Financial and economic analysis for Cat Tien National Park Ecotourism Plan in the period of 2021 - 2030

Abstract

This study was carried out to evaluate the economic and financial viability of the Ecotourism Development Plan of Cat Tien National Park in the period of 2021 -2030 (hereafter known as the Plan). The analysis results showed that the Plan is a feasible investment project, however, its ecconomic efficiency is not too promissing (with the IRR of 5.1% and the NPV>0 at the discount rate of 5%), mostly due to the large investments in multi-purpose facilities which mainly serve for forest protection and local socio-economic development actvities and partly serve for ecotourism development (i.e., investment in building, upgrading and maintainig civil roads around the Park). On the contrary, the financial analysis showed a much better outcome (with the IRR=63.4%, NPV>0 at all three selected discount rates and the net profit ranging from VND 2.5 - 3.7 billion per year). This can be explained that: the investment capital from the Park’s self-financing reveneus only accounts for nearly 30% of the total planned investment cost and is planned to invest directly in the tourism development in the central area of the Park. The sensitivity analysis results showed that even in the case the the tourism revenue in the period of 2021 -2030 only reaches 80% of the expected amount, the fiancial effciency of the Plan is relatively good (with NPV>0 at all three selected discount rates and the net profit ranging from VND 1.2. - 1.9 billion per year). The only risk posed to the Plan, which makes it no longger feasible in term of fiancial efficiency, is that the Park can not mobilize up to 70% of the planned investment capital from the state budget, therefore, must use its self-financing revenue to fill in the gap.