Deriving the discount rate for seedling nurseries and other livelihood projects

Harrison, Stephen R. (2010). Deriving the discount rate for seedling nurseries and other livelihood projects. In: Stephen R. Harrison, Annerine Bosch, Nestor Onting Gregorio and John L. Herbohn, Proceedings of End-of-Project Workshop: ASEM/2006/091 Enhancing Tree seedling Supply via Economic and Policy Changes in the Philippines Nursery Sector. End-of-Project Workshop: ASEM/2006/091 Enhancing Tree seedling Supply via Economic and Policy Changes in the Philippines Nursery Sector, Leyte, Philippines, (171-177). 19-20 June 2010.

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Author Harrison, Stephen R.
Title of paper Deriving the discount rate for seedling nurseries and other livelihood projects
Conference name End-of-Project Workshop: ASEM/2006/091 Enhancing Tree seedling Supply via Economic and Policy Changes in the Philippines Nursery Sector
Conference location Leyte, Philippines
Conference dates 19-20 June 2010
Proceedings title Proceedings of End-of-Project Workshop: ASEM/2006/091 Enhancing Tree seedling Supply via Economic and Policy Changes in the Philippines Nursery Sector
Place of Publication Gatton, QLD, Australia
Publisher The University of Queensland
Publication Year 2010
Sub-type Fully published paper
Open Access Status
Editor Stephen R. Harrison
Annerine Bosch
Nestor Onting Gregorio
John L. Herbohn
Start page 171
End page 177
Total pages 7
Language eng
Abstract/Summary A critical parameter in the financial appraisal of forestry investment projects is the discount rate or required rate of return by the investor – usually taken as the weighted average cost of capital – used to convert incremental net cash flows to their present values. For forestry projects by smallholder and indigenous communities, relatively high discount rates are invariably adopted in investment project assessment (IPA). Long payback period and uncertain or community tenure can make formal sources of lending inaccessible. An assessment of availability of finance and of previous investment studies for small-scale forestry-related projects in the Philippines suggests an appropriate discount rate of about 20% per annum in current price terms or about 15% for constant price analysis (net of inflation).
Q-Index Code EX
Q-Index Status Provisional Code
Institutional Status UQ
Additional Notes This is an ACIAR Research Program. Project ID ASEM/2006/091. Commissioned Organisation: University of Queensland, School of Natural and Rural Systems Management, Australia. Project Leader: Dr John Herbohn.

Document type: Conference Paper
Collection: School of Agriculture and Food Sciences
 
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Created: Fri, 24 Jun 2011, 14:17:17 EST by Annerine Bosch on behalf of School of Agriculture and Food Sciences