In recent decades the transformation of China’s forestry sector has enabled households to earn income from forestry, lease forest land and own trees. How are national reforms being implemented locally? Can the private sector help make forestry more sustainable? What policy and changes in attitude are required to ensure that China’s massive investment in forest protection and plantation is spent wisely?

Research from the Chinese Academy of Forestry and the International Institute for Environment and Development (IIED) examines the costs and benefits, constraints and opportunities for the private sector to improve forest management. Seeking to learn from 20 years of forest land tenure reform, it sets out recommendations for the future of forest land tenure, contracting and payment systems, watershed protection, biodiversity conservation, taxation and forest certification.

China may have the fifth largest area of forest in the world but is, nevertheless, lacking forests. The country has only 0.1 hectares per capita, considerably less than the world average of 0.6 hectares. China’s forest resources are not only small relative to its area and population, but are also small relative to demand. Yet it is the second largest timber importer in the world.

Reform has not been smooth or uniform. Forestry policies and practices vary from province to province and county to county. Efforts to phase out state collectives in forestry take place in an environment of frequent policy reversals and inconsistencies. In much of southern China, where decollectivisation has proceeded the fastest, positive impacts for forestry yields, employment, income and the environment are reported. Elsewhere, efforts to hand responsibility for forests to local households have failed to generate the predicted gains and have often promoted inequality.

Among the constraints examined by the study are:

• insecurity of tenure and delays in the settling of boundary disputes
• ingrained official perceptions of forests as a resource to be mined: taxes are high and discourage re-investment
• overlapping and conflicting authorities of cash-starved state agencies
• remoteness of forests in relation to markets and expensive finance
• contracts which appear to be company-community deals are often actually between companies and local governments
• limited user willingness and ability to pay for environmental services, lack of mechanisms for involving beneficiaries in payment decisions and a widespread feeling that it is the government’s responsibility to look after the environment.

Highlighting the need for establishing a fairer balance between risks and rewards for those who invest in forests, the research team calls on Chinese policy-makers to:

• consider outcomes for local livelihoods and improve consultation with communities when negotiating deals with companies
• develop a central land rights registry and strengthen dispute resolution, monitoring and enforcement mechanisms
• extend the security and planning horizons of contractors and households by permitting contract transfers and lengthening the period over which forest land may be contracted
• promote auctions to allocate forest land use rights to the most efficient producer and to maximise revenue for the contracting authority
• consolidate and reduce service-based taxes and charges, while investing in awareness building to generate willingness to pay for environmental services
• promote the concept of forest-certification: while immediate potential may be low, experience elsewhere shows its potential to promote sustainable forestry.

Source(s):
‘Getting the private sector to work for the public good: instruments for sustainable private sector forestry in China’, International Institute for Environment and Development, by Lu Wenming, Natasha Landell-Mills, Liu Jinlong, Xu Jintao and Liu Can, 2002 Full document.

Funded by: DFID and the European Commission

id21 Research Highlight: 1 August 2003

Further Information:
Lu Wenming
Research Institute of Forestry
Policy and Information
Chinese Academy of Forestry
Wan Shou Shan
Beijing 100091
China

Tel: +86 10 6288 9727
Fax: +86 10 6288 2317
Contact the contributor: luwenmin@public.bta.net.cn

Chinese Academy of Forestry

Natasha Landell-Mills
Forestry and Land Use Programme
International Institute for Environment and Development
3 Endsleigh Street
London WC1H ODD
UK

Tel: +44 20 7388 2117
Fax: +44 20 7388 2826
Contact the contributor: natasha.landell-mills@iied.org

International Institute for Environment and Development (IIED), UK

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