<< Chapter < Page Chapter >> Page >

Examples are plentiful. In dozens of nations from Southeast Asia to Africa, the government as owner of property rights to the natural forest has placed far heavier value on the productive rather than the protective resources provided by the forest. Moreover, the natural tropical forest has been exploited as if only two of its productive resources were of any economic value: the timber stands and the generally poor quality agricultural land lying beneath the canopy. A third economic resource has been consistently overlooked: the forest’s capacity to supply income from commercial and non-commercial non-wood forest products. Virtually all important non-wood forest products in the tropics can be harvested without cutting down trees. Commercial products already known number in the dozens, and include nuts, oils, fibers, meat, cosmetic compounds, dyes, fruits, latex, edible birds’ nests, ornamental plants, spices, and pharmaceutical substances.

Harvest of these products can provide a perpetual annual stream, of income for local people, while leaving the natural forest largely intact. Destruction of the forest destroys this stream. Logging and land-cleaning in the forest, generate essentially short-term economic returns. Clear-cutting is rarely the problem in the case of the type of selective logging practiced in the tropics (wherein one to three stems per hectare are taken). Long-growing cycles for timber means that the commercial value of a cut-over stand cannot be replenished for more than a half-century, if indeed ever. And in the species rich, finely-tuned ecosystems on poor soils characteristic of many tropical forests, even selective logging does three things to the ecosystem that harvest of non-wood products does not: it damages the canopy and the solid, and results in the removal of large quantities of minerals. In the case of clear-cutting of tropical forest for resettlement projects (as in Indonesia and the Philippines), or for cattle ranches (as in Brazil, Ecuador and Central America), former forest lands cannot generally even generate positive private economic returns without expensive governmental assistance. In the case of land clearing for pastures in Brazil, even very heavy subsidies proved insufficient to keep some ranches in operation beyond five or six years, with similar results reported for Central America.

In the case of logging, it is not at all apparent that for a given forest parcel the economic value of the perpetual annual stream of income from annual harvests of non-wood products is exceeded by the economic value of logs extracted or land cleared. Several recent cases from Indonesia, Philippines, and Peru in fact suggest that the potential economic benefits from keeping natural forests intact may greatly exceed those which results from forest conversion.

Consider first a much-simplified example, taken from Indonesia data.

There, I once found that, at least for some areas of forest land, that every hectare logged each year, Indonesia gave up twice as much future income from non-wood products than it gains from logging. This is true even though I applied a 6% rate of discount to the perpetual stream of income from non-wood products, meaning that returns 25 years or more from now have virtually no value. Also, in studying this case, I ignored all the very large environmental costs of logging.

Get Jobilize Job Search Mobile App in your pocket Now!

Get it on Google Play Download on the App Store Now




Source:  OpenStax, Economic development for the 21st century. OpenStax CNX. Jun 05, 2015 Download for free at http://legacy.cnx.org/content/col11747/1.12
Google Play and the Google Play logo are trademarks of Google Inc.

Notification Switch

Would you like to follow the 'Economic development for the 21st century' conversation and receive update notifications?

Ask