Financial and economic analyses of agroforestry systems and a commercial timber plantation in the La Amistad Biosphere Reserve, Costa Rica

Abstract

A possible method of protecting biosphere reserve core zones is to encourage transition and buffer zone activities which are compatible with the core and which provide sufficient returns to the human population to make entry into the core zone unnecessary. The AMISCONDE project is promoting block plantations and coffee/tree agroforestry systems to do this, but did not analyze their financial or economic feasibility. Unprofitable systems will not be adopted without subsidy and are not sustainable after a project ends. Analyses show internal rates of return exceeding 30% for coffee/tree combinations both with and without project subsidies. Coffee/tree systems have significantly higher returns than coffee without trees, reduce the risk from coffee price fluctuations, and reduce the need for chemical fertilizers. Returns from a block plantation of cypress are a small fraction of coffee and coffee/tree system returns, but still are positive and have the advantage of requiring much smaller initial investments. The systems analyzed seem likely to be sustainable and to contribute to project conservation and development objectives.