Sources of Returns

The terminology of income, benefits and returns

For clarity, the following terms are consistently used in this report:

Income – indicates cash income received as payment for goods or services, either by organisations or individuals

Benefits – indicates benefits distributed by a conservancy as dividends or social benefits, or by the private sector as fringe benefits and donations; these go to communities or individual households and can be divided into three types:

in-kind benefits include meat distribution and fringe benefits from tourism employment such as staff housing, etc.
cash benefits are dividends paid to conservancy members from conservancy income
social benefits are investments in community initiatives including education facilities, health services, etc.

Returns – combine income and benefits and indicate overall returns, either to individuals, communities, or conservancies.

Responding to the financial impacts of the COVID-19 pandemic

The pandemic was a learning curve that brought out the need for more resilient strategies in conservation to withstand external and unexpected shocks. Diversification of economic opportunities remains a priority in the CBNRM Programme. While it is envisioned that conservation tourism and hunting will remain the core contributors to income in conservancies for the foreseeable future, there is a need to advance value additions in the fields of conservation agriculture, arts, and crafts, plant products, and develop products and services, such as Wildlife Credits, that can be supported by other external markets.

Total returns to conservancies and members

Sources of returns to conservancies and their members in 2022

Source of cash income and in-kind benefits	Amount 2022 N$	%	Amount 2021 N$	%	Amount 2020 N$	%	Amount 2019 N$	%
Joint-venture tourism (includes all cash income to conservancies and members)	90,898,390	53.7	52,871,581	46	46,453,579	48.2	96,895,376	61.8
Conservation hunting (includes all cash income and meat to conservancies and members)	36,603,243	21.6	28,407,565	24.7	26,988,405	28.0	39,598,195	25.2
Grants	28,964,100	17.1	23,199,858	20.2	13,838,384	14.4	7,249,949	4.6
Game harvesting for meat, conflict animals and live sales	6,810,837	4.0	6,812,134	5.9	4,646,025	4.8	6,363,201	4.1
Miscellaneous (e.g. bank interest)	3,169,738	1.9	1,658,805	1.4	1,944,569	2.0	2,155,377	1.4
Indigenous plant products	1,501,204	0.9	1,029,191	0.9	1,482,160	1.5	1,974,239	1.3
Crafts			708,900	0.6	917,806	1	1,420,496	0.9
Community-based tourism	1,501,204	0.9	257,602	0.2	29,250	0	1,195,660	0.8
TOTAL	169,218,109	100	114,945,636	100	96,300,178	100	156,852,493	100

Varied sources of natural resource returns

Four sample conservancies illustrate the large variation between conservancies in sources of natural resource returns. The “Cash income and in-kind benefits” bar charts show total cash income and in-kind benefits over time, and the “Sources of returns” pie charts illustrate the ratios between sources of returns. The “Disbursements” bar charts show disbursements within conservancies, which also vary considerably. While some conservancies pay out substantial cash benefits to households, others provide broader social benefits to resident communities.

Cash income and in-kind benefits in 2019

Sources of returns in 2019

Disbursements in 2019

Impacts of tourism and hunting

Joint venture tourism and conservation hunting make the greatest financial contributions to communal conservation through game guard salaries, improved livelihoods, and support to farmers with human-wildlife conflict incidents.

Grants from CRRRF were disbursed to conservancies to assist with operations but some conservancies still received income from both tourism and conservation hunting, which are important sources of income for numerous conservancies.

Most conservancies are reliant on consumptive wildlife use for income generation. Without this option (see maps below) many conservancies that do not have photographic tourism potential will no longer be able to cover their operational costs.

The complementary roles of sustainable consumptive wildlife use and joint-venture tourism operations

The figures compare the benefits generated by these two important sectors since the commencement of conservancy creation in 1998.

Reliance on conservation hunting and photographic tourism

International visitors are a high value market for both photographic and hunting operators, and this sector has been the focus of most operators in conservancies in the past. Due to international travel restrictions, many conservancies relied almost entirely on external financial assistance received through the CRRRF. To buffer future potential impacts, conservancies need to diversify sources of income, and one way to do this is to create more products for the domestic market. Cheaper hunting safaris and discount accommodation rates for Namibian or southern African visitors were required during the lockdown, and more of this kind of tourism might be required in future.

The importance of consumptive wildlife use income

Other potential challenges to these industries include the pressure to ban hunting and prevent trophy imports to key hunting markets, and the pressure on international flights due to climate concerns. The latter concern is more problematic for the photographic tourism industry, as larger numbers of visitors are required in this industry than in the hunting industry to generate a similar level of income. Trophy import bans threaten income from the hunting industry and if hunting were not available as a source of income in 2020, many more conservancies would not have been able to cover their operating costs.

Several conservancies that have no income in a usual year received some support through the CRRRF. However, external funding is unlikely to meet the financial needs of all conservancies and community forests in the long term. A better strategy is to create diverse revenue streams that rely on different markets, while meeting any critical financial shortfalls or providing support to conservancies that are not yet generating their own income through grants.

Joint Ventures. Despite the effects of the COVID-19 pandemic, new joint venture partnerships were forged with the private sector in Impalila and Balyerwa conservancies in Zambezi. The BELWG continued to provide technical support such as legal advice, inductions, and JV contract negotiations and reviews for various conservancies. Because of the COVID-19 pandemic restrictions during the year, there have been shortcomings in the management of JV agreements, such as the lack of joint management committee meetings where during normal times most issues between the two parties could be solved through constant dialogue. These shortcomings will need to be resolved to re-establish good working relations between conservancies and the private sector.

Income diversification is crucial to withstand shocks and increase returns.COVID-19 highlighted the need for diversifying income sources to build more robust and resilient livelihoods. Business models need to be reworked, and there is a strong need to create additional opportunities beyond lodges and hunting operations to focus on local entrepreneurs, who can also derive benefits from a pro-conservation business.

It is increasingly important to ensure that benefits from natural resources flow to the household level. This creates a direct link to the value of natural resources, increases the tolerance of communities living with wildlife, and reinforces the importance they place on conservation as a significant contributor to their livelihoods. This may also lead to conservancy members holding themselves and their management committees accountable.

Inspiration. The CBNRM sector remains at the forefront of protecting biodiversity while strengthening conservation measures and ensuring that communities reap the benefits of living with wildlife. To be resilient, there needs to be greater emphasis on sustainability by building the capacity of communities to be self-reliant and self-sufficient. With the fundamentals of governance, accountability and natural resource management in place, Wildlife Credits a payment for ecosystem services, is a valuable nature-based solution (NbS) addition.

Wildlife Credits is a payment for ecosystem services where conservation performance payments are made to wildlife stewards based on verified conservation results. Wildlife Credits have evolved since its inception. Technology such as camera traps, satellite data and SMART apps are now being used to monitor wildlife and landscape conservation metrics within conservancies to show conservation performance. The Wildlife Credits verifications systems has 3 phases:

Phase 1: Conservancy using smartphones, camera traps, and satellites to collect data on their wildlife and wildlife habitat.
Phase 2: Data is transferred, analysed, and automated, using desktop computers, AI, and cloud data-based platforms.
Phase 3: Includes the use of outputs from the data to produce bankable products, i.e., “credit” certificates that can attract payers willing to pay for conservation performance.
Wildlife Credits is being piloted in 6 conservancies but has been shared with 45 conservancies who are all interested in joining the initiative, particularly with the new product called Wildlife Zones. This product could potentially be applied by all conservancies that have set aside land for conservation and would include monitoring using platforms such as AI performance dashboards.

Also being piloted is the Kunene Lions product, which is currently in the development stage and focused on 11 conservancies in Kunene.

“When tourists visit Namibia, they get to see the different wildlife and landscapes found in Namibia, which is completely different from their landscapes and wildlife”

– Poniso Dimba Wallen, Mayuni Conservancy