II. Forests and national development

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When international attention turned to the developing countries in the early 1950s, economists were caught unprepared. They had no readily available conceptual model with which to analyse the economic growth process in these mostly agrarian societies. Many economists reasoned that developing countries would need to follow the same path taken by the world's richer nations in their transformation from agrarian to industrial economies. Development models described this growth process as a series of linear stages through which all countries must pass.

Natural resources such as forests received little or no attention in these initial models. Instead, development strategies highlighted capital formation and technical progress as the major factors responsible for rising incomes and economic growth. In general, forests were viewed as a source of land to be converted to more productive uses. While they could also be a source of revenue and foreign exchange, forests were seen as relatively unimportant in the struggle to promote sustained economic development." Forest industries other than pulp and paper were considered too small to be significant for industrialization efforts.

Forests in early development strategies

International donors also ignored the forestry sector relative to other activities. The World Bank did not establish a policy paper on forestry development until 1978. Between 1949 and 1968, it funded only two forestry projects in developing countries - a chemical pulp and newsprint mill in Chile and a paper mill in Bangladesh.

During the same period, lending for land colonization projects, dam construction, road building and related development projects resulted in the removal of forests. The World Bank's first forestry loan, focusing on soil conservation and watershed management, was made in 1980.

FAO incorporated forestry in its mandate in 1945. For the next 15 years, the Organization produced forest inventories, statistical and outlook reports and market analyses, but paid relatively little attention to the sector compared with its other activities. During the 1950s, FAO concentrated on four basic aims: increasing the yield from forests; reducing waste from logging operations and wood industries; accessing virgin forests in tropical countries; and planting new forests. Even after the 1960 Conference of FAO had approved a reorganization, establishing large departments for Administration, General Affairs and Information and Development, forestry remained the responsibility of a division in the Technical Department. FAO finally established a Forestry Department in 1970.

Perhaps the most negligent among the early development specialists were the economists. The development economics literature of the time contributed very little to our awareness of the role of forests in development. Development economics tended to neglect the forestry sector because it ignored the role of natural capital as a basis for economic growth. As a result, economists did not develop the conceptual and practical capacities to value natural capital.

On the other hand, forest economics did what development economics did not do by developing optimization models that dealt explicitly with the relationship between natural capital, growth and income. However, these optimization models and techniques examined specific forest properties rather than the macro problems important to development economics.

Foresters began addressing questions of long-term optimization and the tradeoffs between present and future choices in the middle of the last century. For example, the German forester Faustman developed a long-term optimization model for optimal harvest time (or rotation age) in 1849. The early models focused on the relative merits of biological and economic efficiency to determine the optimal harvest time. in general, biological models maximize the volume of timber production from a stand, depending on the forest's growth rates. Economic models maximize the present value of the net benefits from the wood; criteria include the timber's value, the time value of money and other costs associated with planting and harvesting.

The optimization question is by far the most fully analysed issue in forest economics, but its focus has remained at the micro level (examining specific timber stands). In the recent past, development economics began addressing questions of present-future choices at the macroeconomic level for non-renewable resources such as oil and minerals. Only more recently has it begun the process of applying the lessons learned from the optimization debate about renewable forest resources to a national scale.

Forests in national economies

While most early development strategies generally ignored the forestry sector, there are two noteworthy exceptions. First, in 1958 Hirshman emphasized the importance of spacial attributes and forward and backward linkages. Hirshman's analysis highlighted important economic growth linkages of lumber, wood and paper manufacturing.

Second, Westoby led a team at FAO to challenge the conventional approach to forestry in the special chapter of The State of Food and Agriculture 1962. The FAO study reasoned that those responsible for setting development priorities were unaware of the potential contribution of forests to industrial-based development. The report drew on Hirshman's concept of growing points, lagging regions and backward and forward linkages to demonstrate how the forests (as natural capital) could play a more vital role in promoting economic growth. Among the many arguments presented are the following:

Westoby's study helped attract international attention to the forestry sector. Over the next decade, the frequency and funding for forestry projects increased substantially and projects were more carefully prepared, documented and justified than in the past.

Two additional factors motivated donors to increase funding. First, market analyses predicted large increases in industrial countries' demand for timber and wood products from the developing world. Second, forestry projects demonstrated higher success rates than other types of development projects.

More than a decade later, however, when Westoby looked back on how the forestry sector had developed, he rejected his initial vision. In a paper presented to the Commonwealth Forestry Association in 1975, he concluded that the exploitation of massive tracts of virgin tropical forest had been, for the most part, reckless, wasteful and even devastating. Westoby argued that nearly all operations lacked a profound or durable impact on the economic and social life of the countries in which they had taken place. Too many forestry projects failed to contribute to vital local needs.

Several other studies arrived at similar conclusions, reporting that forestry projects contributed little to the industrialization process, created few jobs and had a minimal impact on the overall growth process. In 1980 the Director of FAO's former Forestry Industries Division argued that:

"Forests, on the whole, are simply being mined, taking out the easiest to get and the most highly priced trees without any real concern for what happens afterwards. For the forests and the people who are dependent on them, the only obvious lasting effect is retrogression.

By the late 1970s, changes in the overall concept of economic development had created a new role for forestry. Experience revealed that development assistance strategies focused solely on promoting industrialization were not working satisfactorily. Poverty increased steadily in many countries, even though their economies expanded at a strong pace. To address this dilemma, development experts turned their attention to poverty reduction, employment generation and improved equity. Furthermore, policy-makers began to recognize that natural resource degradation seriously impedes economic development and poverty alleviation. Sustainability gradually emerged as the major development principle. At the same time, natural resource and environmental economics flourished, strengthening analytical techniques and enhancing macroeconomic development models.

Today, forests are recognized as an integral part of national economies, Forests contribute to development in many ways, for instance in the form of natural capital, production inputs and environmental goods. But forests also constrain and limit development. In some countries, forests are viewed as obstacles that must be removed before productive activities are possible. For example, in the past, land tenure legislation in many countries required settlers to remove all trees on a parcel before ownership rights were granted. In other circumstances, forests are treated as a scarce natural resource that must be protected from all types of exploitation. Several factors help explain how forests both contribute to and limit policy choices for national development strategies.

First, roads, commerce and agrarian populations have penetrated and settled much of the world's forest land; few forest areas remain unused or disconnected from national interests. Forest areas have undergone "agrification", involving the use of forests and trees in farming systems and the formation of agricultural mosaics within forest systems. Forests are increasingly managed for their range of resource flows, their ability to support rural well-being and their capacity to promote industrial opportunities, Forests provide large, albeit different, ranges of goods and services for virtually all patterns of human settlement and livelihood. They are not contiguous blocks of timber beyond the frontier, but are active parts of life everywhere.

Second, economic development strategies are beginning to include the capital values of forests in national policies and programmes that modify forest stocks, qualities and distributions. Forests are now widely acknowledged as both productive capital stocks and as components of public infrastructural systems. As ecological analogues of industrial capacity and physical infrastructure, forests are entering the central equations of macroeconomic growth, often with new definitions of what the forest is and does.

Advances in national accounting make it possible to incorporate explicitly the capital value of forest resources as productive stocks, and to assess the effects of changes in them on national productive capacity. Conventional national accounting systems overstate sustainable income in two ways. First, the accounts disregard depreciation of forest and other natural capital. Second, the costs of mitigating or offsetting the side effects of resource depletion (e.g. anti-sedimentation measures in a deforested watershed) are not subtracted from national income. This conveys the wrong message: that income gained from depleting forest resources can continue forever.

Some countries are establishing new accounting systems that measure the depreciation of forest resources in excess of their reproductive capacity (both quantitative and qualitative). For instance, the French system shows trade-offs between the economic, ecological and social functions of natural resources. This system, known as the "natural patrimony accounts", records separate accounts for forests, wildlife, water and soil.

As infrastructure, forest systems provide services that would otherwise require capital expenditures or reductions in human well-being. For example, by storing water, regulating flows, protecting channels and cleansing impurities, forests form a structure of hydrological services akin to structures for transportation and communication. Recent economic methods make it possible to account for these infrastructural services on a national rather than project scale.

Third, forests represent productive assets that are increasingly used as a means for attaining national development objectives, including equity, stability, investment and growth. Programmes in community forestry have become central to agrarian reforms that seek to build more productive relations between rural communities and public lands. Community forestry programmes are widely implemented to strengthen investment incentives and encourage civic participation in the growth and use of forests and trees.

Fourth, forests have emerged as significant factors in economic and political relations among nations. For example, forests have taken on foreign policy dimensions through their roles in both economic and environmental trade. (Box 13 presents an example of environmental trade.) Forest conditions increasingly affect national dependence on processing capacity, wood products and international trade. Trading patterns grow more complex as nations shift emphasis from primary to secondary and tertiary forms of production, increase their purchasing power and diversify their consumption requirements.

Furthermore, changes in the extent and quality of forests have become the subject of global environmental concerns. Changing forest conditions represent factors in biodiversity, relations between industrial and non-industrial nations which occupy and use the same global atmosphere as a carbon source and sink and expressions of interdependence between nations. Such developments create pressure on national governments to consider forests in the realm of international relations. Some nations are already moving towards international agreements that tie matters of economic and environmental trade together in the service of larger, global interests.

For all of these reasons, national forest politics and policies have evolved out of a narrow sectoral prerogative to enter pluralized mainstream political interests involving highly diverse groups. Throughout the world, forests are the topic of discussion among articulate groups of populists, industrialists, statists, internationalists, consumers, environmentalists, farmers, indigenous forest communities, city dwellers, scientists, educators and humanists.

The perspectives and demands of these politically diverse groups have proliferated, placing a significant strain on the institutions of forest policy that evolved when forests meant only timber belonging to the state and were controlled by a small professional cadre. These competing pressures, combined with a wider understanding of the importance and complexity of forests' non-wood services and values, are strongly influencing forestry policy today.


Many developing countries are heavily burdened with foreign currency debts to commercial banks, to the governments of industrial countries and to international lending agencies. For the poorest countries the possibility of paying off these debts within decades, if ever, is extremely low.

Debt-for-nature swaps represent an attempt to benefit the environment by capitalizing on lenders' willingness to discount (or sell at less than face value) some of their longstanding debts and to accept an immediate reduced payment rather than a deferred full payment that may never come. The swap is organized by a third party, such as an environmental NGO or the government of an industrial country, which buys the debt at a reduced rate from the lender and agrees to cancel it provided the debtor country makes a specified investment in an environmental project, such as a tropical forest reserve of particular ecological significance.

In this way, the developing country rids itself of the debt without having to repay any foreign currency but assumes responsibility for certain environmental activities.

By the end of 1992, a total of 24 debt-for-nature swaps with a face value of more than $122 million had been arranged, generating conservation funds of more than $75 million but costing just over $23 million. The overall impact is small in relation to the total debt of the developing world and the rate at which deforestation is taking place. in addition, it is difficult to ensure that the conservation programmes are realistic and capable of being implemented and maintained on a sustainable basis. An initiative in Bolivia, for example, ran into trouble because both local indigenous people and loggers who had been awarded concessions laid claim to the land to be managed.

Debt-for-nature swaps have also been criticized as a form of "eco-colonialism", in which industrial countries set the priorities of developing countries. Swaps may work in countries that are badly mismanaging their economies, but not in those that display economic discipline. The economic and ecological benefits of debt-for-nature swaps may overshadow the needs of the people living in the area. It is nevertheless generally accepted that prudently chosen and well-planned debt-for-nature swaps are a viable, if rather complicated, measure that can make a contribution to forest conservation.

Forests as a source of national development

Individual forest ecosystems provide many protective, scientific and commercial services, ranging from living space and food to climate regulation and genetic resources (see Box 14). At the national level, however, countries are interested in their entire forest system (in the macro sense, the forest is any area where there are trees) and how they contribute collectively to national development as sources of goods and services, as forms of insurance against excessive risk and as economic and social assets.

Sources of revenue, foreign exchange and financial equity. Forests supply materials for export and for import substitution in the form of wood, fibre, processed products, energy and a growing variety of medicinal, ornamental and speciality forest products.

Timber typically has been a primary source of capital for forested nations, through the trade of wood for currency, the use of forests as equity for loans and debt relief and the exchange of concessionary rights for physical infrastructure. Canada, India, Indonesia, Italy, Malaysia, Norway, Sweden, the Russian Federation, Thailand and the United States, among many other countries, have relied on the transformation of forest capital to help build their industrial and agricultural capacities; Laos, Myanmar and Viet Nam appear to be pursuing a similar strategy today.

Beyond this initial stage of forest transformation, some nations attempt to create employment and increase incomes by building industrial capacities to process wood into finished goods. Germany, Indonesia, Italy, Malaysia, Singapore, Thailand and the United States have followed this path, using wood from both domestic and foreign sources. Thailand derives substantial foreign exchange from trade in furniture, orchids, speciality foods, medicinals and wildlife. This stage requires more complex market and tenure systems than those that prevailed when timber was the forest's main contribution. Japan's forest industries rely heavily on imports of tropical and temperate hardwood logs; the country accounts for 30 percent of global industrial roundwood imports and about 45 percent of all tropical hardwood imports. Although Japan's own forests are capable of providing for industrial production, environmental considerations and high extraction costs mean that imports are preferred.

Forests also attract recreational users. Since tourism and recreation may require infrastructural investment beyond the requirements of a processing industry, this economic activity usually awaits later stages of industrial and commercial growth.


Protective services and influences

Consumption of plants, animals and derivatives

Psychophysiological influences

Source of land and living space

Education and scientific services

Thus, nations must make strategic trade-offs between converting forest capital for industrial and commercial activities, providing access to non-timber products, using forests as energy sources and increasing future income streams from tourists attracted to pristine forests.

Sources of rural income. Rural populations depend on forest products as well as on their environmental services. Forests contribute to food security. In some areas, forests are the primary source of protein, energy, oils, medicines and even staple foods. In general, they are most important during seasonal or periodic famines or shortages of crop-based foods.

As sources of income, forests are important in a distributive sense, creating opportunities that cannot be generated on a national scale or through incipient market systems. National accounts typically do not record such in-kind forest incomes, although these are essential to the well-being of hundreds of millions of people (especially those groups who depend on the forest as their only source of cash income).

Rural populations also use, protect and create forests as sources of agricultural inputs; they depend on tree products to sustain soil fertility and structure, to feed livestock and to maintain desired moisture regimes and water flows.

Such non-monetized production inputs are not recorded in national accounts, although their decline would reduce monetized production, require compensation through augmented monetized inputs of capital and labour or increase pressure to clear forest for cultivation.

At early stages of market participation, rural populations use commercial forest products to generate cash income. For instance, India has extensive commerce in "minor" forest products which resident communities harvest, process and sell. Examples include silk, cigarette wrappers, food and feed, charcoal, oils, lac and resins, spices and medicines. Box 15 highlights the significance of minor forest products in the West African humid forest zone.

Shares of national assets. Forest tenures have become part of broader strategies designed to distribute national assets to achieve a desired mix of economic growth, equity and stability and to conserve environmental opportunities for future generations.

Tenurial patterns have diversified over the past several decades, reflecting the variety of forest functions, growing populations and political expectations, and expanding technical, financial and organizational capacities. To pure de jure state or de facto local control have been added a wide variety of quasi-public structures of land and market control, systems of state-local cooperative management, local management structures and private tenures for forest activities on corporate, farm and household scales. Forest distribution therefore involves choices within and among fiscal, educational, industrial, agrarian and stabilization policies.

Land reserves. Forests provide habitats and livelihood opportunities for landless people who otherwise would be absorbed or subsidized in more expensive ways. Forests also provide opportunities to grow commercial crops that would be more expensive to grow elsewhere. Although some of these activities may deplete environmental capital, many nations choose to tolerate them because forests provide a flexible alternative to more costly national responses.


Forests have traditionally been valued as a source of timber, pulp and fuel. All other products, regardless of their value to local people, have been classified by foresters as 'minor" forest products. Yet this term often refers only to those products, such as gums, resins and tannins, for which there is an industrial market. for rural West Africans, the forests are valued for a much broader array of products.

Like many forests around the world, the West African humid forest zone is extremely diverse, incorporating many different political and economic systems, cultures, histories and land-use practices. The forests provide food, medicines, household equipment, building material and raw materials for processing. They support agriculture by providing materials for farm implements, harvesting and transportation equipment, crop storage containers and dryers as well as fuel for crop processing. Forests and trees are also socially and culturally important, serving as temples, symbols, gathering places and locations for rites such as initiation ceremonies.

The multitude of "minor" ways in which a single forest species may be used is well illustrated in the example of the Ceiba pentandra of Ho in Ghana. This fibrous fruit is used in making medicines, pillows and a commercial product to plug up holes in canoes, its seed oil is prescribed for rheumatism, sold commercially for soap making and used as a fire-lighter; its leaves are consumed in soups and used as fodder for goats; its ash provides a good mulch; its bark and stems are used as a medicinal mouthwash; and its roots are used in the treatment of leprosy. It is also valued as bee fodder for honey production. in addition, a favoured mushroom grows at the tree's base. Finally, it is a sacred tree; its leaves and bark are believed to expel spirits.

Ecological systems providing biodiversity. The world's forests are both laboratories for the natural selection of genetic resources of plants and animals and dynamic storage banks for these genes. Tropical forests contain an estimated 50 percent of all the living species on the planet, including a great proportion of higher plants and mammals. For example, there are 50 indigenous tree species in Europe north of the Alps. In Malaysia, an area of forest covering just 50 ha was found to contain 830 tree species and, in Peru, nearly 300 species of trees have been recorded on a single hectare.

Infrastructure. Forests provide infrastructural services without which development opportunities decline. They stabilize streamflow and microclimates; protect land and earth structures, such as roads and canals; and drain, shade and purify. Urban trees cool towns, conserve energy and absorb pollutants, substituting for more conventional infrastructure which would otherwise be needed. Strategically placed trees can reduce home air-conditioning needs by 10 to 15 percent by providing shade and can reduce heating requirements by shielding wind.

Forests are ecological systems that provide insurance against reductions in national well-being. The economic and social consequences of changes in ecosystems are difficult to predict. Changes in the dynamics of river basins, ecological regions or wildlife systems, for example, may reduce or increase different aspects of human well-being; without sufficient knowledge, the unpredictability of the consequences tends to rise with the extent of change. The inundation of logs through Thai villages, boulders falling on to Nepalese villages and habitat-deprived elephants rampaging through Indian villages are recent examples of catastrophes that forests can prevent.

Although the concept of "forest as infrastructure" is not yet widely supported, the absence of forests clearly requires constructed infrastructure at the expense of other potential uses of scarce capital.

Sources of energy. Forests supply energy that would otherwise be unavailable or would cost more to obtain. Wood continues to be the primary fuel in most tropical nations and a significant fuel in many others. Wood may substitute for fossil fuels and agricultural biomass, alleviating cost pressures on competing needs for these resources.

Nutritional problems arise where people lack sufficient fuelwood to cook their food adequately and where its substitution with dung reduces the fertility and productivity of their fields. Fossil fuel replacements, whether for energy or fertilizer, can be expensive in foreign exchange or in lost future opportunities for domestic use. Energy policies in nations of South Asia and Africa have placed significant emphasis on fuelwood plantations.


Forested regions offer incentives for both clearance and preservation. The national balance depends on how combinations of economic, social, ecological and political circumstances change over time. Factors include site quality, the distribution of land-holdings, non-farm employment opportunities and the strength of communities.

In India, for example, there has been a simultaneous depletion of state forests and rapid growth of farm forests outwards from urban centres. Natural forest depletion has been driven by the growth of population relative to non-farm employment opportunities and the resulting quest for additional land. The most extreme depletion has occurred just outside protected public forests, displaying a backwash effect against the protective boundaries.

Forest growth and investment in tree crops occurring outwards from cities are driven by market incentives, including rising prices for wood products relative to agricultural crops, input prices and wage differentials. Forest growth also occurs within irrigated areas, where tree crops fit in with other production activities through complementary uses of the same inputs, household management systems and market networks. Although India continues to experience high official rates of deforestation, these tend to reflect the jurisdictional definitions of hinterland forests and do not take into account the impressive growth of forest cover on private agricultural land. This shift in the aggregate forest cover from hinterlands towards settled areas is accompanied by significant changes in the species composition and social organization of forests.

Thailand displays a direct relationship between deforestation and agricultural expansion. Over the last three decades, this expansion has been driven by the growth of urban markets and road networks, new production technologies and export opportunities for agricultural crops. Liberal trade and commodity market policies, the aggressive development of the nation's road network and a strong urban demand for rural land have all shaped forest distribution.

At first, the landless population not absorbed in non-farm employment converted forested land to farmland, thus increasing agricultural production. over time, beginning first near cities and then extending outwards, non-farm opportunities increased dramatically, consequently raising wage rates, reducing agricultural labour supply and increasing agriculture's capital dependence. Meanwhile, agricultural land was converted to residential and industrial uses, leading to further clearance of forests in more remote areas.

In 1989, the Government of Thailand banned logging of public forests. The ban increased incentives to grow wood on private land, while the underutilization of mill capacity created incentives to expand forest extraction into neighbouring countries. As a result, the nation's forest cover shifted towards private land and market centres; debates over local relative to national control of national forests intensified; and the bulk of wood extraction shifted beyond national boundaries.

The State of California in the United States provides an extreme example of the same changes occurring in India and Thailand. The state's population has quadrupled in four decades; its economic structure has shifted from primary to secondary and now to tertiary activities. The cities, supported by huge imports of water, have radiated outwards in sprawling suburban settlements, extending urban park forests, tree-lined streets and residential gardens and reserves across former farm and forest lands.

California's industrial forest, the economic base of many rural localities, has been depleted and fragmented. Imported wood is less expensive, forest land is more valuable when sold for housing development and timber investment opportunities look unattractive compared with the alternatives. National forests, increasingly pressed to favour non-wood services, no longer fill the slack in mill capacity and labour utilization.

The state's aggregate forest is increasing in size but shifting away from traditional forest sites, regions and communities towards urban, agricultural and "non-forest" wooded lands. Despite the compelling force of these changes, forest policy continues to focus on timber production in conventional private and federal forest holdings.

These examples illustrate how national development and policy choices affect the quality and location of forests, while changing forest conditions shape and constrain available options.

A number of African countries illustrate similar relationships between development, energy and forest dynamics. In many countries, wood continues to be the dominant household energy source because alternative energy prices are relatively high. In some cases, economic policies keep energy prices high with import restrictions, market controls and taxes. In other cases, countries lack alternative domestic supplies or capital to develop them. Both the scarcity of alternative energy sources and the means that would relieve such scarcity have an impact on the distribution and quality of forests.

Sources of potentially tradable global services. Forests supply many global benefits: they store carbon; maintain diverse, unique and rare forms of life; store biotic potential; and encompass natural phenomena that have yet to be understood. These global attributes are gaining value rapidly as institutions evolve to protect them and develop means to translate them into tradable forms. The Global Environmental Facility (GEF) was established to finance national provision of such services.

Debt-for-nature swaps, long-term purchases of forest carbon storage for industrial atmospheric emissions, environmental conditions in trade agreements and international contracts for biological prospecting rights are early examples from the gradual development of international trade in global environmental services.

Heritage. Forests contribute to social cohesion that may enhance the success of productive enterprises or, with the help of government subsidies, that may ensure that weak enterprises are made productive. Throughout the world, forest groves provide a focus for community life and form part of a social and cultural regime for managing an economic and ecological system; in some countries, for example, sacred forest groves are located in the hills above irrigation systems. More generally, the groves are natural temples, ancestral places and spiritual retreats that contribute to the strength of the community. As cooperative movements have demonstrated consistently, such strength is difficult to create. Natural parks appear to have analogous functions in urban societies.

In recent years, forests have become more widely recognized as homes of cultures. International concern and appreciation for the value of traditional cultures and their knowledge of nature have contributed to the preservation of forest regimes as a matter of national interest.

Forests as a consequence of national development

While forest conditions affect opportunities for national development, the development process shapes what these forest conditions are, what they do and what they will become. For example, as development proceeds, population pressure on land increases and then declines; urban demand and prices for wood products and energy increase; urban incomes and savings rise; non-farm employment opportunities grow; road systems and water resource developments expand; governmental capacities to protect forests, subsidize forest growth in agricultural areas and cooperate with local populations in forest management increase; and the strength of environmental interests relative to extractive interests and the extent of their international integration increase.

These dynamics determine the motives for cutting and growing trees in different places and at different times. Box 16 presents examples of the relationship between forest conditions and national development in India, Thailand and the United States.

Forest conditions reflect the consequences of policies that create and modify the opportunities for people to grow and cut trees. For example:

Thus, the use, development and conditions of forests are fundamental consequences of the wider configuration of national policy and economic development. National development is constantly creating incentives and capacities both to exploit and to enhance forest resources. Economic growth and social conditions tend to shift the location and composition of forest resources. On a national scale, the nature of this relationship depends on a country's particular economic, demographic and political circumstances. Where forest cover shifts away from traditional jurisdictions and commercial species, national accounts are likely to understate not only the amount of forests, but also the economic, social and environmental importance of forest resources. Two cases illustrate this point:

i) In Bangladesh, 14 percent of the land area is classified as forest under forest department jurisdiction, but more than 50 percent of the nation's wood and energy supplies come from homestead gardens (comprising less than I percent of the nation's land), which are not considered forest and receive relatively little governmental attention. From the air, the actual forest of Bangladesh, i.e. the aggregation of its trees, appears as tens of thousands of small islands in an alluvial plain as well as forest-lined ridges and streams between agricultural clearings and governmental and commercial logging sites. Forest department jurisdictions provide weak indications of actual forest conditions. Analogous patterns are apparent in densely populated regions of Indonesia (Java), Sri Lanka and Viet Nam.

ii) Vast areas classified as national forest in the western United States are treeless. Private irrigated orchards, riparian woodlands, hardwood savannahs and town tree cover in the same region have no legal definition as forests. However, private forest is included under the legal definition, whatever the vegetation or character of contiguous cover, if ownership is above a certain minimum size. Timber industry ownerships are classified as forest even when cleared in a pattern that resembles shifting cultivation in Asia, but 14 million ha of United States farmland planted to trees in agricultural conservation reserves are not called forest. Many metropolitan areas look like forest from the air and function ecologically as such but are not considered forest because of their forms of ownership.

Figure 10: World wood consumption, 1961-1992; Source: FAO

Examples of such jurisdictional distortions are ubiquitous. They raise an interesting point with regard to global attributes of forests, Since trees, not hectares or jurisdictions, conserve and store carbon, their location and arrangement, form of ownership and potential for other uses are irrelevant. Trees in the city store as much carbon as the same species in similar sites in the forest, and their shade reduces emissions from energy required to cool offices and houses. If forests were defined according to what aggregations of trees do, rather than according to certain customs of placement, form and control, the accounts of their national contributions would differ significantly from those cited for jurisdictional purposes.

In the future, the trade-offs between international obligations and national interests and government readiness to negotiate international dimensions of forests (in terms of both commodity trade and environmental services) will further influence policy choices, national development and forest conditions.

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