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Well worth paying for

Emmanuel Ze Meka
Executive Director, International Tropical Timber Organization

Many studies - such as UNEP's The Economics of Ecosystems and Biodiversity - have recently reported on the high ecosystem service values associated with forests, especially tropical ones. They have found that the values of water, carbon storage, soils, biodiversity maintenance and other forest ecosystem functions dwarf the economic value of traditional forest products (primarily timber). This leads to forests being valued at billions - or, globally, trillions - of dollars. Nevertheless, about 13 million hectares of tropical forests continued to be lost - along with their valuable biodiversity and other ecosystem services - every year from 2000 to 2010. How could this be?

There is a simple answer. While the ecosystem services catalogued and assessed in recent reports, using sophisticated economic techniques, are indeed valuable, the markets for transferring payments for them mostly remain in their infancy - if, indeed they exist at all. With the exception of the emerging global market for carbon, there are no mechanisms for tropical countries to monetorize the potential value of their forests. No one is lining up to pay them for these services. So it is not surprising that forest owners (mostly countries but sometimes also the private sector) decide to use the land on which those forests sit for what they perceive to be more productive economic uses, such as agriculture.

ITTO - an intergovernmental organization based in Yokohama, Japan - began life a quarter of a century ago as a commodity organization focused on promoting markets for sustainably produced tropical timber. This objective is still relevant, but the Organization has increasingly sought to help countries manage their forests sustainably and add value to all tropical forest services; it recognises that the revenue from any one service is simply insufficient to offset benefits from such competing land-uses as agricultural crops or oil palm, with their relatively short harvest cycles and simpler management regimes.

Timber remains the single most important way of generating revenue from tropical forests. It has earned tropical countries over $20 billion in export earnings annually over the last decade, if both primary and secondary processed products (like furniture) are taken into account. Indeed the forest sector's contribution to economic development is even greater when the millions of jobs it creates and the revenues generated by domestic timber markets are also considered. Sustainable forestry and sustainably produced timber products must therefore be a part of the solution both to valuing tropical forests appropriately and to reversing their continuing clearance while simultaneously promoting economic development. So ITTO continues to argue that it is essential that the new funding schemes being formulated to combat climate change (such as "REDD+" or Reducing Emissions from Deforestation and Forest Degradation) include sustainable forestry - incorporating sustainable timber production - within their approved activities.

There is a wealth of experience - some of it generated from ITTO field projects - on how to produce timber and other forest products sustainably - by taking the ecology of the tree species into account, using technology to reduce the impact of harvesting, undertaking appropriate rehabilitation and/or reforestation afterwards, and providing market information to ensure the resulting products are fairly priced, so that funds can flow back to the forest. Of course corruption and poor governance - which affect many sectors and countries - need to be tackled to allow the system to work and to ensure funds are not misappropriated: significant work on tackling such problems has been undertaken globally in recent years.

ITTO has tracked progress towards sustainable forest management (SFM) in the tropics since its formation. One of the Organization's first studies (published as the 1989 book "No Timber without Trees"; by Duncan Poore) found that only a miniscule amount of the world's tropical forest was under sustainable management in the late 1980s. A follow up study - ITTO's Status of Tropical Forest Management 2005 - found that, though there had been improvements, the area under SFM was still only around 5% of what was intended to be kept as forest, both for production and for protection, in tropical countries. ITTO's most recent survey - Status of Tropical Forest Management 2011 - finds that progress has continued over the past five years: well over three million hectares a year has been added to the total area under SFM in the tropics. However this still leaves over 90% of the world's tropical forests under poor or no management. Clearly, progress in SFM needs to accelerate to meet our shared goal of ensuring the future of global tropical forest resources.

UNEP - as the key UN agency charged with promoting environmental sustainability - shares a special concern for tropical forests and their ecosystem values, and they have a high profile on the lead-up to next year's Rio+20 Earth Summit. It is worth recalling, however, that many stakeholders (especially the developing countries where virtually all tropical forests exist) were disappointed with the lack of "new and additional" resources that the international community was expected to make available to implement the non-binding forest principles agreed during the original 1992 Earth Summit. In the nearly two decades since that historic event many services provided by tropical forests - including ecotourism, bio-prospecting, and most recently REDD and carbon - have been identified as having the potential to reverse their continued loss. Organizations like ITTO and UNEP must work with governments, NGOs, the private sector and other stakeholders to develop fair and equitable markets for these and other forest products and services. In this way, we can help to send the global community a clear message that managing tropical forests sustainably is a viable land-use option - provided that we properly value and pay for the many goods and services they produce.

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