An Economic Valuation of Reducing Marine Litter on Coastal Beaches in Sri Lanka

Abstract

Sri Lanka is an island with a coastline of about 1620km, located in the Indian Ocean. Marine litter poses several threats to the coastal environment as well as to the economy. This study estimates the total economic value of marine litter reduction on the Sri Lankan coast by employing the One and One-Half Bound (OOHB) dichotomous choice contingent valuation (CV) method, which asks respondents to specify their willingness to pay (WTP) for the litter reduction. The CV surveys were undertaken through person-to-person interviews with 600 people in the western and southern provinces of Sri Lanka in November 2021. The payment vehicle of the scenario is an annual environmental tax for the next five years period. The respondents understood the CV questions well and appropriately responded to the hypothetical scenario explained in the CV questionnaire. Overall, 15.5% of the respondents had zero WTP, and the truncated mean annual WTP is estimated as 2,585 LKR ($12.93) per household. This value has a statistically good fit. The lower estimate of the population’s WTP for the reduction of marine litter would be 3,944.06 million LKR ($19.72 million) per year and the higher estimate is 7,888.13 million LKR ($39.44 million) per year. The present value of mean WTP per household for five years period is 8,665.32 LKR at the discount rate of 15%. Accordingly, the aggregated lower estimate of the project is 13,221.11 million LKR ($66.11 million), and the higher estimate is 26,442.23 million LKR ($132.21 million). The analysis based on the responses suggests two possible reasons for the higher WTP. First, most of the respondents are more concerned and aware of marine litter issues as they reside in coastal areas, which affects WTP positively. The second reason is people’s consciousness of the impacts of marine litter on the coastal tourism industry and the fishing industry. The findings of this study can be utilized for future policy planning regarding marine litter management, especially in western and southern provinces because western and southern coastal areas were identified as the highly polluted areas with marine litter.