their futures and we must ask how this will affect a sustainable strategy approach.

In terms of control over development and environmental protection within specified areas, the current privatization and restitution process is radically altering the context of land use control and development in Bulgaria, and creating concern over the responsibility for effective management of the national parks and protected areas. The relaxation of centralized government control and the increasing powers of municipalities may make integrated policies in the larger parks difficult unless a unified approach is adopted within the planning system.

Regional tourism and economic plans will need to be promoted, possibly via associations of municipalities and Regional Tourist Boards based on national support and encouragement. The National Tourism Strategy (and the regional "PREST" type bodies) should be examples of this.

Clear land use plans for sensitive areas are needed. The sensitive "buffer zones" around the national parks need careful and firm policies. Environmental impact assessment will also be a vital component in planning work in the municipalities. European Community legislation and experience is also relevant for the future.

Another element vital to the future of a sustainable tourist development strategy for Bulgaria is the close link that it must develop with effective pollution control efforts. The central government must continue to emphasize this in investment and legislation. The Ministry of Environment has already implemented a sewage discharge program for the Black Sea and standards of pollution for the country's internal rivers will be addressed following introduction of the 1991 Environmental Protection Act. Again, the "image" factor is of vital importance in this regard. For example, the damage from a major problem at the Kosloduy nuclear installation on the Danube would have far-reaching consequences for the country's tourist economy (not to mention its environmental quality).

Tasks for a National Sustainable Tourism Strategy

I believe that the following key areas of study would be required in developing a National Eco and Sustainable Tourism Strategy:

Practical Strategy Aspects

As part of the effort to improve the national image, it is considered vital that the strategy apply detailed environmental and development codes of practice and design guidelines. Without clear policies regarding new design, layout, and landscaping, development schemes cannot be properly tested as they are put forward. The United Kingdom's experience in establishing Conservation Areas, Area of Outstanding Natural Beauty, and National Parks clearly shows that both developers and the public always benefit from positive environmental design policy advice from public bodies.

The following practical features should also be part of the strategy:

Emphasizing small business activities, particularly those involving local craft industries, is very important. The use of well designed and managed visitor centers in protected areas will also help to attract "soft" tourism interest.

Conclusions

In view of the economic benefits to be gained from the careful and sustainable growth of the national tourist economy, one message seems clear: trends in international tourism show that, without doubt, the expanding interest in Eco Tourism holidays could be of great benefit to Bulgaria. If a strategy is solidly prepared and implemented in the near future, this can be achieved in a manner that is sustainable and that will have long-term benefits for the national image.

There are many economic success stories involving tourism. Cyprus, for example, has a resident population of only about 1 million, but 1 million tourists visit annually. As a consequence it has little or no unemployment, even while maintaining a successful agricultural industry. Switzerland and Austria have strict planning and conservation controls and excellent sustainable tourism facilities, resulting in a high quality national image.

The successful implementation of a national strategy will require the involvement of several ministries and committees. The Ministries of Environment, Regional Development, Transportation, and Agriculture, as well as the Committees of Forestry and Tourism, will need to work closely together to carry out a strategy. Of vital importance will be the practical application of the strategy by regional associations of municipalities and by the individual municipalities themselves.

Bulgaria has everything to gain by preparing such a tourism strategy. I believe that it is a necessary extension - for both conservation and economic reasons - of the biodiversity conservation efforts that are the focus of this workshop.

Back | Table of Contents | Next