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Whale Watching in Cape Ann, Massachusetts.
Photo: Courtesy of Cynde Bierman

March 18, 2002
"The Economic Value of Whales in their Live State: Part I"
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This is Roger Payne speaking to you from aboard the Odyssey.

One of the less controversial ways to measure the contribution made by whales to humanity is to do economic studies of what is earned from such industries as whaling and whale watching. The undisputed expert on the latter subject is Erich Hoyt who, 18 months ago published his third study on the economics of the whale watch industry. To research this comprehensive study entitled "Whale Watching 2000: Worldwide Tourism Numbers, Expenditures, and Expanding Socioeconomic Benefits" he sent a survey to more than 1,000 whale watch operators in 87 countries and territories throughout the world including North, Central and South America, the West Indies, Europe, Asia, Africa, Australia, Oceania & Antarctica.

About half of the recipients responded and from their answers as well as the surprisingly extensive literature that now exists on this subject, he concluded that in 1998, whale watching was done by more than 9 million people worldwide and that a conservative estimate for what they spent doing so was one billion 49 million dollars (US). Since whale watching has been growing exponentially these numbers are presumably much larger now. For example: back in 1991 there were about 4 million whale watchers in 31 countries and territories worldwide. By 1994 it had risen to 5.4 million in 65 countries, and by 1998 to 9 million in 87 countries. These increases of the '90s were not linear they were exponential and there is every reason to believe that similar increases are still going on.

Hoyt also studied the rates of growth of the industry. He found that in the four year period between 1994 and 1998 the amount whale watchers spent on tours, as well as travel, food, hotels and souvenirs went from $504 million US dollars, to more than double that: the one billion 49 million US dollar figure. Inasmuch as four years have elapsed since 1998, it would not be surprising if it has reached more than two billion dollars by the end of this year. Total expenditures show an average annual increase of 18.6%. Between 1994 and 1998, 197 new communities entered whale watching, giving a grand total of 492 worldwide.

Many of these communities were struggling when they started whale watching, but so successful is this form of tourism it has revitalized the economies of some of them-a process that also helps to foster an appreciation of the importance of marine conservation, and at the same time give local researchers long anxious to study whales or the sea, access to boats. As Hoyt puts it: "Whale watching offers communities a sense of identity and considerable pride. In a number of places, itů literally transform[s] a community."

It is interesting to see that the majority (34) of the 40 member countries of the International Whaling Commission (the IWC) now have at least some whale watching activity in their countries, although their discussions of whale watching have been minimal during IWC meetings, and, one gets the feeling, that they are sometimes grudgingly entered into by the largest whaling nations. This is an inappropriate reaction since whale watching is an industry that can save whaling nations from their own excesses by offering new employment to people already out of the business of whaling or soon to be.

Together, the IWC member nations account for nearly 8 million people a year going whale watching. These people spend a total of $779,828,000 US dollars. In fact the vast majority of whale watching (86% of it) occurs within IWC member nations, and that includes the three main whaling nations: Japan, Norway and Iceland. There is a sea change taking place: far more new jobs now come out of whale watching than out of whale killing. This means that in many places the economic rewards of whale watching either already outweigh the economic rewards of whaling or will soon do so-even if whaling reopens. The most dramatic example of this is perhaps Japan where the numbers of people employed by the whaling industry is increasing very slowly, while the number employed by the whale watch industry is growing exponentially.

A humpback whale breaches.
Photo: Courtesy of Cynde Bierman

The point I am trying to make is simple: whales are fast becoming far more valuable to the economies of the nations that have invested in whale watch industries than it is reasonable to expect they can become through reopening commercial whaling on unrecovered whale stocks. And when countries reopen commercial whaling in their home waters they are bound to impact their whale watch industries, and the impact is bound to be negative. The justification for this view comes from a study by Hoagland and Meeks (1997) who took polls of whale watchers showing that the most attractive features of whale watch trips, were, in descending order, number of whales seen, number of species seen, naturalist interpretation, and having a boat ride. It is clear enough from this that the most important consideration in satisfying whale watch customers is to have them see lots of whales. This means that as soon as a country starts killing the whales that pass through its whale watch waters, they will diminish the numbers of whales the tourists have to see, thereby giving those tourists a diminished experience. Around Boston, Massachusetts, the whale watch industry involves over thirty boats all of which are often dependent at the beginning and end of the whale watch season on two or three whales for many weeks at a time. If there were a whaling industry operating in the area and it happened to kill one of these whales (very likely since they tolerate the close approach of boats so easily), it would devastate the whale watch industry. That demonstrates clearly that whale watching and whale killing cannot co-exist in the same area, or on the same stocks of whales.

The only significant market to which to export whale meat these days is Japan. But the country that kills, freezes and exports whale meat will always lose the greatest part of the value from its whales because it will be more or less giving away the whales it kills (to say nothing of risking exporting the frozen remains of the few whales that support its whale watch boats). The loss of value of its whale meat occurs because the country that buys a raw material like meat and sells it on will always reap the big profits, just as the whalers themselves will always reap the smallest profits. In that sense, whaling is like lumbering; those who kill the big trees and ship them overseas will always make the least profit. The big profits will be realized by the importers in the nation buying the lumber-the raw material, and sells it on.

This is Roger Payne aboard the Odyssey off Western Austalia where although we were surrounded by sperm whales yesterday we are now going back in because the weather is too rough for us to work effectively. Next time I will tell you about some rather unexpected forms of whale watching and a strange and rather scary experience I had when I tried to get Iceland to start a whale watch industry back in the 1980s.

(c) 2001 Written by Roger Payne

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  • Go to Part II and Part III of "The Economic Value of Whales in their Live State"

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