Contribution of Forestry to Poverty Alleviation - APFNet

The contribution of NWFPs to the whole household cash income in this case study (31%) is relatively
lower than the estimated share by Morris in 2002 (40%). This is primarily due to the increased share of
new emerging income sources as a result of the introduction of new cash crops for Chinese markets since
the mid-2000s. However, if compared only with the net income from NWFPs, there is an increase.
Indirectly, the income increase from the new emerging sources can be considered as NWFP contributions,
since many villagers borrowed money from the NWFP-grounded Village Development Fund (VDF) for
investing in new income alternatives. In addition, using the VDF for improving village infrastructure,
such as road access, will enable market access into the village.
Contribution from NWFP to increased wealth and reduced poverty
Using wealth ranking as one way to measure changes in poverty, the village members were categorized
in three classes: better-off, middle-class, and poor households. Two related wealth rankings were
conducted in 1996 and 2002 as part of the impact assessment from NAFRI-IUCN NWFP project on
poverty reduction. Using similar criteria and method, the third wealth ranking was conducted during
the field survey in April 2011.
Figure VI.3. Wealth ranking at three different times
60%
40%
20%
26%
34% 35%
40%
48%
55%
0%
Better-off
Source: Field surveys
Middle Poor
194
33%
18%
10%
1996
2002
2011
Figure VI.3 compares wealth rankings at three different time periods during and after the implementation
of the NWFP project. It illustrates that within the time period from 1996 to 2011, people in the village, in
general, have been getting wealthier. This can be seen from the steady increase in percentage of betteroff
and middle-class households and a steady decrease in the percentage of poor households. Within
15 years, the percentage of better-off households increased from 26% to 35%, middle-class households
from 40% to 55%, while the percentage of poor households decreased from 33% to 10% only.
The results from wealth rankings cannot be used solely to measure the impact of NWFP contribution
to poverty reduction in Nampheng village. However, since income gained from NWFPs is significant
to the household economy, it can illustrate the indicative contribution from NWFPs.
Contribution from NWFPs to improved infrastructure and services and other benefits
About 70% of the income of NWFP collectors are considered resource taxes and were put in the VDF.
The remaining 30% was used to pay salaries for people in the marketing group. The fund was set up in
1999 and since then, the village used the fund to purchase one electric generator for the village, build a
new village office and a village food and storage house, and renovate the school building. The village also
used the fund to pay the teacher’s salary at their school. Part of the money was also used as credits for
private investments. Currently Ban Nampheng has savings ofLAK30 million (approximately US$ 3,750)
in the VDF.
In addition to these tangible improvements, there are other indirect benefits that villagers gained
from the initiatives. For examples, through the formation of the NWFP marketing group, villagers