Community-based forest enterprises

Forest Connect

Reducing poverty by linking small and medium forest enterprises with national forest programmes, markets and service providers

Small and medium forest enterprises (SMFEs) are critical to the poor. They generate local wealth, help to secure local resources and environmental accountability, promote local creativity and help to preserve indigenous cultures and market niches. But while the number of SMFEs starting up in least developed countries is high, keeping them going sustainably is a major challenge. They face problems such as too much bureaucracy, unstable policies and regulations, insecure land rights, lack of bargaining power, insufficient business knowledge and difficulties accessing credit, market information and technology.

Many SMFEs work together in associations to reduce transaction costs, adapt to new market opportunities and shape the policy environment in their favour. But in many developing countries, support structures for such forest associations either do not exist or fail to reach those who need help most.

Objectives and expected outputs

The central aim of this project is to connect SMFEs to:

national forest programmes (empowering SMFEs to be heard by policy makers);

emerging markets (by supporting existing SMFE associations) and;

service providers (strengthening their capacity to provide training and finance).

The project expected outputs are:

development of functional and stable information services and support networks for SMFEs in six countries – testing and adapting models for connecting SMFEs to national forest programmes, markets and service providers.

development of an information ‘toolkit’ based on practical experience that guides national forest programmes on how to set up an SMFE information service / support network to support the economic, social and environmental sustainability of SMFEs.

testing, applying and revising the toolkit in partner countries and national forest programme facility countries to maximise the worldwide potential of such information services and support networks for SMFEs.

Geographic region and duration

The project will be implemented in Burkina Faso, China, Ghana, Guatemala. Guyana, Lao PDR, Mali, Mozambique and Nepal, from April 2007 to March 2010.

Forest Connect pilot countries

Key findings and publications to date

Supporting small forest enterprises - A cross-sectoral review of best practice Duncan Macqueen

This report reviews the growing consensus on best practice in small enterprise support, both within and outside the forest sector. It describes how a framework known as ‘market system development’ unites attempts to: strengthen enterprise associations, facilitate better provision of financial and business development services, and improve the business environment. It concludes with specific recommendations for support to SMFEs, which constitute the basis for the ‘Forest Connect’ alliance, aiming to spread good practice more broadly.

Toward an enabling environment for small and medium forest enterprise development Jason Donovan, Dietmar Stoian, Sophie Grouwels, Duncan Macqueen, Arthur van Leeuwen, Gemma Boetekees and Ken Nicholson (2007)
This policy brief was developed from an international conference on Small and Medium Enterprise Development for Poverty Reduction: Opportunities and Challenges in Globalizing Markets, Costa Rica, 23-25 May 2006

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