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Return on investment for mangrove and reef flood protection

Published Article

Caribbean

Publication date: August 22, 2022

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This study applies risk‑industry methods to assess coral reef and mangrove restoration as natural defenses against flooding. Across more than 20 Caribbean countries, results show strong and robust returns on investment for flood risk reduction, even under high restoration costs, revealing major opportunities to finance coastal and marine restoration.

Subject Tags

  • Reefs
  • Coastal
  • Climate resilience

Abstract

There is a growing need for coastal and marine restoration, but it is not clear how to pay for it given that environmental funding is low, and national budgets are stretched in response to natural hazards. We use risk-industry methods and find that coral reef and mangrove restoration could yield strong Return on Investment (ROI) for flood risk reduction on shorelines across more than 20 Caribbean countries. These results are robust to changes in discount rates and the timing of restoration benefits. Data on restoration costs are sparse, but the Present Value (PV) of restored natural infrastructure shows that ROI would be positive in many locations even if restoration costs are in the hundreds of thousand per hectare for mangroves and millions per km for reefs. Based on these benefits, we identify significant sources of funding for restoring these natural defenses.

Citation

Beck, M. W., Heck, N., Narayan, S., Menéndez, P., Reguero, B. G., Bitterwolf, S., ... & Losada, I. J. (2022). Return on investment for mangrove and reef flood protection. Ecosystem Services, 56, 101440.

TNC Authors