In 2009 the world confronts financial and economic crisis. What does it mean for the forest sector, and what can the sector do to respond?
The United Nations Secretary-General, in his report to the Conference on the World Financial and Economic Crisis and Its Impact on Development in June 2009, estimated that global per capita income could drop by 3.7 percent in 2009. Rising unemployment could push hundreds of millions of people into poverty, especially in developing countries.
The crisis has already had dire effects on the forest sector globally, including depressed demand for forest products, industry slowdowns and closures. Reduced investments and budget cutbacks could make it increasingly difficult to obtain financing for forest conservation and management. There is a risk that the crisis could distract attention and funding away from crucial global problems of climate change and environmental degradation.
The resolution adopted by the UN General Assembly at the June conference recognizes that “the response to the crisis presents an opportunity to promote green economy initiatives ... [which] should address sustainable development and environmental challenges and opportunities, including climate change mitigation and adaptation, financing and technology transfer to developing countries and sustainable forest management”.
As part of World Forest Week (16 to 20 March 2009; see page 56), FAO held a special event on “Impacts of Global Economic Turbulence on the Forest Sector”, which explored the opportunities to invest in forest-based job creation. The first five articles in this issue of Unasylva are adapted from presentations at that event.
The overview article, by C.T.S. Nair and R. Rutt, asserts that targeted public investment in forestry could generate about 10 million new jobs around the world, and examines the investment costs required.
T. Presas briefly outlines the challenges and opportunities posed by the crisis from the industry point of view. She notes that the recession is likely to alter the structure and business models of the global forest products industry – and that industry should be preparing for these changes now.
A graph-filled article by R. Taylor illustrates concisely how the crisis has hit the wood industry in North America. Taylor traces how the collapse of the housing market was paralleled by a collapse in construction and in wood products markets. He then describes options for industry, forest owners and governments to help the forest sector gain strength from the crisis.
In the United States, early in 2009 the American Recovery and Reinvestment Act authorized US$1.15 billion for stimulus projects in forestry. A.R. Kimbell and H. Brown describe how the United States Forest Service is investing these funds in programmes to restore forests and protect them from fire and other threats, to improve recreational facilities and to provide jobs for youth.
In South America, forest industry is an important contributor to gross domestic product (GDP) in several highly forested countries. I. Tomaselli examines the potential for developing forestry’s role in economic renewal in the region, focusing on the contribution of forest plantations to employment.
Turning to Asia and the Pacific, J.R. Matta examines the variety of jobs that could be created in India by increasing the allotment of funds to forestry under the National Rural Employment Guarantee Act, which guarantees 100 days of employment to India’s rural population. Such investment would also help to meet national afforestation goals.
J.L. Atienza, Jr briefly describes the Upland Development Program in the Philippines, introduced in 2009 to cushion the impact of the global financial crisis, mitigate hunger and enhance adaptation to climate change. The programme will create thousands of jobs in restoring forests and watersheds, and is also linked to programmes providing support for small-scale forest enterprise.
In China, the global financial crisis has already put the brakes on the forestry sector’s extremely rapid growth of recent years. Decreased demand for forest products has resulted in industry slowdowns and closures, with small and medium-sized wood-processing enterprises hit hardest. Q. Ma, J. Liu and W. Du analyse the policy adopted by the government to stimulate investment in the forest sector, expand domestic demand and create a favourable environment for enterprise.
The crisis has also taken a heavy toll in Africa, with reduced demand from importing countries forcing companies to close concessions and lay off workers. Such crises accentuate the dependence of rural communities on non-wood forest products (NWFPs) for self-employment, income and sustenance. J.C. Tieguhong et al. describe the development of a legal framework for commercial use of NWFPs in Central Africa, to safeguard people’s rights of access and to avoid possible negative impacts from intensified use of the forest.
Finally, R.N. Heath and S. Chipeta outline crisis response measures proposed in South Africa, including accelerated implementation of labour-intensive programmes in rehabilitating degraded woodlands, controlling invasive species and managing fire. The authors stress that measures to safeguard domestic industries and jobs must not unintentionally jeopardize growth in other countries and in the world economy.
Whether sooner or later, this crisis will pass. But the messages of this Unasylva issue will remain pertinent. With strategic investment, forestry can contribute much to employment, to livelihood support, to environmental renewal and to climate change mitigation and adaptation.