Available funds for protecting and managing nature reserves are extremely limited in developing countries, including China. This article considers the financing and management of Xishuangbanna State Nature Reserve in Yunnan as a case study. This Reserve is under the overall management of the Bureau for the Protection of Xishuangbanna State Nature Reserve but there is considerable decentralisation in the management of its five sub-reserves. These are managed from four stations, one for each of the sub-reserves except for Mengla and Shangyang sub-reserves which share the same station. The source of funds for the Reserve and sub-reserves are listed and the nature of outlays are specified. Almost all available funds are spent on salaries wages and pensions for staff of the Reserve, leaving few funds for overheads, transport and other items, especially capital items. Government is the principal source of funding, but some income is obtained from ecotourism, from a butterfly farm and factory for processing butterflies, from multiple use operations such as rental income from concessions to grow passionfruit in parts of the Reserve, and from resource management fees such as fines imposed for illegal use of the Reserve and payments for the controlled removal of timber and wood from the Reserve. Political influences on financing are discussed It is suggested that the high ratio of expenditure on staffing to total expenditure can be partly explained by political considerations. It is, however, observed that actual salaries paid to employees of the Reserve. are very low, even by Chinese standards. Given the shortage of discretionary funds available to the Reserve, especially for capital goods and investment, substantial progress with the latter items is dependent on foreign aid. In this respect WWF(Europe) has been one of the most important donors to date. In the future, some funds for such purposes may also become available from the Global Environmental Facility.


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