Economic and Social Council

 Distr. GENERAL
19 June 1998
ORIGINAL: ENGLISH

COMMISSION ON SUSTAINABLE DEVELOPMENT
Intergovernmental Forum on Forests
Second session
Geneva, 24 August-4 September 1998


                    Programme element II.d(ii)

        Matters left pending and other issues arising from
             the programme elements of the IPF process

           Valuation of forest goods and services; economic instruments,
           tax policies and land tenure; future supply of and demand
           for wood products and non-wood forest products; and
                  rehabilitation of forest cover

                      Note by the Secretariat

                              Summary

    This note, on some major issues relating to the valuation of forest
goods and services; economic instruments, tax policies and land tenure; future
supply of and demand for wood products and non-wood forest products; and
rehabilitation of forest cover, is prepared in order to facilitate the
background in support of the discussion on these topics by the Forum at its
second session.  It raises a few questions which the Forum may wish to
consider and seeks the Forum's guidance in preparation of the report that
will be the basis for substantive discussion at the third session.

    This note is based on material prepared by the Food and Agriculture
Organization of the United Nations and the World Bank as lead agencies for
these topics within the informal, high-level Inter-Agency Task Force on
Forests.


                             CONTENTS

                                                           Paragraphs

I.   INTRODUCTION .........................................    1 - 2  

II.   MANDATE ..............................................   3 - 4

III. MATTERS LEFT PENDING AND OTHER ISSUES ................    5 - 68   

     A.   Valuation of forest goods and services ...........   6 - 21  

     B.   Economic instruments, tax policies and land tenure   22 - 34  

     C.   Future supply of and demand for wood products and
          non-wood forest products.........................    35 - 52 

     D.   Rehabilitation of forest cover ...................   53 - 68 

IV.   PREPARATIONS FOR SUBSTANTIVE DISCUSSION ..............   69    

                  ****************************************

                         I.  INTRODUCTION


1.  This note is prepared as a supporting document to a background
discussion on parts of category II.d of the programme of work set out in the
report of the Intergovernmental Forum on Forests (IFF) on its first session
(E/CN.17/IFF/1997/4) - namely, the valuation of forest goods and services;
economic instruments, tax policies and land tenure; future supply and
demand of wood products and non-wood forest products; and rehabilitation of
forest cover.  At that session, IFF emphasized the need to build on the positive
results achieved by the Commission on Sustainable Development Ad Hoc Open-ended 
Intergovernmental Panel on Forests (IPF) and to consider matters left
pending and other issues arising from the programme elements of the Panel
process.  This note, therefore, recalls in the final report of the Panel
(E/CN.17/1997/12) the conclusions and proposals for action relevant to the above
issues.  It reviews major aspects of those issues and summarizes some of the main
conclusions.

2.  This note is based on documentation prepared by the lead agencies for
these topics in the informal, high-level Inter-Agency Task Force on Forests.  For
the first two issues, the lead agency is the World Bank, and for the last two,
it is the Food and Agriculture Organization of the United Nations (FAO).

                           II.  MANDATE

3.  Category II of the IFF programme of work mandates the consideration of
"matters left pending and other issues arising from the programme elements
of the IPF process".  The section of the mandate stipulating the work under
programme element II.d, concerning the topics of this note states:

        Consider ... valuation of forest goods and services; assessment,
    monitoring and rehabilitation of forest cover in environmentally
critical areas; ... the use and application of the range of economic
instruments, including tax policies and land tenure arrangements as a means of
promoting sustainable development; and future supply and demand of wood and
non-wood forest products and services.

4.  These issues will receive substantive discussion at the third session of IFF.

            III.  MATTERS LEFT PENDING AND OTHER ISSUES

5.  Even if the topics under consideration in this note are interrelated,
they will be treated separately.  Some, however, should be read in combination
-since, for example, valuation of forest goods and services is only meaningful
if directly linked to economic instruments.  Because of constraints in the
length of official documentation, the current note, out of necessity, treats each
of the four topics in a summary fashion.

            A.  Valuation of forest goods and services

                   1.  IPF proposals for action

6.  The Panel's discussions on the valuation of forest goods and services
resulted in several proposals for action.  Inter alia, the Panel encouraged
countries, in collaboration with international organizations, to make use
of available methodologies to provide improved estimates of the value of all
forest goods and services.  It requested international organizations and relevant
institutions to prepare comprehensive documents on the available forest
valuation methods and data sets required for the evaluation of forest goods
and services, in particular those that were not traded in the marketplace.  The
Panel also invited countries and relevant international organizations and
institutions to promote research to further develop forest valuation
methodologies, in particular those related to deforestation and forest
degradation, erosion, and criteria and indicators, taking into account the
particular circumstances of each country.

    2.  Major issues in valuation of forest goods and services

7.  The methods for valuation of wood forest products destined for timber
and fibre use are well established and were discussed in detail during the
Panel's discussions.  Therefore this note will focus on the creation of markets
for non-timber forest values.  Forests provide a wide variety of local,
national, and global services, including carbon sequestration, biodiversity
conservation, recreation, and watershed protection.  These benefits, however, do
not usually accrue to the forest owner or manager, who therefore lacks both
incentives and funds to maintain them.  In principle, if beneficiaries of these
environmental services paid for them, forest conversion would be reduced and
standing forests would be better maintained.

8.  In practice, what is the scope for this kind of financing mechanism? 
Astronomical calculations of forest values, such as one of $4.7 trillion,
emphasize our concern for forests but provide little guidance.  Setting
aside arguments about the derivation of the numbers, the point is that
conservation depends on marginal, not total, values.  What needs to be considered
are mechanisms to influence the forest conversion or exploitation decisions of
the landholder at the forest frontier.  Five non-timber forest services are
often cited as potentially generating incentives for conservation:

    (a) Carbon sequestration

9.  Carbon sequestration appears to be the largest and most generally
applicable non-timber forest service that can potentially be developed in
the near-to-medium term.  A market for this service may be created under the
Kyoto Protocol to the United Nations Framework Convention on Climate Change,
which sets limits on developed countries' greenhouse gas emissions but may permit
them to meet those limits in part by acquiring offsetting emission reductions
from other countries.  The eligibility of forest-based emission reductions for
this purpose is still under discussion.  If such trading is allowed, rough
simulations suggest that in 2010, 1 billion tons of carbon allowances, or
emission reductions, would be traded, at a price above $30/ton.  This
estimate does not allow for emission reductions from forestry, whose inclusion
would boost the quantity traded and reduce the price.  Depending on the
eligibility rules for projects and on the cost of producing emission reductions
- both now subject to great uncertainty - the market for forestry-based emission
reductions might encompass hundreds of millions of tons of carbon and billions
of dollars per year.

10. For a significant market in forest-based sequestration services to
emerge, these technical issues must be satisfactorily resolved, the parties to
the Framework Convention must agree to allow forest-based emission reductions
from developing countries, and the Kyoto Protocol must come into force.

    (b) Hydrological services

11. Conventional wisdom accords forests a significant economic role in
preventing the silting of hydropower facilities, protecting the quality of
drinking water, maintaining the flow of water in the dry season, preventing
flooding, and generating local rainfall.  In reality, the magnitude and
even direction of these impacts is variable and highly sensitive to local
economic and bio-geophysical conditions.  For instance, hydrological theory and
evidence suggest that deforestation often increases rather than decreases dry
season flows.  Sediment impacts depend on the proximity of deforestation to
streams, the gradient of watersheds, and the presence of at-risk facilities such
as power stations in the watersheds.  The local climatic impacts of deforestation
are very poorly understood, but theory suggests that the impacts depend greatly
on the scale of deforestation, and that moderate amounts of deforestation
could increase local rainfall.

12. Maintenance of forest cover in urban watersheds may be a cost-effective
means of maintaining the quality of water supplies for urban consumers and
for freshwater and marine fisheries.  Similarly, maintenance or regeneration of
riparian forests can disproportionately reduce sedimentation, intercept
agrochemical runoff from fields, and play a role in maintaining habitat
connectivity for biodiversity.  There are several markets for hydrological
services based on this rationale, including payments by New York City for
watershed protection, the Quito Watersheds Conservation Fund in Ecuador,
Costa Rica's environmental services payment system, and the Conservation Buffer
Initiative in the United States.

13. In general, however, the hard hydrological data and analyses that could
justify, for instance, spending public funds on watershed protection rather
than water filtration are lacking.  In the absence of these analyses, it is
difficult to assess the potential scale of markets for hydrological services.

14. In principle, downstream users could pay loggers for the service of not
creating sedimentation. Alternatively, one could apply the "polluter pays
principle", as is standard for other types of water pollution, imposing
sediment discharge fees on loggers.  In practice, most jurisdictions impose
regulations on logging practices so as to minimize sedimentation.

    (c) Biodiversity

15. Bioprospecting is an emerging source of forest-based revenue.  While
estimates of the potential value of forest-based pharmaceuticals range into
the hundreds of billions of dollars, existing transactions are modest.  A
recent review attributes this to the growing success of synthetic chemistry in
finding promising compounds.  Over time, the industry may shift from a focus on
identifying individual antibiotics to identifying entire genes or sets of
interacting chemicals.  Such a shift would increase the comparative
advantage of bioprospecting relative to laboratory synthesis.

16. Currently, and probably for the foreseeable future, bioprospecting
revenues will not be strongly linked to the sheer area licensed for exploration
but rather to cleverness in selecting samples for screening.  One rough
theoretical calculation puts the average bioprospecting value, in the area of the
highest and most distinctive biodiversity, at about $2/hectare with more typical
values of less than $0.10 even for areas of great biodiversity significance. 
However, where ancillary information can be used to pinpoint promising areas,
per-hectare values may be considerably higher.

17. If biodiversity conservation is a public good enjoyed by the world, it
is appropriate to seek direct international sources of financing for
conservation. In the long run, it is possible that market mechanisms similar to
those under discussion for carbon will be developed to compensate forest owners
and managers directly for biodiversity conservation services.  This is most
likely to happen in areas of notable biodiversity richness and uniqueness.

    (d) Non-timber forest products

18. Natural forests produce an immense range of non-timber products.  These
are often of critical importance to forest dwellers who rely on non-timber
products to provide them with a source of income.  In some cases, these products
have been able to tap into a broader national or international market.  The most
prominent example is rattan.

19. Early calculations showing extremely high theoretical per-hectare
values of these products have given way to a sober realization of the
considerable barriers to marketing new products.  They include the high labour
costs of extracting products from species with low densities per hectare, the
danger of overexploitation, and keen competition from substitute products and
from domesticated production.  Realistic net rental values associated with the
extraction of non-timber forest products are probably $10-15 per hectare
for favourable areas.  Prospects for generating conservation incentives via
non-timber forest products are site-specific and limited.

    (e) Eco-tourism

20. Information on the scale and prospects of forest-based eco-tourism is
scant. One estimate places the global economic impact of all nature-related
tourism at between $83 and $166 billion.  If this were accurate,
achievement of even a small share for forest-related tourism would represent a
substantial market for forest services.  A realistic measure of current prospects
is provided by the Monteverde Cloud Forest Biological Reserve in Costa Rica. 
One of the most famous and successful forest tourism destinations in the
developing world, it collects annual entrance fees of about $50/ha.  In the very
long run, the combination of a growing world population, higher world incomes,
decreased transport costs, and diminishing forest areas will boost the
recreational value of areas now considered remote.

    (f) Implications for research and development

21. To facilitate the emergence of a market for forest-based carbon
emission reductions, work is needed on developing measurement and verification
protocols and on projecting the economic and environmental effects of such a
market. To facilitate the emergence of markets for watershed services, far more
effort must be invested in hydrological measurements and economic analyses of
potential interventions.

      B.  Economic instruments, tax policies and land tenure

                   1.  IPF proposals for action

22. Discussion by the Panel did not specifically address the issue of
economic instruments, tax policies and land tenure.  There were, however, many
proposals for action that called for creating enabling policy and economic
environments to promote sustainable forest management.  This section aims at
supporting the background discussion on how that can be achieved.

              2.  Major issues in economic instruments, tax policies
                  and land tenure

23. Regulations on land use and forestry have two broad goals:

    (a) To preserve environmental and other non-timber forest values;

    (b) To raise revenue for the forest owner - often, but not always, the
Government itself.

24. A positive economic approach to forest policy examines the economic,
fiscal, and environmental impacts of alternative tax and regulatory
regimes.  A normative approach seeks economic instruments that are cost-effective
in achieving environmental goals and efficient in appropriating rents for
forest owners without introducing economic distortions.  Both approaches are in
their infancy.  This note describes the principal issues; firm empirical answers
are mostly lacking.

25. It is convenient, though somewhat artificial, to break the land
allocation problem into two decisions:

    (a) How much forest land to convert;

    (b) How to manage those areas designated to remain under forest cover.

    (a) The land-conversion decision

26. To achieve environmental, conservation, and economic goals, regulatory
authorities seek to divide natural forests among three classes:  full
protection; multiple use, including both conservation and production of
timber and non-timber products; and complete conversion to agriculture or
plantation forest.  Two overarching issues are:

    (a) On what basis should land be allocated among the classes?

    (b) What instruments are available to bring about this allocation?

    (i) The basis for allocating land

27. From a normative standpoint, forestland ought to be allocated so as to
achieve non-monetizable environmental goals (such as biodiversity
preservation) in a cost-effective manner.  A growing literature in conservation
biology describes "reserve site selection" methodologies which attempt to
minimize the cost (in land area, cost of land acquisition, or other economic
terms) of satisfying a precisely stated environmental goal (such as
representation of species or habitat types), subject to additional social,
economic, and environmental constraints.  Stakeholders can use them as the basis
of negotiations about land-use regulations.  The methodologies will become
increasingly important as land-use conflicts grow - when, for instance,
urban and agricultural areas expand into already fragmented forests.  Important
areas for research and development on these methodologies include refinement of
the ecological objective function and of the cost function, inclusion of
land-use categories intermediate between conversion and protection, and linkages
to policy instruments affecting land-use change (see below).

28. Much less well explored is the issue of the desirability and
applicability of the multiple-use option.  It is generally assumed that
allocation of land to production forests represents a trade-off between the
biodiversity advantages of full protection and the economic advantages of
complete forest clearance. Recent work has questioned the assumed trade-off,
raising the possibility that splitting multiple-use areas between full protection
and full exploitation/conversion may in some circumstances be superior to
multiple use on both economic and environmental grounds.  This is an important
area for investigation and applies as well to land uses such as agro-forestry and
plantation forestry.

    (ii)    Instruments for land-use allocation

29. To date, zoning has been the predominant instrument for enforcing
land-use plans.  Zoning can be effective when enforced, but establishing and
enforcing it can be problematic when there are strong economic and political
pressures for forest conversion or exploitation.

30. Road-network planning, in the context of regional development planning,
is an extremely powerful tool for affecting the spatial configuration of
forest conversion and exploitation.  Intensification of the road network in
favourable agroclimatic areas and a prohibition of road expansion in sensitive
areas would be efficient methods of achieving conservation goals, though they
might raise important issues of geographical equity.

31. A relatively unexplored but potentially promising complement to zoning
is the use of economic instruments.  Just as pollution charges and permits
have reduced the cost of achieving pollution reductions relative to "command and
control" approaches, so too might economic instruments facilitate the
reservation of forest areas with the lowest opportunity cost.  A general
approach would take bids from forest owners for acceptance of easements
restricting land-use change and the degree of forest exploitation.  The
easements might be financed from general tax revenue or from the sale of
carbon offsets, as in Costa Rica.  Alternatively, a system of tradable
development rights might be instituted.  Landholders in environmentally sensitive
areas would be forbidden to develop their property but would be allowed to sell
their foregone rights to landowners in less sensitive areas.  The latter could
use those rights to offset requirements for local forest maintenance.   Much
work needs to be done in this emerging policy area to derive simple, enforceable
and effective economic instruments for efficient land-use allocation.

    (b) Regulation and taxation of logging

32. Landowners (often the Government) regulate logging by:

    (a) Establishing mandatory management criteria; for instance, there may
be rules about which species and what overall proportion of trees can be cut;
minimum diameter limits on cutting; prescribed rotation lengths; maximum
slopes; and so forth;

    (b) Setting up a fee system or taxation structure that governs log
production or concession allocation;

    (c) Prescribing the length and renewability of concessions or use
rights;

    (d) Setting up a monitoring and enforcement system.

33. These regulations, together with market conditions and available
technologies, determine the intensity of logging and management activities
and their impact on biodiversity, carbon storage, logger profits, monitoring
and enforcement costs, and quasi-rents accruing to the landholder. 
Understanding the resulting trade-offs and complementarities is essential to
understanding cost-effective means of preserving biodiversity and reducing carbon
emissions and to understanding the distributional effect of different taxation
systems.  There is much speculation but little empirical information on these
relationships.  Some open questions include:

    (a) To what extent does increasing the strictness of logging
regulations or management criteria lead to diminishing environmental benefits,
increasing opportunity costs, increasing monitoring and enforcement costs, and
decreased compliance?

    (b) Under what conditions does a strategy of allowing a single harvest
of a forested area, followed by protection, dominate a sustained-yield
strategy on criteria of net present value of profits, carbon storage, and
biodiversity preservation?

    (c) Which reduced-impact logging techniques are privately profitable? 
If they are privately profitable, what prevents their spontaneous diffusion?  

    (d) Does low-rent capture result in efficiency losses or merely have
distributional effects? 

    (e) Is better forest management promoted by granting longer concession
periods?

    (f) Which is more effective for enforcing regulations, a system of
performance bonds or a system of renewable short-term concessions?

    (g) What are the costs and benefits of alternative monitoring and
enforcement approaches? Is it possible to emulate modern systems of
industrial pollution monitoring and enforcement, which depend on audited
self-reporting?

    (c)  Areas for research and development

34. Policy-oriented research and pilot studies are needed in the following
areas:

    (a) The effectiveness of land-use zoning;

    (b) Development and application of economic instruments for allocating
land to conservation;

    (c) The economic and environmental implications of alternative forest
tax and regulatory schemes;

    (d) The costs and benefits of innovative methods for monitoring and
enforcement of regulations, including performance bonds, concession
renewability conditions and public disclosure of environmental impacts.

                 C.  Future supply of and demand for wood products
                     and non-wood forest products

           1.  IPF conclusions and proposals for action

35. A primary analysis of future supply and demand prospects was provided
to the Panel in a study sponsored by the Government of Norway, entitled
"Long-term trends and prospects in supply and demand for wood products, and
possible implications for sustainable forest management".  A substantive
discussion of the specific issues and implications arising from the study was
beyond the scope of the Panel's deliberations, although it recognized the key
importance of fundamental economic principles in determining the future of
forests.  As a consequence, it urged countries:

    "To assess long-term trends in their supply and demand for wood, and to
    consider actions to promote the sustainability of their wood supply and
    their means for meeting demand, with a special emphasis on investment
    in sustainable forest management and the strengthening of institutions for
    forest resource and forest plantations management."1

36. The Panel's conclusions and proposals for action acknowledge the
importance of a future supply of and demand for wood and non-wood products in
determining the future of forests and call for action in several areas.

                  2.  Major issues in future supply of and demand
                      for wood and non-wood forest products

37. A considerable body of literature addresses issues of supply and demand
in forest products, mainly for industrial use.  There is need to continue to
study the supply of and demand for fuelwood and non-wood forest products as well
as environmental services and benefits.  In late 1998, a fuller analysis of
the status of resource availability and its prospects will be available upon
completion of the FAO global fibre supply study.

38. While there is broad consensus among recent studies that, in the
immediate future, wood supplies at the global level will be adequate to maintain
a level of availability that approximates the current situation for forest
products at relatively stable prices, none of the recent studies predicts a
surfeit of wood.  There remains sufficient variability and uncertainty in
forecasts to suggest that in some countries and regions the situation is less
than comfortable.

39. The base statistics on which supply assessments are founded are, in
general, very poor.  National forest inventories are often non-existent,
old, incomplete or poorly designed for current analytical needs.  In addition,
utilization data, especially for non-wood products and services, are in an
even worse state than those for wood for industrial purposes.  To compound the
challenges, the best information available is often non-standardized and in
a poor statistical reporting structure both at the country level and for
international reporting.

40. There are a number of central questions that have an impact on supply
of and demand for forest products and services.  This note raises, for the
perusal of the Forum, the questions of how sustainable forest management,
increased forest areas under protection, afforestation and plantations might
affect future supply and demand.

41. The following analysis attempts to give further insight into the
broader supply and demand issues which will have a significant impact on the
ability of forest policy makers to prescribe appropriate forest policies and
policy frameworks.

    (a) Demand

42. The key drivers of demand for forest products are population growth and
increasing wealth (reflected to some extent in GDP).  A range of other
factors also significantly affect demand, including the price competitiveness of
forest products relative to non-wood products, the technical competitiveness of
wood products against substitute products, and consumer preferences for wood
vis-a`-vis non-wood alternatives. 

43. The role of population growth in increasing demand for forest products
and other products is recognized and understood. Increasing income is a
principal factor underlying projections of increasing demand for forest products.
Mainly three areas - North America, Asia and Europe - geographically dominate the
world's industrial forest products economy.  A correlation between
increasing incomes and preferences for environmentally friendly products and
outcomes suggests a future of increasingly complex interplay in the demands
placed on forests and the relative acceptability to consumers of forest products
and competing non-forest substitutes.

    (b) Supply

44. Supplies of forest goods and services have four main sources:  natural
forests, planted forests, trees outside forests, and alternative fibres. 
These sources provide the resource needs for industrial wood, fuelwood and
non-wood forest products and also for an extremely complex array of forest
services.

45. Since forests are very dynamic ecological and economic systems,
developing appropriate frameworks for forest policy formulation is a significant
challenge. In addition, there are also new sources of supply which provide
opportunities for meeting increasing demands for forest products.

    (i) Wood fuels

46. A large proportion of wood fuels come from trees outside forests, and
hence supply conflicts with industrial usage are generally infrequent; in fact,
inefficient resource use may occur as a result of inaccessibility of
industrial wood residues to wood-fuel users.

    (ii)  Non-wood forest products and services

47. Forests provide a vast range of non-extractive environmental services
and benefits alongside wood and non-wood forest products.  The estimated global
value of forest food is about $20-$25 billion.  The key issues associated
with supply of non-wood forest products are related to their small scale and
lack of development in an industrial sense. 

48. For forest services, the key issues relate to developing appropriate
pricing methodologies and mechanisms which will ensure that the full
economic value of forests is recognized.

   (iii)    Land-use change:  deforestation and forest degradation

49. Deforestation remains a serious policy issue for some forest regions. 
A meaningful analysis of changes in the world's forests requires a
differentiation between increases or decreases of forest area and the changes in
forest condition.  The most frequently reported parameter is change in forest
cover.  Forest quality, although equally important for wood supply, is less
intensively observed and monitored.  Given that the change in forest area is
negative in five out of eight regions in the world, deforestation can be expected
to remain a prominent issue in the policy debate over forests.

    (iv)    Sustainable forest management

50. In forests available for wood supply, the shift towards sustainable
forest management means combining wood production with other management
objectives. Conceptualization of sustainable forest management has outpaced the
development of specific on-the-ground practices that will achieve sustainability. 
From a production perspective, this shift could have implications for timber
supply and raises the question whether unacceptable economic hardship will be
created during the adjustment phase.  A potential brake on global flows of forest
products would occur if the forest areas of key producer countries become
inaccessible (for policy reasons) as a source of industrial forest
products. Similar supply implications can also be seen if substantial forest
areas are set aside as protected areas.

    (v) Planted forests, afforestation rate and development gains

51. Since the growth on plantations is much higher than in natural forests,
policy developments that promote the use of plantations will have a
significant impact on fibre supplies, as well as easing the pressures on natural
forests. In general, it can be concluded that good tree improvement programmes
will result in considerable gains in wood yields from tropical and non-tropical
forest plantations.

    (vi)    Alternative fibres

52. Currently wood is the major raw material in the global pulp and paper
industry.  However, waste paper is making significant inroads, and all
regions except North America consume more waste paper than they recover. 
Significant levels of non-wood fibres are used in a handful of countries, using
sources that are usually more intensely grown than wood.  Non-wood paper is often
produced in smaller pulp and paper mills which are frequently unable to afford
pollution-abatement technologies.  Policies need to recognize and respond to the
fact that, in attempting to preserve forests for environmental reasons, the
environmental problem might shift downstream, with maybe even more damage
to the environment.  A host of other issues also influences supply of and demand
for wood and non-wood products and forest services.  Supplementary wood and
fibre sources such as trees outside forests (especially for fuelwood) and
agricultural tree-crops are also important in reducing pressure on forests. 
Similarly, considerable analysis has been carried out on the roles and impacts
of factors such as the economic accessibility of wood supplies, the impact of
integrated forest management, material efficiency, the social dimensions of
forest product supplies, and the roles of institutions and institutional
arrangements.


                D.  Rehabilitation of forest cover

                   1.  IPF proposals for action

53. The report of the Panel outlined priority items for consideration
relevant to assessing, monitoring and rehabilitating forest cover in
environmentally critical areas, including

    (a) The need to determine the underlying causes of deforestation;

    (b) Giving further consideration to the currently neglected traditional
forest-related knowledge;

    (c) The need for regular monitoring of forest cover and its
rehabilitation, including assessments of transboundary studies;

    (d) Better assessment of forest area under conservation or any other
protected status;

    (e) Clear setting of research priorities.

The report made a number of other important observations, notably that:

    (a) Effective assessment, monitoring and evaluation are a major policy
issue;

    (b) Poverty and demographic pressures are the root causes of
deforestation (although it also follows that deforestation delivers the global
benefit of increased food security through expanding agriculture);

    (c) Environmental impact assessments should be used as a basis for
action against uncontrolled conversion of forest land for other purposes.

        2.  Major issues in rehabilitation of forest cover

54. A review of the assessment, monitoring and rehabilitation of forest
cover in environmentally critical areas must start with the understanding that
forests and trees are renewable resources.  It should consider the nature and
causes of deforestation and degradation and under what conditions tree cover
could be restored.  The key questions relate to:

    (a) Shared understanding of concepts, including forest cover,
degradation, environmentally critical areas, areas under potential or actual
threat;

    (b) Identification of the location of the critical areas and
opportunities for carrying out rehabilitation work;

    (c) The importance of deforested and degraded areas;

    (d) The means available to rehabilitate and monitor progress within the
context of adequate criteria for assessment. 

55. Critical areas are understood to include dry zones, mountain areas,
coastal areas, freshwater swamps and land degraded through unsustainable
agriculture. Although trees and forests are highly adaptable renewable resources
which, given protection from damage, will regrow on most types of land, in
critical areas the site conditions and external factors acting on the site make
the growth, regrowth or development of forest cover difficult.

    (a) Dry zones:  desertification and silvo-pastoralism

56. The important international instruments dealing with dry zones are the
United Nations Convention to Combat Desertification in those Countries
Experiencing Serious Drought and/or Desertification, particularly in
Africa,2 and chapter 12 of Agenda 21.3  The Convention to Combat Desertification
notes that information on rates and causes of desertification are still needed,
especially for Africa, and proposes a target of the year 2001 for every
country to have a policy for dry lands.  It emphasizes capacity-building,
partnerships between civil society and non-governmental organizations, and the
empowerment of people along with an assessment of trees, woodlands and forests
and of the processes leading to degradation - the forerunner to desertification. 
It also emphasizes the need for peoples' participation in decision-making and
management, decentralization and the value of a mix of local, national and
international partnerships at all levels. 

57. An expert meeting held in 1996 in Lisbon, Portugal, under the auspices
of the Governments of Cape Verde, Portugal and Senegal, listed many
constraints on development in dry zones, noting particularly the use of trees for
the support of sustainable livelihoods and the need for a holistic approach.  The
low potential biomass yield in dry zones means that tree products should
ideally be of high value and low biomass content, such as honey, silkworms or
medicinal plants.  Low-value crops such as fuelwood usually give low benefit/cost
ratios which, although not likely to encourage outside investment, provide
socio-ecological benefits such as shade, forage, food products. 

58. The recommendations of the Lisbon experts meeting and those of the
Second Expert Consultation on the Role of Forestry in Combating Desertification
both point to some strong critical policy goals, including:

    (a) The existence of national forest policies for dry lands, drawn up
with peoples' involvement and incorporating sound ecological management
principles;

    (b) Clearer tenure arrangements to promote higher security in resource
use, management and conservation;

    (c) Prioritization of preventive measures for action;

    (d) The need for guidelines to help decision-makers in choosing species
and techniques for plantations and doing so on a truly participatory basis;

    (e) Improvement of training and education at all levels, together with
revision of teaching curricula and a new approach to extension;

    (f) Basing action on environmental safety, social acceptability and
economic relevance.

    (b) Mountain forests:  catchments and biodiversity

59. The relevant parts of the international instruments are chapter 13 of
Agenda 214 (Managing fragile ecosystems: sustainable mountain development),
chapter 15 (Conservation of biological diversity) and chapters 10-12 as
well as the "Forest Principles"5 and the Convention on Biological Diversity.6 
Mountains are particularly fragile due to their high energy environments; they
are frequently regions of active geomorphological change and are characterized
(compared with hills) by distinct altitudinal climatic belts. Cloud forests
are especially vulnerable, because once the trees have been removed, they may
receive virtually no rainfall.  It is noteworthy that some of the world's
oldest organisms and some of its most threatened animal species (e.g., the
gorilla) are found in cloud forests. 

60. FAO estimates that upland forests are being lost at an annual rate of
1.1 per cent, greater than elsewhere in the tropics.  A major feature of
many mountain forests is slash-and-burn agriculture, often due to the economic
and political marginalization of the cultivators.  The promotion of
agroforestry on individually held land is often regarded as more effective than
setting up communal forestry schemes in those areas.  In natural upland forests,
women are often the de facto managers, receiving little recognition and no
management authority. 

61. The quantity and variety of resources coming from mountain forests are
often unsustainable, and their value often accrues to downstream
beneficiaries rather than to the mountain communities.  Since the most important
forest product of many mountains is water, many Governments have labelled them
"protection" forests.  The downstream beneficiaries who receive the water,
such as owners of irrigated farmlands, make little or no reinvestment either in
the resources themselves or in the mountain communities.

62. The rehabilitation of mountain forests by tree planting poses a dilemma
in the choice of species.  Other options for the rehabilitation of mountain
and mountain forest ecosystems are more socio-ecological objectives, broader
based management systems, better harvesting practices and an enabling political
environment, and shift away from a concern with biomass production.  The
essential prerequisite and facilitating framework will include the
recognition of services rendered by mountain ecosystems and their dwellers to
lowland communities and systems and the necessity for compensation in a
comprehensive consideration of local and national economies.

    (c) Coastal zones, especially mangrove forests

63. Mangroves represent the single most important coastal forest formation
in the world.  Deforestation in mangrove forests can cause coastal erosion and
interrupt important ecological succession in the stabilization of materials
deposited at the mouths of rivers.  Mangroves are important sources of wood
products and provide habitats for rare species of avifauna.  Some acid
sulphate soils are especially susceptible to degradation when cleared for
agriculture and should be avoided for this purpose.  In view of the aquatic
environment, aerial sprays of agricultural chemicals should be avoided as should
mining operations, which present special hazards.  What is most needed if
mangroves are to be saved are strong policy options that address the need for
integrated approaches to the use and conservation of mangroves; take into account
the multiple services they provide; raise awareness of and evaluate continuously
the environmental impact of development initiatives on mangroves; and envisage
social promotion of societies dependent on mangroves.

    (d) Degraded sites arising from unsustainable agriculture

64. The planting of suitable woody species may often restore soils that
have been exhausted or made otherwise unproductive from exploitative
agriculture.  Recent work on planted fallows shows what can be achieved at some
tropical sites with certain tree species producing highly priced products.  The
need to address the restoration of alkaline and saline soils, which are no longer
productive as a result of land clearance and improper irrigation techniques, is
an important special concern.  Large areas of such soil exist, although they are
not regarded as key for the restoration of forest cover.  The need for
sustainable agriculture is of great importance to the forest sector in this
respect. 

    (e) Objectives and prerequisites for successful restoration and
        rehabilitation of forest cover

65. Degradation and deforestation entail loss of ecosystem productivity,
elimination of natural buffer systems, reduced biological diversity, and
impairment of all the physical and biological services and functions
provided by forest and tree resources.  Rehabilitation will aim at restoring the
balance and the associated natural processes maintaining forest ecosystems.  The
process of rehabilitation can only effectively take place with clearly defined
objectives, against which progress can be monitored.  Some objectives are to:

    (a) Establish nursery crops to restore, eventually, a previous
ecosystem;

    (b) Establish ground cover to protect soils from erosion;

    (c) Protect watersheds and catchments, feeding rivers and
hydro-electric dams;

    (d) Manage a single species with a view to promote understorey
diversity;

    (e) Create a wood resource to take the pressure off natural formations.

66. One of the most important prerequisites for successful rehabilitation
is clear definition of the control over the land in question.  In most cases
there will be several parties or stakeholders interested in the future use of
even heavily degraded or deforested land.  It is useful to identify the
secondary stakeholders who may have considerable influence on the land/forest
reserve as well as the primary stakeholders who have a direct stake in it.  A
recent preliminary study carried out in six African countries has tested a
concept of four "Rs" for stakeholder analysis and conflict resolution.  They are
Rights, Responsibilities, Revenues/returns and Relationships. 

    (f) Technical factors

67. Technical packages exist for most rehabilitation situations, depending
on the objectives of the process.  They fall naturally into two major groups: 
the use and encouragement of natural regeneration; and the introduction of
germplasm through planting.  There are many options combining the two approaches. 
In almost all situations, rigorous protection from grazing, fires and
exploitation, along with soil conservation work, will ensure the recovery of some
vegetative cover and is usually the cheapest option; it may, however, entail
serious loss of benefits to poorer stakeholders.

68. Plantations may contain single species or mixtures, indigenous or
exotic.  Introduced species may have a rehabilitation capacity that indigenous
species do not, such as an ability to deep-root in degraded or lateritic soils
or to withstand drought and high winds on sand dunes.  Introduced species of cash
crops, forage or domestic animals may meet the aspirations of farmers
better than local species.  An exchange of information between technical
foresters and local people, giving full weight to traditional forest-related
knowledge, could result in a better choice of species.

           IV.  PREPARATIONS FOR SUBSTANTIVE DISCUSSION

69. The issues listed under category II.d in the first report of IFF are
scheduled for substantive discussion at the third session of the Forum.  To
facilitate that discussion, a report which describes the issues in greater
detail will be prepared.  The Forum may wish to guide preparations for the
report by identifying matters that need further analysis and elaboration
and by considering some of the questions raised in this note.


                               Notes

    1 E/CN.17/1997/12, para. 28 (a).

    2 See A/AC.241/27.

    3 Report of the United Nations Conference on Environment and
Development, Rio de Janeiro, 3-14 June 1992, vol. I, Resolutions Adopted by the
Conference (United Nations publication, Sales No. E.93.I.8 and corrigenda),
resolution 1, annex II.

    4 Ibid.

    5 Non-legally Binding Authoritative Statement of Principles for a
Global Consensus on the Management, Conservation and Sustainable Development of
All Types of Forests.  Ibid., annex III.

    6 See United Nations Environment Programme, Convention on Biological
Diversity (Environmental Law and Institutions Programme Activity Centre),
June 1992.

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Date last posted: 5 December 1999 15:45:34
Comments and suggestions: DESA/DSD