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Press Release 
Hlengiwe Cele  
Estuaries as a means to enterprise development and economic empowerment

Estuaries are valuable ecological, social and economic assets that present considerable opportunities for revenue generation, particularly for disadvantaged people in rural areas, where the surrounding natural resources are often the only practical option for enterprise development. However, as a recently-published Water Research Commission (WRC) study shows, the potential for economic empowerment based on estuary services is generally underappreciated and underdeveloped. In the Eastern Cape, for example, informal observations made over ten years while conducting research on estuary management indicated that disadvantaged people living at or near estuaries were obtaining limited economic benefit from estuary resources.  The main drivers of economic empowerment were resort hotels which provided employment and other business opportunities, such as horse and hiking trails, canoe trails, cultural tours, ghillies (fishing guides), bait sellers and honey production.

 “An estuary-based enterprise is dependent on two things" says project leader Duncan Hay of the School of Environmental Sciences at the University of KwaZulu-Natal, "something that is related to the estuary that can be sold or exchanged and someone who wants it and that is prepared to pay for it with something else. The interaction between demand and supply creates and dictates the nature of the economic opportunity.” Many of the services provided by estuaries, such as processing of waste, providing bait and fish, for example, are taken for granted and consequently the benefits derived are undervalued. “Because we do not pay for many of the benefits we derive from estuaries, we do not generate the revenue that is required to sustain management,’’ says Hay.

A key factor in determining the success of estuary-based businesses is the risks associated with the highly dynamic natural environment which estuaries present.  Whilst there is wide appreciation of the variability in demand for ecosystem services, there is less appreciation for the variability in the potential of ecosystems to deliver these services. Economic enterprises that are based on ecosystem services are thus continuously subject to uncertainty in both demand and supply. Business enterprises based on natural resource systems are vulnerable to failure when this complexity and uncertainty is not taken into account.

Other important factors are a lack of skills and finance.  Dr Stanley Liphadzi, Director for Water-Linked Ecosystems at the WRC comments “Many disadvantaged people living at or near estuaries are poorly educated and lack the necessary skills to initiate and operate businesses or secure jobs that utilise the ecosystem services offered by estuaries, and local people frequently lack the investment capital to secure equity in existing or start-up businesses.  In one or two instances there are Black partners in resort hotel ownership but they are largely drawn from the political and economic elite”.

To address these challenges, the WRC funded a research project aimed at developing an approach to identify and develop resilient estuary-based business enterprises, by reducing the vulnerability of enterprises founded on one or more ecosystem services.   The process was tested at Mngazana and Mngazi Estuaries near Port St Johns, and also for the Mbongolwane wetland system.

“Central to the process was that key stakeholders themselves established what the opportunities were, how these opportunities might be taken and what the risks were”, explains Duncan Hay, the project leader. “It was a structured and participative process where users, regulators, supporters and researchers learnt together about the system and what was possible. Most of the information was generated by the intended beneficiaries which then allowed them to take ownership of the process.”

Stakeholder response to these case study processes was, without exception, overwhelmingly positive, and it was shown that all participants, even those without formal education, were able to engage the process effectively.  In addition to estuaries, the approach can be applied to other areas natural resource systems, and across a variety of planning and management contexts.

The study is entitled: 'An approach to estuary-based economic empowerment with a particular focus on the Eastern Cape Wild Coast' (WRC Report Number 1705/1/11). Contact Hlengiwe Cele tel:012 33006 or email hlengiwec@wrc.org.za



The Mngazana canoe trail enterprise provides valuable income to local guides and assists them in developing their business skills
Large resort hotels at estuaries are often catalysts for other estuary-based businesses
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