WORLD BANK TECHNICAL PAPER NUMBER 251 W TP951 TECHNICAL DEPARTMENT SERIES

Public Disclosure Authorized A Strategy for the Forest Sector in Sub-Saharan Africa

Narendra P. Sharma, Simon Rietbergen, Claude R. Heimo, and Jyoti Patel Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Ykn RECENT WORLD BANK TECHNICAL PAPERS

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(List continues on the inside back cover) WORLD BANK TECHNICAL PAPER NUMBER 251 AFRICA TECHNICAL DEPARTMENT SERIES

A Strategy for the Forest Sector in Sub-Saharan Africa

Narendra P. Sharma, Simon Rietbergen, Claude R. Heimo, and Jyoti Patel

The World Bank Washington, D.C. Copyright ) 1994 The International Bank for Reconstruction and Development/THE WORLD BANK 1818 H Street, N.W. Washington, D.C. 20433, U.S.A.

All rights reserved Manufactured in the United States of America First printing June 1994

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ISSN: 0253-7494

All the authors are with the World Bank. Narendra P. Sharma is an agricultural adviser, Simon Rietbergen is a forestry specialist, and Jyoti Patel is a consultant in the Environmentally Sustainable Development Division of the Africa Technical Department. Claude R. Heimo is senior forestry specialist in the Agricultural Operations Division of the South- and Department.

Library of Congress Cataloging-in-Publication Data

A strategy for the forest sector in Sub-Saharan Africa / Narendra P. Sharma ... [et al.]. p. cm. - (World Bank technical paper, ISSN 0253-7494 ; no. 251. Africa Technical Department series) ISBN 0-8213-2880-8 1. Forests and forestry-Africa, Sub-Saharan. 2. Forest management-Africa, Sub-Saharan. 3. International Bank for Reconstruction and Development. I. Sharma, Narendra P. II. International Bank for Reconstruction and Development. I. Series: World Bank technical paper ; no. 251. IV. Series: World Bank technical paper. Africa Technical Department series. SD242.A357S77 1994 333.75'0967-dc2O 94-25509 CIP AFRICA TECHNICAL DEPARTMENT SERIES

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Executive Summary 1

1. Introduction 9

2. Forests and Trees in Sub-Saharan Africa 11

The Forest Resource Base 11

The Role of Forests and Trees in Socioeconomic Development 13

Forest Resource Depletion and Degradation 17

The Roots of Unsustainable Forest Resource Use 19

3. Strategic Implications 25

Forest Governance: Hard Choices 25

Options for Sub-Saharan Africa 27

4. An Integrated Approach to Forest Managesnent: A New Agenda for The World Bank 40

The World Bank's Evolving Response 40

Priority Areas for World Bank Intervention 45

Operational Implications 48

Annexes 1. Bank Lending to the Forest Sector In Sub-Saharan Africa 54 2. Sub-Saharan Africa: Forest Area and 56 3. Technical Workshops: Summary of Group Recommendations 57

Figures 1. Typology of Tropical Forests 11 2. Rates of Deforestation by Forest Zones (1981-90) 18

V Boxes 1. Forest Externalities In Sub-Saharan Africa 22 2. A Sub-Regional Perspective: Types and Uses of Forests In 23 Sub-Saharan Africa 3. Experience with Large-Scale Plantations in Bank Forestry Lending to Africa 42 4. New Directions for the Forest Sector in Recent Bank-Sponsored Activities 53

Map Sub-Saharan Africa: Major Regions and Forest Zones Foreword

Forests and trees are important natural resources in Sub-Saharan Africa. They contribute to human welfare and help protect natural systems. The sustainable use and conservation of these resources is essential for the region's economic and environmental security.

But Africa is now witnessing a steady decline in forest resources because of wasteful deforestation. During the 1980s, the region lost 7 percent of its forest cover. Tropical moist forests in West and Central Africa, in particular, are disappearing at an alarming rate of nearly 2 million hectares each year. The current trend of deforestation has significant social, economic, and, environmental consequences, with serious local, regional, and global implications. In the short run, it is the poor who suffer most from loss of forests and trees. But in the long run, the entire world community and future generations are also affected, as a result of the loss of biodiversity and environmental services provided by forest ecosystems.

African countries must find solutions to address this critical problem from a broad development perspective. The world community must participate and assist in their efforts since all mankind has a vested interest. This strategy paper is one element of the World Bank's ongoing process of addressing issues and challenges touching the world's forest resources. It follows the Bank forest policy issued in 1991 which reaffirms the Bank's support to conservation and sustainable development of forest resources, adapting this policy to the African situation.

The underlying theme of the strategy found in this document is that the fate of Africa's natural resources, including forests, is ultimately linked to the fate of Africa's economic development. The former cannot be sacrificed for the sake of the latter. Rather, forest resource management and socioeconomic development in the region must unfold hand in hand-their fates are entwined.

We trust that this strategy paper will not only shape the World Bank's policy in these sectors, but also stimulate dialogue and encourage understanding among African people and the international community, including NGOs, to promote the wise use of Africa's forests.

IEdv;ard. V. co Vice etat Africa Region The World Bank

vii

Abstract

Wise use of forest resources in Sub-Saharan Africa can contribute to sustainable development and benefit many people, especially the poor, who depend on these resources for their livelihoods. The donor community can play an important role in helping African countries to accelerate the transition to sustainable use of forest resources.

There are complex sociopolitical and economic factors that create incentives for rapid exploitation of forest resources. In Africa, there are strong interlinkages between rapid , environmental degradation, and poor agricultural performance. The strategy presented in this paper places forest depletion and degradation firmly within this context. It recognizes that many of the root causes contributing to these problems lie outside the forest sector and, thus, the strategy provides African countries with a series of options that encompass actions necessary both within and outside the forest sector. While Bank lending can help the region to improve forest resource management, the final success of any measures adopted will ultimately depend on the commitment and will of the African people.

This strategy paper builds on the landmark Conference on Conservation of West and Central African , held in in November 1990, as well as the seminal paper, "Saving Africa's Rainforests," by Ismail Serageldin. It is the fruition of a lengthy process initiated several years ago within the Technical Department of the World Bank, which has produced a number of background studies, and culminated in two technical workshops held in Nairobi and Abidjan in early April, 1994.

ix Acknowledgments

This technical paper-prepared by Narendra Sharma, Simon Rietbergen, Claude Heimo, and Jyoti Patel-marks the culmination of an exercise started in 1990, which has benefited from numerous comments from individuals and diverse agencies dealing with forestry inside and outside the Bank. From the outset, Kevin Cleaver has provided guidance, support and useful comments to complete this technical paper. He has also participated in various discussions with individuals within the Bank, as well as representatives of external agencies to address key issues, and to develop consensus on the solutions needed. The paper has further benefited from comments from Jean Doyen, who participated in the follow-up technical workshop.

Michael Jacobsen, Sofia Bettencourt, Michel Simeon, John Spears, Frangois Wencelius, and Duncan Poore provided assistance by preparing the background studies for the draft paper. Comments and suggestions on the draft paper were provided by members of the Africa Forestry Group, including Emmanuel Asibey, Mathurin Gbetibouo, Mikael Grut, John Hall, Patrice Harou, Chris Keil, Kathleen McNamara, Raymond Noronha, Abdelkrim Oka, John Peberdy, Raymond Rowe, Madani Tall, and Lars Vidaeus. From outside the Africa Forestry Group valuable suggestions were made by Frangois Falloux, Alfredo Sfeir-Younis, Andrew Spurling, and David Steeds.

Following the distribution of the draft paper, comments were received from both inside and outside the World Bank Group, helping to improve the final version of the report now presented in this paper. Bank staff members who contributed at this stage included Albert Greve, Shane Rosenthal, Paul Ryan, Moctar Toure, Jack Van Holst Pellekaan, and Horst Wagner. Among the major outside organizations who contributed a response were the African Development Bank (AfDB), the African Timber Organization, Association T6chnique Internationale des Bois Tropicaux, Caisse Frangaise de Developpement (France), CIRAD- Forets (France), the Danish International Development Agency, Deutsche Gesellschaft fur Technische Zusammenarbeit (GTZ, Germany), the Finnish Forest Research Institute, the Finnish International Development Agency, the Food and Agriculture Organization of the United Nations, the International Center for Research in Agroforestry, the International Food Policy Research Institute, the International Institute for Environment and Development, the International Livestock Center for Africa, the Ministry of Cooperation and Development (France), the Natural Resources Institute (UK), the Oxford Forestry Research Institute (UK), the Overseas Development Administration (UK), the Overseas Development Institute (UK), the Swedish International Development Agency (SIDA), the United Nations Environment Program (UNEP), the United States Agency for International Development, the Worldwide Fund for Nature, and the World Resources Institute (WRI).

David Groenfeldt provided significant input into the preparation of the earlier draft of this paper. Shivsharan Someshwar also provided a valuable input in finalizing the draft, particularly with regard to forestry institutions.

Valuable input was also provided by a Special Technical Advisory Group (STAG) established for processing the final version of the policy paper, comprising Ajit Banerjee, Arne Dalfelt, Walter Lusigi, Horst Wagner, Moctar Toure, and Cynthia Villaneuva.

x In addition, the technical workshops jointly sponsored by UNEP and the AfDB in April 1994 in Nairobi and Abidjan, respectively, also included representatives of the public, private, and NGO sectors in several African countries, who, besides the donor agencies, made a substantive contribution (see Annex 3).

Special thanks are due to SIDA, who provided the financial support for this exercise, and to the Ministry of Cooperation and Development in France, for completing the French translation of this technical paper.

xi Acronyms and Abbreviations

AfDB African Development Bank AFRTD Africa Region Technical Department (also referred to as the TD) ATIBT Association Tdchnique Internationale des Bois Tropicaux ATO African Timber Organization CGIAR Consultative Group on International Agricultural Research CIFOR Center for International Forestry Research CODs Country Operations Divisions CPR Common Property Resource ERR Economic Rate of Return FAO Food and Agriculture Organization of the United Nations FY Fiscal Year GEF Global Environment Facility GIS Geographical Information System ICRAF International Center for Research in Agroforestry ICRISAT International Center for Research in the Semi-Arid Tropics IDA International Development Association IED International Institute for Environment and Development IITA International Institute for Tropical Agriculture LCA International Livestock Center for Africa ITTO International Tropical Timber Organization IUCN The World Conservation Union IUFRO International Union for Forestry Research Organizations LE13 Log Export Bans NEAP National Environmental Action Plan NGOs Non-Governmental Organizations NRM Natural Resource Management OED Operations Evaluation Department ODI Overseas Development Institute SODs Sector Operations Divisions SADC Southern African Development Community SIDA Swedish International Development Agency SPAAR Special Program for African Agricultural Research TFAP Tropical Forestry Action Program TMF Tropical Moist Forest UNCED United Nations Commission on Environment and Development UNDP United Nations Development Program UNEP United Nations Environment Program

xii Executive Summary

As Sub-Saharan Africa is moving toward a free market system and political pluralism, efficient management and sustainable use of natural resources, especially forests, water, and soil, is an imperative. To this end, African countries must turn the tide of uncontrolled deforestation and place greater emphasis on better stewardship of this important renewable resource. Afrca needs good policiesfor the forests-notjust betterforesty policy.

Fundamental Challenges

Forests and trees are essential for Sub-Saharan Afica's economic and environmental security. Wise use of these resources is closely associated with food security, energy needs, poverty alleviation, and environmental protection. To this end, they make a significant contribution to economic development, preserve biological resources, and maintain natural systems. Many African people, especially the poor, depend on this resource for their livelihoods. But SSA is witnessing unprecedented rates of deforestation, eroding a resource base that covers 24 percent of the total land area, undermining economic growth, exacerbating poverty, and contributing to environmental degradation. For individual African countries, it is crucial to safeguard a resource which meets the basic needs (fuel, fodder, fiber, small timber, and medicinal plants and animals) of most of their people, and which has important environmental values in terms of soil protection, biological resources, carbon sequestration, climate regulation, and watershed stabilization. For the world community at large, there is a vested interest in sharing the burden this imposes on the region, because of the global benefits derived from SSA's diverse forests.

Deforestation in Sub-Saharan Africa is still averaging an annual rate of less than 1 percent, but in some areas it is especially severe, recorded at rates which are among the highest in the world. This is particularly the case for , where nearly three-fourths of the original tropical moist forest (TMF) has already been lost, along with the associated biodiversity and other regional and global benefits, such as watershed protection and carbon sequestration. Much of the deforestation that is presently taking place is wasteful, for example, the removal of forests essential for watershed protection and biodiversity conservation, or the clearing of land unsuitable for agricultural production. The resource base is also under further pressure from degradation of woodlands and trees. These problems are often highly localized- there are many areas within individual African countries that already have a deficit in woody biomass, are under stress, or reaching a threshold of crisis.

In the region, as a whole, there are strong interlinkages between rapid population growth, environmental degradation, and poor agricultural performance-linkages that are reflected in the complex processes behind deforestation and forest degradation. At the local level, the direct agents of forest degradation and depletion include agricultural expansion, uncontrolled woodfuel and timber harvesting, infrastructure development, and overgrazing. Underlying these direct agents is a dynamic comprising driving forces such as growing and migrating populations, poverty, international trade, accessibility, and technology as well as accelerating or trigger forces, namely, market, policy, and institutional failures. A good illustration of the synergy between these forces is the penetration of tropical moist forests by logging roads, followed by selective felling of underpriced timber for export and domestic markets and, finally, deforestation through agricultural settlement by migrants. African countries must find solutions to promote sustainable forest resource use from a broad development perspective, recognizing the role of forests in economic development, conservation of biological resources, and maintenance of natural systems. In this context, it is urgent that steps are taken to ensure the protection and conservation of TMF resources. Sub- Saharan Africa faces three fundamental challenges:

* Prevention of wasteful deforestation and forest degradation of both TMFs and tropical dry forests through: (a) correction of distortionary policies; and (b) conservation and sustainable use.

* Augmentation of the resource base through tree planting and regeneration in a broader context of land use.

* Revitalization of the wood industry to enhance efficiency and competitiveness.

For the region to meet these challenges, a working partnership needs to be established on two fronts: first, at the country level, the involvement of all the major stakeholders (e.g., public agencies, the private sector, NGOs, local communities, and informal local institutions) is essential for efficient management of forest resources; second, the global community should develop a common agenda for internalizing the priorities and needs of countries in the region. This must also provide strong financial and technical assistance to African countries so that they can manage their forest resources more efficiently, especially TMFs, which make a sigrdficant contribution to the carbon sequestration necessary to mitigate the "Greenhouse Effect."

Strategic Implications

The aforementioned dynamic transcends the forest sector, implying that single-sector approaches to forest resource development and conservation are no longer relevant. Just as the forest sector cannot be analyzed in isolation from the wider political economy, forestry cannot be dealt with in isolation from other forms of land use and other natural resource systems. In short, what is required is a cross-sectoral approach, placing forestry firmly within a natural resource management (NRM) framework, i.e, a "nexus" of interactions among forestry, agriculture, poverty, population, and technology. An effective strategy for conservation and sustainable use of African forests should begin with the Aftican people, including local people and traditional practices, since there is no dichotomy between forest conservation and development and their well-being in the long term.

The response to the fundamental challenges for the forest sector in SSA will vary according to prevailing conditions within each African country. There are some areas in the region, for example, Central Africa, where greater time is available for stewarding the deforestation process towards a more socially optimal outcome. But even here, the precautionary principle dictates that high priority should be assigned to curbing uncontrolled forest depletion and degradation, and to promoting sustainable use of forest resources. For SSA, in general, the existing institutional and policy framework will need to be re-ordered to strike the right balance between economic development and conservation aims. African governments will also need to change the perception of their role in sector development in order to become more effective custodians of society's interests.

2 Good macroeconomic policies are essential for a dynamic and efficient forest sector. As already suggested, African governments will need to consider important issues outside the forest sector when drawing up a relevant agenda for action. Given that an expanding agricultural frontier (especially in existing crop lands and in lands cultivated at the forest margins) is the primary agent of deforestation in SSA, an improvement in the performance of agriculture stands out as an indispensable precondition for the conservation and sustainable use of forest resources here. Increasing agricultural production and productivity through improved inputs, credit, infrastructure, marketing, and research and extension is essential to relieving population pressure on forest lands left intact. Forestry and agroforestry (including the domestication of trees for high value/low volume products such as indigenous fruit trees and medicinal plants), can also enhance agricultural production through watershed protection, and through the introduction of appropriate tree species in farming systems.

Separate but related policies involve land use planning and natural resource management. Countries in SSA must give priority to revising their land use policies (access to land, tenure security, and tree tenure). Through improved land use policy and zoning, countries can allocate forest lands for different purposes (conservation of biological resources, wildlife protection, stabilization of watersheds, timber production, extractive reserves, conservation of areas for agriculture, recreation, etc.). Population, energy, and industrial policies also have a strong influence on forest sector performance. Energy policies should give special attention to alternative sources of energy and conservation measures to ease the high dependency on fuelwood and charcoal.

Within the forest sector, itself, there is considerable scope for improvement. The limited success of past command-and-control policies in containing forest depletion points to a greater reliance on market forces and pricing in the drive for more efficient use and conservation of the forest resource base. This implies a new role for government: one based on public discussion and debate, and which clearly recognizes the comparative advantages of local communities, the private sector, and NGOs, versus the state. Governments should provide an enabling environment for economically efficient and environmentally sound forest sector activity, ensure better pricing to reflect the full scarcity of forest resources, and tax resource users accordingly to internalize externalities. In short, public sector efforts should be limited to those activities that cannot or will not be carried out by farmers, local communities, and private enterprises on their own accord-i.e., environmental conservation (where the market often fails), research, human resource development, and donor coordination. The scaling down of government involvement in production will also release scarce resources for these purposes. And governments should focus on strong alliances with local people, local institutions (formal and informal), and the private sector in forest management. Countries in the region will also need to focus on the demand side by reducing waste in the harvesting and processing of wood, and by introducing conservation measures to improve efficiency in wood utilization.

Key actions that African countries need to take within the forest sector are as follows:

Forest policy and legislative reform. In many African countries, the existing policy environment encourages deforestation by undervaluing and underpricing forest resources. To change this situation, it is essential to make markets for forest products work better, and to take account of non-marketed benefits in decisions regarding the use of forests. Market and policy failures should be corrected through a process of dialogue among various stakeholders. New policies and laws will need to be based on the fundamental principles of transparency and

3 public accountability. New policies should be translated into appropriate legislation and implemented effectively.

Capacity building and human resources development. Strengthening forestry institutions should be part of a systemic civil service reform process for improved governance, with emphasis on accountability, rule of law, improved financial management and budgetary process, and transparency. The mandates of government forestry agencies should be reoriented by granting rights and devolving responsibilities for forest sector activity to farmers, local communities, and the private sector, as appropriate. Capacity building initiatives within state forestry departments will also need to respond to the capacity building requirements of these important forest sector agents. Furthermore, capacity building should also be targeted to institutions at the regional, district, and local levels, involving all the major stakeholders.

Involving farmers and local communities in forestry activities through policy and legal change (e.g., land tenure and incentives). Training in participatory planning will also enable forestry agencies to develop partnerships for forest management and reforestation with local communities and NGOs. In addition, government support for participatory negotiation processes among forest users will greatly facilitate sustainable forest management by local people and help resolve local conflicts.

Enhancing private sector involvement in forestry and forest industry. Governments must shift their role from direct involvement in production toward an enabling function, providing a policy and legal environment, and information services, that stimulate private investment in forestry as well as a more efficient wood industry. Private sector involvement in planning and policy making can help towards this end.

Improving and disseminatingforest-related knowledge and technology. Governments need to conduct national forest inventories which will serve as a basic framework for planning, implementing, monitoring and evaluating forest sector activities. Lessons learned from pilot field activities need to be disseminated more widely, and the relevance and efficiency of forestry research needs to be improved by closer cooperation between researchers and the potential users of their results. More emphasis should also be placed on educating people about the social and environmental considerations associated with forest utilization. In addition, a more integrated, participatory approach for developing and disseminating knowledge on forest sector management and use is needed to optimize results.

The Role of The World Bank: A New Strategy for Lending in SSA

Bank lending to the forest sector in SSA started in fiscal year 1969. Since then it has evolved considerably, moving from an initial focus on industrial forestry to social and agroforestry and, more recently, to operations supporting national programs with multiple objectives as well as increased emphasis on forest resource conservation. Past projects, however, systematically failed to address the pervasive policy and institutional constraints to improved sector performance, and also neglected local participation in the development process. The experience with these projects further underlines the importance of a holistic approach to the forest sector; one encompassing other forms of land use and economic activity, as well as the prevailing policy and institutional environment. Recently, a new generation of projects has been launched, attempting to tackle some of these cross-sectoral issues more explicitly. Although it is too ewy to judge the success of the new projects, many of them

4 appear to share a number of conceptual weaknesses (e.g., regarding the process for delivering policy and institutional reforms, and mechanisms for generating popular participation).

What role should the Bank play in the future development of the forest sector in SSA? Based on the 1991 World Bank Forest Sector Policy, the seminal paper, "Saving Africa's Rainforests" (Ismail Serageldin, 1993), and the above discussion, the following principles have been developed to guide Bank lending to the sector:

Guiding Principles for Sustainable Management of Forest Resources

* Forests and trees should be treated as economic, social, and environmental goods. Forest utilization should rely on market and pricing mechanisms.

* A comprehensive, more ecosystem based approach, recognizing the interrelationship between forests and land use, should be adopted for sustainable management of forest resources.

* Management of forest resources requires local and national actions as well as international cooperation.

* Forest management should be decentralized based on the principle of "shared responsibility," including local people, private sector, and the government at appropriate levels.

* The management of intact TMFs should follow the "precautionary principle"; the burden of proof falls on countries to demonstrate that use of TMFs is ecologically, economically, and socially sound. This also implies that sound practice shou)d be demonstrated, and adequate provision for monitoring and assessmeut of implementation assured.

* Expanded investments in the forest sector should be preceded by comprehensive sector work, including cross-sectoral considerations, and adoption of a long-term forest development plan.

* Environment and social assessments should precede all major investments in the forest sector.

* A sensitivity to gender issues is required, as women play a major role in forest resource utilization and regeneration in SSA.

A strategy for Bank lending is proposed that focuses on four areas where the Bank has considerable comparative advantage, and where it can complement government and other donor activity. The four key areas for future Bank lending are:

(a) Promotion of policy reforms

(b) Support to capacity building and human resources development

(c) Support to investments in critical areas

5 (d) Promotion of better donor coordination in the forest sector.

This approach incorporates the nexus of interactions among forestry, agriculture, poverty, population, and technology advocated in the build-up to the new lending strategy, which are accommodated through the National Environmental Action Plan (NEAP) process. It also supports existing Bank-funded operations promoting the conservation and sustainable use of SSA's forest resources through a NRM framework.

What are the operational implications of this new Bank strategy? In order to achieve maximum development impact, forest sector operations in SSA should be part of an integrated, long-term program approach, based on comprehensive sector work, and closely attuned to country needs and priorities, existing institutional capacity, and to the Bank's overall development objectives. Borrower ownership and commitment, above all, is important to success. The long-term program approach recommended would embrace a broad range of lending instruments for improving forest sector performance, including Structural and Sectoral Adjustment Loans, encompassing both NRM and free-standing forestry projects of varying duration. Lending instruments should be utilized and designed on the basis of strong, multi- disciplinary sector work, identifying policy reforms, capacity building requirements, and other priority investments necessary to achieve forest conservation and development objectives. NEAPS and Tropical Forestry Action Programs (TFAPs) provide a suitable framework for completing such sector work.

Major investments should be preceded by policy reforms, and country capacity building, particularly in countries where the policy framework is poor and institutions weak. It is important for the Bank to design simpler projects within broad sectoral programs and priorities. Instead of a single project dealing with many components and tackling several major issues, the long-term program advocated in this paper should include a series of actions and investment operations extending over a longer time horizon. Pilot projects should also be used to develop new approaches for stimulating private sector and local community involvement in forest resource management and conservation. In addition, new investments should, where necessary, incorporate an appropriate financing mechanism (e.g., forest funds, revenue sharing, or trust funds) to ensure financial sustainability.

The new lending strategy will require:

* Increased coordination between SODs and CODs to integrate macroeconomic and sectoral agendas.

* Greater manpower allocations for sector work over the next two years for improvements in the quality of the forest-related project pipeline.

* Increased attention to project designs to take into account the capacity of existing institutions to implement development programs, best practices, and the need for greater flexibility to facilitate participatory approaches to sector development, involving local people and the private sector. They will further need more simplicity in terms of the number of objectives and components.

6 * Special efforts to improve the quality of Bank supervision to get better results on the ground, by allocating a higher proportion of staff weeks to assessing results in the field, and more active involvement of government officials. Natural resource management projects, including forestry, will require much more focus, greater regularity, and a more systematic approach, embracing project performance and development indicators.

* Better coordination with other donors-with respect to new projects, pilot programs, and ongoing operations-in order to prevent duplication of effort, an overload of borrower country absorptive capacity, and sustainability problems.

Next Steps

This strategy paper was discussed at two technical workshops, jointly sponsored by UNEP and AfDB in Nairobi and Abidjan, respectively, in early April 1994. These workshops helped establish a common ground, and facilitated some consensus building on problem identification, important actions needed, scope for regional cooperation, and questions of donor support among key players in the forest sector in Sub-Saharan Africa, including government officials and representatives from donor agencies, NGOs, the private sector, and academia. An important outcome of the Nairobi and Abidjan technical workshops, initiated by Africans and donors alike, was the African Forest Policy Forum. The African Forest Policy Forum has, in principle, been endorsed by AfDB, FAO, UNDP, and UNEP. It is intended that this Forum will meet every 18 to 24 months in the Africa region to discuss policy matters and topics of special interest, such as marketing, agroforestry, wood industries, and best practices in forest sector management. The African Forest Policy Forum will also foster regional cooperation (e.g., research), promote intra-regional trade, and discuss transboundary issues (including protection of watersheds, conservation of biodiversity, and wildlife protection).

7

1. Introduction

Sub-Saharan Africa's (SSA's) forests and woodlands contribute significantly to the region's economic development and environmental security.' They support many people- farmers, herders, rural communities and forest dwellers-provide important environmental services such as watershed protection, and constitute a major source of income, employment and capital. The poor depend on forests for their basic needs, including food, fodder, fiber, fuelwood, small timber, and medicinal plants and animals. At the same time, the 's forest resources--and especially the tropical moist forests among them-provide benefits to the global community, in the form of biological diversity, genetic material, and carbon sequestration. But SSA is witnessing unprecedented rates of deforestation and degradation of forests and woodlands. This has serious social and economic implications for the welfare of both present and future African populations. The loss of biological resources also has implications for the world community at large; therefore urgent action is required to curb uncontrolled forest resource depletion and degradation, and to promote sustainable use of forest resources.

Some deforestation is unavoidable and necessary in a continent where the majority of a rapidly growing population derives its basic needs directly from forest lands. But where deforestation is wasteful, such as in the case of the removal of forests and trees essential for watershed protection and biodiversity conservation, or the clearing of land unsuitable for agricultural production, it is eroding the region's resource base and environmental stability. Loss of forests and trees often exacerbates the lot of the poor directly, by destroying a valuable asset on which their livelihood depends, and indirectly, by destroying the biodiversity and ecosystems which are es,;ential for the maintenance of life-support systems.

Following the principies outlined in the 1991 Bank Forest Sector Policy and in "Saving Africa's Rainforests' (Ismail Serageldin 1993), the strategy proposed in this paper aims to help develop a consensus among African countries and donor agencies on what needs to be done in the forest sector to improve the welfare of people-particularly on how forests can be linked to other natural resources in a broader framework of land use management-and to guide Bank lending to the sector. The challenges this strategy attempts to address are threefold: (i) prevention of wasteful deforestation of existing forest resources, including both tropical moist and dry forests, through: [a] correction of distortionary policies; and [b] conservation and sustainable use; (ii) augmentation of the resource base through tree planting and regeneration; and (iii) revitalization of the wood industry. The balance between these challenges and the options chosen to address them will vary according to differences in local contexts in Africa's sub-regions and sovereign countries. African countries will also need to address other factors such as population growth, widespread poverty, and the need for improved agricultural performance within their development programs. In response to these challenges, the Bank's strategy outlines its agenda for a working partnership with African governments and other donor agencies, and for providing long-term assistance in those areas where the Bank has a comparative advantage.

Chapter 2, which follows this introductory section, reviews the status of forests and woodlands in SSA. It first gives an overview of the resource base and then identifies the key

1 In this paper, SSA and Africa refer to Sub-Saharan Africa. 9 problems facing the forest sector and the underlying causes of these problems. It concludes that accelerated deforestation is exacerbated by forces outside the forest sector, and that these forces also need to be tackled in order to improve the stewardship of forest resources and to create an enabling environment for forest sector investment.

Chapter 3 outlines some of the difficult trade-offs between economic growth and environmental protection encountered by African countries. It presents the options available to countries for integrating economic development into conservation and environmental protection objectives through measures both outside and within the forest sector. It adds that macroeconomic, agricultural, natural resource management, population, energy, and industrial policies all have an impact on forest use and management. Within the forest sector, five strategic implications for addressing forestry issues are discussed: (i) forest policy and institutional reforms; (ii) capacity building and human resources development; (iii) greater involvement of local communities; (iv) greater involvement of the private sector; and (v) generation and wider dissemination of improved forestry practices, forest-related knowledge and technology.

How should the World Bank, in collaboration with other donor agencies, respond to the challenges and opportunities of sustainable forestry development in Sub-Saharan Africa? Chapter 4 addresses this question and presents a strategy to guide future Bank investments in the region to assist African countries in their transition to sustainable use of forest resources. The chapter focuses on four priority areas in which the Bank can be most effective in getting results on the ground: (i) promoting policy reforms; (ii) capacity building and human resources development; (iii) investment operations in critical areas, such as management of existing forest and woodlands, protection of watersheds, agroforestry, and tree planting (in both rural and urban areas), contingent on government commitment to policy reform; and (iv) improvements to donor coordination. The chapter concludes with a discussion of the operational implications of these priorities and provides recommendations for forestry lending, especially cross-sectoral analysis of the forest sector, and the design and implementation of long-term lending programs comprising a series of actions, including operations which are not complex, as well as pilot projects.

10 2. Forests and Trees in Sub-Saharan Africa

The Forest Resource Base

Forest resources in SSA, covering 0.5 billion 2 hectares or 24 percent of the total land area, differ markedly from those found in other tropical regions. Whereas closed forests make up the larger part of the resource in and , open canopy , of mostly woodlands, accounts for 60 percent or 0.3 billion hectares of Africa's forests (see bar chart below). Plantations in SSA account for 3 million hectares or 2 percent of the total area under closed forests.

FIgure 1. Typology of Tropical Fonsts

so-Saharam Africa

AsiaA PaificOpeaFa" UCkaw Fangt

LAWn Amwica

0 NO0 2(,' 300 400 500 600 700 SOO 900 1000

Source: PAO, 1992

The map at the end of this techDical paper provides an overview of the main and forest typologies in Africa, and indicates the predominantly dry nature of forest vegetation in the region. Further details on the nature and status of forest resources in each of Africa's subregions are given in Box 2. Using FAO terminology, forests include closed canopy forests as well as woodland and with more than 10 percent tree canopy cover.3

The distribution of Africa's various forest types can largely be explained by geophysical ch.aracteristics, and the quantity and seasonality of rainfall. Tropical moist forests (TMFs), i.e., closed evergreen and semi-deciduous forests, predominate in coastal West Africa and equatorial Central Africa, where rainfall is abundant and the dry season short or non- existent. The six countries of Central Africa-, Central African Republic, Congo, Equatorial , , and Zaire-contain the largest remaining contiguous expanse of tropical moist forest on the African continent and the second largest in the world. These countries account for nearly 60 percent of the TMF in SSA, over 90 percent of the region's

2 1 billion = 1,000 million.

3 "Forcst Resources Assessment 1990: Tropical Countrics, PAO, 1992. 11 tropical rain forest, and also contain most of Africa's valuable hardwood timber, comprising well known species such as Khaya spp. (mahogany) and and Odorophoraregia (iroko).

To the north and south, decreasing rainfall and longer dry seasons give rise to increasingly deciduous and open woodlands of lower stature, that gradually bend to grassland and finally desert. The latter covers large parts of Mali, Niger, Chad, and () in the north, and Botswana (Kalahari) in the south. Tropical dry forests are important for a number of reasons.' They protect the soil against the elements, store large quantities of carbon, and support many species. Tropical dry forests furnish considerable moisture to the atmosphere in low rainfall areas. In addition, they contribute directly to human welfare. Humans have learned to live in symbiosis with these woodlands by relying both on the milk and meat which animals produce from tree-browse, and on the replenishment of soil fertility which the trees bring to agriculture. Furthermore, bush foods provide protein, minerals and vitamins: an essential component to the carbohydrate-rich farm diet. Many of these are subsistence products, but other are traded in national (woodfuel, poles) and regional (livestock) markets. Dry forests, although not important as a source of internationally traded timber, also generate export earnings and save expenditure on imports.$

This general pattern is modified by differences in geology and soils, and by the presence of mountains and rivers, often associated with lusher forest vegetation. Closed high forests, for instance, can be found in the montane areas of East African countries such as Tanzania, Uganda, Kenya, and Rwanda. Meanwhile, mangrove forests are found along the coasts and in the brackish river estuaries of West Africa, Madagascar and, to a lesser extent, . The interventions of farmers and herders have long influenced the distribution and characteristics of Africa's forest vegetation. The high proportion of useful tree species in the woodlands of Senegal, Burkina Faso, and other Sahelian countries, are the result of centuries of selective felling and burning.6 In recent decades, however, this influence has intensified with increasing population growth, urbanization, economic growth, and trade. Consequently, in some African countries there is little natural forest cover left. Burundi, Cote d'Ivoire, Kenya, Madagascar, and Rwanda have lost more than 90 percent of their original closed forest cover, most of it in the last 50 years.7

The interactions between forests and society in SSA reflect the early stages of development in this region, where forests are a direct source of subsistence for many people (forests and trees here should be considered within the context of a broader land use mosaic). In Africa, the majority of the people live off the land and use a variety of forest products on a

4 The following is based on G. Shepherd, B. Shanks, and M. Hobley, "National experiences in managing tropical and sub-tropical dry forests", in C. Sargent and D. Howlett, Ed., "Technical Workshop to Explore Options for Global Forestry Management, ITTO, ONEB and lIED, London, 1991.

5 Traditionally, the chief exports of a country like Somalia (hides, meat, live camels, cattle) are almost totally dependent on trees. Non-timber forest products such as gum arabic generate modest export earnings for various Sahelian countries. Leaf litter (as mulch) substitutes for imported fertilizer in the Sudanian zones of Africa.

6 Gill Shepherd, "Forest Policies, Forest Politics," ODI, 1992.

7 J.A.Sayer, C.S.Harcourt and N.M.Collins, Ed., 'The Conservation Atlas of Tropical Forests: Africa,' IUCN/WCMC, Macmillan, 1992.

12 daily basis. Superimposed on these local uses are demands for products and services valued nationally and internationally, including industrial timber, traded nonwood products such as bushmeat and canes, watershed protection, biodiversity, potentially useful genetic material, and carbon sequestration to mitigate the "Greenhouse Effect." Africa is not a major emitter of COz and other greenhouse gases from commercial and industrial energy uses, but it does account for 20-30 percent of CO2 emissions from changes in land use which, on a per capita basis, is the highest in the world.9 While utilization of forest products and services by African people is very site-specific, the use value they derive from forests can generally be subclassified under three basic categories: productive and sociocultural uses, and environmental services.

Forests also have nonuse or existence values, because people value forest resources even when they make no direct use of them, as demonstrated by mounting international concern over the destruction of tropical moist forests.10

The Role of Forests and Trees In Socioeconomic Development

Productive Uses

Consumptive uses include the harvesting of woodfuel, industrial timber products and other building materials, food, fodder, genetic material (e.g., that found in Caranthus in Madagascar), medicinal and other products (e.g., latex, gums, resins, oils). Woodfuel and industrial timber, which account for the bulk of formally traded forest products, are treated separately below. The harvesting, processing, and trade of nontimber forest products provide much needed rural employment and cash income, as demonstrated by the trade in chewing sticks, canes, and wrapping leaves in . Cattle and other livestock are highly dependent on woodland grazing and browsing, even more so in the dry season and during recurrent droughts, such as those experienced in the Sahel and East Africa. Bushfoods complement the regular diet of most rural populations; and for the hunter-gatherers of Central Africa, they are the principal source of food intake. While dependency on traditional medicine varies considerably across the region, medicinal plants collected from forest areas are used to treat a variety of ailments by local households, ranging from fevers and colds to tumors. The barks of some tree species are traded internationally for medicinal purposes, for example, Pygeum afticanun from Cameroon. There is also an extensive trade in medicinal plants in local rural and urban markets.

Apart from fulfilling domestic consumption needs, forest resources enable countries to generate vital income, employment, and foreign exchange. The latter, either directly through exports of forest products, or indirectly via provision of products that would otherwise have to be imported. The gross value for total regional forest sector production in 1989 was about US$13 billion. The contribution of forestry to GDP is also significant at the country level: amounting to 9.7 percent, 5.6 percent, and 5.1 percent in Ghana, Gabon, and Cameroon,

Sofia Bettencourt, "Forest Uses in Sub-saharan Africa," unpublished Africa Forestry Strategy Working Paper, The World Bank, 1992.

R.Clement-Jones, "Greenhouse Gas Emissions and Global Warming in Africa," DraA Paper, Technical Department, The World Bank, 1993.

10 Narendra Sharma, Ed., "Managing the World's Forests: Looking for Balance Between Conservation and Development," Kendall/Hunt Publishing Company, 1992.

13 respectively. 11 Official statistics, however, belie the true extent of the contribution of forest resources to socioeconomic development, portraying neither the full value of forest resources, nor the costs of their depletion. This is because many forest products and services are either not traded, or traded within the informal sector. As a consequence, GDP statistics mainly reflect value derived from industrial timber exports, marketed fuelwood, and charcoal.

Fuelwxod and Otarcoal (Woodfuel)

Woodfuels are the primary source of energy in Sub-Saharan Africa, accounting for approximately 70 percent of total energy use. Thus, they are of greater significance in proportionate terms than oil for developed countries. Extensive use is made of woodfuels at the household level: more than 80 percent of the energy required for cooking, heating, and lighting is derived from this source in both rural and urban areas. Charcoal is the fuel of choice in most of Africa's large cities. Traditional food processing industries also rely heavily upon woodfuel, as in the case of beer brewing, the processing of , and smoking of fish and meat. Agroprocessing (e.g., tobacco curing, tea drying, sugar processing), and rural cottage industries, (e.g., brickmaking and ceramics production) are two other important users of woodfuels.

FAO data suggest that over 85 percent of the wood removed from the region's forest and tree resources is explained by woodfuel consumption, with the highest overall dependency on woodfuels being exhibited by the Sudano-Sahelian and Eastern African sub-regions. Presently, woodfuel shortages in SSA are highly localized, but according to FAO, demand will significantly outstrip supply by the year 2020 if present population growth and woodfuel consumption trends continue. This trend is anticipated to appear first in the Sudano-Sahelian , marked by the lowest per capita woodfuel consumption of 0.74 cubic meters per annum (FAO 1991, World Bank 1991).12 Of more immediate concern is the fact that local woodfuel shortages already occur, especially in densely populated areas. There are now rings of deforestation around cities such as Dakar, Kinshasa, Ouagadougou, and Dar es Salaam, which are partly explained by excessive wood cutting to provide fuel to rapidly growing urban populations.

Timber

Generally speaking, industrial timber harvesting and processing concentrates on hardwoods from natural forests in West and Central Africa, and on plantation-grown softwoods in Southern and East Africa. Industrial timber production is an important source of employment and satisfies part of the region's demand for industrial roundwood, sawnwood and sleepers, and wood based panels. It accounts for 2.2 percent of GDP in Ghana and 2.3 percent of GDP in Gabon. In addition, industrial timber exports generate much needed foreign exchange, amounting to US$1,259 million in 1989, most of which was derived from

11 Ibid, 1992.

12 Projections such as these have to be treated with caution. Estimates of woodfuel use are generally unreliable, as a large proportion of woodfuel consumption (and a considerable part of trade) are not subject to systematic data collection. Important discrepancies also occur in African woodfuel supply figures: in most countries, supply estimates are based essentially on forest inventories concentrating on stemwood. Furthermore, linear projections of woodfuel deficits into the future fail to take into account adaptive change, e.g., peoples' responses to increasing scarcity.

14 roundwood exports. The region's timber exports have suffered greatly from an increasingly competitive world market-one which emphasizes lower quality wood that can be processed easily and on a cheaper basis. Between 1970 and 1989, SSA's share of the world export trade in tropical timber dropped from nearly one-fourth to less than a tenth.13 Market share has been lost to producers and processors in Southeast Asia and Northern countries. Exports from the latter have added to the flow of finished wood products exported to tropical Africa, which is now a net importer of forest products (including pulp and paper). Regional imports of forest products were valued at nearly US$500 million in 1991, with Cameroon, the biggest importer in value terms, accounting for goods worth US$120 million.14

In 1990 total industrial roundwood production amounted to 58 million cubic meters. apart, West Africa is the largest consumer of industrial roundwood in the region and was also the dominant exporter until it was surpassed recently by Central Africa. Between 1989 and 1991, average yearly exports for this sub-region amounted to 3.4 million cubic meters, worth over US$600 million, against US$450 million for West African exports. Nigeria, a major producer and exporter in the 1960s but now importing wood products valued at US$100 million, illustrates West Africa's declining importance in the tropical timber export trade. Central African countries such as Gabon, Cameroon, and Congo all ranked among the 20 leading world exporters of tropical wood in 1989. Inaccessibility and high transport costs have limited timber exploitation to a few high value hardwood species. Moreover, because of policy and government failures, timber harvesting has generally not employed sustainable management systems and practices. Africa has potential for increased and sustainable timber production. But this will only be realized if appropriate checks and balances are in place, international competitiveness is enhanced, the efficiency of the wood industry increased, and intraregional trade expanded.

Sociocultural Uses

In many African countries, forests are also important for their sociocultural use. Sacred groves and forest trees, plants, and animals play a significant role in religious, spiritual, and healing ceremonies. Forests and forest products also feature in numerous cultural traditions throughout the region: in fables, legends, myths and tales, art, and even in politics and law. In Western Cameroon, for instance, the tree Dracaena arborea is traditionally considered a symbol of peace.15 Africa's forests further have aesthetic value and provide considerable opportunities for recreation. In terms of science and education, Africa's forests constitute living laboratories for the study of animal and plant life.

Wildlife Activity and Ecotourism

Wildlife held within and supported by forests and woodlands are a particular source of human recreation, and provide a source for generating valuable foreign exchange. The region's

13 African wood accounts for roughly 1 percent of worldwide tropical and temperate timber exports.

14 "Forest Products Yearbook," PAO, 1991.

15 "The Major Significance of Minor Forest Products: the local use and value of forests in the West African humid forest zone", PAO, 1990. Information on the cultural significance of forest resources in Africa is dispersed over a wide body of anthropological, ethnobotanical, geographic, and linguistic studies, which generally concentrate on specific cthnic groups and communities.

15 forests and woodlands, for example, account for about one third of the total area occupied by elephants, a much favored tourist attraction. Several African countries have already taken advantage of the opportunities for ecotourism offered by their wildlife. In Rwanda, the mountain gorillas in the Volcanoes National Park are a major focal point for tourism, enticing over 10,000 visitors in 1989.16 In Kenya and Tanzania, where there has been a much longer tradition of tourism based on wildlife in national parks, ecotourism accounts for a significant portion of total GDP emanating from tourism (11.6 percent and 14.5 percent respectively).1 7 But this option is being lost in areas where human activity (mainly agricultural and livestock) is increasingly leading to the fragmentation of forest zones, resulting in the removal of essential habitat and the marginalization of large populations of animals. Ecotourism in the tropical rainforests has greater prospects for development in the long-run.

Environmental Services Provided by Forests and Trees

.African people derive substantial use value from the environmental services provided by their forest resources. Forests and trees in cropland help replenish soil fertility, sustain critical nutrient cycles, and improve climate. They protect fragile soils by intercepting rainfall and stilling wind velocities, facilitate nitrogen fixation, reduce high temperatures, stabilize watersheds, and act as carbon sinks. The tropical moist forests in the Guineo-Congolean belt are most valuable in the latter regard. In addition, the soil fertility and microclimate functions performed by Africa's forests are extremely important, given the region's low utilization of fertilizer and the harsh climatic conditions prevalent in the arid and semi-arid areas that cover much of the land mass. Africa's forests also regulate the quantity and quality of water resources, lowering the evaporation that drains surface water and limiting siltation from watersheds. Mangroves, in particular, constitute an important habitat for the spawning of fish, shrimp, and prawns. Along the coasts of Mozambique, local protein intake is largely derived from off-shore fish and shrimp stocks. In Ghana, seafood surpasses terrestrial animals in terms of nationwide protein intake.

As the above so clearly demonstrates, many of the environmental services provided by Africa's forests contribute indirectly to economic activity. In some forest areas, the economic value of regulatory uses, although difficult to quantify, may even outweigh that of productive uses. It is the inter-linkages with other critical environmental subsectors (i.e., soil, air, and water) that emphasizes the importance of approaching forest sector issues from a broader natural resource perspective.

Non Use or Existence Values

Non Use or existence values are largely explained in terms of biological diversity, genetic material, and the potential impact of forest ecosystems on climate. Africa's forests hold myriad plant and animal species, including the primates essential for studying the evolution of mankind. Several countries in the region are also classified as areas of megadiversity, for example, Cameroon, Madagascar, Tanzania, and Zaire. Zaire is probably the richest nation in tropical Africa in terms of species diversity, benefiting from the wide variation in habitat

16 M.Wells, K.Brandon, and L.Hannah, *People and Parks: linking protected area management with local communities", 1992.

17 'Ile Economist Intelligence Unit, Kenya and Tanzania Country Reports, 1992/1993 - these figures include trade, hotels, and restaurants.

16 required to sustain an array of plant (11,000), bird (1,100), mammal (400), and freshwater marine life (700). Forest ecosystems here include rainforests, , montane forests, swamp forests, and mangroves, and harbor endemic mammals such as the okapi and the bonobo or pygmy . Species endemism is at its highest in Madagascar, home of the threatened aye-aye Daubentonia madagascadensis."In mainland Africa, important areas for endemism include the lowland forests of Cote d'Ivoire and ; the montane and lowland forests of Nigeria, Cameroon, and Gabon; the forests of the western escarpment of Angola; the lowland and montane forests of eastern Zaire, western Uganda and Rwanda; the coastal forests of Kenya; and the eastern forests of Tanzania. However, many other countries in Africa are also rich in terms of species diversity, genetic material, and ecosystems. Ethiopia, for example, is registered as holding 5,770 different species of plant alone.19 But, as with many other parts of the world, there has been little investigation into the genetic material stored by these different species. In the region, as a whole, about 1.1 million km' or 4.8 percent of the total land mass is under protected reserves. As of 1990, there were 379 protected areas in Africa, 65 percent of which are managed and protected, albeit to a varying extent (World Development Report, 1992).

Forest Resource Depletion and Degradation

According to a recent FAO study, total regional forest cover dropped from 569 million hectares to 528 million hectares between 1981 to 1990, representing a decrease of 7 percent. This average annual deforestation of 4.1 million hectares (0.7 percent of total forests) does not include degradation of forest areas.2 The rate of deforestation has increased significantly in the 1980s, compared to the previous decade, when average annual deforestation was estimated at some 3 million hectares. At the subregional level, the latest figures suggest that the annual rate of deforestation is highest in West Africa at 1 percent, and lowest in Central Africa at 0.5 percent. 2' The bar chart on page 18 gives an indication of the most affected forest types. Individual country rates of deforestation are given in Annex 2 (Sub-Saharan Africa: Forest Area and Deforestation).

The primary agent of deforestation in SSA is the conversion of forests and woodlands into cropland and grazing areas. The area of cropland in the region is expanding by roughly 0.6 million hectares every year, mainly at the expense of forests and woodlands, and primarily for shifting cultivation and perennial cash crops (e.g., coffee, cocoa, and cotton). Wildfire is another important agent of deforestation, while use of forest lands for shifting cultivation is the main agent of forest degradation. Other agents of forest depletion and degradation are commercial timber and woodfuel harvesting and overgrazing. Commercial timber harvesting

la *Species endemism" refers to the existence of species unique to a single country.

19 "Biodiversity in Sub-Saharan Africa: Conservation, Management, and Sustainable Use," IUCN, 1990.

20 Deforestation is defined as the permanent conversion of forest to non-forest land. Therefore, shifting cultivation with bush fallows is not considered to be deforestation, but forest degradation. Op cit, PAO, 1993.

21 The 1991 Bank Forest Policy identifies 20 countries around the world with thratened tropical moist forests, including Cameroon, the Central African Republic, Congo, Cote d'Ivoire, Gabon, Madagascar, and Zaire.

17 Figurt 2. Rates of Defrestation by Forest Zone (1981-90)

Tirplcat Raiiforest

Moist Deduus Forst

Dry Deidus Forst

Seni Arid Forst

IMll and Moonas Forest

0.00 2.00 4.00 6.00 3.00 10.00 12.00

Source: FAO, 1958 normally involves a cut of between 5 and 35 cubic meters per hectare and leaves most of the original forest vegetation intact.22 Apart from the depletion of high-value timber species such as Entandrophragmacylindricum (sapele) and Entandrophragmautile (utile), the main impact of timber harvesting is indirect: it necessitates the development of new roads which provide access to pioneer farmers. Commercial woodfuel harvesting for urban household and industrial consumption, although involving smaller volumes of wood than rural household consumption overall, is generally thought to have the most severe impact on forest resources because it derives from the large-scale cutting of natural woodlands. With the regeneration of these woodlands often being impeded by repeated fires and conversion to agriculture. Most rural households, on the other hand, consume woodfuel that comes from fallow bush or trees on farm land rather than from forests.

le 0.7 percent deforestation rate experienced by SSA compares favorably with those of 1.2 percent and 0.8 percent for Latin America and Asia respectively. But these overall figures conceal disturbing trends at the subregional level. Forest depletion rates in parts of the region, such as Madagascar and coastal West Africa, rank amongst the highest in the world. Over the past 50 years, nearly three-fourths of the original tropical moist forest in West Africa has been lost. The damage incurred by C8te d'Ivoire, which experienced an annual deforestation rate of 5.2 percent in the 1980s, is particularly severe," although the tropical moist forests in surrounding countries (e.g., , Nigeria, and ) are also nearing depletion. 24 Central Africa, which contains the largest remaining area of tropical rain forest, is facing increasing pressures around the eastern fringes, where farmers are leaving densely

2 Average timber harvests in the tropical moist forests of SSA are 12 cu m3 ha, against 17 cu m3 in Latin America, 38 cu m3 in South Asia, and 45-90 cu m3 in the dipterocarp forests of insular South East Asia, lanly, 1985.

23 Cote dIvoire's deforestation rate was the highest in SSA in the 1980s. The accompanying shrinkage of wildlife habitat is estimated to threaten 10 percent of the country's mammals with extinction.

Ismail Scrageldin, "Saving Africa's Rainforests," Ite World Bank, 1993.

18 populated areas to invade the forests along newly established roads. In eastern Zaire, this is threatening some of the most biodiverse tropical moist forests of the whole region. Meanwhile, the arid and semi-arid deciduous forests of the Sahel are being cleared for farming and degraded by overgrazing and overharvesting of wood for urban charcoal consumption. And selective overharvesting of high-value timber species such as Dalbergia melanoxylon (blackwood) is affecting the miombo woodlands of Southern and Eastern Africa. 5 On the positive side, there are areas in Rwanda and Kenya (Machakos District) which support higher tree cover now than they did 50 years ago, despite sharp increases in population density. Smallholders in these areas have responded to market forces by planting large numbers of trees on their farms. But this supply response has come too late to save natural forest cover.

Deforestation statistics have to be treated with caution, especially in the African context, where boundaries between agricultural and forest land are unclear and subject to frequent change. Remote sensing imagery is unreliable for mapping open canopy, deciduous woodlands, and forest-fallow-field mosaics such as those present in shifting cultivation areas. Furthermore, country forest inventories are generally at an early stage of development. Hence, much of the information presently available on the region's forest resources is inconsistent and unreliable and, at best, indicative.

The Roots of Unsustainable Forest Resource Use

Some conversion of forests in high potential areas to cropland, pasture, and production forest is unavoidable and even necessary for socioeconomic development in a continent where the majority of a rapidly growing population lives off the land. But where deforestation lowers land productivity, it may reinforce the very factors that caused it in the first place, giving rise to a vicious circle of impoverishment and environmental degradation. As a result, forests essential for watershed protection and biodiversity conservation are being removed in areas unsuitable for agricultural production, and the region's efforts to attain sustainable development undermined. In Africa, there are strong interlinkages between rapid population growth, environmental degradation, and poor agricultural performance-a "nexus" that improvements in technology, sustainable farming practices, and population control can help overcome.26

In reality, forest depletion and degradation are rarely simple processes. Often, they result from a complex chain of events, involving a number of different agents and causes in each locality and at each point in time. This paper distinguishes between agents, driving forces and accelerating forces, which interact synergistically to produce deforestation and forest degradation. 27 Agents of forest degradation and depletion include agricultural expansion, uncontrolled woodfuel and timber harvesting (mainly commercial logging), infrastructure development, and overgrazing. Underlying these direct agents is a dynamic comprising driving forces: growing and migrating populations, poverty, international trade, accessibility and technology; and accelerating or 'trigger 'forces: market, policy and institutional failures.2s

"Miombo" is the Swahili word for the Brachystegia species which dominate these woodlands.

26 K.Cleaver and G.Schreiber, "ITe Population, Agriculture, and Environment Nexus in Sub-Saharan Africa, (Revised)", Africa Technical Department, The World Bank, 1993. 27 M.Palo, "Deforestation or Development in the Third World," Finnish Forest Research Institute, 1989.

28 Narendra Sharma, Ed., op cit, 1992. 19 Driving Forces

Population growth, on average exceeding 3 percent per annum, and poverty have increased the pressures on forest resources in the region, through agricultural and pastoral development of intact forests and reduced fallow periods in secondary forests, and in terms of increased demand for wood and wood products.29 The latest World Bank projections foresee a doubling of Africa's population over the next two decades, by which time it will surpass 1 billion. The migratory nature of the expanding populations referred to by this figure compounds the problem further. In many areas (e.g., Cte d'Ivoire, Ethiopia, and Tanzania), the arrival of large numbers of migrants has eroded customary laws and rules governing use and management of commonly owned natural resources. In addition, farmers and herders migrating into unfamiliar territory often take with them inappropriate agricultural practices. A clear case in point is humid West Africa, where savanna farmers who have occupied rain forest zones are using much more destructive agricultural methods than indigenous groups. Another is the Sahel, where growing farming populations have expanded into traditionally pastoral areas, degrading fragile soils and forcing herders to overuse their increasingly limited resource base. Pastoralists, in turn, have settled down in due course, and often on land unsuitable for agriculture. Frequent droughts have exacerbated these trends in recent years.30

Cash crop agriculture and timber exports place forest depletion within the wider context of trade and the iaternational economy. While the production of timber and crops such as cocoa, coffee and cotton need not lead to undue environmental degradation, in practice it often does. Foreign currency revenues provide a major incentive-in the absence of conservation and rational use of land-for both unsustainable timber harvesting practices, and agricultural expansion into environmentally fragile areas. Infrastructure development can be an important determinant of forest degradation and depletion. Logging roads are a good example, as they often open up intact forest areas, as clearly demonstrated by the experience of Cte d'Ivoire. FAO estimated that of the 1.25 million hectares of the region's productive tropical moist forest cleared annually between 1976 to 1980, more than 1 million hectares had been logged over prior to clearing. Deforestation in unlogged forest was negligible by comparison. 3 1

Accelerating or "rigger" Forces

Mutually reinforcing market and policy failures often precipitate unsustainable forest resource use. Forests generally suffer from their "public good" nature: it is both difficult to

29 Poverty in itself need not cause forest degradation; that depends on the coping strategies of the poor. Where such coping strategies depend on use of forest resources, e.g., farmers responding to crop failure by harvesting woodfuel for urban markets, environmental degradation may ensue. Peerce and Warford, 'World Without End", The World Bank, 1993.

30 A number of recent studies have documented the links between population, agricultural intensification, and deforestation. As a general rule, deforestation is positively related to population pressure (where policies are favorable to agriculture), but negatively related to the use of modern farm inputs. Kevin Cleaver and Gotz Schreiber, op cit, 1993.

31 The situstion was most extreme in West Africa, where 671,000 out of a total of 691,000 hectares had been logged prior to deforestation; followed by Eastern Africa (including Madagascar) with 18,000 out of 237,000 hectares, and Central Africa, with 177,000 out of 328,000 hectare. FAO, "Forest Resources Assessment, 1980,' Rome, 1981.

20 market all of the benefits they provide and to exclude public access. Market failure refers to the inability of markets to reflect the full social costs of production in the price of traded products and inputs and the non-existence of markets for "externalities" such as soil, water, and biodiversity conservation. Market failure is intricately linked to property rights and policy failures. There is increasing evidence from a variety of renewable resources that any open access regime, in which no property rights are defined for individuals or communities, risks degradation or depletion of the resource. Common property regimes without clearly defined rules for use and management are also subject to degradation ("the tragedy of the commons"). Privatization allows the market to function better, but market failure will still occur because of the presence of some externalities, reflecting a divergence between private and societal interests in the use and management of forest resources.32

At first glance, state ownership of land and natural resources would solve the problem by internalizing the externalities ingrained in open access, common and private use of forest resources to a single owner. For state ownership to work effectively, however, the state must be able to monitor the use of resources, establish acceptable rules of use by individuals and communities, and enforce those rules. Typically, in SSA, governments have been unable to do this because of lack of capacity and resources.33 Nationalization of forest resources in the absence of government capacity to manage them has replaced customary land management systems by open-access regimes, under which forest resources can be exploited at will and there are few incentives for conservation. This has been especially prevalent in former French colonies, such as Mali, Niger, and Chad. Pricing and concession policies and royalty systems have been similarly inappropriate. Timber and fuelwood concessions in much of Sub-Saharan Africa are almost invariably allocated without much competition and with little provision for environmental considerations, and stumpage fees charged are typically very low, a point confirmed by the experience of countries in West Africa (e.g., Ghana and Gabon).34 The African experience in general shows that underpricing sends inappropriate signals about the relative scarcity of forest resources and encourages wasteful practices such as high-grading and inefficient processing. This reinforces the perverse incentives that encourage short-term profit taking and discourage sustainable management.3

African forestry departments have been given the responsibility to manage 1.3 billion hectares of land.3 6 Modeled on colonial forestry institutions, they have been able to protect national parks and oversee commercial timber harvesting in gazetted forests to some extent, but they have been ineffective in dealing with multiple forest management objectives for local as well as national needs, such as the production of timber, fuelwood, fodder, non-timber forest products, recreation, watershed management, and biodiversity conservation. Forestry

32 Markets also fail because they ignore the property rights of future generations, creating an incentive for over-exploitation of forest resources in the short term, and given the "public good" characteristics of important environmental services, such as those relating to biodiversity, and the maintenance of air, soil, and water quality. 33 Pearce and Warford, op cit, 1993. Malcolm Gillis, "West Africa:rcsource management policies and the tropical forest," in Public Policies and the Misuse of Forest Resources, Ed., Repetto and Gillis, 1988.

35 Grut, Gray, and Egli, "Forest Pricing and Concession Policies," World Bank, 1991.

36 Grasslands covering around 0.8 billion hectares, although having less than 10 percent tree cover, typically also fall under the legal jurisdiction of forestry departments. PAO Yearbook, 1991.

21 departments are often underfunded and lack effective institutional capacity-the people, skills, and incentives necessary to sustain and augment the continent's forest resources.

Bes 1. Forist Ezteraitiu in S-Saharas Africa

All forests and woodlands, whether natural or planted, have some externalities, that is, they provide benefits which are not fully valued because they are not traded in markets. Most of these benefits are environmental services; some of them national or international (e.g., watershed protection) and others, global (e.g., biodiversity conservation, and carbon dioxide fixation and storage). Appropriately sited and well-managed plantations can also contribute to the maintenance of soil and water quality, and absorb considerable amounts of carbon dioxide. But plantations are inferior in terms of biological diversity, whoe natural fores have an obvious comparative advantage. Some African tropical forest ecosystems have significantly larger externalities than others and are, therefore, more undervalued. TIheas are limed below in order of importance.

* Closed liand tropical moist forests (TMPs), covering 0.2 billion hectares, contain mont of the region's biological diversity - significant both in terms of its seer quantity and quality (species endemism). The dense types of TMP, often referred to as rainfbreats, are especially diverse. These cover nearly 86.5 million hectares of land and are concentrated in the rich Guineo-Congolean belt, an area of land expanding through West and Central Africa that holds over half of all the species in the , including 8,000 plants, 80 percent of which are endemic. About 20 percent of the remaining forest in West Africa is now in protected areas, and so is 7 percent of forest in Central Africa. But a recent review has pointed to important gaps in the existing protected area system within the Guinso-Congolian belt. TMPs, as a whole, contain higher socks of carbon per hectare than any other terrestrial ecosystem in SSA. The genetic material they sustain is not only important from the point of view of biodivenity, but also has significant developmental potential;

* Tropical dry forests are predominant in Africa, representing 75 percent of the total amount of this forest type in the world. They mostly comprise open woodlands and forect fallows. Although tropical dry forests contain far less biomase per unit area than TMPs, they have importeant consequences for soil protection and water regulation in the fragile arid and semi arid lands of the region. They provide a valuable habitat for wildlife - many unique species are adapted to the harsber ecological conditions in which such fores are found - and contribute to carbon sequestration, as exemplified by the miombo woodlands in the southern parts of Africa.

* Tropical montane forests, covering about 35 million hectares (including hills), although less diverse than TMF9, are of global significance because they contain many rare and codemic species (e.g., the primates in the mountainous regions of Rwanda, and Uganda), and have considerable consequences for regional development, protecting the watersheds of international rivers. These forests are also more fragile than TMPs, as they recover only slowly from disturbance due to lower growth rates. Deforestation in the hill and montane zones of Africa is most severe, at an annIal average rate of 1.2 percent. A relatively large proportion of these forests is in protected areas.

* Mangreve foreats, covering about 3.5 million hectares, are important as a spawning habitat for fish and other marine life, and enwure the protection of water quality in coastal areas. They provide a break against storm surges; help reduce floods; and fuIrther limit coastal and beach erosion. Mangroves protect coral reefs along the East African coast by intercepting sedimentation flows which can destroy them. Mangrove ecosystems are under threat from fuelwood, urbanization, and infrastructure development.

Policy failures outside the forest sector may be even more important. Government policies relating to trade, land, relative prices, taxation, expenditures, and subsidies provide incentives in other sectors that often have detrimental consequences for forest resource use and conservation. Ilis is particularly the case with regard to agriculture, the principal source of forest depletion and degradation in Africa, and the mainstay of future economic growth and poverty alleviation in this region. Subsidies and tax concessions constitute powerful incentives for opening up new forest areas, thus expanding the agricultural frontier. Low, administratively set producer prices for crops, often used to depress domestic food prices, further inhibit agricultural intensification and add to the pressures for land clearing. While

22 Box. 2 A Sub-Regional Perspective: Types and Uses of Forgsts in Sub-Saharam Africa

Region I - Sudano-Sealian Afica (Burkina Paso, Chad, the Gambia, Mali, Mauritania, Niger, Senegal, Somalia and Sudan). The vegetation found In this region Is mainly savannas dominated by grawes and by tree species such as Acada and Commiphora, bordered in the mouth by open IsoberiWa woodlands, and in the north by grass steppes and desert vegetation. The seminanural woodlands of this arid and semiarid region have been subjected to overharveting for woodfuels (particularly charcoal for urban areas) and to intensive grazing and farming pressures resulting from population growth. Aggravating this situation is the erosion of common property systems for woodland protection and management by public ownership, which, in the absence of government control, has turned woodlands into open access resources. Degradation has been exacerbated by the low erratic rainfall, implying a slow growth rate and uncertain regeneration.

Region H - Humid and Subhumid West Africa (Benin, Cte dIvoirm, Ghana, Guinea, Guinea-Bissau, Uberia, Nigeria, , and Togo). The vegetation of the northern and eastern part of this region consists mainly of open woodlands dominated by Isoberitae, Bruchysregie, and Julbendia, while closed evergreen and semideciduous forests predominate in the south and west. Between the two is a transition zone of forest/savanna mosaics resulting from human intrusion on the aboriginal closed forest. Rising population growth and extensive in-migration, exacerbated by infrastructure established for extensive logging of high-value species, have led to large scale encroeachmet into the natural forests of this region. Closed forests are now down to lass than 11 million hectares (less than 10 percent of the wooded area) while open forest fllows and savannas cover some 130 million hectares (90 percent of the wooded area). Large areas of former forest land have been converted to agriculture. Much of this is based on shifting cultivation utilizing relatively short fallow periods. There are extensive tracts of mangroves along the western coasts of Africa. These cover five main species, including Rizophoru mangle, R. harrisoni, R. rmcemora, Avcennia geminns, and Laguncularia racemoa.

Region I - Humid Central Africa (Cameroon, C.A.R., Congo, Equatorial Guinea, Gabon, and Zaire). The central half of this region is covered by the largest area of closed tropical rain forest remaining in Africa (about 160 million bectares), whereas the northern and southern areas are dominated by deciduous open woodlands, and the eastern area contains high-altitude forests and savannas. Population pressure does not yet present the same threat of destruction as in Region I. Nevertheless, in southern Cameroon, eastern Zaire and parts of C.A.R., population growth and in-migration will probably necessitate some additional conversion of forest land to agriculture.

Region IV - Subhumid Mountainous East Africa (Burundi, Ethiopia, Kenya, Madagascar, Rwanda, and Uganda). The lower, drier parts of this region an dominated by a variety of open woodland and savanna vegetation types. Most of the evergreen forests that formerly covered a large part of the cooler uplands in this region have been mainly converted to agriculture. The remaining closed natural forests, covering some 8 million beclares, (Ls., less than 3 percent of the total wooded aresa) are mainly situated on slopes and protected as government forest reserves primarily for biodivernity, water catchment, or national parks. Rising population pressure, combined with relatively favorable agroecological conditions for intensive farming and tree growth, have led to large scale spontaneous tree planting, particularly in those situations wher security of land tnume prevails. And rising prices for poles/fuelwood have provided the impetus for cash crop tree farming. Most of the requirements for faelwood, and building poles for rural households is met from on-farm trees. Continuing clearance of remnants of atural forest for agriculture supplies much of the demand for charcoal in urban townships. Given the heterogeneity of the natural forest species and their relatively slow growth rates, industrial timber needs an largely being met by plantations, mainly of fast-growing pine, cypress, and eucalyptus species. Madagascar and Eams Africa hold a more diverse mangrove flora than that found in West Africa; one encompasaing nine different species. Cerfops sagal on Madagascar is sometimes considered an endemic species.

Region V - Subhumid and Semiarid Southern Africa (Angola, Botswana, Laesotho, Malawi, Mozambique, Namibia, Swaziland, Tanzania, Zambian, and Zimbabwe). The main type of fores in this region is a deciduous tropical woodland (Miombo) dominated by species Fuch as Brachystaegla and BergWa/Julbemnardle. These woodlands are important providers of woodfuels, bush foods, and utility timber in rural areas. Industrial plantations sad wood processing enterprises are run mainly by parastatal organizations. As many of the savanna woodlands of the region overlie soils with good agricultural potential, it is both inevitable and logical that some forest land will have to give way to agriculture.

Sources: FAO and WRI

23 overvalued exchange rates also prevent the desired supply response.37 Other examples of nonforest policy failures include inappropriate land use planning and infrastructure development that aggravate forest depletion, as well as poor investment in the social sectors. 1lhe latter not only delays the required demographic transition, but also constrains the adoption of improved technology which is crucial for surmounting the "nexus" in Africa. Measures to promote agricultural intensification work best in an environment where farmers, as well as trainers, possess a certain level of education. All these trends have been intensified by the successive economic and political crises in many African countries, which have resulted in policies that emphasize short-term consumptive use of forests rather than their management for long-term development benefits, thereby thwarting sustainable development.

37 Exchange rate reform, however, can also work negatively by exacerbating uncontrolled timber logging for export purposes: a point which underlines the fact that there is no simple relationship between price related policy reforms and the environment, as shifts in resource use depend on the intervening institutional structure. 24 3. Strategic Implications

Forest Governance: Hard Choices

Options for managing forest resources involve difficult trade-offs and hard choices, and ultimately depend on how individual countries respond to fundamental questions concerning conservation and development, intergenerational equity, and the global commons: What percentage of the natural forests should be set aside by each country for biodiversity protection? How should existing forest areas be allocated to competing uses such as agricultural production, protection of watersheds, and recreation? Can additional areas of forests and woodlands be set aside justifiably if the development opportunities of increasing numbers of poor people are limited? Is there a moral responsibility towards future generations, and, if so, to what extent should their needs weigh on present decision-making? To what degree should decisions on the use of forests and forest lands reflect wider regional and global concerns? The answers to these questions lie beyond the realm of economics, embracing important ecological, sociopolitical and ethical considerations. They also depend on the extent to which the donor community will accept responsibility for helping SSA to preserve its forests and share in the costs as well as benefits of global externalities such as biodiversity and carbon sequestration. At the UNCED Conference (Earth Summit) held in Rio de Janeiro in 1992, the donor countries accepted the principle of equitable sharing of the cost of tropical forest conservation by signing the Non-Binding Statement of Forest Principles 38, which addresses some of the above questions and aims to help develop country strategies.

The national interest in many African countries, however, is being undermined by insufficient government attention to forest resources and their conservation, which has led to "open access" and "free rider" problems. African governments need to be more responsive to the broader economic, social, and environmental goals, and concerns of their societies. They need to strike a balance between the competing demands for economic and environmental goods and services derived from their forest resources in the context of the National Environment Action Plan (NEAP), and national development programs. This can be achieved through a mix of forest preservation, conservation through better management for multiple uses, conversion to other uses such as agriculture, and reforestation. The balance of this mix will depend on the specific socioeconomic, political, and biophysical context within each country. In sparsely populated, forest-rich countries such as Congo, Gabon, Zaire and Zambia, there are still options to conserve natural forests and woodlands for productive uses, preserve biological resources and critical forest ecosystems, and maintain environmental services. In forest-deficit countries (e.g., Nigeria, Cote d'Ivoire, Rwanda, and Madagascar) such conservation options are few and costly, and there is a need for expanding the forest resource base through tree planting and regeneration. Reforestation will serve to meet basic needs for fuel, fodder, and fiber, and also help alleviate the localized fuelwood crises that distinguish many urban areas in Africa. Plantations operated or owned by the private sector can meet local demands for these products. In the case of tree planting, individual and community actions are of greater importance in expanding forest resources.

38 United Nations Conference on Environment and Development, Agenda item 9, Ref: A/CONF.151/6/Rev.1, June 1992. 25 SSA's tropical moist forests, in excess of 200 million hectares, are particularly important, as their use may have far-reaching consequences beyond the local and national levels. As discussed earlier, these forests are a significant repository for biological diversity (species, genetic material, and ecosystems), and perform critical watershed protection, carbon sequestration, and climate regulation functions. Although scientific knowledge has expanded in recent years, information on these forests (e.g., concerning species, genetic materials, and the dynamics of biomes) is, at present, limited, Because of this situation, African countries, as with other tropical countries in Asia and Latin America, will need to take a cautious approach, exploiting TMF resources in a sustainable manner, and balancing the need for economic development with that of long-term ecological and sociocultural sustainability. At present, there are few management systems in the region employing sustainable practices of timber harvesting. This situation, combined with the fact that there is limited knowledge about the dynamics, complexity, and functions of TMF forest ecosystems, places the burden of proof on African countries to demonstrate that the benefits derived from extracting TMF resources actually outweigh the social costs incurred. Present circumstances dictate that African countries should protect intact tropical moist forests. But following this option involves direct and indirect costs, for which the world community at large shares a burden of responsibility. SSA will need external funding (to contribute to direct and indirect costs) in order to protect a significant portion of these forests to benefit the African people as well as the world community.

On balance, many forest resource conservation options are compatible with economic growth objectives, at least in the long term. On a worldwide basis, some of the most widely publicized environmental disasters in tropical forest areas were also costly development failures.39 The strategic options discussed below explore the considerable potential in the African forest sector for win-win choices or, where tradeoffs are small, that simultaneously promote environmental and developmental aims.

A New Role for Government

Since most of Africa's forested lands are in the public domain, realization of this potential will depend on governments fulfilling their role as custodians of society's interest through effective implementation of appropriate policies. In view of the limited success of past command-and-control policies in containing forest depletion, a greater reliance on market forces and private sector involvement will be needed to promote efficient use, conservation, and augmentation of forest resources. In order to achieve this, governments will need to provide an enabling environment for economically efficient and environmentally sound forest sector activity, price forest resources to reflect their scarcity, and tax commercial forest resource users to internalize externalities.

The particular socioeconomic and ecological context, and public discussion and debate will determine the government's role within each individual African country. But, in general, state efforts should not be expanded to add to the existing bureaucracy. Rather, they should be limited to those; activities that cannot, or will not, be carried out by farmers, local communities and private enterprises on their own accord. This would imply that governments should move out of those activities generating profits. Ventures with positive externalities, such as reforestation of degraded watersheds to prevent reservoir siltation and setting aside intact natural forests for the conservation of genetic material, species and ecosystems, should be

39 E.g., Polonorocste in Brazil, and food crop transmigration in Indonesia. 26 encouraged and supported by the public sector. Activities generating negative externalities, such as the exploitation of pristine forests rich in biological diversity, should be curbed by appropriate pricing and taxation policies and complemented by strict enforcement on the ground. Such targeted state intervention is not only conducive to greater public sector effectiveness, but also releases scarce resources for alternative uses. The reallocation of public funds from areas where the private sector is more efficient, such as woodfuel and timber harvesting and processing, will enable governments to step up investment in areas where the market fails, such as biodiversity conservation, watershed protection, the maintenance of forest-related databases and information systems, the provision of timely and accurate information to forest resource users, research, and development of human resources.

Options for Sub-Saharan Africa

Government interventions, both within and outside the forestry sector, can help African countries to stem forest resource depletion where this is economically and environmentally wasteful. Macroeconomic management, agricultural, natural resource management, population, energy, and industrial policies are strongly related to forest sector performance, and represent a formidable platform for addressing the driving and accelerating (or "trigger") forces contributing to forest depletion and degradation. Within the forestry sector, policy and institutional reforms, capacity building and human resources development, greater involvement of local people and the private sector, and generation and dissemination of forest-related knowledge and technology can contribute considerably to achieving economic growth, social equity, and environmental protection objectives.

Complementary Measures Outside the Forest Sector

Many of the underlying causes of the complex and interconnected processes leading to forest depletion and degradation described in the previous chapter are to do with issues largely outside the reach of the forest sector, as noted above. Whether a reasonable balance between forest conservation and development can be struck will ultimately depend on whether African governments can tackle these cross-sectoral issues successfully, and on how effectively they can integrate forestry considerations in the NEAP process. Put more simply: Africa needs good policies for the forests - not just better forestry policy. 0 Most obvious is the need for macroeconomic and political stability, to allow for rational, long-term public sector investment, for agricultural intensification to increase productivity and thus reduce pressure on remaining forest areas, and for greater involvement of people in the management of forest resources.

MacroeconomicManagement

Good macroeconomic and public sector investment policies are essential for a dynamic and efficient forest sector. Inordinate amounts of red tape and regulations have stifled private enterprise. Heavy state involvement in the growing and processing of wood has further curbed private sector forestry investment and wasted scarce public resources. The forest sector can benefit greatly from macroeconomic policy reforms designed to make the market work and enhance the effectiveness of public sector interventions. Fiscal, trade, exchange rate, and pricing policy reforms pursued under Structural Adjustment Programs can promote more

40 Ismail Serageldin, op.cit, 1993.

27 efficient forest resource use by facilitating increased involvement of the private sector. The work programs of forestry sector agencies have suffered from poorly coordinated public sector investment policies and the haphazard allocation of public funds. Government forestry agencies typically lack sufficient budgetary support. They are poorly placed to perform a coordination function with regard to the use of forest lands, having little influence over decision-making processes in other or even their own line ministries. And with most forestry departments located in Agriculture or Lands Ministries, forest sector interests are invariably overshadowed by the interests of these other sectors.4 1 But finance and planning ministries can use their influence to ensure consistent and complementary activity with regard to forests. High-level awareness and knowledge within these ministries about the importance of productive uses and environmental services of forest resources to the economy as a whole are indispensable to this end.

The timely availability of sufficient funds to cover investment and operating expenditures is important for all public sector agencies, but even more so for forestry departments. Late disbursement of agreed budget allocations can have quite severe consequences for the forestry sector, such as missing the tree planting season, or being unable to carry out timber felling inspections and other tasks that cannot be delayed. In response to this situation, many forestry agencies have vied for the right to retain forest revenue in a special account, such as the Fonds de Reconstitution du Capital Forestier in Zaire and the Silvicultural Fund of the Forestry Development Authority in Liberia. Such forest funds have generally been poorly managed, and often suppressed by structural adjustment efforts, which support consolidated state accounts from a macroeconomic management and public accountability point of view. But the underlying concept remains valid. There is an obvious need to improve the management of forest funds. African governments should further note that the existence of a forest fund does not necessarily imply that the forest sector can be completely self-financing.

Land Use Planning and Natural Resource Management

Economically efficient, socially equitable, and environmentally sustainable land use rarely comes about automatically. Incentives that rule the behavior of individuals often lead to results that are suboptimal for society at large. As custodians of society's long-term interests, governments-in collaboration with the people-have to exert some influence on how land is used, by whom and for what purpose. In the past, many governments have relied on centralized land use planning in order to achieve this. Technicians from the various ministries involved would use land suitability maps and forest inventory results to devise complex land use plans identifying conservation areas, timber production forests, and areas for farming, mining and infrastructure development, e.g., in Cameroon, Tanzania, and Zimbabwe. The pronounced lack of success of this "command and control" approach was mainly due to the fact that land use planning was conceived as a technical and administrative exercise, whereas little attention was paid to the political conflicts inherent in the competing demands on forest resources and the economic incentives governing their use. Conflicts between the various users, especially for common and public lands, need to be resolved through negotiation, and agreements translated into relatively simple "rules of the game" to be respected by all parties involved if land use plans are to have any practical value. There are no regionally or nationally valid blueprints for such decentralized land use planning, but it generally implies considerable

41 Few African countries have separate forestry ministries. Among the exceptions are Cameroon, Congo, and Gabon. 28 cross-sectoral coordination, a high degree of local community participation, and adherence to the rule of law, an essential prerequisite for any effective land use policy. An example of the effectiveness of this kind of approach is the fact that many forest reserves established on the basis of extended negotiations between forest administration and local populations in Ghana in the 1930s have remained intact, although the surrounding areas are now densely populated.

Agriculture

In SSA, extensive agriculture encroaches into forest areas at a rate of 0.6 million hectares annually. Although some conversion of forest lands and woodlands suitable for agriculture will be justified and necessary, indiscriminate expansion of the agricultural frontier into forests that are unsuitable for agriculture but essential for watershed protection and biodiversity conservation needs to be contained. Agricultural intensification and increased productivity of existing cropland can contribute to this goal. As with forestry, the role of government here is to create an enabling environment for sustainable agriculture, by upgrading technical services; developing rural infrastructure; improving input and output markets; developing appropriate technologies; removing policy distortions such as administered low producer prices for crops; and addressing tenurial issues.42

Population

As indicated earlier, the SSA population will surpass 1 billion over the next two decades. The food and fuel requirements of these 1 billion people will place increasing pressure on forest lands. African countries must act quickly to attenuate the population pressures that are contributing to poverty and environmental degradation. Increased investment in health and education services is needed to accelerate the demographic transition. Government can also contain large-scale migration into environmentally fragile areas by carefully planning investment in infrastructure, and by reasserting the land and resource use rights of local populations in return for cooperation in .

Energy

The bulk of energy used in SSA comes from forests and on-farm woody biomass resources. Therefore, energy sector interventions may be warranted in those African countries where woodfuel consumption by large urban populations and rural industries is a major agent of forest degradation and loss of tree stocks on agricultural land. These countries need to improve woodfuel supplies and efficiency in the use of fuelwood. Woodfuel demand management interventions fall into two main categories, namely, those relating to conservation and substitution. The former include the promotion of improved cooking stoves, more efficient charcoal making, and the use of more efficient combustion technologies in rural industries depending on woodfuels. Conservation efforts in woodfuel harvesting, processing, and consumption have considerable scope and are highly desirable, not only for curbing forest depletion but also for reducing carbon emissions and alleviating poverty. This combination of global and local benefits provides a powerfil rationale for international funding of woodfuel conservation in SSA. In marked contrast, woodfuel substitution (e.g., promotion of electricity and gas as alternative fuels) has much less potential under current economic conditions.

42 See K.Cleaver, "A Strategy to Develop Agriculture in Sub-Saharan Africa and a Focus for the World Bank", The World Bank, 1993. 29 Measures Within the Forest Sector

Forest Policy and Legislative Reform

FOREST POLICY. Where ownership of forest lands is vested in government, as in most of SSA, good forest policy is essential for sustainable management. In many countries, however, forest policies have failed to stem forest resource depletion-or have even accelerated it. The combination of excessive reliance on command and control procedures and limited enforcement capacity has reduced the impact of many well intentioned forest policy and legislation initiatives. New policies and laws will need to be based on the fundamental principles of transparency and public accountability. They will also have to rely on economic incentives to a much greater extent than is presently the case, with policing and control playing a complementary rather than a paramount role. The need for public accountability and reliance on economic incentives implies that many policies and laws will have to allow for matters of detail to be devolved to lower levels of government, which can take into account the local socioeconomic context in developing and enforcing rules and regulations. Areas in which policy reform is particularly important is the valuation of forest resources, the pricing of forest products and the allocation of harvesting rights (concession and royalty systems), and forest industries policies.

Valuation of forest resources has focused on their productive uses, whereas environmental services have often been neglected. Where forest ecosystems with considerable externalities-such as tropical rainforests, dry forests, montane forests and mangroves - are concerned, this undervaluation leads to suboptimal land use allocation, and considerable economic as well as environmental losses. Increased soil erosion reduces productivity and may cause economic and environmental costs downstream; loss of biodiversity may harm future development options; and depletion of mangroves may seriously harm coastal fisheries. Better valuation of forest services as well as products will provide essential inputs into the design of policies that make the market work where it can and adjust incentives where the market fails.

Concession policies that grant the private sector timber and woodfuel harvesting rights to public lands should reflect the scarcity of these forest products in order to promote efficient use.43 There are many possible options to achieve this. Administratively set fees can be indexed to take into account relative price changes, and recovery procedures simplified to enhance collection of fees and increase transparency of the revenue system. The introduction of competition into the allocation of timber harvesting rights can help to increase forest revenue and reduce waste of timber during harvesting and processing. The granting of concessions should be subject to consultation with local communities, and some portion of timber revenue should revert to local control to increase incentives for forest protection." Among other things, payments in kind can also be made to local communities for this same purpose. Concessions can be reviewed periodically, and renewal subjected to the fulfillment of previously agreed criteria, such as meeting high standards for road construction to reduce erosion; the adoption of low-impact harvesting methods; and the respect of areas excluded from logging (stream buffers, steep slopes). Where there is a capable and responsible private sector, private operators could be granted long-term contracts in return for accepting the

43 Malcolm Gilis in N.Sharms, op.cit, 1992.

This p-actice exists in Ghana, where the Forestry Department manages forest reserves in trust for the traditional land authorities, and where the latter receive a fixed percentage of forest fees.

30 responsibility to implement forest management plans.45 Performance bonds can be introduced to increase private sector commitment to sustainable management. Whatever system is adopted, consistent and equitable enforcement is key to its success. Increasing forest fees in a situation where many enterprises do not and will not pay them is likely to punish the operators that do pay.

Forest industries policies in many countries have concentrated on stimulating domestic timber processing. Although this is in itself a sound development objective, the market distortions that have been introduced to achieve it-such as log export bans, quota and other restrictions-have caused considerable economic inefficiencies and needless waste of forest resources. Log export bans (LEB), for example, have lowered domestic log prices, encouraging increased harvesting and reducing incentives for efficient processing. In countries such as Ghana, where LEB have been applied to the most valuable and increasingly rare timber species, accelerated harvesting has given rise to serious concerns about their conservation.4 Alternative policy options to stimulate domestic processing are available. These should rely primarily on improving the investment climate, where necessary, in combination with log export tariffs which can be phased out over time, to offer domestic industries some degree of (temporary) protection.

FOREST LEGISLATION. Until very recently, African forest legislation has narrowly focused on regulation of forest products harvesting from and protection of existing forest resources. In view of serious depletion of the forest resource base of the continent and ever- increasing pressure on remaining forests, this is no longer appropriate. Forest legislation needs to recognize the links between the various forest land uses and users, and it will need to integrate and define clearly such notions as multiple-use management, and community and village forests.47 Laws also need to codify government policy, clearly setting out the incentives for managing existing forest resources and creating new tree stocks on agricultural land (legislation can provide stability against too rapid change in policy inspired by short-term considerations). They should not only protect peoples' rights, but also provide them with the opportunity to assert these rights. In most of Africa, many of the daily uses of forest resources by rural people are illegal, irrespective of whether they are damaging or not. Recently, an increasing number of countries have recognized this and have started to overhaul existing legislation pertaining to forestry, in what often constitutes the first significant amendment of the regulatory framework governing sector activity since colonial times, for example, in Cameroon and Malawi.

The present situation of forest resource tenure in most African countries is one of vague overlays of various forms of customary law with "modern" land and forest laws which are often inappropriate, and inconsistently and inequitably enforced. In practice, this often amounts to open access and leads to poor forest resource management. This situation needs to be remedied by providing local communities and user groups interested in managing forests

Grut, Gray, and Egli, op. cit, 1991.

46 In Ghana, volumes harvested of timber species such as Milicia axcelsa (odoum) and thaya spp. (mahogany) are now larger than before their export in log form was banned in 1979, although their availability in the forest has greatly decreased. "Study of Incentives for the Sustainable Management of the Tropical High Forest of Ghana", prepared by IIED and the Ghana Forestry Department for the International Tropical Timber Organization, 1993.

47 Franz Schmithusen, "Forest Legislation in Selected African Countries, PAO Forestry Paper 65, 1986. 31 resources with secure use rights. There are a number of possible options to do this, including official recognition of customary systems of tenure where these are still viable, or granting property or long-term usufruct rights to locals. Usufruct rights may be granted to forest resources as a whole, or to specific forest products only, in return for local groups accepting clearly defined forest management responsibilities. The role of government would be to monitor management practices, to provide feedback to the users, and to help locals to enforce management rules against outsiders.

Capacity Building and Human Resources Development

The responsibility for managing and conserving natural resources is often scattered among a variety of institutions with compartmentalized mandates and competing interests. The ensuing lack of coordination leads to considerable inefficiency and waste of public resources. The management of forest resources is usually entrusted to government forestry departments, often paper tigers, with little opportunity or incentive for fulfilling the responsibilities vested in them. Implementing the forest policy reforms discussed above will require significant changes in the mandates and organizational structure of forestry departments and other government agencies. Better incentives will be needed to improve staff performance. Capacity building and human resource development will be needed to ensure that redefined institutional mandates can be fulfilled. Strengthening forest sector institutions has to be viewed as part of a larger process of systemic civil service reform, delving beyond personnel management and addressing important issues, such as incentives, the rule of law, and budgetary allocations. These institutions must have the budgets necessary to perform their duties effectively; the accountability to ensure a responsiveness to the needs of local and regional interests (that is, while maintaining the balance required for long-term sustainable economic development); and the transparency that also enhances sector governance. Development of and access to information and knowledge are also important ingredients for improving institutions and ensuring transparency.

NEW INSTITUTIONAL MANDATES. Greater local community and private sector involvement in production forestry (multiple use management of natural forests, farm and community forestry, plantation establishment and management) implies an important shift in the role of government. Rather than being directly involved in production, government institutions will increasingly support the efforts of outside agents. State forestry agencies will need to maintain a high profile in the management of tropical moist and dry forests for environmental purposes, mainly because of the externalities involved. Investment in forest preservation and in the rehabilitation of degraded forest lands, for instance, are unlikely to receive much interest from private actors, and progress in these areas will continue to depend on substantial government involvement. Even in environmental forestry, however, partnerships with local communities, conservation NGOs, and the private sector can contribute significantly to achieving forest policy objectives. New institutional mandates should be clearly defined and realistic, focusing on policy analysis, planning, and extension functions to achieve the full range of socioeconomic and environmental policy objectives set for the forestry sector. They should also include the institutional linkages necessary to make forestry departments effective cross-sectoral operators.

STAFF INCENTIVES. A la.ting improvement in the functioning of forestry institutions will depend on the existence of sufficient incentives for staff to perform their duties. Incentives include not only timely payment of sufficient salaries and allowances, but also the recognition of good performance through merit increases and promotion, and disciplinary 32 action against bad performers. The success of public sector forestry interventions depends to a considerable extent on the quality of field staff. But poor living conditions in rural areas and the lack of recognition for good performance in the field have reduced interest of the best staff in field positions. Improving this situation may require basic civil service reform, or the reconstitution of forestry departments as semi-autonomous bodies. The latter option will be difficult to realize unless forest resources generate substantial revenue.

Public sector CAPACITY BULDING and human resources development are required to strengthen the planning, programming, monitoring and enforcement functions performed by forestry departments. A prerequisite to capacity building is to first define the role of the public and private sectors, as well as local communities, in forest utilization and management. Important components of capacity building are the recruitment of a wider range of skills, improved forestry training and education, and retraining of existing staff. If forestry institutions are to become effective cross-sectoral agents, it will be necessary to change recruitment policies to broaden the array of technical skills available. Agriculturalists and agroforesters, range managers and ecologists, rural sociologists and public relations experts, natural resource economists, statisticians, and planners will all have a role to play in fulfilling the new mandates outlined above. Regulations blocking their recruitment or limiting their career perspectives in forestry institutions will need to be addressed. Forestry training has suffered from cuts in African education budgets and from the increasing imbalance between subjects taught and the professional reality. Forestry curricula, whether in developing or developed countries, have been unable to meet the needs of tropical forestry practitioners. Lack of a cross-sectoral perspective and hands-on experience during training have reinforced the disregard of foresters for farmers' perceptions and knowledge, leading to misunderstandings with local populations and misconception of field interventions. In-service retraining, refresher courses, and workshops are urgently required to ensure that existing staff are aware of new institutional mandates and able to fulfill their changed roles.

Capacity building will also be needed outside the public sector, so that farmers and local communities and the private sector can meet the new demands placed upon them. Capacity building initiatives within state forestry departments will, therefore, have to respond to this need.

Involving Farmersand Local Communities in ForestryActivities

Most farmers and local communities are already involved in forestry-related activities, which form an integrated part of their land use. In traditional Sahelian agroforestry systems, for example, crops benefit from nitrogen fixation by leguminous trees scattered in farm fields, and livestock depend on tree browse throughout much of the year. The increasingly active involvement of local communities and farm households in management and conservation of forest resources and tree stocks on agricultural land is desirable for the purposes of environmental protection and for the increased production of forest products in areas where these are scarce. Such involvement can contribute significantly to rural income generation and employment and environmental protection. Government reservation of forest resources has produced little in terms of practical management, especially in the semiarid and subhumid zones, and public sector involvement in plantation forestry has given rise to costly failures. Past experience suggests that farmers in countries such as Kenya and Rwanda can be very efficient producers of wood and other forest products, and that local people in the Sahelian drylands are better placed to act as custodians of forest resources than governments whose locus of power is far removed, and who are ostensibly absentee landlords relying on the 33 services of poorly paid representatives. Special attention will have to be paid to the role of women, who are the first to suffer from forest product scarcity (e.g., woodfuel collection), and who are often unable to participate in planning and executing forestry activities, because they lack time or are not allowed to under existing institutional arrangements."

The scope for farmer and community involvement will depend very much on the local context, especially the type and extent of natural forest ecosystems, the various productive and regulatory uses at stake, and the structure and functioning of local communities. Formerly, most natural resources in rural areas were under some form of common property resource (CPR) management, under which traditional institutions, such as clans and lineages, allocated land use rights to local farmers and transhumant pastoralists and laid down simple rules regarding its use. However, in many areas these CPR management systems have been eroded by government intervention, population growth, and migration to such an extent that they can no longer provide a framework for community-level forest management. Local woodlands in such areas have often been reduced to small patches on marginal soils in an otherwise tightly fanned landscape. In such cases, CPR management has very little potential, as per capita benefits will be extremely low and transaction costs high, and the most promising focus for local involvement is on the creation and maintenance of tree resources on farm. Management responsibility for these small patches of woodland is often better left with government, which may involve local people in management and protection through the contract, or allocated to small user groups with proven management capability.

More remote areas with lower population density, and often relatively less rainfall, are more likely to be candidates for successful local woodland management.49 Local communities are unlikely to accept management responsibility, however, without being allocated clear, long- term usufruct rights to the forest resources involved. In practice, this implies that government should grant custody of forest reserves to local communities or user groups, provide them with assistance to use it in a sustainable way for multiple uses, and grant them permission to extract royalties from outside users (financial returns can provide a clear incentive for constructive involvement in forest resource management at the local level). Care has to be taken that management responsibilities (surface area, enforcement against outsiders) are realistically set and do not surpass the implementation capacity of these communities. The transfer of custody over forest resources to local entities will have to take place gradually and be subjected to monitoring. Some local communities may have a strong interest in forest resource conservation, whereas others consider forests and woodlands mainly as land reserves for agricultural expansion. Even after devolving management responsibility, government may have to retain some involvement, for instance in mediating in disputas local users cannot resolve, and in protecting the rights of disenfranchised groups such as women and the poor. By supporting participatory negotiation processes among forest users, African governments can greatly assist sustainable forest management by local people.

Yet another type of local participation can be envisaged around extractive activities involving forest and tree products. Some of these activities involve tree stocks on agricultural or fallow land, such as Acacia senegal (gum arabic) in Sudan and Butyrospermum parki (shea butter) in the Sahel; others concern the harvesting of products from closed moist forests, such

4 African women often lack direct access to land, and have little say in the allocation of land to food, cash or troc crops. In many areas where women & own land, they are not allowed to plant tre.

49 GW shepherd, "Managing Africa's Tropical Dry Foreats: a review of indigenous methods." ODI, 1992. 34 as canes, Garciniaafkelli chewing sticks and wrapping leaves in Ghana.50 Further development of such activities would mainly benefit women, who often control the gathering, processing, and marketing of non-timber forest products, but have few other opportunities for entering the cash economy. Where there are areas with special potential for producing sustainable yields of economically important non-timber products, the establishment of "extractive reserves" to which local people have sole access rights could be tested to help safeguard the forest habitat. This approach is being tested for the extraction of medicinal tree barks from montane forests in Cameroon and for canes and chewing sticks in Ghana. Incentives to manage such reserves, or tree stocks on agricultural land, are stronger if good marketing links are in place.

A number of conditions may need to be fulfilled for such increased local involvement in forestry activities to be successful. These concern land tenure policies and forest legislation (described above) and the role of government forestry institutions.

The role of government institutions will have to change from a repressive to a supportive one, where extension and cooperation are the norm, and policing is the exception. There is an important role for agricultural extension agents to carry advice on the management of tree stocks on agricultural land and other forestry messages. Forestry subject matter specialists can teach these extension agents and, in return, learn to understand practical local- level constraints to forestry activities, e.g., restricted availability of labor for tree planting during peak periods of farm activity. Village level forest resource management, forestry production, and marketing may require considerable local level capacity building. NGOs may have more experience in this field, and can function as an intermediary between government and local communities. NGOs generally have a comparative advantage in terms of being able to effectively facilitate grassroots initiatives in a flexible and transparent manner. This comparative advantage, however, is not always realized, and NGOs, as with government agencies, need to perform frequent, critical self-evaluation in order to assess their true development impact.

However, much has yet to be learned about the factors determining sustainable management of forest resources at the local level, and the successful resolution of conflicts between users which this implies. Community participation in the forest sector is still an evolving concept and by no means a panacea for all its problems. But what is clear is that the incentive system for generating increased farmer and local community involvement in forestry activities will need to incorporate varying inducements, such as security of tenure, responsive government extension services, improved infrastructure, revenue sharing, and easy access to rural credit, which is presently a major constraint against the adoption of improved technologies in SSA.

Enhancing Private Sector Involvement in Forestry and ForestIndustry

At present, private sector involvement in the forest sector is underdeveloped. Mlis situation is exemplified by undercapitalized, inefficient wood industries. There is considerable scope, however, for increased private sector investment in the forestry sector, not only in traditionally important ventures such as timber harvesting and processing, but also in areas

50 In reality, the boundaries between agricultural and forest land are not so clear, and shilt over time: abandoned fields revert to fallow and eventually to woodland. As a consequence, most non-timber foreut products are harvested from both agricultural and forest land.

35 such as tree growing for commercial purposes, tree seed production, supervision of timber harvesting in government forest reserves, 5 and silvicultural research and extension. A major increase of private sector activity, however, will depend on considerable improvement of the investment climate for forestry. This implies first that the prevailing policy environment must be corrected so that the factors discriminating against private sector operations are eliminated. Private sector involvement in planning and policy making can help towards this end.

An important measure that needs to be considered is the divestment of state-run enterprises, which generally benefit from subsidized access to raw materials and tax exemptions, to the private sector. This, in combination with better forest resource pricing, will encourage the emergence of more efficient and competitive wood industries. To increase efficient management and utilization of state-owned industrial plantations, they can be privatized or jointly managed with the private sector. The same principles can be applied to large-scale, peri-urban woodfuel plantations currently managed by forestry institutions. The sale of wood from government-owned plantations or natural forest reserves at subsidized prices creates a disincentive for private sector and smallholder involvement in tree growing as well as adding considerably to the pressures on already overburdened treasuries, and should therefore be discontinued. By thus leveling the playing field, African governments will be performing one of their most important duties as facilitators and regulators of sector activity. What is needed is a governmental role which clearly recognizes the comparative advantages of local communities and the private sector, versus the state.

However, in a region marked by a weak overall investment climate, there may have to be some additional incentives for increased private sector activities, especially in industrial plantations. High investment costs, substantial risks, and low returns generally hinder private sector involvement here. Without reverting to direct subsidies, which are often difficult to target and administer, governments can help mitigate this situation by providing reliable sources of non-subsidized credit and through improved tenurial arrangements and other benefits. The latter include tax breaks for forest industry developments linked with resource augmentation, government contributions to essential technical support, training, research, and extension services, as well as the enforcement of legislation against encroachment, and the infrastructure development that deepens market channels, and opens up fresh opportunities for growth.

There is considerable scope for expanding private industrial timber production. First, there is the international market comprising exports of high quality timber products (e.g., furniture parts) made of premium species from natural forests, for which Africa has considerable potential advantage. Second, and more important, there is great potential for expanding intra-regional trade for logs and value-added wood based products. In the case of the latter, governments can assist large and small-scale private sector activities by creating an enabling framework for the wood processing industry; expanding markets for processed wood prcducts at both the domestic and regional level (e.g., via establishment of wood product standards for government buildings, and infrastructure development enhancing links to regional export markets); and also by strengthening capabilities all along the marketing chain through training, research, and technology transfer. It is advantageous for African governments to establish a sustainable management system for timber harvesting in order to keep pace with developments in the industrialized countries, where the use of "green labeling" is increasingly being advocated.

51 Timber harvesting inspection ham beer succesafully contracted out in Cote d'Ivoirm. 36 Special attention has to be paid to forestry activity in the informal sector, as small enterprises provide most of the forest-related employment in SSA. In Malawi, for instance, 10 percent of the active population is employed in small enterprises which depend directly on forest products, for raw materials (carpentry, basket making, charcoal burning), or for fuel (cottage industries such as beer brewing, fish and tobacco curing, lime burning, brickmaking).5 2 Again, the main contribution governments can make to the performance of these enterprises is to improve the enabling environment, by reducing unnecessary regulatory activity, such as overly detailed zoning laws, and facilitating the establishment and functioning of financial intermediaries to increase access to working capital.

Improving and DisseminatingForest-Related Knowledge and Technology

In the field of tropical forestry, many observers have stressed what we do not know, but neglected the fact that existing knowledge and many available technologies are not applied effectively. There are improved methods for planning and execution of timber harvesting operations in tropical moist forest which can reduce environmental damage and increase profitability-But these methods are rarely applied.53 Research institutes have developed methods for the vegetative propagation of fruit trees preferred by farmers, but the latter have no access to these technologies. Many rural people have developed sound land use practices with possibly wider applications, but this is often not recognized by government extension agents. 54 This situation is in large part due to the lack of communication between producers and potential users of technology. Communication suffers from language barriers (both international and national), from the lack of funding for and the weakness of functional link- ups between research and extension institutions, and from the contempt many technicians have for local people and their knowledge. A more integrated, participatory approach for developing and disseminating knowledge on forest resource management and use can help improve understanding of indigenous knowledge and increase the responsiveness to local needs.

What needs to be done? As a first step, African countries need to establish a forest database, by conducting national forest inventories which should provide information on the current state of forest ecosystems and the biological resources they contain, as well as trends in deforestation and other dynamics relevant to natural resource management. This baseline information can then be used to specify forest resource targets and standards that will serve as a basic framework for planning, implementing, and monitoring forest management and conservation activities. Monitoring systems should be established to provide regular updates of forest resource assessments. The user groups (i.e., policy makers and planners, land users and managers) involved should also be clearly differentiated in order to better serve their needs.

Second, governments have to concentrate on learning by doing. Many of the new approaches suggested above entail devolving forest management responsibility to local

52 Malawi Small and Medium Scale Enterprise Survey, GEMINI program, USAID, 1992.

53 In selective felling operations, sustainability depends on minimizing damage to the remaining forest vegetation and soil. Much inefficiency and damage to trees and soil is caused by the disorganized movement of heavy vehicles in the forest. Accurate stockmaps identifying every tree to be felled allow for better sidding track siting. Directional felling can further help to minimize felling damage to undersized trees of conunercial species. Sources: ITTO and FAO forest management guidelines.

54 Sometimes, land use practices that are sound in principle, such as early burning to protect village forests against destructive fires late in the dry season, are banned by law. 37 communities and the private sector. These approaches can not be developed through studies alone; they have to be tried in different local contexts in the field, initially on a pilot scale, and careftully monitored and evaluated to distill lessons for future implementation. Capacity building will also be required to help facilitate the integrated, participatory approach recommended. Such an approach can be particularly useful in terms of providing forestry extension related to marketing of non-traditional species, which is presently deficient.

Third, forestry research needs to be revived.5 Research has concentrated mainly on wood technology, and on descriptive studies in natural forest ecosystems and plantation silviculture. Silvicultural research components in Bank-funded projects have yielded important results. In the Centre-Nord Project in Cameroon, for example, studies have clearly demonstrated that large-scale government-led reforestation efforts with exotic species were inferior in both ecological and economic terms to silvo-pastoral management of savanna woodlands and agroforestry. In Burundi, research carried out alongside reforestation operations has greatly broadened species choice, which now includes dozens of local as well as exotic species.

However, systematic research efforts to improve understanding of the dynamics of natural forests and of silvicultural interventions in these forests have been undertaken only relatively recently.56 Hence, in much of the region, knowledge pertaining to dynamics and silviculture of tropical forests and woodlands is far from comprehensive. The impact of shifting cultivation and logging on biodiversity remains uncertain, and basic studies of range management have largely been neglected. Many studies that have been carried out are descriptive, and have yielded few results that can be applied at the operational level. Some of the most glaring gaps are in the "software" realm, particularly in terms of research on forest institutions, be they government agencies or traditional management rules and political arrangements.57

Reviving forestry research institutions is not merely a matter of funding. What is needed is not only more research, but rather more relevant research, which is carried out in cooperation with specific end users where possible. This should draw its topics from a new, "bottom-up" research and development agenda, based on technical problems and solutions observed in the field rather than on questions raised in research stations. As far as the improvement of existing farming systems is concerned, educated agricultural extension workers are perhaps best placed to acquire and impart field level knowledge. Research on improving the quality of harvesting and wood processing operations should be carried out in partnership with interested private forest industries operators. As for strategic research on major knowledge gaps, this can be conducted by the CGIAR institutes in collaboration with national organizations. Research topics corresponding to the changes in African forestry sector activity

55 In 1990, money spent on tropical forestry research amounted to US$250 million. This represents only 0.15-0.12 percent of the value of tropical wood products. J. Spears, "Forestry Research Expenditure and Economic Returns", in "Forestry Management for Sustainsble Development", EDI Policy Seminar Report No. 32.

56 Since 15-30 years in tropical moist forests, and since 10 years in drier forest formations.

Some lood studies have been compLted on land tenure systema of particular ethnic groups, and countries. However, the economic and equity implications of these arrangements, as well as the institutional and operational implications for executing agencies, have rarely been considered in meaningful detail.

38 suggested by this strategy paper include the shift from exclusive timber production towards true multiple use management; methods of devolving forest management responsibility to local communities and the private sector while safeguarding the environment; socioeconomic constraints to and opportunities for farm forestry; tree/crop interactions in agroforestry systems; and instruments for regulating access to and use of forest resources.5 8

In the field of agroforestry in particular, there.is an urgent need to reassess the merits of traditional practices versus systems such as alley cropping which are being tested in research stations.s9 The latter are often complex and labor-intensive, and have not been adopted by farmers on any meaningful scale despite more than twenty years of research. In contrast traditional practices rely on low-intensity management of indigenous multipurpose trees and shrubs scattered on crop land, and can be adopted easily, even in the most fragile environments. Particularly widespread examples are rotational bush fallowing and the use of scattered trees such as gum arabic and Faidherbiaalbida (gao) in crop land in the savannah zone to slow down windspeed, provide livestock fodder, and nourish crops through nitrogen fixation. The persistence of these traditional practices in many parts of Africa proves their validity, and highly variable growth rates within some of the tree species used suggest at least one avenue for improvement. Mechanisms are required for drawing together the highly dispersed and disjointed knowledge on agroforestry available at the local level.

58 Australian Center for International Agricukural Research, *Center for International Forestry Research (CIFOR): outline for a proposed strategic draA plan", Canberra, 1992.

59 Agroforestry is a collective name for land-use systerns in which trees are used on the same units of lad as agricultural crops or animals. Trees and crops may be combined in space, e.g., hedgerows in betwem crops, or in time, e.g., a field-fallow rotation.

39 4. An IntegratedApproach to Forest Management: A New Agenda for The World Bank

The World Bank's Evolving Response

Bank lending to the forestry sector in Sub-Saharan Africa started in fiscal year6 0 1969 (FY69) with a US$5.3 million credit to Zambia. The cumulative total of this lending is now approaching US$1 billion.61 The nature of this assistance has evolved over time in response to changing socioeconomic and environmental realities as well as Bank perceptions of these. Prior to FY78, US$65 million or 94 percent of total forestry sector lending was committed against industrial forestry projects, focusing on industrial plantations, logging operations, and the development of wood industries in a handful of countries in Eastern and Southern Africa (i.e., Kenya, Tanzania, Madagascar, and Zambia).

With the adoption of the first Bank-wide forest policy in 1978, there was a move towards social forestry, fuelwood plantations, and agroforestry. The scope of Bank assistance also increased significantly during the period FY78-87 by US$338 million. From FY87 to end FY93, Bank forestry lending amounted to US$543 million. As shown in Annex 1, the country coverage also increased to include other sub-regions in SSA. After 1987 a clear shift occurred from single objective projects to operations supporting national programs with multiple objectives and increased emphasis on forest resource conservation, involving activities such as watershed protection and forest resource management, research and institutional strengthening. The Forests Management and Protection Project in Madagascar represents a turning point in the region.

In 1991 a new Bank forest sector policy was issued, stressing the importance of cross- sectoral considerations in forest utilization, environmental concerns, integrating forestry activities into a wider natural resource management perspective, and of conducting better sector work along these lines. The new forest policy also gave rise to the Forestry Operational Policy Statement and Guidelines of Best Practices 4.36 which provides the guiding principles for the Bank's lending operations in the forest sector. The Bank's new forest policy makes forestry lending conditional on a country's commitment to sustainable management of forest resources by creating an enabling policy environment, building institutional capacity, developing human resources, and adopting a conservation approach to forestry. As shown below, the new policy is already having an impact on Bank lending operations in the region.

Experience with Forestry Projects in Sub-Saharan Africa62

"Free-standing" forestry projects supported by the Bank and other donors during the 1970s and 1980s largely reflect the needs and priorities at the national level, as perceived at the

60 IT Bank's fiscal year expands the period July 1 to June 30.

61 This figure, based on a total of 49 projects. includes forestry, natural resource management, and environment operations, but cwludcs projects in other sectors with forestry components, such as agriculture - further details on the leding portfolio are to be found in Annex 1.

62 This section draws on individual projcct repo.ts and on the findings outlined in "Forestry Development: A Review of B&nk Experience," OED Report No.9524, The World Bank, 1991. 40 time. In the Sudano-Sahelian zone, structural imbalances, particularly in localized areas with high concentrations of population, between the demand and supply of wood for fuel, building poles, and general industrial use was identified as the major problem. A number of projects were designed to improve this situation, with an emphasis on fast-growing exotics, irrigated plantations, village woodlots, agroforestry, and sand dune fixation, such as the early forestry projects in Mali and Burkina Faso. In coastal Western Africa, the increasing rates of deforestation were perceived to be the primary point of concern. Bank forestry projects in this zone focused on large-scale reforestation in order to provide alternative sources of timber for export and local markets. Logged-over high forests had to make way for fine hardwood plantations of varying species (e.g., Fraque and Framire) intended for timber production and soil protection in CMe d1Ivoire, whereas softwood and utility hardwood plantations of Eucalyptus and Onelina were established on degraded forest lands for pulp production in Nigeria. However, project results show that large-scale plantations in SSA have not been highly successful, especially with public sector involvement (see Box 3).

In the mountainous regions of Africa (particularly in East Africa), where large tracts of natural forests have been converted to agriculture and pasture lands, the emphasis of Bank projects was on tree planting to increase the supply of fuelwood and industrial wood, as well as to protect agricultural soils. Bank operations in these areas have established large-scale rainfed plantations; attempted to enhance timber harvesting and processing efficiency and capacity; promoted the pulp and paper industry; and supported agroforestry. T"he few forestry projects assisted by the Bank in the Central African region have concentrated on supporting industrial forestry, especially production, processing, and exports (e.g., the Cameroon Forestry Project and the Ouesso Wood Processing Project). Forestry operations in Southern Africa, such as the two industrial forestry projects in Zambia and the Rural Afforestation credit to Zimbabwe, have targeted both industrial and social demands for wood.

Many of these past projects, such as the Forestry Plantation Project in Nigeria,63 have to a certain degree addressed policy and institutional reforms. Changes in resource pricing and revenue systems have been incorporated into some project designs to raise government revenues and ensure full cost recovery. In addition, institution building was often stated as a project objective. But efforts to induce necessary policy changes have faltered because of lack of government commitment, and the impact of measures undertaken to strengthen institutional capacity has varied, in many cases proving negative. Furthermore, the Bank's approach has undoubtedly been piecemeal. Subsequent reviews of even those projects judged satisfactory highlight the need for the development of a comprehensive sectoral policy as a prerequisite for future investments, thereby ensuring that this is both targeted and coherent. Such a policy has to address the competing demands on land, as well as the broader environmental and social issues associated with resource use.

Previous Bank-funded operations in Africa have made few attempts to generate community interest and participation in forestry development. Even where participation was an explicit objective, little effort was devoted to involving local people in setting priorities, designing field-level interventions, and addressing tenurial issues. As a result, these projects promoted widespread planting of exotic species (e.g., Pinus, Gmelina, and Eucalyptus), sometimes contrary to farmers' needs and wishes, and inappropriate for local conditions. The

63 T"he project attempted to introduce major policy changes and to help increase stumpage rates on a nationwide basis. 41 distribution of seedlings turned out to be costly, and survival rates low. The plantation schemes also showed low financial rates of return, and, in some instances, suffered from problems with marketing.

Box 3. Experime with lrMScak Plantaons In Baisk Foresty Lading to Africa

The experience with large-scale plantations has been decidedly mixed, suggesting cautious use of this option in the future. The early industrial plantation ventures in Kenya and Zambia, though rated satisfactory, featured significant cost overruns - 90 percent in the case of the first Industrial Forestry Project in Zambia (mainly due to inflation), and 17 percent in the case of the second. A buoyant world market for wood and pulp ensured that the economic rate of return (ERR) for the two plantation projects in Kenya remained positive. Technical problems have also abounded, and ERRs for later projects have proved disappointing, reflecting weakness in global market conditions. In many countries wood production from industrial plantations is greater than the absorption capacity of domestic markets at competitive prices.

* Over-emphasis on public sector management and involvement contributed to the disappointing expericnce with the Third Forestry Project in Kenya. This suffered from poor management and was hampered by low labor productivity, which placed mounting pressures on overall government development budgets - the general ban on the shamba system for plantation establishment and management is leading to similar problems with labor productivity in the Forestry Development Project now ongoing in Kenya.

* In Western Africa, under the Second Forestry Project in Coto dIvoire, the use of heavy equipment for land clearing and preparation escalated project costs. Projected benefits for many of the operations here did not materialize due to low local demand for plantation fuelwood, pulp, and construction timber: a result of the continued availability of underpriced wood from natural forests and cheap imports from and .

* In the Sudano-Sabelian region, urban wood supplies derived from plantations were expensive in comparison to those readily available from underpriced natural forests. Recurrent droughts, fires, and poor soil conditions were also responsible for low plantation output here, for instance in the Second Forestry Project in Niger.

A more promising example of industrial forestry, the Sao Hill (Phase 2) Forestry Project in Tanzania, suggests that appropriately sited and well-managed plantations can yield positive results. This project achieved its main objective of establishing the resources ncessary to supply an emerging wood- based industry, and encouraged staff dedication to the implementation process by providing nonmonstary incentives.

Key Lssons Learned

As indicated earlier, past Bank lending has mostly supported industrial forestry operations: only 41 percent of closed projects (i.e., 12 projects) were designed to promote social concerns. An overall rating is available for 25 of the total number of closed projects, that is, for 16 industrial forestry operations and 9 social forestry operations. The former feature significantly among those operations rated unsatisfactory, accounting for 78 percent of these. About half of all industrial forestry projects (i.e., 7 out of 16 projects) are rated poor, largely due to increased costs, low economic rates of return, and technical difficulties. It is noticeable that the number of projects classified unsatisfactory increases sharply with time, reflecting the shift in performance criteria beyond a narrow consideration of economic returns to a much broader range of indicators, including project sustainability and development impacts. Most projects have been extended beyond their original closing date. The average period of extension is over 1.5 years, and the average length of project completion is approximately 7 years.

Former operations have suffered from a number of generic problems in project implementation and supervision, such as those arising from lack of counterpart funding and 42 overly complex design. The following factors, however, stand out as the major conceptual flaws, specific to the forestry sector, that have constrained project performance and project development objectives:

Failure to develop an overall framework for sector development and to take into account nonsector considerations in forest utilization. There has been a neglect of the policy distortions and perverse incentives underlying forest degradation in and beyond project areas, as well as the potential of macroeconomic, agricultural, and other sectoral policy reforms for resolving forest sector issues (e.g., those relating to property rights and tenure);

* Lack of comprehensive forestry sector work on which to back a coherent long-term investment program, resulting in poor attention to the interface between the forest sector and socioeconomic and natural systems, reflected in the absence of economic analysis attempting to conduct a valuation of important externalities, and the failure to consider natural forest and woodland management as a viable alternative to non-forestry land-uses or industrial plantations;

* Lack of focus on capacity building measures and human resources development, and the long time horizon required to achieve these objectives; lack of coordination among agencies dealing with forest resources and forest lands;

* Lack of attention to the opportunities for greater local and private sector involvement in forestry activities, and the neglect of pilot projects for testing new arrangements for resource management and involving people;

* Limited resources devoted to improvements in data collection, information, and monitoring systems (e.g., forest inventories); poor regard for technical issues;

* Failure to develop appropriate indicators to assess development results in the field and sector performance;

* Limited coordination with other donor efforts.

The Present Project Portfolio and Lending Pipeline

The present forestry project portfolio contains 20 projects, total lending amounting to US$543 million, inclusive of environment and natural resource management operations addressing forest sector issues - increasingly, forestry development is covered under projects of this type. Over a third of these projects show major problems, due to difficulties encountered in implementation and project management, and these are spread fairly evenly between the social and conservation project categories. Some operations, for example, the Second Integrated Forestry Project in Rwanda, have been undermined by civil strife. Lack of counterpart funding, however, is a more general problem. Under the Forestry Development Project in Kenya and the Forest Resources Management Project in Ghana, steps have been taken to alleviate cash flow problems by raising the percentages for IDA contributions to project costs. But this short-term measure raises doubts about long-run sustainability. Weak 43 management, project complexity, lack of trained personnel, and poor local commitment, typically appear as further problems impeding the performance of ongoing projects.

A new generation of projects (such as the natural resource management projects in Benin and Mali) has recently emerged supporting more participatory approaches which view local people as potentially capable managers of a resource base in which they have a vested interest. Many of these operations have internalized some of the key lessons from the past: approaching forestry issues from a more integrated natural resource management perspective, and attempting to provide the correct policy framework in which community involvement can actually thrive. Land tenure policy reform and decentralized land-use planning are thus a significant feature of some of these projects. In addition, with the increasing priority assigned to environmental concerns, there has been a distinct rise in the resources available for development of both the staff and systems required for monitoring and assessing changes in quality and quantity of forests and other natural resources. Examples of innovative forest- related sector work and projects are given in Box 4.

The overall project status for the new-style, participatory, natural resource management operations is generally rated positive. But these are still at an early stage of development, and difficulties may yet arise in the future due to a number of shared conceptual weaknesses:

* Most project documents outline reforms in policy and institutions as conditionalities for project effectiveness, but pay little attention to the lengthy process of delivery-the formulation, analysis, adoption, legislation, and implementation behind the suggested reforms.

* Many projects advocate a participatory approach to planning and implementation, but not all outline the mechanisms for realizing this aim.

* Most projects have institutional strengthening provisions but do not focus on capacity building and human resource development in a comprehensive manner.

* Nearly all projects fail to take account of environmental impacts in economic analysis, as well as sustainability considerations.

* In many instances, the project implementation period may prove too short.

* Generally, these operations do not include indicators to measure results in the field in terms of development impact.

These projects are often also complex, reflecting diverse objectives and cross-sectoral considerations that are not compatible with existing institutional capacity at the national and local levels. However, the Natural Resource Management (NRM) Project in Mali represents a step in the right direction. This project supports the initial phase (of 5 years) of a long-term national development program (of 15-20 years) for natural resource management. Small steps are also being taken with regard to pilot testing of new approaches to resource management, as in the case of the NRM project in Benin.

44 Forest resource management and forest sector issues will continue to be addressed through NRM and environment projects during the next five years. Much of the US$740 million linked to the forest sector under the present five-year lending program (FY94 to FY98) for the Africa region supports operations of this kind. But care must be taken to ensure that the mistakes of the overly complex rural development projects of the past are not repeated under this new approach, and that free-standing forestry projects are not abandoned altogether. These projects also have a valid role to play within a long-term program that embraces an NRM perspective by supporting the development of an institutional and policy framework that adequately tackles forest resource issues. Juxtaposing a complex NRM approach onto a region where institutions are weak and where existing Bank-funded projects are suffering from weak implementation capacity could result in poor project performance. It is thus important to consider free-standing forestry operations in a broader framework of natural resource management supporting development and conservation aims.

Priority Areas for World Bank Intervention

There are many actors in forestry development in Sub-Saharan Africa, including multilaterals, bilaterals, international NGOs, and, most obviously, local people and governments. The Bank cannot and should not do everything; but it should concentrate on areas of comparative advantage: policy reforms, capacity building and human resources development, investment operations that promote sustainable development, and improvements to donor coordination. Forest sector investment operations will undoubtedly enhance the Bank's overall development objectives, namely, poverty alleviation, environmental protection, privatization, and increased women's participation in the development process. Bank interventions in the sector should be guided by the following principles:

Guiding Principles for Sustainable Management of Forest Resources

* Forests and trees should be treated as economic, social, and environmental goods.

* Forest utilization should rely on market and pricing mechanisms.

* A comprehensive, more ecosystem based approach, recognizing the interrelationship between forests and land use, should be adopted for sustainable management of forest resources.

* Management of forest resources requires local and national actions as well as international cooperation.

* Forest management should be decentralized based on the principle of "shared responsibility," including local people, the private sector, and the government at appropriate levels.

45 * The management of intact TMFs should follow the "precautionary principle; the burden of proof falls on countries to demonstrate that use of TMFs is ecologically, economically, and socially sound. This also implies that sound practice should be demonstrated, and adequate provision for monitoring and assessment of implementation assured.

* Expanded investments in the forest sector should be preceded by comprehensive sector work, including cross-sectoral considerations, and adoption of a long-term forest development plan.

* Environment and social assessments should precede all major investments in the forest sector.

* A sensitivity to gender issues is required, as women play a major role in forest resource utilization and regeneration in SSA.

Although Bank-funded operations will support development and conservation aims, the Bank will not finance commercial logging in primary tropical moist forests, as stated in the new forest policy of 1991.

Policy Reforms

As demonstrated in Chapter 2 the increased involvement of local communities and private entrepreneurs in forestry activities in Sub-Saharan Africa is severely handicapped by counterproductive public sector policies and weak forestry institutions with ill-adapted mandates and inadequate capacity and resources. Without improved policies and institutions, further investments in the sector will yield poor results. True policy changes, however, depend on country ownership and commitment to the reform process. The Bank can stimulate this process by entering into a dialogue with borrower countries on the need for cross-sectoral policy reforms, combined with institutional changes. Forest-related issues, including cross- sectoral considerations, must be incorporated into the Country Assistance Strategy as well as the policy dialogue between senior Bank management and government officials. Regular discussions on public sector investment programs provide a solid platform from which to address broad forestry issues and development priorities. Country Economic Memoranda, as well as Agricultural and Environmental Strategy Papers, can also be used to advance macroeconomic, agricultural, and other sectoral policy reforms necessary to enhance efficiency and sustainability of forest resource use. It is this capacity for integrating forest-related sector work into lending operations promoting macroeconomic and sectoral agendas that confers on the Bank considerable comparative advantage.

Capacity Building and Human Resources Development

The Bank's efforts to strengthen forestry institutions will be advanced through support for systemic civil service reform. In the short term, Bank lending operations can build considerable capacity and support human resources development to the extent that they involve borrower country staff actively in planning and implementation of project activities. This normally requires considerable training of borrower country nationals. But the resident technical assistance that is usually hired to carry out this training in practice often ends up concentrating on "getting the job done" rather than on training counterpart personnel to do the work. This is in part due to the technicians recruited who, even if well-intended, are ill- 46 equipped for motivation and training activities. But in large part, it is due to the inappropriateness of the concept of resident technical assistance. In the future, capacity building and human resources development for key agencies will be mainly done in the form of flexible arrangements, where consultants visit borrower countries on a regular basis to conduct training sessions, evaluate activities carried out and discuss work programs, but refrain from doing the work themselves. This would ensure that inputs of foreign expertise are gradually phased out.

Investment in Critical Areas

The Bank is an experienced lending institution, and has considerable capacity for investment programs. Bank forestry investments should take into account the following as conditions for expanded lending to the sector:

(a) the contribution of forest resources, actual and potential, to sustained economic growth and poverty alleviation, as well as the losses resulting from lack of investment;

(b) the extent to which forest biomes perform environmental services and support biological resources. Bank operations should assist governments to protect critical watersheds, biodiversity, and other forest uses (such as extractive reserves and recreation parks) subject to market failure;"

(c) the extent to which countries are making good progress in promoting sustainable management of forests. Bank lending should be contingent on government ownership and commitment to policy reforms and capacity building that will promote economically efficient and environmentally sound forest sector management.

The Bank will assist governments, as appropriate, in the preparation of country forest strategies within a NEAP framework, encompassing the TFAP process where applicable. This should help towards the establishment of a solid institutional and legal framework for regulating forest sector activity; sound government policies; and the formulation of a long term forestry conservation and development plan, taking into account local needs and national priorities, which has clearly defined roles for local communities, the private sector, and the government.

Donor Coordination

The main actors in the forestry sector in SSA are local and national leaders, and it is on their decisions and actions that progress largely depends. However, better coordination among donors and other international organizations involved in the forest sector is urgently required and can greatly help to accelerate the achievement of forest conservation and development objectives. Many donors are providing assistance to Sub-Saharan Africa for forestry development and conservation, directly to individual countries or in the framework of

64 The GEP plays a major role in investments in protection and managemcnt of forest resources with gkbal externalities, such as biodiversity conservation and carbon sequestration. Bank lending should compk:ment GEF activity by covering issues outside the GEF mandate, and by full-scale implementation of successful GEP pilot projects.

47 several ongoing initiatives, such as the NEAP, the TFAP, and the European Community- sponsored Regional Action Program for conservation of the Central African forest. There is a tendency for donors to establish separate entities to implement projects, often bypassing government sector agencies. This practice results in duplication of efforts and inefficiency in the use of scarce capital and limited institutional capacity.

The Bank should assist African countries to improve coordination of donor activities, and to provide leadership in developing a common agenda for conservation and development of forest resources in the country. To this end, greater use can be made of the TFAP, especially in countries where there is a comprehensive forestry action program and a consultative group for forestry activities. Borrower ownership and commitment is essential for success. Therefore, CODs and SODs, in consultation with the donor community, should take advantage of this strategy paper to initiate a process of dialogue with the Africans, in order to precipitate country-led strategies for the sustainable development of forest resources. Consultation with other donors such as the African Development Bank, the Global Environment Facility, UNDP and bilateral agencies, and international organizations such as ATO, FAO, ITTO, UNEP and relevant NGOs could enhance understanding of individual country goals and priorities. As far as research is concerned, the Bank will need to consult regularly with the CGIAR-institutions (CIFOR, ICRAF, ICRISAT, IITA, 0CA) and with IUFRO to ensure that research agendas reflect priorities apparent from Bank experience, and that available knowledge is used more fully in Bank-financed projects.

Operational Implications

In order to achieve maximum development impact, forestry operations in Sub-Saharan Africa should be part of an integrated, long-term program approach, based on comprehensive sector work, and closely attuned to country needs and priorities, existing institutional capacity, and to the Bank's development objectives.65 This program approach should include a broad range of lending instruments for improving forest sector pertormance based on strong, multi- disciplinary sector work which identifies policy and institutional reforms, capacity building needs, and other priority investments necessary to achieve forest conservation and development objectives. It is also important for the Bank to design simpler projects, focusing only on a few objectives and components. Instead of a single project dealing with many components and tackling several major issues, the long-term program advocated in this paper should include a series of actions and investment operations extending over a longer time horizon.

In addition, major investment should be preceded by policy and institutional reform and country capacity building, particularly in countries where the policy framework is poor and institutions weak. The use of Structural and Sectoral Adjustment Loans has considerable scope for bringing about forest-related policy reforms, as demonstrated by the SAL and ASAL operations in Cameroon. But care must be taken to ensure that the use of policy-linked conditionalities is combined with due regard for necessary changes to the existing legal code. Pilot projects can be used to build capacity and test innovative ways of involving local communities and the private sector in forest resource management before full-scale implementation under Forestry, Natural Resource Management or Environmental Projects. Careful evaluation of pilot project experience can also help to refine policy and institutional reform agendas as well as introduce "best practices' into project designs. Special effort should be directed toward improving the quality of projects at "entry,' i.e., upstream of the project

65 As outlined in the Bank's new Operational Policies and Guidelines of Best Practices 4.36. 48 cycle. New operations should not only be less complex, but also include investment programs covering no more than three years. For capacity building, a much longer time horizon is required, suggesting that institutional strengthening components may need to extend over a number of project cycles. These projects should further embody alternative financing mechanisms (e.g., forest funds, revenue sharing, or trust funds) to help enhance project sustainability.

Forests and Forestry In Economic and Sector Work

Country sector work

The availability of good, cross-sectoral knowledge of forestry and its land use context is an important prerequisite to promoting policy and institutional changes and to financing forest-related lending in the region. Sector knowledge must be based on lessons learned from past and ongoing forestry projects in the region, insights drawn from OED evaluations and Bank staff project experience, sector analysis undertaken by other donor agencies (whether or not conducted under the aegis of TFAP), as well as Bank-sponsored sector work. The Bank's approach to sector work will be interdisciplinary and multisectoral, incorporating the "nexus' concept that has been developed especially for the Africa region, assessing the linkages between environment, population, agriculture, poverty, and technology variables. Sector work will focus on the following elements:

* The role of forests and trees in economic development and the environmental externalities inherent in their use;

* The interfacing of forestry, agriculture, and wildlife management;

* The impact of macroeconomic and other sectoral policies on forest use and management, supply and demand, and trade in forest products;

* Forest resource pricing, taxation, subsidies, and revenue systems;

* Efficiency and competitiveness of the wood industry and marketing of forest products;

* The institutional and legal framework for forestry activities; and

* Development options and investment opportunities.

Country Departments should significantly increase manpower allocations for sector work during the next two fiscal years (FY 95/96) to improve the quality of the forest-related project pipeline. Sector work should also be jointly conducted with other donor agencies, and with local participation, including that of academic institutions. In addition, forestry needs to be covered in the public expenditure reserves at the country level, to ensure that adequate capital and recurrent funds are allocated to support priority actions and programs.

49 Regional program

The regional program managed by AFRTD will develop best practices in key areas of concern, supporting the efforts of SODs. The current program includes the impact of macroeconomic policies on natural resource use, economic valuation techniques for environmental goods and services which are not traded in the market, ways to encourage popular participation and to address property rights issues, and the reform of forest institutions. Regional program outputs will be discussed in broadly representative subregional workshops, in order to develop specific recommendations for the subregions." The findings and conclusions from these workshops would be summarized in "white papers" and made available to governments, development aid agencies, the private sector and NGOs.

Design of Bank Forestry Investments

Once development options, investment opportunities, and necessary policy and institutional reforms have been identified, borrower country governments would be able to design a natural resource management (NRM) investment program for the next 10 to 15 years. A program which, in addition to NRM projects, should incorporate pilot projects and free- standing forestry projects tackling specific areas of concern (i.e., where appropriate)67 . An extensive policy dialogue based on the findings of economic and sector work would ensure government ownership of and commitment to the program developed. No forestry operations should proceed in the absence of such commitment. Over this longer time horizon, several lending operations of variable duration can be envisaged, each to achieve its own specific objectives. Such an approach should allow for keeping projects simple, rather than overloading them with too many components and conditions. It would also provide an opportunity to phase out the financing of incremental operational costs over several operations instead of after a single project. New projects should also pay special attention to the involvement of user groups (i.e., local communities and the private sector), and the NGO community, and define actions needed (vis-h-vis procurement, accounting and financial management, staff recruitment, and preparation of detailed implementation schedules) during the pre-project period. These projects should also develop indicators for project performance as well as for development impact and sustainability.

The initial emphasis of investment programs should be on developing country capacity and establishing the necessary policy and institutional conditions for implementing expanded investment programs. Bank support for capacity building should focus on training programs of greater length and regularity. Environmental and social assessments should be carried out in the early stages of project preparation to improve project quality upstream, rather than later when expensive redesign may be necessary. Adopting an integrated, participatory approach to the management of renewable natural resources has far-reaching implications. Participatory projects and the demand-led investments they imply need a large degree of flexibility. Conventional project documents containing blueprints for timing of previously determined physical investments are no longer relevant. Therefore, Credit Agreements, Working Plans and

Such workshops could be modeled on the conference organized by [JCN and the World Bank, and hosted by the African Development Bank, November 5-9, 1990, Abidjan. See also: 'Conference on Conservation of West and Central African ," World Bank Technical Paper, Environmental Series, 1992.

67 Where pilot projects are highly experimental, grant funding can be sought for their implementation, whether from GEP or through co-financing arrangements. 50 Disbursement Schedules can no longer be prepared in their classical form. Greater flexibility will accommodate further use of NGOs within the implementation process since these are prone to losing some of the very qualities which render them attractive. For example, the ability to respond quickly to changing local conditions.

While externalities may limit the prospects for calculating an overall ERR for a project, it may still be possible to apply cost-benefit analysis to individual project components. Valuation exercises of the benefits derived from forests and alternative land uses can also prove useful by guiding the general direction of proposed project lending and by improving its justification.

Improving the Supervision of Bank Forestry Operations

The new NRM and environment projects will require greater supervision input and intensive supervision at the field level. The strategic emphasis on policy and institutional reforms and the multiplicity of environment and development-related objectives make intensive supervision even more critical. Supervision visits of sufficient length and quality by multi- disciplinary teams of Bank staff and consultants with a long-term commitment to the project are essential. Priority should be assigned to: getting results in the field; institutional development to strengthen forestry institutions and enhance their ability to participate in and influence a cross-sectoral dialogue; and the steering of projects towards sustainability. In particular, the Bank should take steps to:

* Promote government and beneficiary commitment to the project;

* Make project supervision more systematic, by developing indicators to be monitored, increasing monitoring and evaluation efforts, and analyzing overall development impact, including beneficiary assessment;

* Encourage greater use of thematic supervision by specialist teams of staff or consultants, in which specific components of one or more projects are assessed in a single mission;

* Assign Bank staff to the field in countries (or sub-regions) where there are several forest-related operations and ensure greater use of Bank field staff (and local consultants and NGOs) to monitor projects continuously;

* Use in-country training to address management, procurement, and accounting problems;

* Increase resources available for mid-term reviews and to simplify or reorient projects if necessary;

* Adopt development indicators in supervision reports to measure results in the field; and

* Involve donor agencies and government officials in field supervision.

51 Improvement of Region-wide Coordination

The cross-sectoral approach to forest-related economic and sector work and lending operations advocated above will require closer coordination between the SODs and the TD, on the one hand, and the CODs on the other. This can be achieved to a large extent through country teams, and through increased collaboration on economic and sector work, and discussion of how this relates to forest sector objectives.

The Africa Regional Natural Resource Management Sub-Group of the Agriculture Group Team, managed by the TD, is already functioning as a clearing-house for information on best practices and on the implementation of ongoing projects (especially innovative ones). In so doing, it can be instrumental in increasing coordination and ensuring a coherent approach to forest-related issues in the region, particularly for economic and sector work, country dialogue on policy and institutional reform, and the design of forestry lending operations. The SPAAR framework for action, covering the Sahel, Humid and Sub-humid Africa, East Africa, and SADC, can be utilized to link regional research efforts on a number of salient issues, for example, multiple use forest management, agroforestry, buffer zone use, and participatory forest management.

52 Bo 4. New Directios for the Forest Sector in Reent Bank-Sposmored Activities

The bare threads of the holistic multi-sectotal approach recommended in this paper are already present in existing Bank operations, as demonstrated by the following examples.

* h Ethiopia Forestry Action Program (EPAF) represents a good model for fAsure Bank assistance to the forest asctor in Africa: both In terms of its driving process, and in terms of the multi-sectoral approach that it employs. Initiated by the former Government of Ethiopia, EPAP involves a country-led process, featuring considerable participation by country nationals at each sage. The preparatory study for EPAP, executed by the Bank, places the immediate causes of resource depletion and degradation in Ethiopia -land clearing for agricultural and livestock activity, and fielwood harvesting -firmly within the context of a weak socioeconomic climate. It sets out the overall conditions for progrsis and thea confronts the salient isuse that need to be resolved within the sector, proposing: a set of policy action needs to establish an environmest conducive towards sustainable resource use and development; an agenda for institutional reform and strengthening; and an investment framework for public sector investments linked to the institutional development agenda. A sift from excessive state control to greater participation by private sector agents is considered the way forward. Sectoral integration (i.e., via k via other natural resources) is also strongly emphasized. EPAP's final phases are: (i) a National Seminar on the Ethiopian Forestry Sector Program, and (ii) a Donors Conference to consider the proposed investment program.

* Bank economic and sector work can help overcome the inadequacies of present methods of national accounting which understate the fall contribution of fored resources to social and natural systems by placing greater emphasis on valuation. This has recently bean the case under the Zimbabwe National Policy Review for Forests and Trees (May 1993). he Review demonstrates the importance of consumer preference in valuing the benefits of Zimbabwe's indigenous woodlands, and how this is reflected in: market prices for woodland products (or from the costs of their replacement); implicit market prices (such as those for land); or artificially constructed markets where consumer 'willingnose-to-pay' is the key indicator. A further important technique utilized relates to the value derived from alternative land uses. e A good working example of complementary measures outside the forest motor can be found in the household energy component of the Niger Energy Project which has developed a new regulatory framework providing incentives for rational harvesting and marketing of woodfels by people at the local level. A firewood trade monitoring and taxation systam has bean produced and is being applied to demarcated areas around urban localities-20 rural firewood markets have been operationalized thus far, and 30 more am planned for the near fiuture. Puelwood conservation is also being encouraged through support for the marketing of kerosene stoves. Over 6,000 of these Loves have been sold, with responsibility for production and sale being vested entirely in private sector hands. e The Forest Resources Management Project in Tanzania, though hampered by early delays in implementation, demonstrates how the Bank can suppost the Tropical Forestry Action Program (TFAP) process that incorporates essential donor coordination - a TFAP was completed for Tanzania in late 1989. k does so at two basic levels. First, at a very general level, by addressing some of the broad sectoral concerns in which individual site-specific projects are deficient, and on which their success depends, such as those relating to the institutional capacity for developing and implementing forest and land policies. And second, at a more specific level, by bridging the regional gaps in planned donor investment.

* The recent NRM projects in Benin and Mali have bee extremely innovative, employing a 'Gention de Terroirs" approach that concentrates on decentralized, participatory, and multi-sectoral natural resource management. A key element in this approach is the preparation of a land development plan by the local community with the assistace of a multidisciplinary team of technicians. The *terroir" approach will also be used in the Rural Land Management Project for CMte dIvoire, which is planned for an FY95 entry into the lending program. This project aks to address the serious tenurial problems undermining the country's natural resources.

* The experience under the Second lategrated Forestry Project in Rwanda uggess tht ak support for ecological inventories can bear promising results. With the ecological inventory being prepared to assist in the protection and conservation of Nyungwe Fores being the astbnding success of this project. 400,000 goo-referonced date have been recorded so far, providing valuable information for the design and implementation of management and conservation plans, and the permanent monitoring of the fragile ecosystem in a section of the forest covered by lank lending. In addition, two other donor have been inspired to finance similar ventures in those parts of the forest under their management.

53 Annex 1

Past Bank Lending to the Forest Sector in Sub-Saharan Africa

Country Proje Type OvuraD Rting aalCrd Amount USm

FY69 Zambia Induri Forestry Industrial Forestry Satisfactory 5.3

FY7 Kenya Foret Plntations lusatrial Fortry Sai"factory 2.6

FY7S Kenya Second Forestry Plenmat Industrial Forestry Stifacory 20.0

Madaascar Mangoro Foretry Indutrial Forsy Unsatisfactory 13.5

FY77 Taflania Forftty Deveopm Iedurial Fortry Satisfactory 7.0

7mba Secnd Industrial Forsry Induatrial Foretry Satisfactory 16.8

M78 Nigør Foresy Socia~Rurl Dsvpt. Suti"factory 4.5

FY79 Burnli Fortry Social/Rural Dvpt. Stiafactory 4.3

Cote dIvoire Foresy Indutrial Fortry Satisfactoy 18.0

iJbeuim Fortstry Induatrial Foreatiy Unaatiafactoiy 6.0

Mali Forestry SociauRural Devpt. Satiafactory 4.5

Nigeria Foresy Plantatifi Indutrial Foretry Satisfaciory 31.0 pYse Burtina F~as Fore~sy Sociul/Rural Devpt. Un-aiafactoiry 14.5

Malawi NRDP II (Wood Energy) SocialRural Devpt. Sa"ifactory 13.3

Rwanda Interated Fortry & SociaWRuual Devpl. Satiafactory 21.0 iv~estock Dvp_

FY81 Madagascar ScOnd Mangoro Indutrial Foretsry Unauiifactory 20.0

Senegal Foretry SociaRurul Devpt. Satifactory 9.3

FYM2 Ca=meroo Fortry Iul trialForsy Unatifactory 17.0

Kenya Ilird Foretry Industrial For~stiy UD-dafactory 37.5

Niger Second Foretry SociawRural Devpt. U~stisfactory 10.1

Tanania So HillForety (Pbaae 2) Indu~trialFrstry Satiafactory 12.0

FYU3 Congo Oua80 Wood Proceming Induatrial Foretry Unatisfactory 12.0

Zimbabwe Rural Afforeaa SociaWRural Devpt. Satisfactory 7.3

FYS4 Benin Forety Indutrial Porestry Satisfactory 5.4

FY4 Zambia Industrial Foretry (II) Induatrial Foretry 22.4

FY5 Coe dIvoire Second Foretry Industrial Forestry Uatiafactory 31.3

FY B6 urnidi Second Foretry SociaRura Devpt, 12.8

Malawi Send Wood Energy SociauRrl Devp. 16.7

Mali Send Fortry SocialRurm Devp. 6.3

Totao Nua.~er of Projectar 29 402.9

54 Annex 1

Present Bank Lending to the Forest Sector in Sub-Saharan Africa

Country Pred Type Loan/Credi Amount US$

FY87 Ethiopis Forestry Social/Rural Devpt. 45.0

Rwanda Second Integrated Forestry Social/Rural Devpt 14.1

Uganda Forestry Rehabilitation Social/Rural Devpt 13.0

FY38 Issotho Land Management& Conservation Conservstion/Production 16.0

Madagascar Forests Management & Protection Conservation/Production 7.0

FY89 Ghans Forest Resource Management Conservation/Production 39.4

Nigeria Second Forestry Social/Rural Devpt. 71.0

FY90 Central African Republic Natural Resource Management Conservation/Production 19.0

Cote d'lvoir Forestry Sector Conservation/Production 20.0

Guinea Forestry & Fisheries Management Conservation/Production 5.0

Madagascar Environment Conservation 26.0

Zimbabwe Foret Resources Management Conmervation/Production 14.5 & Development

FY91 Burkins Fase Environmental Msnagement Conservation/Production 16.5

Kenya Forestry Development Comservation/Production 19.9

FY92 Benin Management of Natural Resources Conservation/Production 14.1

Kenya Protected Ares & Wildlife Conservation 60.5

Mali Natui Resource Management Conservation/Production 20.4

Tanzania Forest Resource Management Conservation/Production 15.3

FY93 Gabon Forestry & Environment Conservation/Production 22.5

Ghans Environment Conservaion/Production 18.1

Total Number of Projeds 20 543.3

55 Annex 2

Sub-Saharan Africa: Forest Area and Deforestation

Annual Deforestation 1981-1990

Land Area Total Forest Area of Pemcent of Area 1990 Depletion Total ('000 ha) ('000 ha) ('000 ha) - Forest Area

Angola 124,670 23,074 174 0.7 Benin 11,062 4,947 70 1.3 Botswana 36,673 14,261 77 0.5 Burkina Paso 27,380 4,416 32 0.7 Burundi 2,565 233 1 0.6 Cameroon 46,540 20,350 122 0.6 Central African Republic 62,298 30,562 129 0.4 Chad 125,920 11,434 89 0.7 Congo 34,150 19,865 32 0.2 C6t* d'Ivoire 31,800 10,904 119 1.0 Djibouti 2,311 22 0 0.0 Equatorial Guinea 2,805 1,826 7 0.4 Ethiopia 110,100 14,165 39 0.3 Gabon 25,767 18,235 116 0.6 Gambia 1,000 97 1 0.8 Ghana 23,002 9,555 137 1.3 Guinea 24,586 6,692 87 1.2 Guinea Bissau 2,812 2,021 16 0.1 Kenya 56,969 1,187 7 0.6 Liberia 9,675 4,633 25 0.5 Madagascar 58,154 15,782 135 0.8 Malawi 9,408 3,486 53 1.4 Mali 122,019 12,144 106 0.8 Mauritania 102,522 554 0 0.0 Mozambique 78,409 17,329 135 0.7 Namibia 82,329 12,569 43 0.3 Niger 126,670 2,550 0 0.0 Nigeria 91,077 15,634 119 0.7 Rwanda 2,467 164 0 0.3 Senegal 19,253 7,544 52 0.7 Sierra Leone 7,162 1,889 12 0.6 Somalia 62,734 754 3 0.4 Sudan 237,600 42,976 482 1.1 Tanzania 88,604 33,555 438 1.2 Togo 5,439 1,353 22 1.5 Uganda 19,955 6,346 65 1.0 Zaire 226,760 113,275 732 0.6 Zambia 74,339 32,301 363 1.1 Zimbabwe 33,667 3,897 61 0.7

Total 2,235,660 527,581 4,101 0.7

Soure: FAO, 1992

56 Annex 3

Technical Workshops: Summary of Group Discussions

Two technical workshops were organized in Abidjan and Nairobi in April 1994 to discuss forest- related issues. The World Bank's draft forestry document provided the basis for the dialogue. These workshops set out to provide a platform for contributions from various stakeholders, including government officials and representatives from donor agencies, NGOs, academics, and the private sector. It is hoped that these workshops will be the first step in a process designed to encourage African ownership of and commitment to policy and institutional reforms needed to achieve environmentally sustainable development in the forest sector.

The participants discussed the following five themes:'

* Policy and legislative reforms * Capacity building and human resources development * Local participation * Public and private sector involvement * Forest-related knowledge and technology

The following is a summary of the findings of the working groups.2

Policy and Legislative Refonms

Policy Formulation

Policy formulation must take into account three fundamental elements:

* non-forest sector policies affecting the forest environment, such as those concerning agriculture, livestock, wood energy, transport;

* demographic growth, which amplifies the impact of various sector activities; and

* the often conflicting interests of different actors in the forest environment: national and local government, local populations, private forest industries, NGOs and donors.

Tools for Policy Implementation

Forest legislation must reflect forest policy orientations, while taking into account land law. Legislation can be an important tool for forest conservation. It should not, however, include too many

I In Abidjan, the groups discussing themes 1 and 4 were merged.

2 This summary highlights the areas on which there was consensus among seminar participants. Full reports of the working group discussions will be published in the Nairobi and Abidjan workshop proceedings. 57 Annex 3 technical details concerning forest management, but concentrate instead on the following:

* forest resource pricing and user fees on government-owned forest land; * taxation of private forests; * subsidies; * incentives (negative and positive); * compensation models;

Financing of the forest sector is often problematic, as many forestry development activities are considered non-economic in the short and medium 'term. Forestry funds, if they are well-managed, can constitute an interim solution by providing continuous and permanent financing. The existence of a forestry fund, however, does not automatically imply the forest sector is self-financing, and treasury and donors should not use it as a pretext to discontinue necessary subsidies.

Private Sector and Local Community Participation

Participation of all the stakeholders in forest management is essential for the success of forest policy implementation. But participatory management does not mean a complete retrenchment of the state. What it does imply is:

* involvement of stakeholders according to comparative advantage; and * decentralization of forest resource management.

Incentiyes for Participation

Incentives will allow the passage from coercive forms of management imposed by the state to participatory modes of management, where other stakeholders share in the costs and benefits of resource management.

Associations, NGOs, cooperatives, and community groups can play an important role in developing rural forestry activities such as agroforestry, reforestation, and local forest product processing. Incentives may include:

* allocation of a share of the revenues from resource exploitation (through taxation, or directly by the private sector); * provision of inppts for the establishment of community forests; and * devolvement of responsibility for the management of concessions.

For private sector operators, incentives can be of various types:

* implementation of a taxation system which favors resource regeneration by taking into account harvesting costs, especially those linked to transportation; * authorization of credit facilities or access to external markets; and * revision of the investment code.

58 Annex 3

Capacity Building and Human Resources Development

Capacity building can be effectively addressed if a full understanding of the key actors or stakeholders in the forestry sector is obtained. On the basis of this, programs and implementation responsibilities can be appropriately allocated, and capacity building focussed on priority needs of the implementing stakeholder. Each stakeholder would have varying requirements for institution building, sustainable financing, and training and human resources development.

Institution Building

There is clear consensus on the need for a central forest institution integral to the government; its functions are vital but limited. There are some aspects of forest policy implementation, - such as profit making business and certain aspects of community involvement - which are better left to the private sector.

The central forest administration should set national policy on forests; it should regulate and monitor actions of the private sector; it should collaborate and formulate recommendations on actions in other sectors which affect forests; it should coordinate diverse international funding which contributes to forest-related components of the national development plan. Also, it should monitor the effectiveness and success of activities undertaken by all the different national and international institutions involved, and instigate follow-up where necessary.

Quasi-public or private institutions should be autonomous or self-supporting to effectively carry out operational activities. Self-selected community kroups - local agencies of development - should receive capacity building and support from government for this purpose.

The roles of institutions need continual examination and redefinition in line with evolving long- term development plans and objectives.

Actions Needed

* analyze the forestry sector and define the key actors to identify the comparative strengths and weaknesses;

* review the relevant organizations and arrange for decentralization or other modifications to institutional mandates as Appropriate;

* investigate, and test at pilot level, models for participatory management upon which success can be built;

* where weaknesses in institutions or key actors are inhibiting, devise mechanisms to strengthen the existing structures, e.g., by networking arrangements;

* strengthen and improve coordination so that the private sector and NGOs/PVOs are not relegated to insignificant roles;

59 Annex 3

instigate similar actions at regional level, e.g., within SADC, the Indian Ocean Region, the East African Community, etc. Ideally, donors and other agencies should find ways of promoting and sustaining regional collaboration in relevant programs; and

* where regional institutions and protocols exist, they should be more strongly encouraged to get involved in transborder cooperation and resource sharing.

Sustainable Financing

Sustainable development implies that many activities will be self-financing in the long term. This will require better understanding and practical application of the full costs and benefits of different actions, goods, and services from forest eco-systems. A national forestry fund to provide necessary investment can be a useful tool to facilitate sustainable funding. Incentives encouraging beneficial action and discouraging unsustainable activities are also an important component of public forest policy.

The forests of Africa provide very substantial global benefits generated by some of the poorest countries in the world. Substantial international funding is thus justified and necessary. Countries that are already deeply indebted cannot be expected to incur further debt to continue to provide global benefits or to experiment with untested pilot type projects. Full grant funding is required for such purposes.

Actions Needed

* seek mechanisms for generating local financing of programs; develop arrangements for reinvesting revenue where appropriate;

* where possible, award services and functions of governments to those actors that can sustain them. Channel donor financing through government or with its approval;

incorporate income generating activities, e.g., ecotourism, into forestry programs; and

* consider other funding sources, e.g., levies, taxation of services that affect forests (e.g., roads), such as trust funds and retention schemes.

Training and Human Resources Development (HRD)

Training needs to go beyond government officials to reach all stakeholders, with special emphasis on women. The involvement of communities in natural resource management, planning and policy will require a certain level of literacy for all, and so this is also an essential element of training. Training and building the institutional capacity for collecting and processing data and managing information on natural resources continue to be important requirements.

Technical assistance has, in the past, played an important role in training. However, the traditional model of an expatriate expert transferring skills to nationals has very often been an ineffective and costly method. There continues to be an important role for international personnel - innovative and imaginative ways must be constantly sought to make the most cost-effective contribution to national skills, training, and capacity building.

60 Annex 3

Actions Needed

* define key actors and take stock of their human resources capabilities;

* identify training needs and request that donors provide scholarships and financing to build key skills and capabilities;

* where possible, conduct basic pre-service training locally;

* implement in-service training for policy and decision makes, farmers, NGOs, and implementing organizations according to their new roles;

* determine the place of gender issues in forestry and natural resource management and facilitate the deployment of women;

* promote, with support of international organizations, strengthening of human resources at a regional level in those programs that effect several countries;

* promote measures to ensure that competent nationals are replaced and/or compensated for if they move to project implementation jobs;

provide additional incentives to people seconded to projects, NGOs, or private organizations so that there is an equitable remuneration package; and

* develop mechanisms to retain human resources in all key implementing institutions.

Natural Resource Management (NRM)

The overriding consideration in NRM must be sustainability. As a minimum, the management of forest resources involves not just wood products but the management and maintenance of water, soil, plant cover, wildlife and medicinal and other non-wood products. All of these important benefits and products, including biodiversity, should be managed and sustained.

Much of the international attention has focused exclusively on TMF and timber management. There should also be a full consideration of dry forests, where production of fuelwood and other non- timber products, as well as the role of women are even more important. The management of this wide array of products and benefits will require a more intersectoral approach which in turn depends on greater coordination between state ministries, between central and local institutions, and between different internationally funded projects.

Finally, programs and projects must be designed with the full involvement of all stakeholders, and close links need to be maintained between forest projects and other projects impacting on natural resources.

61 Annex 3

Local Panticipation

Local participation is defined as the involvement of local communities in a bottom-up, participatory approach to forest management and other forestry sector activities. Participation can be thought of in terms of rights (to utilize forest resources), decision-making authority and ability, and implementation capacity. The term local communities is used loosely, referring to the people living in and around forests who are the major stakeholders (and who may or may not form an administrative unit, or sub-unit).

Key Constraints

The key constraints for enhancing active participation of local communities are:

* overly centralized authority * lack of properly defined policy and legislative framework * lack of sense of ownership/tenure * lack of awareness of the role that the local community is supposed to play * local institutional conflicts * limited capacity of communities in planning and coordination * lack of proper consultation and coordination at local level * lack of support systems such as extension, research, finance, NGOs * lack of benefit-sharing * lack of ability to act/function as a pressure group to bring about change.

Guiding Principles

Guiding principles for local participation are:

* Local people should play a central role in any local forestry initiative and be involved in needs identification, planning, implementation, management, utilization (benefits), and monitoring and evaluation.

* In order for participation to work, government should improve the environment for sustainable forest resource utilization at local level.

Actions Needed

* Re-define the roles of central and local government and local communities, with government concentrating on: providing an appropriate policy and legislative framework; the protection of national interests (e.g. national heritage); retraining to reorient government officials in extension services towards more participatory approaches; and promoting awareness and education for communities concerning the roles they can play in natural resource management.

62 Annex 3

* Recognize and promote customary tenure systems which can contribute to forest protection rights (e.g. totemism), and reform institutional framework so that it can respect the multiplicity of existing rights.

* In addition to increasing security of tenure, design other incentives to encourage local- level participation (e.g., benefit and revenue sharing arrangements).

* Open a dialogue between forest administration, local people, and local politicians and administrators (e.g., the peasant forest committees instigated by SODEFOR in Cote d'Ivoire) to increase the political will to decentralize forest management responsibility and promote local awareness of the opportunities involved.

* Build community-level capacity, focusing on the strengthening of community capabilities in the areas of advocacy, decision-making, planning, organization, and implementation. Key tools to enhance and consolidate local capacity include support systems for research and extension, and credit.

* Encourage participation of local-level, informal institutions in forest-related activities.

* Encourage NGOs to get involved in forest-related activities where they have a comparative advantage (e.g., community mobilization), improve their intervention capacity, and promote regular and critical self-evaluation of NGO activities.

Public and Private Sector Involvement

The responsibilities of the state in forest resource management include:3

* conception and formulation of policy and law * inter-sectoral coordination * developing knowledge and skilled manpower for resource management * planning of resource management * management of forests of national interest (e.g. national parks)' * acquiring and coordinating financing * public awareness and extension * control of adherence to rules and regulations * environmental protection * creation of a suitable environment for private sector development * international negotiations on forest-related activities.

N.B. Responsibility relates first and foremost to funding; it may or may not imply an executive role.

Such management need not exclude local involvement and use. The definition of "national interest" requires public discussion and debate. 63 Annex 3

The role of the private sector should include investment in resource exploitation for profit, forest regeneration and plantation establishment and management, industrial development, and a contribution to the improvement of living standards in rural areas.

However, this division of labor is not a rigid one, and will vary with ecological and economic circumstances in different countries. It is unlikely to be the same, for instance, in equatorial and Sahelian countries.

Problems and Constraints

Government

* low morale (e.g., low salaries, late payment, lack of accommodation, etc.) * lack of political will and support to forest-related activities (e.g., funding) * limited regional collaboration * limited qualified expertise * donor conditionalities restricting and limiting government action * excessive bureaucracy.

Private Sector

* private sector not involved in forestry planning and policy making * high duty on imported machinery and equipment * international competition * difficulties in getting long-term exclusive access to land * limited capital * limited data on markets * shortage of qualified personnel.

Actions Needed

The following actions need to be taken by the government in order to facilitate better private sector involvement.

review policies and implement reforms in support of the private sector and the government's new roles (e.g., fiscal policies to establish incentives);

* review and streamline land acquisition procedures and improve security of land tenure;

privatize state-owned plantations and/or the management of plantations;

* identify markets - internal and external -, e.g., through provision of information on prices and standards;

* promote cross-fertilization of ideas (e.g., new practices and technologies); and

* provide credit. 64 Annex 3

Forest-Related Knowledge and Technology

Guiding Principles

In order to increase the contribution of forestry to socioeconomic development and environmental protection in Africa, forest-related knowledge and technology will need to be supplied in response to the demands and needs of policy makers, planners, managers, and land users.

Good forest product utilization and marketing can contribute to sustainability of management, as can improvements in well-being and working conditions in the agricultural sector.

Research will have to receive continuous attention, especially with regards to coordination and diffusion of results. Implementation of pilot projects is indispensable to good technology transfer, because it avoids the trap of global, integrated approaches which are too complex to manage.

Research for Sustainable Forest Management

Essentially, forestry research has concentrated on wood technology, descriptive studies of natural forest ecosystems, and plantation silviculture. Systematic research into forest vegetation dynamics and natural forest silviculture has only been started relatively recently (15 to 30 years ago in tropical moist forest (TMF), 10 years in dry forest). There is now a basis of knowledge for productive forest management, but it is mainly oriented towards timber production from TMF.

The use of Geographical Information Systems (GIS) as a tool for implementing a forest policy is increasingly possible at regional and national levels, if sufficient attention is paid to harmonization of basic definitions and technical standards. As a tool for the management of tropical forest stands, GIS is not yet fully operational.

Key Issues to be Addressed by Present and Future Research

Technical Aspects

* validation of the first experimental results and long-term monitoring of the dynamics of natural and man-influenced forest vegetation in order to improve the present lack of knowledge; * increasing knowledge about the wild fauna, its role in sustainable forest utilization, and possibilities for management; * ecological monitoring (flora, fauna, soil, water) as an integral part of management systems; * basic knowledge and management techniques for non-timber forest products; and * the contribution of agroforestry and rural forestry to the maintenance of ecological stability and biodiversity conservation.

65 Annex 3

Socioeconomic Aspects

* evaluation of real costs involved in natural forest management and silviculture; * sociological issues involved in utilization and marketing of non-timber forest products; * socioeconomic factors determining rural forestry development.

Technology Transfer Priorities

* carrying out of pilot management activities on an operational scale, with careful monitoring of costs; * development of a more systematic, farming systems oriented approach to design and testing of technical packages to intensify and stabilize agricultural production; * forming partnerships with industry to carry out research on optimization of processing and marketing of forest products, focusing on efficiency, quality and pro-active marketing in the case of timber.

Actions Needed

Human resourcesdevelopment for research activities (e.g., specialist training for wildlife management, more particularly in TMF; ecological monitoring; and forest industries) and for implementation of pilot R&D activities (e.g., better training of field staff).

* Development of financing mechanisms that guarantee continued support for key research activities, for example:

- Better access to grantfunding. Pilot management projects should be eligible for grant funding (e.g., GEF) as they contribute to biodiversity conservation and carbon sequestration. Such projects can be implemented under co-financing arrangements.

- Better allocation offorest revenue. Timber rents that have increased in exporting countries subsequent to the increase in world market prjces for tropical timber and the CFA devaluation offer an important opportunity.

- Closer involvement of industrialpartners. The active role of timber industries in pilot management projects should not be an obstacle to obtaining funds from the Bank and other donors. A reinforcement of the loggers' obligations in forest management and processing activities can be achieved through fiscal means.

* Improvement of the policy frameworkfor agriculturalstabilization through mobilization of political will to conserve existing forests and promotion, of a macro-economic environment conducive to intensive agriculture.

* In view of the small volume of timber production of individual countries, a wood technology development policy should be agreed at the regional level, along with the

66 Annex 3

introduction of an African green label (under study by ATO) to promote sustainable forest resource management.

* Improventent of technology transfer by strengthening client relationships in the research and development process, e.g., through user-pay systems, development of more integrated approaches to extension, and improved technology for extension personnel.

* Mobilization and dissemination of indigenous knowledge and technology by developing and creating capacity for implementing more participatory extension methods, and empowerment of client groups.

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20O 1 402" DECEMBER 1993

RECENT WORLD BANK TECHNICAL PAPERS (continued)

No. 217 Antholt, GettingReadyfor the Twenty-First Century: Technical Change and InstitutionalModernization in Agriculture No. 218 Mohan, editor, Bibliographyof Publications:Technical Department, Africa Region, July 1987 to December 1992 No. 219 Cercone, Alcohol-Related Problems as an Obstacle to the Development of Human Capital:Issues and Policy Options No. 220 Kingsley, Ferguson, Bower, and Dice, Managing Urban Environmental Quality in Asia No. 221 Srivastava, Tamboli, English, Lal, and Stewart, Conserving Soil Moistureand Fertilityin the Warm Seasonally Dry Tropics No. 222 Selvaratnam, Innovations in Higher Education:Singapore at the Competitive Edge No. 223 Piotrow, Treiman, Rimon, Yun, and Lozare, Strategiesfor Family PlanningPromotion No. 224 Midgley, Urban Transport in Asia: An OperationalAgenda for the 1990s No. 225 Dia, A Governance Approach to Civil Service Reform in Sub-Saharan Afica No. 226 Bindlish, Evenson, and Gbetibouo, Evaluationof T&V-Based Extension in Burkina Faso No. 227 Cook, editor, Involuntary Resettlement in Afica: Selected Papersfrom a Conference on Environment and Settlement Issues in Afica No. 228 Webster and Charap, The Emergence of PrivateSector Manufacturing in St. Petersburg:A Survey of Firms No. 229 Webster, The Emergence of Private Sector Manufacturing in Hungary: A Survey of Firms No. 230 Webster and Swanson, The Emergence of PrivateSector Manufacturingin the Former Czech and Slovak FederalRepublic: A Survey of Firms No. 231 Eisa, Barghouti, Gillham, and Al-Saffy, Cotton ProductionProspects for the Decade to 2005: A Global Overview No. 232 Creightney, Transportand Economic Performance:A Survey of Developing Countries No. 233 Frederiksen, Berkoff, and Barber, Principles and Practicesfor Dealing with Water Resources Issues No. 234 Archondo-Callao and Faiz, Estimating Vehicle OperatingCosts No. 235 Claessens, Risk Management in Developing Countries No. 236 Bennett and Goldberg, ProvidingEnterprise Development and FinancialServices to Women: A Decade of Bank Experience in Asia No. 237 Webster, The Emergence of Private Sector Manufacturingin Poland: A Survey of Firms No. 238 Heath, Land Rights in COte d'Ivoire: Survey and Prospectsfor Project Intervention No. 239 Kirmani and Rangeley, InternationalInland Waters: Conceptsfor a More Active World Bank Role No. 240 Ahmed, Renewable Energy Technologies: A Review of the Status and Costs of Selected Technologies No. 241 Cernea and Adams, Development, Sociology, and Anthropology: An Annotated Bibliography of World Bank Publicationsand Documents in Sociology and Anthropology No. 242 Barnes, Openshaw, Smith, and van der Plas, What Makes People Cook with Improved Biomass Stoves?: A ComparativeInternational Review of Stove Programs No. 243 Menke and Fazzari, Improving ElectricPower Utility Efficiency: Issues and Recommendations No. 244 Liebenthal, Mathur, and Wade, Solar Energy: Lessons from the Pacific Island Experience No. 245 Klein, External Debt Management: An Introduction No. 246 Plusquellec, Burt, and Wolter, Modern Water Control in Irrigation:Concepts, Issues, and Applications No. 247 Ameur, Agricultural Extension: A Step beyond the Next Step No. 248 Malhotra, A Survey of Asia's Energy Prices No. 249 Le Moigne, Easter, Ochs, and Giltner, Water Policy and Water Markets: Selected Papers and Proceedingsfrom the World Bank's Annual Irrigationand DrainageSeminar held in Annapolis, Maryland, December 8-10, 1992 No. 250 Rangeley, Thiam, Andersen, and Lyle, InternationalRiver Basin Organizationsin Sub-SaharanAfrica The World Bank Headquarters European Office Tokyo Office 1818 H Street, N.W. 66, avenue d'Ikna Kokusai Building Washington, D.C. 20433, U.S.A. 75116 Paris, France 1-1 Marunouchi 3-chome Chiyoda-ku, Tokyo 100, Japan Telephone: (202) 477-1234 Telephone: (1) 40.69.30.00 Facsimile: (202) 477-6391 Facsimile: (1) 40.69.30.66 Telephone: (3) 3214-5001 Telex: wur 64145 WORLDBANK Telex: 640651 Facsimile: (3) 3214-3657 RCA 248423 WORLDBK Telex: 26838 Cable Address: INrBAFRAD WASHINGTONDC

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