1. In accordance with its schedule of work, the Intergovernmental Forum on Forests (IFF), as endorsed by the Commission on Sustainable Development and the Economic and Social Council, continued consideration at its fourth session of the three programme elements included in its mandate.

2. In accordance with its mandate, IFF adopted a decision proposed by the Co-Chairmen by which the Forum recommended the texts of programme elements I-III negotiated at the fourth session for adoption by the Commission on Sustainable Development at its eighth session (see chap. II, draft decision).

3. IFF also reiterated the provisions of paragraph 12 of its report on its first session (E/CN.17/IFF/1997/4) and expressed its appreciation to the organizers of government-led initiatives undertaken in support of its fourth session, including:

(a) An open-ended international expert meeting on special needs and requirements of developing countries with low forest cover and unique types of forests, under the initiative of the Government of the Islamic Republic of Iran;

(b) A presentation on initiative on international arrangements and mechanisms to promote the management, conservation and sustainable development of all types of forests in support of IFF programme element III, under the initiative of the Governments of Costa Rica and Canada;

(c) A presentation on implementing the proposals of the Intergovernmental Panel on Forests (IPF), sponsored by the United Nations Development Programme (UNDP) with the Governments of Costa Rica, Malawi and Viet Nam;

(d) A presentation on profitable rehabilitation of degraded forests sponsored by the Government of Turkey;

(e) A presentation on the outcome of a South Pacific subregional workshop on IFF issues, sponsored by the Government of Australia;

(f) A presentation on the theme "Greener forest: extension services and training for sustainable forest management", sponsored by the Government of Sweden.

4. IFF expressed its appreciation to Governments, international organizations and non-governmental organizations that had organized various side events and presentations during the session, which had provided for an in-depth consideration of a number of important issues of the IFF work programme and enriched its deliberations.

5. IFF expressed its appreciation to the IFF secretariat as well as member organizations of the Inter-Agency Task Force on Forests (ITFF) for their important work and contributions in support of its deliberations.

The Intergovernmental Forum on Forests, in accordance with its mandate, recommends to the Commission on Sustainable Development, at its eighth session, the adoption of the following draft decision:

Matters relating to the work of the Intergovernmental Forum on Forests on its fourth session

The Commission on Sustainable Development, at its eighth session, adopts the programme elements of the Intergovernmental Forum on Forests contained in the annex below.

Conclusions

1. The Intergovernmental Forum on Forests (IFF) welcomed the commitment, expressed by Governments, international organizations and other partners, to the implementation of all the Forum’s proposals for action and noted with appreciation the many activities at the national level initiated by countries, groups of countries and international organizations. It noted the added attention given to the social and environmental services provided by forests as well as the challenges to address these issues. It emphasized the need for the effective involvement of relevant interested parties, as well as the improvement of institutional arrangements and appropriate ways and means of communication.

2. The Forum underscored the need for implementation of strategies in terms of investment, mobilization of domestic and international resources and — in the case of developing countries, with special attention to least developed countries and developing countries with low forest cover — appropriate financial mechanisms and/or measures including support through official development assistance (ODA).

3. The Forum considered national forest programmes, as defined by the Intergovernmental Panel on Forests (IPF), to be a viable framework for addressing forest sector issues, including implementation of the IPF proposals for action in a holistic, comprehensive and multisectoral manner. It took note of the national case studies prepared under the Six-country Initiative of Finland, Germany, Honduras, Indonesia, Uganda and the United Kingdom, as well as of the Baden-Baden workshop and its results. This initiative was considered an important contribution to the assessment of the IPF proposals for action at the national level, and for supporting implementation work at national and subnational levels. The Initiative had recognized the diversity of national conditions and interested parties in assessing the relevance and prioritization of the proposals at the national level, and had also produced a useful Practitioners Guide, which should be revised to facilitate assessment exercises. In order to enhance the implementation of the proposals for action adopted by IPF, the Forum identified the need for effective follow-up and long-term commitment at all levels.

4. The Forum noted that the IPF proposals for action were numerous and complex and covered a wide range of important issues. The Forum recognized that sustainable forest management was a long-term process and goal and countries would not, within a limited time-frame, be able to show substantial progress in capacity-building, policy development, planning processes and creation of enabling and supporting infrastructure. The Forum underlined the need for sustained efforts in implementing the IPF proposals.

5. The Forum recognized that IPF implementation by developing countries with low forest cover merited special attention. It called on the United Nations Environment Programme (UNEP), as the lead agency for this programme element, to expedite the development of a definition of low forest cover as contained in the IPF proposals for action. It invited the Global Environment Facility (GEF) as well as the relevant environmental conventions, including the Convention on Biological Diversity, the United Nations Framework Convention on Climate Change (A/AC.237/18 (Part II) Add.1 and Corr.1, annex 1) and the United Nations Convention to Combat Desertification in those Countries Experiencing Serious Drought and/or Desertification, particularly in Africa (A/49/84/Add.2, annex, appendix II), and international financing institutions to look into and reflect on the special needs of developing countries with low forest cover, and called upon the informal, high-level Inter-Agency Task Force on Forests (ITFF) to coordinate its work in supporting these countries.

6. The Forum expressed support for the work carried out by the informal, high-level Inter-Agency Task Force on Forests. It noted that the Task Force had been and continued to be an effective means of support of the IPF/Forum process and of informal inter-agency coordination on forests. In future, the work of the Task Force should be strengthened and further developed.

7. The Forum took note of the continuing monitoring of the effects of airborne pollutants on forests within member countries of the International Cooperative Programme on Forests (ICP Forests), as well as the establishment of new protocols dealing with nitrogen, heavy metals and persistent pollutants under the Geneva Convention on Long-Range Transboundary Air Pollution, as well as the beginning of regional cooperation on a monitoring network on acid rain among countries in Eastern Asia. It noted with appreciation the offer by some countries to extend their cooperation to interested countries not presently participating in international networks.

8. The Forum also took note of recent regional and international initiatives that are supportive of implementation of the IPF proposals for action, including the strengthening of the Sub-Network of Protected Areas of the Amazon, agreed by the Ministers of Environment of the Parties to the Amazon Cooperation Treaty, in March 1998; recent developments within the framework of the Central American Convention on Forests; the regional workshops on IPF implementation held in Indonesia in February 1998, in Senegal in April 1998 and in Chile in June 1998, under the auspices of the Food and Agriculture Organization of the United Nations (FAO) Regional Forestry Commissions for Asia and the Pacific, Africa and Latin America and the Caribbean; the Ministerial Conference on the Protection of Forests in Europe held in Portugal in July 1998; and the G-8 Forest Action Program endorsed by G-8 Heads of State in May 1998 in England (the Group of Eight, or G-8, comprises the United States of America, Japan, Germany, France, Italy, the United Kingdom, Canada and the Russian Federation).

Proposals for action

9. The Forum agreed that the following are particularly important for the implementation of IPF proposals for action:

(a) Provision, taking into consideration the relevant chapters of Agenda 21 and paragraph 10 of the Non-legally Binding Authoritative Statement of Principles for a Global Consensus on the Management, Conservation and Sustainable Development of All Types of Forests (Forest Principles), by the international donor community, including international organizations and international financial institutions of increased financial resources, including through innovative strategies to mobilize finance, technical assistance and transfer of environmentally sound technology at the international and domestic levels, as well as through better use of existing mechanisms and measures, to support national forest programmes in developing countries, including countries with low forest cover and particularly the least developed countries;

(b) Promotion, where appropriate, of an integrated approach by countries through their national forest programmes as defined by IPF, and in collaboration with international organizations, to the implementation of the IPF proposals for action and forest-related work as set out under the Convention on Biological Diversity, the United Nations Convention to Combat Desertification in those Countries Experiencing Serious Drought and/or Desertification, particularly in Africa, and the United Nations Framework Convention on Climate Change;

(c) Creation and/or strengthening, by countries and international organizations, of initiatives, approaches and partnerships, which could include partnership agreements, to encourage long-term political commitment; relevant, effective, sustained and reliable donor support; and participation by the private sector and major groups; as well as recognition of the special role of ODA in meeting the needs of developing countries, in particular least developed countries and countries with low forest cover;

(d) A systematic assessment, by all countries, of the IPF proposals for action and planning for their implementation in the context of countries’ own national processes aimed at sustainable forest management;

(e) Implementation by countries of the IPF proposals for action in the context of their national forest programmes/national policy framework in a coordinated manner and with the participation of all interested parties. Clear objectives and criteria should help promote effective implementation of sustainable forest management. The policy framework should be kept under review in order to continue to embody capabilities for intersectoral planning, coordination and implementation, and adequate resource allocation;

(f) Establishment, by each country, of a focal point to guide and coordinate the implementation and assessment process of the IPF proposals for action, including the participation of all relevant interested parties;

(g) Further assistance by the international community to developing countries and countries with economies in transition in implementing the IPF proposals for action as needed. National forest programmes could be used as a framework for channelling development assistance for implementation. Such support is particularly needed for capacity-building, and for creating participatory mechanisms and innovative financing arrangements.

Conclusions

10. IFF recognized that there are various aspects to data collection, monitoring, assessment and reporting. One aspect relates to assessing progress in implementation of the IPF proposals for action in terms of existing and, if appropriate, new legislation, policies, programmes and processes. Another aspect relates to assessing trends in the management, conservation and sustainable development of all types of forests as well as the state of forests, and to make the best use of criteria and indicators for sustainable forest management. IFF also recognized that the national implementation of criteria and indicators and assessing progress is affected by enabling conditions and mechanisms, including financial and technical resources. The primary value and benefits of reviewing, monitoring and reporting is at the national level. Efforts should be made to make national data timely, accurate and internationally comparable, as well as transparent and accessible to all interested parties.

11. The collection, assessment, monitoring, organization, reporting and dissemination of data can involve substantial costs and institutional capacity. Therefore, efforts should be made to avoid duplication by utilizing, where appropriate, existing reporting systems of international organizations and instruments, and by harmonizing, where appropriate, existing monitoring and reporting systems.

12. There is a need to build and strengthen institutional, technical and human capacity at the national level to enable periodic monitoring of the state of forests in order to measure and report on policy effectiveness and progress towards sustainable forest management as well as to identify priority areas of action. Monitoring, assessment and reporting activities should be integrated into national forest programmes. Approaches to strengthening national capacities should be practical and cost-effective.

13. Cooperation, coordination and partnership among countries and between countries and organizations would assist capacity-building. In this regard, greater priority should be given by all countries to financial and technical assistance programmes and the transfer of technology to help developing countries to strengthen their capacity for reviewing, monitoring and reporting.

14. There is also a need to develop a better common understanding of key concepts, definitions and terms at both the national and international levels, as well as greater comparability of data that permits aggregation at the regional and global levels. This would assist countries in meeting the various demands for reviewing, monitoring and reporting on forests by international instruments, multilateral organizations and various regional and international criteria and indicator processes.

15. Criteria and indicators for sustainable forest management are important tools for reviewing, monitoring and reporting on the state of and trends in all types of forests and for assessing progress towards sustainable forest management. Incorporating the results of criteria and indicators, for instance, in voluntary national reporting to the Commission on Sustainable Development, as well as to the FAO global forest resources assessment, national forest programmes reporting, and the State of the World’s Forests reporting, would provide useful bases to assess progress towards management, conservation and sustainable development of all types of forests.

Proposals for action

16. IFF recalled the IPF proposals for action that are relevant to this category (in particular, E/CN.17/1997/12, paras. 17 (g), 17 (i), 70 (e), 77 (f), 78 (b), 78 (c), 115 (a) and 115 (b)).

17. IFF encouraged countries to:

(a) Prepare national information on the management, conservation, and sustainable development of all types of forests as the basis for any consolidated information on forests at the international level. Adequate financial resources, both domestic and international, should be available for capacity-building and implementation of national reporting initiatives;

(b) Make forest-related information for reviewing, monitoring and reporting progress in implementation of sustainable forest management widely available and accessible to policy makers and to interested groups, noting the important role that subnational levels of government and interested groups play in contributing to assessment and information gathering;

(c) Report on the implementation of IPF proposals for action in the context of reporting on forests to the Commission on Sustainable Development at its eighth session, taking into account, where appropriate, the process used to assess the relevance of the proposals and priorities for action, the organizations and interested parties involved, and noting progress made and the areas where new actions could be undertaken;

(d) Further develop and implement, with the support of international organizations, as appropriate, criteria and indicators for sustainable forest management, and use them as a basis for reviewing, monitoring and reporting national trends in the state of forests, as well as progress on the management, conservation and sustainable development of all types of forests;

(e) Encourage the donor community to assist developing countries in preparing national information and reports on forests, recognizing that information collection and reporting are costly activities.

18. IFF encouraged ITFF member organizations and other relevant international and regional organizations to consult with countries regarding collection and synthesis of national information in order to facilitate accurate reporting with a view to having countries verify the information synthesized, and give effective feedback on the overall results of data collection and reporting and make such information widely available and accessible to policy makers and to interested groups.

19. IFF encouraged countries, ITFF member organizations and other relevant international and regional organizations to:

(a) Develop harmonized, cost-effective, comprehensive reporting formats for collecting and synthesizing national forest information to meet the diverse demands for reliable and timely data by various forest-related international organizations and instruments. There is a need to incorporate information on relevant criteria and indicators for sustainable forest management, including indicators on environmental, social and economic functions, such as non-wood products, forest resources and services, and the competitiveness of forest products at the domestic and international levels, into such reporting formats in order to reduce reporting burdens on countries and increase the timeliness and consistency of reporting;

(b) Improve the effectiveness of coordination and partnership within countries and with international organizations and instruments as a means of building the capacity in developing countries for periodic and timely collection, review, synthesis and utilization of information related to sustainable forest management.

Conclusions

20. IFF reiterated the relevance and validity of the IPF proposals for action on financial assistance. A substantial increase in financing from all sources, including domestic and international, public and private, is required for the effective management, conservation and sustainable development of all types of forests, especially in many developing countries. It is equally important to increase efficiency and effectiveness of available resources and existing mechanisms. Developing countries, including countries with low forest cover and particularly the least developed countries, need special consideration in financial cooperation to meet their needs for forest products and services sustainably and sustainably manage their forests, and in some cases, expand their forest cover.

21. IFF recognized the need for greater investment from all sources to promote sustainable forest management. Mobilizing new and additional financial resources for sustainable forest management requires innovative strategies that address the widely increasing need for public financing for forests as well as the creation of an attractive and adequate policy environment for private investments in sustainable forest management. Achieving the sustainable forest management policy goal requires recognizing the benefits of attaining profitability of sustainable forestry practices while discouraging unsustainable forest exploitation. In the case of domestic public and private sources, a major aim is to increase revenues from sustainably produced forest products and services, including forest-related biological resources, while encouraging the necessary reinvestment in sustainable forest management.

22. Private-sector investments in sustainable forest management are generally inhibited by factors resulting from policy and market imperfections as well as those related to the specific characteristics of forestry, such as risk and uncertainties associated with long rotation periods and uneven distribution of benefits and costs over time. There is a potential for sustainable forest management to be financially self-sustaining in the long run but bridging financing is often required during the transition period.

23. The roles of public and private sector financing sources are distinct but complementary and they should be jointly considered in financing strategies for sustainable forest management. However, private sector investment should not be considered a substitute for international public funding, including ODA. Both international and domestic public financing have supportive roles to play in the transition process to sustainable forest management. The purpose of public sector financing is, inter alia, to promote the enhancement of the environmental, social and economic functions of forests, whereas that of the private sector is often to generate wealth and create markets in a manner that is consistent with national policies and regulations. It is desirable to expand the role of private sector resources in the financing of sustainable forest management. The mobilization of private sector resources often requires policy adjustments in order to create enabling conditions for sustainable forest management such as appropriate legal and institutional frameworks and provision of incentives. In developing countries, the public funding related to forests, both domestic and international, including ODA, is needed for capacity-building, leveraging private-sector funding, and financing environmentally sound development projects and programmes for sustainable forest management according to national priorities.

24. Financial flows into the forest sector should support and be consistent with the development and implementation of national forest programmes and initiatives. In this regard, sustainable forest management should be considered one of the priorities in domestic financial resource allocation as well as in programming ODA available for forest-related activities.

25. The more efficient and effective use of all financial resources is enhanced by transparent and effective administrative and management arrangements, and the involvement and participation of interested parties. Adequate institutional capacity is essential for the better absorption and utilization of existing as well as additional international public funding for sustainable forest management. The provision of domestic and international financial resources to strengthen and reinforce institutional and management capacity in developing countries is therefore necessary.

26. Availability of timely and relevant information on financial flows from all sources and on financial mechanisms is instrumental in helping countries and their cooperation partners take more focused actions to support sustainable forest management. There is therefore a need to develop cost-effective and efficient information systems. Country case studies could be useful to further understand the role of financial flows from different sources and to help ensure effectiveness in achieving sustainable forest management.

27. In the context of current mandates and frameworks of existing international financial institutions and programmes, the proposal for establishing an international financial mechanism to support sustainable forest management was deliberated upon. In this regard, it was proposed that an international fund for forests be established in order to support, inter alia, the additional costs during the transition period towards sustainable forest management, and that such an international financial arrangement or mechanism should preferably (a) involve participating donors and beneficiaries in relevant decision-making, (b) respond to national needs and support national forest programmes, (c) facilitate internalizing externalities of forests in promoting sustainable forest management, (d) build on or link with national financing mechanisms, (e) be transparent and administratively efficient, (f) complement the financing mechanisms of relevant multilateral agreements, and (g) have secure and sustained funding sources. However, reservations were also voiced regarding the establishment of an international fund for forests.

28. The concept of an international investment promotion entity to mobilize private sector investment in sustainable forest management deserves further consideration. Any such entity need not require the creation of a new organization and could be integrated within existing institutions. Such an investment promotion entity could catalyse and support activities related to information, capacity-building, technology transfer, and finance between the public and private sectors to facilitate investment in sustainable forest management. International financial and investment promotion mechanisms for sustainable forest management, though independent, could be complementary and mutually reinforcing.

29. IFF recognized that developed countries should fulfil the commitments they have undertaken to reach the accepted United Nations target of allocating 0.7 per cent of gross national product to ODA as soon as possible.

Proposals for action

30. IFF recalled the IPF proposals for action relevant to this programme element (in particular, E/CN.17/1997/12, paras. 67-71) and called upon countries and relevant international organizations to:

(a) Increase financial resources and make or intensify efforts to improve the effectiveness and efficiency of available resources for sustainable forest management, and use national forest programmes or other integrated programmes as the basis for channelling, prioritizing and increasing financial assistance to the forest sector in developing countries;

(b) Give special consideration to developing countries, including countries with low forest cover and particularly the least developed countries, in financial cooperation to meet their needs for forest products and services sustainably and sustainably manage their forests, and in some cases expand their forest cover;

(c) Encourage private investments in sustainable forest management by providing a stable and transparent investment environment within an adequate regulatory framework that also encourages the reinvestment of forest revenues into sustainable forest management;

(d) Undertake activities for systematic collection and analysis of financial flows data in the forest sector in order to enable informed and rational policy decisions based on reliable information;

(e) Explore the feasibility of operationalizing an investment promotion entity taking into account the functions and circumstances under which such an entity would operate as well as its scope in relation to the existing financial mechanisms.

31. The Forum discussed but was not able to reach consensus on the following proposals for action:

(a) Continue further exploration, identification, and development of new and improved and more effective financial mechanisms, and further explore the potential and results of innovative use of existing mechanisms to promote sustainable forest management, taking into account the full range of goods and services, including forest related biological resources, and sharing experience and information on such mechanisms;

(b) Create an international forest fund to support, inter alia, the additional costs during the transition period towards sustainable forest management;

(c) Make full use of the potential of existing mechanisms, such as GEF, consistent with their mandates, and explore options to expand their scope/and review their scope for financing a wider range of sustainable forest management activities;

(d) Consider the need for preparing a study integrating such issues as the valuation of forest goods and services, including biological resources, and the international trade of forest goods, taking due account of the effects of international restrictions, such as tariff escalations, and other protective measures.

Conclusions

32. Mutually supportive trade and environment policies can effectively promote the achievement of the management, conservation and sustainable development of all types of forests. Given that trade and environment policies have their specific objectives, decision makers, including trade partners, should contribute to achieving trade in wood and non-wood forest products and services from sustainably managed forests, and implement policies and actions, in particular, avoiding policies that have adverse effects, either on trade or on the sustainable management of all types of forests. It is important to take into account the needs of developing countries for social and economic development and environmental protection, in particular poverty alleviation.

33. The impact that international trade in wood and non-wood forest products has on sustainable forest management can be both positive and negative. Trade liberalization adds value to the resource and has the potential to promote economic development, contribute to poverty alleviation and reduce environmental degradation, provided it is accompanied by sound environmental and social policies. However, trade liberalization must not be a vehicle for undermining domestic environmental and health standards which are consistent with international trade rules. Countries should study the positive and negative impacts of trade policies on sustainable forest management. The Uruguay Round of multilateral trade negotiations yielded significant reductions to tariffs affecting forest products. Special attention should be given to remaining and emerging trade restrictions which constrain market access, particularly for value-added products. Trade measures intended to promote sustainable forest management should not constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on international trade.

34. IFF recognized the potential role of voluntary certification of forest management and labelling of forest products as among the potential tools in promoting sustainable forest management and differentiating forest products and services in the market. However, more practical experience is necessary to reach conclusions on the effectiveness of such programmes. Moreover, unsuitable design or non-transparent application of such schemes may in some cases lead to unjustified obstacles to market access. In particular, small and medium-sized forest owners and enterprises, including those of developing countries, may find it excessively costly to implement certification and/or labelling schemes. In the context of these issues, IFF took note of the work of the World Trade Organization (WTO) with regard to voluntary eco-labelling schemes. The proliferation of certification and/or labelling schemes calls for further cooperative work, in line with IPF recommendations, towards achieving their international comparability and considering their equivalency while taking into account the diversity of national and regional situations.

35. Forest products and services and their substitutes should be adequately valued through full-cost internalization, which in turn would influence competitiveness of these products and services. In this context, countries should undertake analyses of the implications of such valuation on forest management and economic development. Countries should also implement full-cost internalization strategies for forest products and services and their substitutes, taking into consideration the potential costs and benefits of improved efficiency and sustainability of the forest sector.

36. Some available studies carried out on the relative full life-cycle analysis of the environmental impacts of forest products, and their substitutes suggest that the former may be preferable, but further work on such life-cycle analysis is needed.

37. The nature and extent of illegal trade in wood and non-wood forest products, including forest related biological resources, is a serious concern due to damage to ecosystems, loss of biodiversity, lost revenue by Governments, forest owners and local and/or indigenous communities, and distortion of markets for forest products and services. National policies and international cooperation are important to reduce illegal trade with the aim towards its elimination.

38. Recent changes in the markets for forest products, such as those caused by the recent financial crisis, have raised concerns on the ability to continue the implementation of measures aimed at sustainable forest management but have at the same time increased the need for it. The long-term impacts of such unpredictable events on efforts to promote sustainable forest management need examination and monitoring. Such situations highlight the need to develop strategies for sustainable forest management with a long-term perspective so that the negative effects of short-term market changes can be minimized.

39. Developing countries with low forest cover and small island countries have special problems in developing their forest sectors to meet local needs for forest products and services. They depend, in many areas, on other countries to satisfy their needs for forest goods and services. Trade is essential to meet such needs, and international economic and trade policies may have serious impacts on the efforts of these countries to expand and rehabilitate their forest cover.

40. Increased market transparency is essential in order to improve the market access for forest products and services, including those coming from sustainably managed forests. In this regard, the role of the private sector is vital but action is also needed by all interested parties to improve market transparency. A better understanding by both producers and consumers of the potential relationship between trade in forest products, forest services and their substitutes and sustainable forest management could help to promote responsible choices in the supply and demand for forest products, forest services and their substitutes.

Proposals for action

41. IFF stressed the importance of implementing the IPF proposals for action on trade and environment. In order to further their effective implementation IFF:

(a) Urged countries, including trade partners, to contribute to achieving trade in wood and non-wood products and services from sustainably managed forests, and implement policies and actions, in particular avoiding policies that have adverse effects, either on trade or on sustainable forest management;

(b) Urged countries, international organizations, including WTO, and other interested parties to undertake, as appropriate, further cooperative work on voluntary certification and/or labelling schemes, in line with the recommendations of IPF, while seeking to enhance their international comparability and considering their equivalence, taking into account the diversity of national and regional situations, and to ensure adequate transparency and non-discrimination in the design and operation of such schemes, and are consistent with international obligations so as to promote sustainable forest management and not to lead to unjustifiable obstacles to market access;

(c) Urged countries to undertake analyses of the implications of full-cost internalization on forest management and economic development and implement full-cost internalization strategies for forest products and services and their substitutes;

(d) Requested countries, international organizations and other interested parties to undertake further work on full life-cycle analysis of the environmental impacts of forest products and their substitutes;

(e) Called upon all interested parties to take action to improve market transparency, taking into account the role of the private sector, to help promote responsible producer and consumer choices in the supply and demand for forest products, forest services and their substitutes;

(f) Called upon countries to consider appropriate national-level actions and promote international cooperation to reduce the illegal trade in wood and non-wood forest products including forest related biological resources, with the aim of its elimination;

(g) Urged countries to develop strategies for sustainable forest management with a long-term perspective so that the negative effects of short-term market changes, such as the recent regional financial crises, can be minimized;

(h) Urged countries to recognize the special importance of imports of forest products for countries with low forest cover and fragile forest ecosystems, and small island developing States to satisfy their needs for forest products and services to assist them in expanding and rehabilitating their forest cover.

42. The Forum discussed but was not able to reach consensus on the following proposal for action:

"Supported continued efforts by countries and the World Trade Organization towards trade liberalization giving special attention to removing remaining and emerging trade restrictions which constrain market access, particularly for value added forest products;".

Conclusions

43. IFF reiterated the importance of the Forest Principles, chapter 34 of Agenda 21, the Programme for the Further Implementation of Agenda 21 (General Assembly resolution S-19/2, annex) and decision 6/3 adopted by the Commission on Sustainable Development at its sixth session, to the transfer of environmentally sound technologies in support of the management, conservation and sustainable development of all types of forests. IFF emphasized the strong links among sustainable forest management and transfer of technologies, capacity-building and institution-building, investment and financing from both public and private sources.

44. Although not every constraint to sustainable forest management can be alleviated by the transfer of technology, IFF emphasized that improved access to and utilization of environmentally sound technologies have great potential for enhancing sustainable forest management. Indeed, policy environments and measures favourable to sustainable forest management and investment are as important as the availability and appropriate application of the technologies themselves.

45. Efforts to enhance technology cooperation through the development, transfer and diffusion of environmentally sound technologies should recognize the important but differentiated contributions of the public and private sectors, while stressing the governmental role in developing and fostering an enabling policy, legal and institutional framework.

46. National forest programmes, as described in the report of IPF on its fourth session (see E/CN.17/1997/12, para. 17 (a)), should facilitate development and transfer of environmentally sound technologies in support of sustainable forest management and forest products processing. There is a need to further the participation of interested parties in forest-related technology development and to facilitate efficient adaptation and use of technologies and know-how, in accordance with national legislation, through partnerships among the public and private sectors, including research centres, universities and companies, and indigenous people, local communities and non-governmental organizations.

47. There is a wide range of available environmentally sound technologies, particularly in developed countries, that can support sustainable forest management. The policies, actions and types of financing that are needed for efficient selection, transfer, adaptation and use of these technologies vary, depending on the type of technology, local conditions and intended use. They should be demand-driven and consistent with national priorities for sustainable forest management, as expressed in management, conservation and sustainable development of all types of forests and, where appropriate, should be reflected in national forest programmes. IFF stressed that the international community should promote, facilitate and finance, as appropriate, access to and transfer of environmentally sound technologies and the corresponding know-how, in particular to developing countries, on favourable terms, including concessional and preferential terms, as mutually agreed, taking into account the need to protect intellectual property rights as well as the special needs of developing countries for the implementation of Agenda 21.

48. Efforts for the comprehensive assessment of technology needs and suitability have been insufficient so far. Many countries, in particular developing countries, need to strengthen their capacities for assessment of the environmental soundness, economic sustainability and social impacts of technologies.

49. Developing low forest cover countries have technological needs related to, in particular, afforestation for land rehabilitation, reforestation and restoration of degraded forests and for sustainable management of existing, often unique, forests.

50. Opportunities do exist to finance and support North-South technology transfer through ODA. Further opportunities also exist to finance and support North-South cooperation in technology transfer through public and private partnerships, joint ventures and foreign direct investments. There is also an important role for international organizations in the dissemination and facilitation of transfer of existing knowledge. Efficient and effective private-sector involvement in North-South technology transfer depends on mutual interests and an appropriate enabling environment, including promoting policy instruments aimed at creating a favourable environment to attract foreign private investment. International and regional organizations have an important role to play in the field of forest-related technology transfer. Regional networks could contribute to a more effective and efficient use of already existing technologies.

51. South-South cooperation is complementary to North-South transfer of technology and know-how. There is potential for further strengthening of South-South transfer of technology and know-how. Technologies generated in the South may be more accessible, more applicable and less costly and have greater potential for diffusion than some technologies developed in the North. Environmentally sound indigenous technologies, including traditional forest-related knowledge, should be given special attention, as appropriate, and transfer of such technologies or know-how must be carried out with the consent of the holder and according to national legislation.

52. IFF recognized the importance of technologies related to biological resources (as defined by the Convention on Biological Diversity) of forests. In this respect, cooperation between developed and developing countries should be strengthened on transferring and, as required, developing technologies for the sustainable use of biological resources (as defined by the Convention on Biological Diversity) of forests, as they relate to the management, conservation and sustainable development of all types of forests consistent with and building on progress under the Convention on Biological Diversity and without prejudice to the commitments undertaken by parties to the Convention within its scope.

53. To date, relatively little attention has been given to the need for increased technology and know-how diffusion to end-users through forest extension services. Some countries have, to that end, effective mechanisms and/or extension programmes, which have a significant potential to be emulated by a broader set of countries.

54. There is an urgent need for implementation of modern, appropriate environmentally sound wood energy technologies, which would enable more efficient use of waste and by-products created by forest logging and wood processing, as well as wood harvested for fuelwood, for both industrial and household uses.

55. Focused attention should be given to gender mainstreaming related to capacity-building and technology transfer, particularly in the context of wood energy use, tree cultivation for household energy use, sustainable forest management and tenure, and ownership of forests and lands designated for afforestation. Appropriate technologies for the use of wood as an energy source at the rural household level have a great potential to enhance the health and socio-economic status of women in many developing countries.

Proposals for action

56. IFF stressed the importance of implementing the IPF proposals for action on the transfer of environmentally sound technologies. In order to further their effective implementation, IFF:

(a) Urged countries, consistent with decision 6/3 of the Commission on Sustainable Development as well as paragraph 77 of the IPF proposals for action (E/CN.17/1997/12), to initiate actions towards the broadening and development of mechanisms and/or further initiatives to enhance the transfer of technology from developed countries to developing countries to promote sustainable forest management;

(b) Urged all countries to develop an enabling policy, legal and institutional framework that encourages appropriate public and private sector investments in environmentally sound technologies for sustainable forest management in line with the respective national forest programmes, where applicable;

(c) Urged countries and relevant international organizations to support the strengthening of cooperation between institutions to facilitate the assessment of needs for adaptation and transfer of forest-related environmentally sound technologies through North-South and South-South cooperation. Those institutions recognized as centres of excellence should act as clearing houses, in line with Agenda 21, chapter 34, in order to expedite the flow of these technologies;

(d) Urged all countries to recognize the importance of the transfer of technologies to developing countries and economies in transition, including human and institutional capacity-building, as an integral part of the process of investment and sustainable development; and the importance of combining technology transfer with training, education and institutional strengthening in order to promote effective use and broad dissemination of environmentally sound technologies;

(e) Urged all countries, in particular developed countries, to take further concrete measures to promote and facilitate the transfer of environmentally sound technologies to developing countries on favourable terms, including on concessional and preferential terms, as mutually agreed, taking into account the need to protect intellectual property rights in accordance with the relevant international and domestic laws, in order to put into further practice the recommendations of Agenda 21, the Commission on Sustainable Development and IPF, and in this context to mobilize further support for the development and application of appropriate technologies and corresponding know-how within these countries to enhance their capacities to implement sustainable forest management;

(f) Urged countries and relevant international organizations to consider practical measures to promote the diffusion of environmentally sound technologies to end-users, particularly in local communities in developing countries, through the efficient use of extension services;

(g) Urged countries and relevant international organizations to enhance partnerships, and to initiate, as appropriate, coordinate and cooperate in forest-related technical and financial assistance and capacity-building in respect of the transfer, development and application of environmentally sound technologies;

(h) Encouraged countries, with the cooperation of international organizations, to promote appropriate transfer of environmentally sound rehabilitation technologies for the sustainable management of forest ecosystems in environmentally critical areas, and to develop appropriate means to promote sharing of environmentally sound technologies between and within countries, including effective links between research, extension and implementation;

(i) Underscored the importance of assisting developing countries with low forest cover and those with fragile forest ecosystems in their efforts in respect of capacity-building that would facilitate the development and transfer of environmentally sound technologies to address those needs;

(j) Urged countries to promote fair and equitable sharing of the benefits arising from the utilization of forest genetic resources (as defined by the Convention on Biological Diversity) and the results and applications of research, upon mutually agreed terms, and to work, as necessary, on addressing issues of the identification of origins of forest genetic resources within their intellectual property rights, sui generis or other relevant systems for protection, as appropriate, taking into account the work being advanced by the Convention on Biological Diversity and other relevant international agreements, in accordance with national laws;

(k) The Forum also discussed but could not conclude the debate or reach consensus on the proposal to encourage countries to develop appropriate mechanisms and/or measures to enable indigenous people, local communities and forest-dependent groups to realize the potential benefits of traditional forest-related knowledge in accordance with the Convention on Biological Diversity, through the establishment and enforcement of intellectual property rights linked to this knowledge, including the giving of due recognition to the use of traditional forest-related knowledge in patent applications for technologies;

(l) Urged all countries, in particular developed countries, to pursue actions that would facilitate the transfer, development and application of environmentally sound technologies for and analyse the implications of the use of wood and non-wood by-products created by forest harvesting and wood processing for industrial and domestic purposes, giving special attention to wood-waste materials as an energy source;

(m) Called upon countries to undertake steps to ensure equal opportunities for women, in particular indigenous women and women in rural areas, to become beneficiaries of environmentally sound forest-related technologies, know-how and extension services;

(n) Urged countries to strengthen outreach programmes targeted at women in the areas of education, training and microcredit, related to community development programmes and household use of wood, wood lots for fuelwood and energy-efficient cooking technology;

(o) Urged countries and relevant international organizations to use data and information that are disaggregated by gender in sectoral surveys and studies used in the development of technologies for sustainable forest management policies and projects.

Conclusions

57. IFF reiterated the need for the implementation of the proposals for action on this programme element adopted by IPF, and noted their continuing relevance and validity. In this context, it noted the recommendations of the global workshop held in Costa Rica in January 1999.

58. To overcome major obstacles when addressing the underlying causes of deforestation and forest degradation, IFF stressed the importance of policy consistency inside and outside the forest sector. Furthermore, it emphasized the need for effective policy coordination for addressing underlying causes of deforestation, which are often interrelated and social and economic in character, and include poverty; lack of secure land tenure patterns; inadequate recognition of the rights and needs of forest-dependent indigenous and local communities within national laws and jurisdiction; inadequate cross-sectoral policies; undervaluation of forest products and services; lack of participation; lack of good governance; absence of a supportive economic climate that supports sustainable forest management; illegal trade; lack of capacity; lack of enabling environment, at both the national and international levels; and national policies that distort market and encourage forest lands conversion to other uses, including in low forest cover lands. It was further noted that the underlying causes of deforestation and forest degradation as well as the approaches to deal with them are often country specific and therefore vary among countries.

59. IFF continued to recognize the need for analysis at the national and international levels of the sequence of causes contributing to changes in the quantity and quality of forests, in particular by using the diagnostic framework referred to in the report of IPF on its fourth session (see E/CN.17/1997/12, para. 31).

60. IFF, while recognizing the important role of Governments in establishing national policies in their respective countries towards attaining sustainable forest management, stressed that the private sector, both in developing and developed countries, also has an important role to play in forest policy development and implementation. Combating deforestation requires the involvement of many actors, including national and subnational Governments, civil society, forest owners, international organizations, the private sector, research organizations, and international and bilateral aid agencies. Broad participation of indigenous and local communities (including indigenous people and other forest-dependent people practising traditional lifestyles, forest owners and local communities, many of whom possess important traditional forest-related knowledge; see General Assembly resolution S-19/2, annex, para. 37) and women in forest-related processes is needed. All actors need to work together to initiate processes, both at the national and international levels, to address effectively underlying causes of deforestation and forest degradation.

61. A major challenge which now lies ahead concerning deforestation is the implementation of the IPF proposals for action. For developing countries, this involves responding to political, financial and technical needs and priority to national forest policies and programmes; for country donors and international organizations, it involves more focused cooperation and coordination in support of their efforts on agreed priority areas for action.

62. The valuation of all goods and services, including biological resources (as defined by the Convention on Biological Diversity) provided by forests, is needed to realize its importance compared with other land uses. Inadequate valuation of natural forests is an important underlying cause of deforestation. The non-valuation of non-marketable environmental and social services of forests is a market failure, and inappropriate subsidies that encourage conversion of forested lands should be discouraged. Deforestation is closely related with the lack of economic and financial competitiveness of sustainable forest management compared with other alternative uses of the land. Current economic valuation of forest resources has often resulted in inadequate incentives for sustainable resource use, which in turn induce environmental degradation. The pricing of forest goods and services as well as their substitutes should include environmental and social costs and benefits. In relation to this, the Forum underlines the importance of its work on valuation (see programme element II.d (v)) and economic instruments (see programme element II.d (vi)).

Proposals for action

63. IFF recalls the following IPF proposals for action relevant to this programme element (see E/CN.17/1997/12, paras. 17 (e), 17 (f), 27 to 31, 67 (g), 70 (c) and 77 (f)).

64. IFF stressed the importance of implementing the IPF proposals for action on underlying causes of deforestation and forest degradation, with particular emphasis on the needs and requirements of low forest cover countries and countries with fragile forest ecosystems. In order to further their effective implementation, IFF encouraged countries, with the assistance of international organizations, donor countries and financial institutions, to implement the following additional proposals through partnerships involving, where appropriate, the participation of government institutions, non-governmental organizations, community-based organizations, indigenous and local communities, forest owners and the private sector:

(a) Further study and take practical measures to address the chains of causality of the underlying causes of deforestation and forest degradation within each country, including the impact of poverty and the impact of processes outside the forest sector;

(b) Create appropriate procedures in order to promote effective participation of all interested parties in decision-making about forest management;

(c) Support appropriate land tenure law and/or arrangements as a means to define clearly land ownership, as well as the rights of indigenous and local communities and forest owners, for the sustainable use of forest resources, taking into account the sovereign right of each country and its legal framework;

(d) Develop mechanisms, as appropriate, to improve land access and use of forest resources on a sustainable basis;

(e) Support capacity-building in communities, in particular for those with responsibilities in forest management, including in low forest cover countries, and create awareness in the society at large on the importance of issues related to deforestation and forest degradation;

(f) Support and promote community involvement in sustainable forest management through technical guidance, economic incentives and, where appropriate, legal frameworks;

(g) Promote maintenance and enhancement of forest resources through sustainable forest management practices, and promote the creation of new forest resources through the establishment of planted forests and other means, such as rehabilitation of degraded forests, taking into consideration their social, cultural and environmental impacts, and economic costs and benefits;

(h) Identify and measure internalization of externalities, and introduce positive incentives in both the forest and non-forest sectors that may help combat deforestation and forest degradation;

(i) Support local community programmes for capacity-building and credit facilities, and facilitate access to domestic and external markets of forest products and services;

(j) Request international financial institutions to analyse the impacts of foreign debt on deforestation and forest degradation, and request international financial institutions to explore, in cooperation with donor and recipient countries, innovative financial approaches and schemes for helping countries to promote sustainable forest management.

65. IFF invited international financial institutions to strengthen transparency in decision-making as it affects sustainable forest management, and to ensure that their policies support sustainable forest management.

66. IFF also invited countries to use national forest programmes, as appropriate, or other relevant programmes to involve indigenous and local communities and women to participate in the formulation and implementation of measures that aim to protect their rights and privileges in relation to forest lands, traditional forest-related knowledge and forest biological resources (as defined by the Convention on Biological Diversity).

67. IFF encouraged ITFF member organizations to support the elaboration of a comprehensive study of land tenure issues related to deforestation and forest degradation.

Conclusions

68. The involvement of indigenous people and local communities (including indigenous people and other forest-dependent people practising traditional lifestyles, forest owners and local communities, many of whom possess important traditional forest-related knowledge; see General Assembly resolution A/S-19/2, annex, para. 37) and the understanding and use of their traditional knowledge, as well as recognition of their rights to the natural resources in their traditional areas within national laws and jurisdiction, can support the formulation, design, implementation and monitoring of policies towards sustainable forest management. The sharing and application of this knowledge can help interested parties to avoid procedures that impact unfavourably on ecosystems and local social systems. Traditional knowledge can complement new technologies, and might be adapted and used more widely. In this context, IFF recalled relevant IPF proposals for action (in particular, E/CN.17/1997/12, para. 40 (r)).

69. IFF recognized the need to further explore the modalities for promoting greater recognition, respect and protection of traditional forest-related knowledge involved in sustainable forest management. Further understanding of the role of traditional forest-related knowledge in sustainable forest management can be achieved by identifying traditional systems that promote management, conservation and sustainable use of forest resources, in accordance with article 8 (j) and other provisions of the Convention on Biological Diversity and proposals for action derived from the IPF/IFF process.

70. Several processes relevant to the application and development of legal and other forms of protection of traditional forest-related knowledge are being addressed through different international organizations and instruments. There should be a close cooperation and coordination between the work of the Convention on Biological Diversity and the implementation of IPF/IFF proposals for action. While recognizing the importance of the work of the World Intellectual Property Organization (WIPO) and the Convention and of effective protection mechanisms for traditional knowledge systems and practices, and recalling the proposed memorandum of understanding between WIPO and the Convention, IFF stressed the importance of ongoing work to develop a common appreciation and understanding of the relationship between the intellectual property rights, sui generis or other relevant systems for protection, and the Convention on Biological Diversity.

71. In keeping with Agenda 21, chapter 26, and also noting the relevant International Labour Organization (ILO) convention, IFF recognized the critical importance of the rights of indigenous and local communities to participate in the conservation and management of all types of forests and forest biological resources.

72. IFF noted and welcomed the establishment of the Ad Hoc Open-ended Inter-sessional Working Group on article 8 (j) and related provisions of the Convention on Biological Diversity, in which indigenous and local communities are participating.

Proposals for action

73. IFF recalled IPF proposals for action relevant to this programme element (in particular, E/CN.17/1997/12, paras. 40 (a) to 40 (r) and 132 (c)).

74. IFF called upon countries to:

(a) Implement effective measures to recognize, respect, protect and maintain traditional forest-related knowledge in sustainable forest management, including forest biological resources (as defined by the Convention on Biological Diversity) within their intellectual property rights, sui generis or other relevant systems for protection, as appropriate, taking into account the relevant work being advanced by the Convention on Biological Diversity and other relevant international agreements;

(b) Promote fair and equitable sharing of benefits, including consideration of payments, where appropriate, arising from the use of such knowledge, innovations and practices, in accordance with, inter alia, article 8 (j) and related provisions of articles 15, 16 and 19 of the Convention on Biological Diversity and other relevant international agreements and taking into account national law, with the holders of such knowledge, innovations and practices;

(c) Work with relevant international organizations to help to develop a common appreciation and understanding of the relationship between the intellectual property rights, sui generis or other relevant systems for protection, and the Convention on Biological Diversity, including work, as necessary, on addressing issues related to the identification of origins of traditional forest-related knowledge, and of the knowledge that results from the use of forest genetic resources (as defined by the Convention on Biological Diversity), with a view to protecting such knowledge from inappropriate use;

(d) Develop or strengthen, as appropriate, and implement, at the national level, legislation and policies to achieve objectives under article 8 (j) and related provisions of the Convention on Biological Diversity, and support efforts by relevant international organizations and institutions regarding the protection and application of traditional forest-related knowledge, which can include the development of guidelines, in accordance with their mandates.

75. IFF invited the Conference of Parties of the Convention on Biological Diversity, with the participation of indigenous people and local communities, through the Ad Hoc Open-ended Inter-sessional Working Group, in its programme of work, under the related provisions of the Convention on Biological Diversity, to include options for collecting, recording, applying and locating traditional forest-related knowledge, recognizing the need to foster the wider application of such knowledge, innovations and practices, with the approval and effective involvement of the holders throughout the process.

Conclusions

76. IFF noted the outcome of the in-depth study on the theme "International forest conservation: protected areas and beyond", sponsored by the Government of Australia, and the recommendations of the international expert meeting on protected forest areas sponsored by the Governments of the United States of America and Brazil.

77. The Forum recognized the importance of an ecosystem approach which underlines forest conservation and protection as an integral component of sustainable forest management. The establishment and management of protected forest areas within an ecosystem approach can contribute significantly to local economies and non-market benefits to society in the form of flood control, soil and watershed protection, and other ecological services essential to human well-being.

78. The Forum acknowledged that existing protected areas are important in protecting a number of forest values and represent considerable effort and achievement on the part of all concerned in their establishment and management. However, it was noted that fragmentation of forest land may be a constraint to the effective protection of biodiversity and ecological functions of forest areas. In a number of countries, existing protected areas are not, in themselves, sufficient to maintain forest conservation objectives. Forest conservation cannot be based solely on a rigid demarcation between protected areas and all other forms of land use, in particular commercial forest use. Where possible, protected areas should form part of a landscape continuum, where the conservation of biological diversity, environmental services and other values are also accorded priority in the wider context of other forest management and land-use practices in surrounding areas.

79. Most countries have adopted legislation, policies and strategies towards landscape management, biological diversity, forest conservation and protected areas. However, implementation and enforcement of these policies and laws in many countries is inadequate. Insufficient coordination of conflicting policies and practices, inappropriate implementation strategies and lack of political will and financial and human resources are widely recognized as the major reasons for the failure to achieve forest conservation goals in some countries. The effectiveness of the management of protected areas can be assessed in terms of security of status through the implementation of appropriate legislation, the effectiveness of protection of biodiversity and ecological values, institutional capacity, positive social impacts and the level of support from indigenous and local communities (including indigenous people and other forest-dependent people practising traditional lifestyles, forest owners and local communities, many of whom possess important traditional forest-related knowledge; see General Assembly resolution S-19/2, annex, para. 37), and adequate financial support at both the national and international levels.

80. There are several existing categories of protected areas. The one developed by the World Conservation Union (IUCN) World Commission on Protected Areas is being used by many countries, United Nations institutions and major groups. IUCN is currently working with other organizations and countries to interpret the categories for use in national and international statistics. The categories need to be more flexible in order to encompass the wide range of forest protection regimes existing in various countries. There is also a need to develop common understanding on the key concepts, definitions and terminology concerning management regimes consistent with forest conservation inside and outside protected areas. In establishing and managing protected forest areas and identifying them with appropriate categories, consideration should be given to their value as representative of unique forest types, their potential to generate information on ecological processes, conservation of biodiversity and environmental services, and their impact on the indigenous and local communities and others depending on them for sustenance.

81. The forest sector is affected by policies that concern both public- and private-sector activities and by activities in other sectors. Many non-forest-sector policies, such as those related to regional development, resettlement, trade, structural adjustment and agriculture, may have intended or unintended profound perverse impacts on forest conservation goals. The success of efforts to achieve forest conservation will be enhanced with effective cross-sectoral linkages and coordination.

82. A greater awareness of the social, cultural, economic and environmental benefits, especially biological resources, of forest conservation and protected forest areas can help to generate public support and resources for forest conservation. Many civil society actors have an interest in forest conservation. The convergence of interests of indigenous and local communities and of protected forest areas needs to be further explored and identified so as to allow the effective participation of all interested parties. A variety of partnerships and international cooperation schemes, operating at different geographical scales at national and international levels and with different objectives, may be useful to the support of forest conservation and protected areas.

Proposals for action

83. The Forum recalled the proposals made by the Intergovernmental Panel on Forests for action relevant to this programme element (see, in particular, E/CN.17/1997/12, paras. 17 (f), 17 (i), 58 (b) (v), 67 (f) and 77 (f)).

84. The Forum invited countries to implement, with the assistance of international organizations, donor countries and financial institutions, the proposals for action of this new programme element through partnership mechanisms involving, where appropriate, the participation of governmental institutions, non-governmental organizations, community-based organizations, and indigenous and local communities.

85. The Forum encouraged countries to:

(a) Commit themselves to the protection, conservation and representativeness of all types of forests, consistent with national forest policies and programmes that recognize the linkage between forest conservation and sustainable development. This commitment may be achieved through a range of conservation mechanisms, reflecting varying national circumstances, applied within and outside of protected forest areas, and the complementary roles of protected forest areas and other sustainable forest management activities — for example, the production of wood and non-wood products and services, where forest conservation is promoted by other means;

(b) Develop and implement appropriate strategies for the protection of the full range of forest values, including cultural, social, spiritual, environmental and economic aspects; recognition of the multiple functions and sustainable use of all types of forests, with particular regard to biological diversity; participation of communities and other interested parties; integration of the livelihood needs of indigenous and local communities; and planning and management on an ecosystem basis, in which special emphasis should be put on the continued integrity of genetic diversity;

(c) Develop and implement forest management mechanisms, as appropriate, that provide for partnerships and the participation of forest owners and of indigenous and local communities in support of forest conservation initiatives for sustainable forest management within the legal framework of each country;

(d) Develop financial support mechanisms to engage all interested parties, in particular forest owners and the private sector, in the planning and management of protected forest areas; and recognize protected forest areas under the stewardship of private forest owners or indigenous and local communities;

(e) Develop and apply consistently, as needed, criteria based on the adequacy, consistency and effectiveness of protected areas, following an ecosystem approach and incorporating reserve design principles that identify the need for new protected areas critical to the protection and maintenance of environmental services. In this regard, consideration should be given to linking protected areas, where possible, with corridors and buffer zones in order to form networks;

(f) Develop and implement a range of innovative mechanisms for financing and encouraging forest conservation, including economic incentives, voluntary guidelines, forest regulations, private contracts, taxes and charges, reinvestment of returns from protected areas, forest-related industries, and environmental services in forest conservation; tax deductions for private forest conservation; direct charges for protected area use; and possible returns from carbon sequestration, in accordance with, and within the context of the implementation of relevant articles of the Kyoto Protocol and the United Nations Framework Convention on Climate Change;

(g) Contribute to a global and regional assessment of the current status of protected forest areas, including total number, extent of each area, objectives of establishment, effectiveness of management, IUCN-system equivalent category, and basic biological and social information available. This can assist in the establishment of bio-geographically balanced networks of protected forest areas.

86. The Forum encouraged countries that share ecologically important or unique transboundary forests to establish joint protected forest areas, including ecological corridors of regional and/or global significance, and establish agreed guidelines concerning their collaborative management.

87. The Forum called upon countries, international financial institutions and other donors to provide financial support and other resources to activities in developing countries related to forest conservation and to the implementation and management of protected areas in the surrounding landscape, in accordance with national action plans, where such plans exist, through, inter alia, institutional strengthening and capacity-building; research and education and public awareness; promotion of access, development and transfer of environmentally sound technologies; and technical and scientific cooperation.

88. The Forum encouraged countries, relevant international organizations and institutions to cooperate in developing methodologies for assessing the conditions and management effectiveness in existing protected forest areas and the surrounding landscape and in protected forest area networks, taking into account the various efforts under way in several countries to build further capacity to collect, organize, utilize and share information and experience, including indigenous and local knowledge, in order to create and manage protected forest areas.

89. The Forum invited countries, relevant international organizations and institutions to work collectively to develop further guidelines for consistency in the interpretation and use of existing IUCN categories of protected areas for application in a national context, and to develop a global approach for assessing the effectiveness of protected forest area management in relation to environmental, social, cultural and other relevant objectives.

90. The Forum urged countries, international financial institutions and other donors to improve coordination, at both the national and international levels, of policies and programmes that affect forest conservation and to address cross-sectoral policies, structural adjustment packages and perverse incentives.

Conclusions

91. IFF noted the outcome of the international consultation on research and information systems for forests sponsored by Austria and Indonesia, stressed the importance of strengthening research to inform policy, solve practical national and forest-related environmental and social problems, and meet national priorities. It recognized the value of research and information systems in enabling those responsible for forest management and civil society to achieve improved forest outcomes. However, priority setting should be improved. The value of inter-country research collaboration at the eco-regional level was emphasized. Forest-related research agendas should not be limited to forest sector issues but should include other policy issues as well. Inputs from the public and private sectors should be encouraged.

92. There are some inadequacies in existing systems for mobilizing resources, setting priorities and achieving coherence for forest research. Improved mechanisms are needed for research to play its full role in support of sustainable forest management and the maintenance of forests and wooded lands to meet all current and future human needs. Research agenda should be more relevant to policy makers and potential beneficiaries of research. The importance of engaging major groups in identifying priorities and using results was also stressed. It was emphasized that member organizations of ITFF working with the International Union of Forestry Research Organizations (IUFRO) should continue to explore ways of generating resources, improving priority setting and increasing the coherence of national, regional and international research efforts.

93. IFF, taking note of proposals for the development of a global forest information service, suggested that use should be made of existing institutions, mechanisms and networks, to enhance access to forest-related information. The need to provide access for all interested parties was noted. It was recognized that individual countries and regional and subregional organizations would contribute to such an effort, both through relevant international institutions and through the national research information systems. The role of networks in providing valuable opportunities for collaboration by research institutions, within and between countries, as well as the potential for such networks to facilitate capacity development in developing countries, was also noted. The strengthening of linkage with other scientific-oriented international bodies to avoid duplication of efforts and forge synergies of global efforts was emphasized.

94. IFF noted that assistance allocated to building national research capacity is an effective form of development assistance. In this regard, greater priority should be given by all countries to financial and technical assistance programmes and technological cooperation to strengthen the capacity of developing countries. IFF strongly encouraged countries to continue giving higher priority to the forest sector, including through allocation of resources to national research capacity-building.

Proposals for action

95. IFF recalled IPF proposals for action 94 (a), 94 (c) and 94 (d), and underlined that forest research should have a country-driven approach.

96. IFF called upon countries to:

(a) Improve national efforts to strengthen forest research by formulating policies, programmes and strategies, as appropriate, within the context of national forest programmes in order to identify research needs and priorities as well as to coordinate the implementation of research programmes relevant to sustainable forest management;

(b) Consider examination of new ways of mobilizing funding for forest research, including changes to the charters of research institutions that would allow them to address diverse sources of funding, as well as changes to research agendas;

(c) Improve linkage between forest science and forest policy processes at the national and subnational levels by creating opportunities for policy makers, scientists, donors, and other interested parties to provide guidance to research and forest policy discussions;

(d) Ensure that forest research in countries be undertaken with prior consent of the country/countries concerned.

97. IFF urged international organizations, donor countries and financial institutions to:

(a) Contribute to fund forest research in developing countries;

(b) Examine new ways for mobilizing funding for forest research and intensify efforts, including development assistance, to strengthen research networks and build capacity at the national, regional and global levels, to facilitate all countries to meet the broad economic, social, cultural and environmental demands upon forests;

(c) Enhance access to forest-related information by all interested parties, making best use of existing institutions, mechanisms and networks, including national, regional and international research information systems;

(d) Foster joint ventures in forest research involving both the public (research institutions) and private sector.

98. IFF requested ITFF member organizations to:

(a) Explore ways and means of improving priority setting and support for national, regional and international forest-related research efforts;

(b) Explore options for providing guidance to forest science initiatives, strengthening linkages between science and policy, mobilizing resources, including financial resources, and increasing international efforts in support of forest research and research capacity-building;

(c) Work with IUFRO in exploring possibilities for a global forest information service.

Conclusions

99. In all countries, forests provide a wide variety of goods and services, including the basis for subsistence livelihood, in particular in many developing countries. Forest valuation should reflect the social, cultural, economic and ecological context and consider values that are important to local and/or indigenous communities, private forest owners, gender aspects, and distributional impacts. In addition, many benefits, such as watershed and soil protection, the mitigation of natural disasters and the enhancement of recreation and tourism are important to society as a whole. At the global level, benefits include carbon sequestration, the conservation of biological diversity and combating desertification.

100. The Forum noted that the development of forest valuation tools and methods is an ongoing process. It reiterated the proposals for action on the valuation of forest goods and services of IPF, and noted their continuing relevance and validity.

101. The Forum stressed that the deficiencies in valuation in economic terms of, for example, social and ecological values, does not imply that these values are considered less relevant. More quantitative data, including resource prices and data for non-economic values of forests, will make forest valuation more effective. There is also a need for simplified, rapid and cost-effective valuation methodologies to suit specific circumstances of countries.

102. The Forum noted that forest valuation can be one of the necessary tools for promoting sustainable forest management, and valuation estimates provide important inputs to forest policy development and to the formulation and implementation of national forest programmes. The Forum noted, however, that sound forest policy decisions can often be made without explicit forest valuation. Forest valuation by itself does not provide a guarantee for appropriate policy decisions.

103. The scope of valuation of forest goods and services needs to extend beyond the limits of the forest sector and include, for example, consideration of alternative land-use options of significant social or economic value, forest products pricing, and ecological impact of substitute materials. There is a need to develop an approach to identify both costs and benefits of sustainable forest management, as well as ways to encourage countries to internalize externalities.

104. Enhanced international cooperation is required, with special attention to capacity-building for the development and application of forest valuation in order to enable informed policies and decision-making, as well as enhanced programme formulation in developing countries.

105. There is a need for enhanced cooperation and coordination on forest valuation matters with other forums dealing with such issues as climate change, international trade, desertification and biological diversity.

Proposals for action

106. The Forum recalled the IPF proposals for action relevant to this programme element (in particular, E/CN.17/1997/12, paras. 104 (a), (b), (c) and 134 (a) and (b)).

107. The Forum:

(a) Urged Governments to improve collection of quantitative data to enumerate and develop physical accounts of the full range of forest goods and services, including inventories of timber and other goods and services, and impacts of changes in forest use on the environment. This should also be done for substitute non-wood materials;

(b) Encouraged further development, by countries and international organizations, of rapid and low-cost valuation methods, including a focus on the development of approaches which incorporate a wide range of values, reflect the overall value of forest ecosystems, as appropriate, and identify the costs and benefits of sustainable forest management, as well as ways to internalize externalities;

(c) Requested relevant international organizations to develop and test rapid valuation methods that are policy relevant and efficient, that reflect regional and national characteristics and requirements, and to develop approaches for the identification of the costs and benefits, including incremental costs and benefits, of sustainable forest management which can be employed for a cost-efficient use of investment funds for forests;

(d) Requested countries and international organizations to assist developing countries in building and promoting capacity for the development and application of forest valuation methods.

Conclusions

108. The Forum noted that economic instruments and tax policies are powerful tools in forest policy when applied within an effective forest policy and institutional framework. However, they may be ineffective or counterproductive in a situation of policy, institutional or regulatory failures.

109. Economic instruments in the forest sector should include consideration of opportunity costs of alternative land uses and opportunities in other sectors, and both public and private ownership of forests.

110. The ability to offer a wide variety of forest goods and services for sale in local, national and international markets can be an effective incentive for sustainable forest management. Additional information is needed on approaches to creating markets for forest products, especially non-wood forest products and services, and on the role of the public and private sector in helping assure that new or expanded markets are consistent with all dimensions of sustainable forest management.

111. The Forum recognized the need for secure land tenure and user rights in the effective use of economic instruments as tools to support sustainable forest management and for investments of the private sector in the establishment and management of forest resources. However, to institutionalize this is a long-term process, and interim measures are required in most cases in view of the urgent need to regulate resource utilization and address the issues related to local and/or indigenous communities, as well as gender aspects.

112. The Forum recognized that economic instruments applied in the forest sector, including taxes and revenue collection, can be a source of financial support for improved management; these instruments can also support and promote sustainable forest management by providing incentives and disincentives.

113. The Forum recognized that the macroeconomic policies of countries may have extensive and enduring effects on the forest sector as well as on other sectors; consideration of these effects, as a component of programmes of macroeconomic structural adjustment, can provide the basis for informed decision-making, which can lead to sustainable economic growth and sustainable forest management.

114. It has been the experience of many countries that developments in other sectors that are, in some cases, the consequence of policies, can lead to unintended changes in the forest sector. Weak or inconsistent policies in other sectors, including but not limited to the agricultural sector, can undermine the use of any forest policy tools, including economic instruments.

Proposals for action

115. The Forum:

(a) Encouraged countries, with the assistance of relevant international organizations, to assess the potential scope and effective combination of economic instruments and tax policies as tools for promoting sustainable forest management, as appropriate, as part of their national forest programmes. This assessment should include but not be limited to collection of forest revenue from timber extraction;

(b) Encouraged countries to recognize and use, where applicable, an appropriate combination of regulations and economic instruments for achieving the objectives of forest policies, including the use of charges and forest revenue collection that also offer incentives for sustainable forest management practices;

(c) Encouraged countries to recognize the actual and potential impacts of economic instruments and tax policies as a means of providing incentives to engage in activities that avoid deforestation and forest degradation and that support sustainable forest management practices; and to examine, in collaboration with international organizations, when requested, the role of forest policy failures and policies in other sectors as a contributing factor in deforestation, forest degradation or unsustainable forest management; and to collaborate with international organizations in developing mitigating policies;

(d) Encouraged countries, within their respective legal framework, to support land tenure policies that recognize and respect legitimate access and use, and property rights in order to support sustainable forest management and investment, recognizing that institutionalizing tenure is a long-term and complex process which requires interim measures to address urgent needs, in particular of local and/or indigenous communities;

(e) Requested relevant international organizations to undertake an up-to-date review of contemporary forest revenue collection systems for the use of forest products and services. The Forum encouraged countries to share their experiences in this area and to support this effort;

(f) Invited relevant international organizations to provide, on request, general and specific advice to countries on the design and administration of economic instruments and tax policies to promote sustainable forest management, and encouraged countries to offer examples of successes in using economic instruments to advance the practice of sustainable forest management;

(g) Encouraged countries to develop macroeconomic policies and policies in other sectors that support and contribute to sustainable forest management; and requested international financial and lending institutions to consider mitigating the impacts of macroeconomic structural adjustment programmes on forests consistent with sustainable forest management.

Conclusions

116. IFF recognized that the demand for and supply of wood and non-wood products and services of forests will continue to form the basis for the contribution of forests to economic and social development, particularly for poverty eradication. The need for commodities, including but not limited to wood, will provide one of the powerful motivations for conservation and sustainable management of forests. This future outlook does not eliminate, however, the need for improved information, forest policy implementation and forest management. Reliable forest inventory data are essential in the analysis of trends in demand for and supply of wood and non-wood products.

117. Most recent outlook studies have reached the general conclusion that at the global level, wood fibre supply will be broadly matched with demand without likely price increases, but at the national level some countries may experience shortages and possibly price increases. Furthermore, alternative sources of fibre, such as from recycled paper and non-wood fibre, now account for an increasing share of industrial fibre consumption. A number of factors, including effects of deforestation, forest degradation, the designation of additional forests as protected forest areas, markets and technologies, are leading to a gradual shift in some regions in the focus of wood harvesting to more intensively managed forests, including natural forests, planted forests, as well as trees outside forests. Due consideration of environmental, economic and social principles of sustainable forest management should be taken at appropriate levels in the planning and management of forests.

118. Global consumption of wood for fuel is larger than industrial roundwood consumption in terms of volume. Much work is required to accurately assess the impacts of fuelwood collection on forest resources, and the role of trees outside forests. For most of the world’s population, it is as a source of fuel that forests play their most important role in social and economic development.

119. Policies that set or affect the prices of wood and non-wood products and services are among the most important factors influencing demand and supply. Policies that distort the efficient operation of markets may contribute to the unsustainable management of forests. Furthermore, it is not only prices of forest products but also of their substitutes that need to be considered when assessing market policies and their environmental consequences.

120. Private and community ownership of forests and the private sector in general play an increasingly important role in sustaining production of industrial wood products. Private forests presently account for about half of world wood production and this share is expected to increase in the future. The increasing role of private owners, local and/or indigenous communities and market processes will present new challenges for choosing and implementing forest policies to achieve both wood and non-wood objectives for forests.

Proposals for action

121. The Forum encourages countries and international organizations to improve data collection and information dissemination through:

(a) Increasing the extent, quality and comparability of inventory data on forest resources, including both wood and non-wood forest products and services;

(b) Giving adequate attention to collection and reporting on the use of a broad range of non-wood products, including quantities gathered and consumed, ownership rights and their importance to rural and indigenous communities;

(c) The systematic collection and reporting of information on the source and use of wood fuels; and

(d) The provision of timely, useful and comparable data on prices of wood and non-wood products as well as their substitutes.

122. The Forum further encourages countries, including through international cooperation, to:

(a) Promote policies, as needed, to meet increasing demand for wood and non-wood forest products and services, through sustainable forest management, including, where appropriate, planted forests and trees outside forests, and work towards an internationally agreed definition of planted forests;

(b) Recognize the role of the private sector, where appropriate, in producing forest products and services. This role may need to be supported within a framework of policies, incentives and regulations, such as secure land tenure and appropriate tax policies to help ensure the improved management of forests and sustained production of a wide range of goods and services;

(c) Incorporate the supply of fuelwood and wood energy as well as efficient wood energy technologies as a crucial part of policy and planning exerci