Natural tropical forest management faces particularly difficult challenges. Many markets, including those proximate to these forests, are not yet demanding certified products nor are they willing to pay a green premium for more expensive management practices. The lack of markets for lesser-known species creates an economic problem for tropical forests with high levels of species heterogeneity; these need to be harvested along with higher value commercial species, both to fit ecological management standards and to make SFM viable. The high cost of audits and documentation for complex ecologies, combined with limited markets for lesser known species, needs to be offset by compensatory payments for environmental services or other green market mechanisms. This inherent economic problem for certification of tropical natural forests inevitably means that the certification process has to be supported initially by some subsidy, whether directly or indirectly. Subsidized certification is theoretically justified by the significant environmental benefits at stake which are not at present recognized by the market. The fact that certification is a relatively new market-based instrument can also justify this subsidy, but can create problems for long-term progress towards SFM if this creates a perverse incentive against sustainably produced forest products in the marketplace.

Type of Case
Printed publication (book, sourcebook, journal article…)

Publisher
Forest Trends

Region
Global

Biome
All

Forest Type
All forest types (natural and planted)

Primary Designated Function
Production