Tropical Forest Policy and Legislation

Abstract

Despite numerous initiatives and national and international programs, the world’s tropical forests continue to lose continually larger areas every year. During the past decade, some 110 million hectares of tropical forests were lost or were severely degraded. This was only partially compensated by a gain of around 25 million hectares of forests, scarcely with the same qualities of the original areas. Further, also during this period, forest loss in the tropical domain accelerated at an average rate of some additional 210,000 ha per year. Governments, in efforts to improve the management of the nation’s forests and to reduce or stop wasteful deforestation issue a number of forest policies and regulations. The effectiveness of these policies and regulations is variable, but in general it are not satisfactory. Further, forest policies need to be complemented by policiers and regulations in other sectors, such as agriculture, transportation infrastructure and international trade, that have a paramount effect on incentives to improved forrest management.

Appendix: Unintended Negative Impacts of Common Policies Affecting Forests

Policy and intended impact	Economic impact	Policy impact	Environmental impact
Supply of forest industrial material at subsidized prices to promote industrial development	Waste in harvesting and industrial processing. Reduction of incentives to sustainable forest management Companies become addicted to subsidies and effectively lobby to keep them Incentives to corrupt deals	Large enterprise benefits the most; small enterprises benefit less or do not benefit at all. Government loses income Private forest landowners are deprived of potentially profitable forest investments	Excessive levels of forest cut Inadequate incentives to maintain environmental services of forests
No recognition of traditional ownership rights to concentrate presumably superior decisions in the hands of government	Reduction of incentives for local people to invest in forest management as uncertainty of resulting benefits increases	Negative impact on the poor and indigenous groups that cannot use their lands as a capital asset Use of forest lands by external actors, such as corporations in concession areas impoverishes the poor further and creates conditions for social and conflict and often violent upheaval	Conflicts and uncertainty contribute to deforestation, forest fires and degradation of the forest environment
Logging bans to protect the integrity of forest resources	Economic uses of forest are closed Industry may have to depend on higher priced imports The commercial value of existing forests may decrease substantially, thus reducing profitability of sustainable forest management	Loggers, including some low income logging communities, may go out of business. Industrialists may see their profitability reduced if imported logs are pricier than domestic supplies Possible contraction of logging and industrial activity may reduce rural and industrial employment	Commercial value of forest resources may be reduced enough to encourage conversion to other more profitable uses of land, particularly if land is scarce. These other uses may be less environmentally desirable than forest uses of land
All forest resources are owned by the state, to be managed by government in closer consonance with societal objectives	Disincentive to investments in forest management and afforestation, particularly on private lands	Policy negatively affects land owners that otherwise may have engaged in rehabilitating forest lands Loggers and industrialists have a greater opportunity and incentive to engage in corrupt acts	Policy may promote deforestation to avoid government control of forest resources
Land ownership is contingent on demonstration of occupation, to regularize property rights	Incentive to deforestation to prove land occupation. Valuable economic forest resources are lost	This option is usually not open to large corporations. Small farmers may benefit by obtaining land ownership but by sacrificing potential forest benefits that could have been obtained in absence of deforestation	Deforestation is an effective way to prove occupation. Incentive to destructive environmental practices
Plantation subsidies, to promote industrial development, protect soil and water resources and divert pressure away from natural forests	Cost to the national treasury. Opportunities for corruption and misallocation of economic resources increase due to price distortions. Economic natural forest values may be lost particularly if plantations replace natural forests	Large scale plantations may lead to displacement of local people Traditional agrosilvicultural methods of forest resource management may be at a disadvantage and displaced by monocultures Subsidies may inflate land prices and thus redistribute wealth to existing landowners. Small, undercapitalized landowners may not be able to access subsidies Subsidies tend to disproportionately favor large corporations	Deforestation of natural forest may occur to clear land to establish plantations. Monocultures may expand at the expense of mixed natural forests. Subsidies often lead to extremely poor quality of plantations
Timber transit rules to control legality of timber origin	High transaction costs. Policy opens opportunities for corruption and misallocation of resources Depending on the effectiveness of government action, transit restrictions may reduce commercial value of some timber species and contribute to forests being replaced by alternative uses of land	Small producers may find themselves at a commercial disadvantage if they are unable to pay bribes. Larger corporations may control controllers	In practice these rules have had negligible impact on the conservation of forest resources

1. Source: Contreras-Hermosilla 2011