Economic Valuation of a Tamarind (Tamarindus indica L.) Production System: Green Money from Drylands of Eastern Uganda
Abstract
Tamarind (Tamarindus indica) is a valuable tree species Uganda and elsewhere in semi-arid Africa—for fruit, timber, leaves and shade—but like other indigenous species has been subject to decline in recent years. The success of steps to assist natural regeneration and rehabilitation will depend on the net financial benefits to the rural households, hence there is a need for improved financial information on the costs and returns of growing tamarind trees. This paper compares the financial performance of T. indica production in the open woodland and cropland areas in Uganda. Household surveys were carried out in Kamuli and Kaliro districts in eastern Uganda from July 2004 to February 2005. The estimated mean production of T. indica was 127 and 84 kg/ha/year from open woodland and cropland areas, respectively, a statistically significant difference. The net present value from T. indica products was US$ 893/ha in woodland and US$ 684/ha in cropland. In terms of foreign export earnings, T. indica juice from woodland and cropland was estimated to generate US$ 0.03/ha and US$ 0.02/ha, respectively. Returns from alternative land-use activities of agricultural cropping were highest for maize and lowest for finger millet in both open woodland and cropland sites. Sensitivity analysis revealed that an increase in the real discount rate from 9.86% (base case) to 15% decreases the financial NPVs of both the open woodland and cropland areas by 24%.
Keywords
Desertification Rural livelihood Financial analysis Fruit productionNotes
Acknowledgment
Funds to carry out this study were provided as a post-doctoral research grant to the second author by the Department of Economic Planning and Management, Gadjah Mada University, Yogyakarta, Indonesia.
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