Forests Sourcebook - HCV Resource Network

3.1, Mainstreaming Conservation Considerations into Productive
Landscapes). Plantations, when coupled with promotion
of environmentally and socially responsible trade in
timber and forest products, have the potential to meet the
rapidly growing demand of countries like China and India
without sacrificing protected forest areas.
Improved forest management practices. Although
biodiversity and key environmental services have
traditionally been sustained through the establishment of
protected areas, the wide range of competing uses for forests
by diverse groups imposes constraints on how much can be
achieved by protection alone. Improving forest management
practices in production forests (forests where productive use
is permitted) is an essential component of any strategy to
protect vital local environmental services, in addition to
efforts aimed at bolstering the effectiveness of management
within protected areas.
Innovative financing. It is highly unlikely that governments
will be able to significantly scale down lumber extraction to
preserve forests for their environmental services unless the
costs of forgone revenue can be offset in some way. Moreover,
very few countries would be prepared to borrow funds—from
the World Bank or other sources—to finance forest protection
as a substitute for forest production. Innovative financing
options and markets for forests’ environmental services, such
as ecotourism, carbon offsets, reduced emissions from
deforestation and degradation (REDD), and watershed
management, will all have important roles to play. As carbon
credits grow in value under emerging global carbon trading
systems, incentives to invest in the establishment of new
forested areas for their carbon benefits, and in reduced
deforestation for reduced carbon emissions, will increase.
Avoided deforestation. Though the Kyoto Protocol has
no mechanism for providing compensation for reduced
deforestation, the Stern Review highlights “avoided
deforestation” as a cost-effective mechanism to limit
greenhouse gas emissions (Stern 2007). Present concerns
about climate change have opened a window of opportunity
for the framework of avoided deforestation. The Forest
Carbon Partnership Facility of the World Bank is developing
a financing mechanism for avoided deforestation and
preparing countries to participate in this scheme.
Preparations include, among other things, developing
technical tools for monitoring and measuring avoided
deforestation, assessing opportunity costs, and making the
necessary financial transfers. Beyond the technical aspects of
operationalizing this concept, an enabling environment
must be created to facilitate this approach.
Cross-sectoral impact. Deforestation is a complex
phenomenon: While there is general agreement that it is
strongly influenced by economic change arising from
outside the forest sector itself, its specific causes (and,
equally important, its economic and social effects) vary
widely between—and even within—countries. Large-scale
economic change in any country, whether induced in
specific reform programs or inflicted through exogenous
forces beyond the control of that country, has the potential
to bring about major changes in the condition of natural
resources and the environment, especially in developing
countries, where natural capital plays a significant role in
economic growth and development and is crucial to the
sustainability of these processes.
Pressures on forests from poorly aligned strategies in
agriculture, transportation, energy, and industry, as well as
from unsound macroeconomic policies, are major causes of
forest loss and degradation. Cross-sectoral cooperation to
coordinate policies is essential to avoid forest degradation,
to ensure that forests are managed in a sustainable manner,
and to harness opportunities created by ever-rising fossil
fuel prices and improved biofuel technologies.
THE WORLD BANK’S APPROACH
TO THE FOREST SECTOR
Forests are important to the World Bank’s mission because
of their contribution to the livelihoods of the poor, the
potential they offer for sustainable economic development,
and the essential global environmental services they provide.
The World Bank’s 2002 Forests Strategy and
Operational Policy
In 2002 the World Bank adopted a revised Forests Strategy
(World Bank 2004) and Operational Policy on Forests (OP
4.36) that allow the World Bank to engage more proactively
in the forest sector to help attain the goal of poverty reduction
without jeopardizing forests environmental and economic
values intrinsic to sustainability. The strategy was
founded on three equally important and interrelated pillars:
■
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Harnessing the potential of forests to reduce poverty in a
sustainable manner
Integrating forests more effectively into sustainable
development
4 INTRODUCTION: OPPORTUNITIES AND CHALLENGES IN THE FOREST SECTOR