The Rainforests of Cameroon - PROFOR

8 The Rainforests of Cameroonimportant, but continued inattention to local markets and small firmshas significant social implications and can undermine forest sector performanceand governance in important ways. Local markets and smallscaleenterprises are the source of numerous jobs—precarious butessential—for the poor, yet little effort has been made to strengthenthis important forest constituency and enable it to operate openly. Thechallenges involved are not small. Distrust of bureaucratic processesand fear of harassment by officials discourage artisanal loggers fromjoining the formal sector. Given the chance to produce timber legally,they may simply sell it to the better-paying export industry ratherthan to local markets, which would create conditions for new illegalartisanal loggers to arise.Fortunately, partnerships between small and large enterprises andinnovative solutions to create a steady supply of material to undersuppliedregions have started to emerge. They should be encouraged andreplicated. Access to the more lucrative export market should continueto be subject to the law and to fair competition by all companies,large and small.• Adapt reform instruments to emerging forest management and industryneeds. While the new social, fiscal, and other obligations that accompanymanagement plans are positive developments, integrating theminto a new business model can be extremely demanding for industry.The fragility of Cameroon’s industry as it moves toward a highlyregulated and managed forest production system is underappreciated.High international timber prices have somewhat compensated forindustry’s reliance on a few tree species and sawn timber, but industryneeds now to invest in more advanced processing and technologies touse a wider range of species and market a broader range of products.The regulatory framework could be adapted to benefit both forestsustainability and industry. Rewarding responsible corporate behaviorwith more lenient bank guarantees and automatic reimbursement ofvalue added tax may prove as important for conserving forests as punishingcorporate misbehavior. The development of incentives for firmsto gain international certification could improve the sustainability offorest resources and of individual firms’ operations at the same time.The risks facing investors Delivered and by The concession World Bank holders e-library to: need to be consideredThe World Bankmore seriously. Concession IP holders : 192.86.100.34 are required to absorb a large shareof commodity price risk Mon, on 09 Nov the 2009 international 17:06:18 timber market. Finetuningpolicies and adjusting taxation and incentives may be critical inhelping firms cope with cyclical downturns in prices and demand.(c) The International Bank for Reconstruction and Development / The World Bank