Forestry in a new economic climate

FAO launches latest report on the State of the World’s Forests 2009

16 March 2009, Rome – The dual challenges of economic turmoil and climate change are bringing the management of forests to the forefront of global interest.  The need to reform forestry institutions and increase investments in science and technology are key to the better management of forests, notes the State of the World’s Forests 2009 launched today. 
A highly mixed situation is expected, with gains in forest area in some regions and losses in others, notes the report. Countries in the early stages of development in particular tend to struggle with immense pressures on their forests. The trade-offs between immediate economic compulsions and long term benefits are challenging. Institutional weaknesses remain the most important problem, but also the most difficult to solve. 

 “Adapting forestry institutions to rapid changes in the larger environment is a major challenge”, says Jan Heino, Assistant Director-General of FAO’s Forestry Department.  Of particular importance is the need to re-invent public sector forestry agencies that have been slow in adapting to changing customer needs, said Mr. Heino.

Global demand for products and environmental services is expected to increase in the coming decades, notes the report. Energy and climate change policies are increasing the use of wood as a source of energy, although this trend may be affected by the recent economic down-turn.
Effect of global economic crisis

In the short term forests and forestry are greatly impacted by the global economic crisis, notes the report. Reduced demand for wood and wood products as a result of the collapse in the housing sector and the credit crunch are having a severe negative impact on investments in industries and also on forest management.

A general concern is that some governments may dilute previously ambitious green goals or defer key policy decisions related to climate change mitigation and adaptation as they focus on reversing the economic downturn, the report said. Initiatives such as those for reducing emissions from deforestation and forest degradation that are dependent on international financial transfers could also face problems.

Furthermore, contraction of formal economic sectors often opens opportunities for expansion of the informal sector and could lead to more illegal logging. 

Green path to development

But there are also opportunities stemming from the current crisis. Increased attention on “green development” could provide a new direction to the development of the forest sector.  Planting trees, increased investments in sustainable forest management, and active promotion of wood in green building practices and renewable energy will all become integral parts of “green development,” notes the report.   

Regional disparities

Forest resources in Europe are expected to continue to expand in view of declining land dependence, increasing income, concern for protection of the environment and well developed policy and institutional frameworks. Europe accounts for about 17 percent of global land area but has one-quarter of the world’s forest resources, approximately 1 billion hectares, of which 81 percent is in the Russian Federation. I

In South America, the pace of deforestation is unlikely to decline in the near future, despite low population density. High food and fuel prices will favour continued forest clearance for production of livestock and agricultural crops for food, feed and biofuel.

In Africa, forest loss is likely to continue at current rates. The growing demand for, and rising price of, food and energy will exacerbate the situation, especially as increased investments in infrastructure open up new areas. Increasing frequency of droughts, declining water supplies and floods strain coping mechanisms at the local and national levels and undermine efforts to manage African forests sustainably.

In Asia and the Pacific, home to more than half of the world’s population with some of the most densely populated countries in the world, demand for wood and wood products is expected to continue to increase in line with the growth in population and income.

Growth in the demand for primary commodities owing to rapid industrialization of emerging economies is likely to result in forest conversion in other countries within and outside the region. While the region is a leader in planted forests, it will continue to depend on wood from other regions, as land and water constraints will limit the scope for self-sufficiency in wood and wood products.

The near future of forestry in North America will depend on how quickly the region reverses the recent economic downturn and its impact on the demand for wood and wood products, especially in the United States of America, noted the report. The forest sector will also need to address challenges of climate change, including increasing frequency and severity of forest fires and damage by invasive pest species.  

Photo: ©FAOB. Vivattana
Increased attention to “green development” could provide a new direction to the development of the forest sector.