Bridges Trade BioRes • Volume 9 • Number 5 • 20th March 2009

Financial Crisis Placing Pressure on Forests in Developing World

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The initiative to increase forest coverage in the developing world as a means to combat climate change is being threatened by the current global financial crisis, according to the UN Food and Agriculture Organisation’s report on the State of the World’s Forests.

The report suggests that because developing countries often struggle with institutional weaknesses and immense pressures on their forests the current problem is difficult to solve. Moreover, because of the heightened economic challenges faced in the developing world during the financial crisis, short-term economic benefits will often trump long-term environmental planning, the report says.

There is concern that some governments could abandon ambitious climate change mitigation and adaptation targets as they focus on reversing the economic downturn, the report says. Specifically, schemes such as the UN programme on Reducing Emissions from Deforestation and Forest Degradation in Developing Countries (REDD) Programme, which rely on financial transfers from developed to developing countries to encourage forest conservation, could face significant challenges.

The collapse of the housing sector and the credit crunch has resulted in a dramatic decline in industrial and forest management investment. The report warns that the contraction of formal sectors, such as those supplying the building industry, could lead to an increase in illegal logging as the informal sector is called on to fill the gaps.

However, the report says that over the long-term global demand for forestry products and environmental services are expected to increase in the coming decades.

The FAO publishes the State of the World’s Forests every two years to provide a global view of major developments affecting forests. The 2009 report provides a regional analysis on rates of deforestation, drawing particular attention to concerns in Africa and South America.

“Although Africa holds only 16 percent of the global forest area, from 2000 to 2005 it lost about 4 million hectares of forests annually, close to one-third of the area deforested globally,” the report reads. “Forest loss is likely to continue at current rates. The growing demand for, and rising price of, food and energy will exacerbate the situation, especially as increased investments in infrastructure open up new areas.”

Concerns for continued levels of deforestation were also highlighted for South America due to high food and fuel prices which are likely to encourage continued forest clearance for production of livestock and agricultural crops for food, feed, and biofuel.

The report recommends that forestry institutions be reformed and science and technology investments be increased to help manage forests globally.

The full report can be accessed here: http://www.fao.org/docrep/011/i0350e/i0350e00.htm

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