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Financing forests and sustainable forest management in Small Island Developing States Second macro-level paper Prepared by Indufor for the United Nations Forum on Forests Helsinki 2 September 2010 The views presented in this document are those of the consultant and do not necessary reflect

the views of the United Nations.

DISCLAIMER

Indufor makes its best effort to provide accurate and complete information while executing the assignment. Indufor assumes no liability or responsibility for any outcome of the assignment.

Copyright © 2010 by Indufor Oy All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including, but not limited to, photocopying, recording or otherwise.

© INDUFOR: FINANCING FORESTS AND SUSTAINABLE FOREST MANAGEMENT IN SMALL ISLAND DEVELOPING STATES. Second macro-level paper. 2 September 2010.

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Table of contents

EXECUTIVE SUMMARY 1

1. INTRODUCTION 4

1.1 Background 4

1.2 Recent trends in policy processes relevant to financing forests and trees 5

2. METHODOLOGY AND DATA GATHERING 7

3. PRESENT FINANCIAL FLOWS FOR FORESTS AND SFM IN SIDS 8

3.1 Introduction 8

3.2 Public foreign financing: Forestry ODA 8

3.3 Public domestic financing: Budget, own income generation and forest funds 12

3.4 Private financing – domestic and foreign direct investments 15

3.5 Innovative financing sources 17

4. DEMAND FOR FOREST AND SFM FINANCING 22

4.1 Forests and trees in development strategies 22

4.2 Forest policies of SIDS 23

5. FINANCING GAPS AND OBSTACLES 24

6. CONDITIONS FOR INVESTMENT AND THE ENABLING ENVIRONMENT FOR FINANCING FORESTS AND SFM IN SIDS 26

7. STRATEGIES FOR INCREASING FINANCING FLOWS FOR SFM, INCLUDING NEW AND INNOVATIVE SOLUTIONS 30

8. CONCLUSIONS 33

9. REFERENCES 34

List of annexes

Annex 1 Value added (%) of agriculture, fisheries, hunting and forestry Annex 2 ODA in SIDS during 2002-2008 Annex 3 Forestry ODA contributions (%) by donor in SIDS during 2002-2008 Annex 4 Forestry ODA received by country in SIDS during 2002-2008 Annex 5 Percentage shares of forestry ODA in SIDS by thematic area during

2002-2008 Annex 6 Forests and trees in national MDG strategy or report Annex 7 Forests and trees in national agricultural, environmental or related

strategy in SIDS Annex 8 Forest resources, inclusion of forests in a PRS or other national

development strategies in SIDS, and existence of national forest programme (NFP), forest policy (FP), forest strategy (FS) or forest legislation (FL)

List of figures

Figure 1 Forestry ODA in SIDS during 2002-2008 9

Figure 2 SIDS share from total forestry ODA during 2002-2008 9

Figure 3 Forestry ODA contributions by donor in SIDS during 2002-2008 10

Figure 4 Average forestry ODA percentage received by country in SIDS during 2002-2008 11

Figure 5 Percentage shares of forestry ODA in SIDS by thematic focus during 2002-2008 12

List of tables

Table 1 Forest and conservation funds in SIDS 13


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Table 2 FDI flows in agriculture, forestry and fisheries available in SIDS 15

Table 3 REDD(+) specific financing and activity in SIDS 19

Table 4 Forest carbon-related funding in SIDS 20

Table 5 Business environment indicators in SIDS 28

List of boxes

Box 1 Revenue generation systems in Fiji linking water with forests and trees 17

Box 2 Watershed conservation, carbon credits and agro forestry in Fiji 18

Box 3 Debt-for-nature swaps in Jamaica and Belize 21

Box 4 Thematic areas of the PRS and national development strategies 23


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ABBREVIATIONS AND ACRONYMS ACCPIR Adaptation to Climate Change in the Pacific Island Region AIMS The Atlantic, Indian Ocean, Mediterranean and the South China Seas BCEP Boden Creek Ecological Preserve BCF Belize Conservation Fund BPOA Barbados Programme of Action BZD Belize Dollar CBD Convention of Biological Diversity CBO Community-based organization CCBA Climate, Community and Biodiversity Alliance CDM Clean Development Mechanism CI Conservation International CO2 Carbon dioxide CPI Corruption Perceptions Index CRS Creditor Reporting System DAC Development Assistance Committee EU European Union FACRP Fondes Amandes Community Reforestation Project FAO Food and Agriculture Organization of the United Nations FCF Forest Conservation Fund FCPF Forest Carbon Partnership Facility FDI Foreign direct investment FIP Forest Investment Programme FL Forest legislation FP Forest policy FS Forest strategy FSM Federated States of Micronesia GDP Gross domestic product GEF Global Environment Facility GLISPA Global Island Partnership GM Global Mechanism GOJ Government of Jamaica GSI Guiana Shield Initiative I&CB MRV Institution and Capacity Building for Monitoring, Reporting and Verification I&CB R-funds Institution and Capacity Building for handling REDD+ funds IADB Inter-American Development Bank IFMCP Kamula Doso Improved Forest Management Carbon Project IFS Integrated Financing Strategy ITTO International Tropical Timber Organization JI Joint implementation LDC Less-developed country LFCC Low Forest Cover Country MCT Micronesia Conservation Trust MDG Millennium Development Goal MUSD Million USD n/a not available NBSAP National Biodiversity Strategy and Action Plan NBSPA National Environmental Policy

NDP National Development Plan NFMCP National Forest Management and Conservation Plan NFP National Forest Programme NGO Non-governmental organization n.s. not significant NTFP Non-timber forest product NWFP Non-wood forest product NZD New Zealand Dollar ODA Official Development Assistance


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OECD Organization for Economic Cooperation and Development PACT Belize Protected Areas Conservation Trust PES Payment for environmental/ecosystem services PfB Programme for Belize PNG Papua New Guinea PRS Poverty Reduction Strategy PRS(P) Poverty Reduction Strategy Paper RBCAP The Rio Bravo Climate Action Project REDD Reducing Emissions from Deforestation and Forest Degradation REDD+ Reducing Emissions from Deforestation and Forest Degradation+ R-strategy Preparation of National REDD+ strategy SCF Suriname Conservation Foundation SFM Sustainable forest management SIDS Small Island Developing States SLM Sustainable Land Management SPC/GTZ Pacific-German Regional Programme TFAP Tropical Forest Action Plan TIDE Toledo Institute for Development and Environment TNC The Nature Conservancy TTNWR Trinidad & Tobago Nariva Wetland Restoration UK The United Kingdom UNCCD United Nations Convention to Combat Desertification UNCTAD United Nations Conference on Trade and Development UNDP United Nations Development Programme UNEP United Nations Environmental Programme UNFCCC United Nations Framework Convention on Climate Change UNFF United Nations Forum on Forests UN-REDD United Nations Collaborative Programme on Reducing Emissions from

Deforestation and Forest Degradation in Developing Countries US United States USD United States Dollar USDA United States Department of Agriculture WBSD World Business Council for Sustainable Development WEF World Economic Forum WWF World Wildlife Fund


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EXECUTIVE SUMMARY

The scarcity of land in most Small Island Developing States (SIDS) puts pressure on the forest resources. Though the forest cover in SIDS does not represent an area with a magnitude of global significance, the forests and trees in SIDS provide invaluable products and services for the residents of SIDS and for the global population. The islands of the Caribbean, West Indian Ocean and Pacific Ocean are all considered biodiversity hotspots. Land is scarce on many islands, and the areas with forests and trees must provide multiple services to their population, including, inter alia, provision of fresh water, food, raw materials for building and energy production, shelter and means of adaptation to the effects of climate change. Forests and trees in SIDS are inevitably a multi-sectoral issue; thus, financing the provision of services and products from forest and trees in SIDS cannot be limited to the forest sector (in the traditional production-oriented sense).

With the currently available data, it is not possible to compare the relative shares and significance of different sources of finance for forests and trees in SIDS. However, in most SIDS, the forest sector, in the traditional production and downstream value-adding sense, is marginal or absent, so public financing sources such as domestic budget, official development assistance (ODA) and innovative mechanisms are more likely to play a significant role. On the other hand, nature-based tourism is an increasing source of forest-related investment and income in many SIDS. However, there are no studies concerning the impact of such tourism on forest financing in SIDS. Official development assistance is an important funding source for forests and trees in SIDS. The majority of ODA (82 per cent) allocated to this group of countries comes from bilateral donors. On average, between 2002 and 2008, SIDS received USD 5.5 million per year of ODA for forestry as defined by the OECD. ODA has been on a slightly decreasing trend; during the same period, ODA was an average of 1.5 per cent of total forestry ODA, and the portion for SIDS has been decreasing in recent years.

There is no readily available data on domestic public financing of forests and trees in SIDS. Access to domestic financing data would be important in many SIDS where domestic public financing and ODA are likely the most important sources of financing for forests and trees. For SIDS, no information on domestic direct investments was available, and foreign direct investment (FDI) information was scarce. A financing survey carried out for the present study turned out to be unsuccessful in collecting such factual data because of a very low response rate by SIDS respondents, and study resources did not permit data collection visits to a large number of countries. Of the 38 SIDS included in this report, 5 have a specific forest fund. A further nine countries have a fund supporting conservation and management of natural resources. Protection of biodiversity and watersheds, for example, is an activity potentially relevant to forests. The majority of forest funds in SIDS focus on conservation. Challenges for SIDS include the small size of domestic markets (economies of scale), capacity constraints due to the small size of the population (affecting institutions, training, education and skills), high costs of overseas transport and limited access to land. However, these issues would require in-depth research such as a detailed SIDS-specific investment climate survey. In the World Bank´s Ease of Doing Business index, almost half of the SIDS rank in the bottom half, indicating a business environment that is not conducive to investments. Watershed services are considered important benefits of trees and forests in SIDS. For example, watershed management features prominently in the SIDS Poverty Reduction Strategies (PRSs) and other national development strategies. In this context, payment for watershed services systems has the potential to mobilize financing for forests and trees in SIDS. However, capacity development is necessary in many cases. Only a few SIDS have identified the potential for generating funds through environmental services in their national strategies.


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Nine countries included in this report have carbon financing related to forests and trees. All credits seem target the voluntary markets, as there are currently no Clean Development Mechanism (CDM) projects in SIDS related to afforestation/reforestation. Among the nine countries, only two have private sector involvement in their forest carbon projects, while in the rest of the countries (Belize, Dominican Republic, Fiji, Guyana, Maldives, Papua New Guinea and Suriname), the projects are supported either fully or partially by international donor agencies or bilateral donors. Most of these forest carbon projects have multiple objectives, including generation of ecosystem services and supporting local livelihoods. Guyana has signed a Memorandum of Understanding with Norway on cooperation in Reducing Emissions from Deforestation and Forest Degradation (REDD), including the establishment of a framework for results-based financial support that will be channelled through the “Guyana REDD-plus Investment Fund”. Guyana, Papua New Guinea, Suriname and Vanuatu are participants of the World Bank’s Forest Carbon Partnership Facility (FCPF). Papua New Guinea is also a UN- REDD

1 pilot country, and Solomon Islands is a UN-REDD partner

country. Approximately one third of SIDS included in this report have a Poverty Reduction Strategy (PRS). The majority (9 out of 12) of these countries have included forests and trees in their PRS. Although relatively few countries in the group have a PRS, the role of forests and trees is often recognized in other existing strategies. In total, 22 countries of the 38 SIDS included in this report have identified forests and trees in their development strategies. On the one hand, this clearly indicates the countries’ acknowledged demand for financing for increased provision of services from forests and trees in a large number of SIDS countries. On the other hand, in the remaining SIDS, the absence of forests and trees in national development strategies may reflect a weak understanding of and/or low political priority given to the issue. Main conclusions:

• ODA is a major source of funding for forests and trees in SIDS. Inclusion of forests

and trees in the national development strategies is crucial to enabling the mobilization

of donor funds. However, a significant number of the countries (slightly less than half)

have not included forests and trees in their PRS or other development strategies,

which may reflect a weak understanding of or low political priorities for forests and

trees. In addition, more than half of the SIDS included in this report do not have a

forest strategy, which might suggest a lack of political interest in forests and trees in

those SIDS.

• Watershed, soil management and biodiversity conservation are among the important

issues in SIDS. These thematic areas are cross-sectoral, meaning that various

sectors, especially the forest, agriculture, water, energy and tourism sectors, need to

address the issues together or in some combination. An integrated approach to the

management and financing of land, water and forests could be facilitated and

supported to achieve better coordination and integration of strategies and policies. A

good example of cross-sectoral financing strategies is the Global Mechanism (GM)-

facilitated Integrated Financing Strategy (IFS) process.

• Domestic budgets are a significant source of financing of forests and trees in SIDS.

An understanding of the domestic budgeting process and liaison with the respective

national planning institution may potentially result in an increase of the budget

allocation to forest-relevant institutions.

• In many SIDS, there are close linkages between forests and trees and the fastest

growing economic sector: tourism. However, information on these linkages is scarce,

and the issue should be studied further. The services and products that forests and

trees generate for the tourism sector should be identified at country level, and a

payment for forest environment services (forest PES) system should be designed.

1 The United Nations Collaborative Programme on Reducing Emissions from Deforestation and Forest Degradation in Developing Countries.


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Examples of this include voluntary or mandatory forest environment fees for cruise

passengers, hotel guests and nature park visitors.

• Presently, only a few countries have identified the potential for fund generation

through environmental services in their national strategies. PES systems could

provide an opportunity for increased generation of funds for forests and trees in SIDS,

but PES capacity development is necessary in most countries. This could also entail

the need to channel more ODA to forest education and training, which currently has

received only a minor share of forestry ODA in SIDS.

• Land and forest tenure is an important component of investment attractiveness and in

the designing of PES systems. Fiji provides an interesting example of a clear tenure

arrangement: the country’s customary tenure system is integrated into the legislation.

Many arrangements in Fiji combine lease payments with other income streams from

forest land, such as estimated timber income forgone in conservation areas or carbon

sales.

• Debt-for-nature swaps have been implemented in some SIDS. These agreements

have the potential to generate substantial funding, as demonstrated by the case of

Jamaica. Experience sharing and awareness-raising could allow other countries in the

group to tap into this opportunity.

• Timberland investment has not been fully tapped into in those SIDS countries where

suitable growth potential for high-value commercial species (e.g., teak, mahogany,

agarwood, sandalwood, etc.) exists and where suitable land is available.


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1. INTRODUCTION

1.1 Background

Support given to the process of “Facilitating Financing for Sustainable Forest Management (SFM) in Small Island Developing States (SIDS) and Low Forest Cover Countries (LFCCs)” continues the efforts of the United Nations Forum on Forests (UNFF) to systematically promote SFM, as stipulated in the Global Objectives on Forests. In October of 2009, the Member States of the UNFF adopted a decision on means of implementation of SFM during a special session of the ninth session of UNFF. The decision launched two initiatives to catalyse funding for SFM. The Forum established an intergovernmental Ad Hoc Expert Group, which will analyse existing financing strategies for SFM and explore ways to improve access to funds, including the option of establishing a voluntary global forest fund. The second initiative is a “facilitative process” on forest financing to assist countries to mobilize funding from all sources. The facilitative process addresses the special needs of countries that have faced a decline in forest financing, which include, among others, SIDS. This study aims to understand the current level and sources of financing for forests and trees in SIDS, the related gaps and obstacles, and opportunities present. It also provides recommendations for financing forests and trees in SIDS. There is strong global political commitment to SFM, but current financial resources are insufficient to support SFM and halt deforestation. Globally, approximately 13 million hectares of forest disappear every year (FAO, 2010). Social and economic considerations drive land use and forest management decisions. According to many studies, the most common reason for deforestation is the land use change from an option perceived as less profitable (forest/forestry) to a more profitable use such as agriculture or animal husbandry. The difference in profitability is real, at least in the short term, but it is often caused or supported by agricultural subsidies or other policies that favour agricultural expansion. In the case of most SIDS, the scarcity of land puts pressure on the forest resource.

Forest cover in SIDS does not represent an area with a magnitude of global significance. However, the forests and trees in SIDS provide invaluable products and services for the residents of SIDS and for the global population. The islands of the Caribbean, West Indian Ocean and Pacific Ocean are all considered biodiversity hotspots. According to the Convention on Biological Diversity (CBD), islands cover about 3 per cent of the world’s surface, yet they harbour a disproportionate amount of global biodiversity, and endemic species in particular. One third of the world’s conservation hotspots are islands. For example, the Seychelles has the highest number of endemic amphibians in the world. According to the United Nations Framework Convention on Climate Change (UNFCCC), SIDS are home to an important proportion of the world’s biodiversity, especially because of their geographic isolation, which has led to the formation of many endemic species. The biodiversity of upland and coastal forests, including mangroves, is threatened by both global change and local factors; for example, more than a quarter of Small Island States have a greatly reduced forest cover as a result of encroachment from infrastructure development or agriculture. A specific feature of SIDS is vulnerability to changes in general, including changes in, inter alia, climate, the global economy, tourism, invasive species. The reason for this special vulnerability is their limited size, often isolated location and exposure to natural forces. Climate change is a case in point. There is a vast amount of documentation on various aspects of such vulnerability (see, for example, http://www.sidsnet.org/aosis/). However, the specific links between forests and the other risks related to changes in the SIDS have neither been studied nor documented. There would be a need for a specific study on the risks associated with climate change and forests in SIDS.

Forests and trees in SIDS are inevitably a multi-sectoral issue, so financing the provision of services and products from forest and trees in SIDS cannot be specifically limited to the forest sector in its traditional production-oriented sense. Land is scarce on many islands, and the areas with forests and trees must provide multiple services to their population, including, inter alia, fresh water, food, raw materials for building and energy production, shelter and means of adaptation to the effects of climate change. A multi-sectoral approach to financing SFM in


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SIDS has the potential to allow the necessary service provisions to meet the demands of local and global populations.

The Eliasch Review (2008) estimated that the opportunity cost of Reducing Emissions from Deforestation and Forest Degradation (REDD) and SFM could range from USD 15 billion to USD 33 billion per year, most of which would be needed in developing countries. According to Simula (2008), the external public funding is approximately USD 1.91 billion per year. Furthermore, according to the Organization for Economic Cooperation and Development (OECD 2008), the level of forest ODA from Development Assistance Committee (DAC) member countries has remained flat over much of the past decade, while the share of aid to forestry (as defined by OECD) of the total ODA has declined, even as total ODA has increased. The global forestry ODA is unevenly distributed, and the SIDS share of the total forestry ODA is not significant. It has also declined during the past decade. 1.2 Recent trends in policy processes relevant to financing forests and trees

There is a clear need, identified by the UNFF and other global processes and stakeholders, to define and remunerate all services from forests and trees, encompassing both the traditional production-oriented services and the more recently identified environmental services. This remuneration would be used to guarantee the necessary financial resources for SFM in SIDS and elsewhere. In 2006, the International Tropical Timber Organization (ITTO) launched a process to encourage investment in natural tropical forests. The process has included one global, three regional and two national forums. All these forums have concluded that the current investment levels in natural tropical forests are insufficient to ensure sustainable forest management or the avoidance of conversion of forests to other land uses more profitable in the short term.

The joint study process of the Food and Agriculture Organization of the United Nations (FAO) and other institutions, introduced in the FAO (2009) paper on national financing strategies for SFM, stresses that the broadening and diversifying of the financing basis for SFM is the key to enhancing the competitiveness of forests as a land use. The Intergovernmental Panel on Forests (IPF), the Intergovernmental Forum on Forests (IFF) and the United Nations Forum on Forests (UNFF) have reached similar conclusions in studies. The paper highlights obstacles to SFM financing, such as undervaluation of the multi-functionality of forests, perceived high risks in forest investments and the long-term nature of the forestry cycle. According to the study, a comprehensive national financing strategy is needed at the country level as an integral part of a National Forest Programme (NFP), and integration with the national development strategy is considered crucial. The Global Mechanism (GM) of the United Nations Convention to Combat Desertification (UNCCD) promotes the Integrated Financing Strategy (IFS), a process-oriented approach to guide resource mobilization efforts towards an investment framework that meets the specific, long-term needs of developing country Parties to the UNCCD. The IFS process aims at a more efficient use of existing Sustainable Land Management (SLM) financing sources and instruments, and at mobilization of new and additional resources (internal, external and innovative) through the creation of an enabling environment. The concept emphasizes cross-sectorality and aims at linking SLM to existing national or sectoral processes and frameworks. According to the GM (2008), SLM has close inter-linkages to the agriculture and environment sectors and to forests and trees; hence, if a country already has a comprehensive sector programme for forests or rural development, the concept recognizes the potential to mainstream SLM principles into this programme rather than to establish an SLM-specific framework. Currently, the Global Mechanism and the United Nations Development Programme (UNDP) have an ongoing process to facilitate the development of IFS in 14 Pacific countries with Global Environment Facility (GEF) funding. The Global Island Partnership (GLISPA) – of which more than one third of SIDS included in this report are participants – emphasizes the multi-functionality of forests and trees, and addresses the policy and financing issues related to these through programmes on


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biodiversity and protected areas. The GLISPA is a recognized partnership that aims to achieve the Convention on Biological Diversity’s biodiversity 2010 targets in islands. For example, through its Micronesia Challenge, its goal is to conserve by 2020 at least 20 per cent of terrestrial resources across Micronesia, including forests and trees outside forests. One of the major strategies of GLISPA is to facilitate increase funding for island priorities by working with the GEF, the World Economic Forum (WEF), the World Business Council for Sustainable Development (WBSD), other trade organizations and voluntary initiatives, and interested private sector partners. Thus far, it has helped catalyse more than USD 70 million in island conservation commitments. All these approaches show the trend in the thinking on forests and trees- relevant financing strategies where:

• Cross-sectoral linkages owing to multi-functionality of forests and inter-sectoral

impacts are emphasized.

• Integration with country-level strategies and policy processes is considered necessary.

• The role of the enabling environment is highlighted.

• The potential of new and innovative financing sources and mechanisms is viewed as a

new opportunity.


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2. METHODOLOGY AND DATA GATHERING

This report was compiled through a desk study, three country case studies and a global survey on forest financing. The desk study focused on gathering existing background data on forest financing in SIDS. Under Indufor supervision, local consultants in Cape Verde, Fiji and Trinidad and Tobago conducted the country case studies, which included various stakeholder interviews and expert consultation workshops. A global survey of SIDS was carried out to gather quantitative and qualitative information on forest financing, policies and legislation in the respective countries. Various hindrances to the collection of reliable data on forest financing in SIDS were experienced during the study process (see also the first SIDS macro-level paper entitled “Background to Forest Financing in SIDS”):

• The survey on forest financing in SIDS had a very low response rate. Three evident reasons for this were (a) lack of UNFF connections in the country, which led to difficulties in locating the contacts of forest-relevant institutions and consequently in locating representatives of those institutions within the time frame of the study; (b) lack of response once some of these representatives were eventually located; and (c) outdated contacts in the list of Country Focal Points. The countries had not informed the UNFF Secretariat on institutional staffing changes.

• Quantitative and qualitative information at a global level on financial flows other than ODA for forests and trees was limited, and previous studies focusing on forest financing in SIDS were lacking.

• In the case study countries, the consultants were able to secure data mostly on traditional production-oriented forestry and forest sector. Data on funding flows between the sectors was in most cases difficult to access within the time frame of the process. Reasons for this were either lack of communication from the institutions and ministries in the respective sectors and/or difficulties in identifying/quantifying the cross-sectoral fund flows. Also, in cross-sectoral activities and projects, it can be difficult to identify which funds are used for forest-relevant activities and which ones are used for other activities.

To overcome the issue of the low response rate of the global survey, additional data was gathered from available sources, such as the Creditor Reporting System (CRS) of the OECD

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and the United Nations Environmental Programme (UNEP) Risoe Clean Development Mechanism (CDM)/joint implementation (JI) Pipeline Analysis and Database

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2 http://stats.oecd.org/Index.aspx?DataSetCode=CRSNEW 3 Updated 1 July 2010. http://cdmpipeline.org/


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3. PRESENT FINANCIAL FLOWS FOR FORESTS AND SFM IN SIDS

3.1 Introduction

Simula (2008) studied the global demand for forest financing and the supply of external financing for forests in the context of the Non-Legally Binding Instrument on All Types of Forests. The role of ODA was concluded to be catalytic, and in national forest financing strategies, ODA is considered complementary to the own revenue generation of the sector and to the creation of an enabling environment for private sector investment. According to the study, on the supply side of global forestry, ODA was approximately USD 1.91 billion per year during 2005 - 2007. Financing flows to forests can be classified according to existing sources (domestic or foreign), institutions (public or private) and mechanisms (investments, loans, grants etc.). The ODA data presented in this chapter is extracted from the OECD Creditor Reporting System

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(CRS), and the ODA definition of forestry is as defined by the OECD. Financing generated through various multi-sectoral thematic areas such as biodiversity, desertification and climate change is important in generating funds for forest and trees in SIDS. In this respect, the CBD, UNCCD and UNFCCC, among others, are institutions generating global policies and mobilizing financing for these thematic areas. The exact ODA flows that these organizations have mobilized to each SIDS country cannot be identified. However, in the cases of CBD and UNCCD, GEF is one major source of funding that is reported under the CRS of OECD. In addition, mobilized bilateral flows are documented in CRS and can thus be identified. Climate funding in the context of forests and trees, namely REDD+ funding, is mainly generated through UN-REDD and the World Bank’s climate financing mechanisms, such as the Forest Carbon Partnership Facility (FCPF) and Forest Investment Programme (FIP), as well as to some extent through bilateral ODA. With the currently available data, it is impossible to compare the relative portions and significance of different sources of finance for forests and trees in SIDS. However, in most SIDS, the forest sector (in the traditional production and downstream value-adding sense) is limited or absent, and sources such as domestic budget, ODA and innovative mechanisms are more likely to play a significant role. In those relatively few SIDS that have a large forest resource base, value-adding downstream processing and significant export activities (e.g., Papua New Guinea, Suriname, Fiji, Samoa, the Solomon Islands, Guyana, the Dominican Republic, and Vanuatu), domestic and foreign direct investments and portfolio investments assumedly have a more pronounced role. According to Lebedys (2004), in 2000, the GDP share of forestry in SIDS was approximately 0.7 per cent. In those SIDS where forest industry was considered to be important

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national economy, the share was approximately 3.6 per cent; the world average being at the time approximately 1.25 per cent. Value added for agriculture, fisheries, hunting and forestry from a United Nations compilation of national accounts statistics is listed by country in annex 1. In 2008, the aggregate share was high in countries with forest industry; however, conclusions cannot be made, as a distinction between the forest and other sectors in the aggregate figure cannot be made. The reader should note that national income accounts do not reflect all of the benefits from forestry activities, for the informal forestry sector activities (e.g., production of wood fuel and non-wood forest products (NWFP)) often go unrecorded; as a result, the real economic contribution of the forestry sector is far above the levels stated in published national income statistics.

3.2 Public foreign financing: Forestry ODA

ODA is an important funding source for forests and trees in SIDS. Between 2002 and 2008, SIDS received on average USD 5.5 million per year of forestry ODA as defined by the OECD. During the same period, this was an average of 1.5 per cent of total forestry ODA reported by the OECD. The trend of forestry ODA in SIDS during 2002-2008 showed a slight decrease:

4 http://stats.oecd.org/Index.aspx?DataSetCode=CRSNEW 5 Fiji, Guyana, Papua New Guinea, Samoa, Solomon Islands, Suriname and Vanuatu


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from 2002 to 2004, SIDS received an annual average of USD 6.4 million, and from 2006 to 2008, they received an annual average of USD 4.8 million although 2007 saw an increase in bilateral forestry ODA (see Figure 1 and Annex 2). SIDS’ share of total forestry ODA has also been decreasing; in 2002, SIDS received 3.3 per cent of all forestry ODA, but only 1.1 per cent

in 2005 and 0.9 per cent in 2008 (see Figure 2 and Annex 2). Figure 1 Forestry ODA in SIDS during 2002-2008

Figure 2 SIDS share from total forestry ODA during 2002-2008

Of the total global forestry ODA distributed during 2002-2008, bilateral donors have contributed on average 82 per cent per year, but the contributions of the multilateral donors have been growing relatively faster. Similarly, in SIDS, the majority of ODA (82 per cent) comes from bilateral donors. On average, the share of multilateral ODA increased during 2002-2005, but decreased during 2006-2008 (see Figure 3). Australia has been the top ODA donor to SIDS, with an average 25 per cent yearly contribution during 2002-2008 (see Figure 3 and Annex 3). During the same period, Japan, with an 17 per cent share, has been a significant donor in the case of total forestry ODA. In addition, Canada (11 per cent), Germany (9 per cent) and the Netherlands (9 per cent) have been major ODA donors to SIDS. The European Union Institutions are the only major


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multilateral donor in SIDS, with a share of 18 per cent of the total, and with almost all of the contributions from the multilateral institutions recorded by the OECD. Figure 3 Forestry ODA contributions by donor in SIDS during 2002-2008

Six of the nine least developed countries in SIDS belong to the Pacific regional group (see annex 1 in report Background to forest financing in Small Island Developing States (SIDS) - First macro-level paper). The Pacific SIDS received on average 56 per cent of forestry ODA of all forestry ODA allocated to SIDS countries. Hence, within the SIDS group, the least developed countries (LDCs) are well represented as recipients of forestry ODA. The Caribbean SIDS received 40.5 per cent, and the Atlantic, Indian Ocean, Mediterranean and the South China Seas (AIMS) SIDS received 3.5 per cent. The forestry ODA in SIDS has been highly lopsided, as during 2002-2008 18 out of 38 SIDS did not receive any at all and 10 countries received on average over 90 percentage of forestry ODA in SIDS (see Figure 4 and Annex 4). Papua New Guinea received during 2002-2008 on average almost one third of forestry ODA in SIDS. Solomon Island, Dominican Republic and Guyana received approximately 10 per cent each (see Figure 4). The assistance seems to have targeted SIDS with notable forest resources, while many countries with lesser resources have received no forestry ODA allocations.


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Figure 4 Average forestry ODA percentage received by country in SIDS during 2002-2008

Germany, the Netherlands and Portugal were the sole donors of forestry ODA to the AIMS countries. Within the group, Cape Verde received contributions from Germany and the Netherlands, and Sao Tome and Principe received assistance from Portugal and the Netherlands. In the Pacific SIDS, Australia and Japan were major forestry ODA donors; Australia directed forestry ODA solely to the Pacific group. European Union institutions were also a major donor for the Pacific SIDS, which received the largest share of the European Union Institutions’ allocation. The region also received contributions from Canada, Germany, New Zealand, the Republic of Korea and Italy. The major ODA donors to the Caribbean SIDS included in this report were Japan, Canada, the Netherlands and the United Kingdom. Germany, Switzerland and European Union institutions also provided forestry ODA to countries in the Caribbean SIDS.

In terms of thematic focus, during 2002-2008, the category of forest policy and administration received over half of the forestry ODA allocated to SIDS (see Figure 5 and Annex 5). Forestry development has been another major thematic area, receiving over a quarter of forestry ODA. Forestry services, fuel wood/charcoal and forestry education/training have received relatively minor percentages of forestry ODA.


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Figure 5 Percentage shares of forestry ODA in SIDS by thematic focus during 2002-2008

3.3 Public domestic financing: Budget, own income generation and forest funds

The financing and investments into forest and tree-related activities by domestic public institutions vary depending on a number of factors, including government policies and priorities and funding capacity. As, for example, Simula (2008) and Tomaselli (2006) have concluded, there is no readily available data on public domestic financing of forests and trees, and this also applies to SIDS. The response rate to the questionnaire was so low that conclusions on the levels of domestic public funding allocated to forest and tree-related activities cannot be made. Access to domestic financing data would be important in many SIDS where domestic public financing and ODA are likely the most important sources of financing for forests and trees. However, the domestic data is needed to compare the relative shares and trends of these sources. The data is probably available in many countries, but an effective compilation process and an adequate time table would be required. In some countries, where forests and trees are institutionally bundled together with other service provision mandates, such as agriculture or environment, deriving information specific to forests and trees can be challenging. Funds can also be raised through income generation from state forests and through taxes and levies imposed on forest activities. Income generation can indeed be significant in countries with large forest resources under management of the state, or in countries with significant accessible forest resources and capacity for implementing fiscal regulations. The information on fund generation from state forest income or via fiscal regulation was not available, due to the low response rate in the survey and the lack of published data sources.

Globally, various countries have forest funds for specific purposes. According to Tomaselli (2006), the funds are usually replenished with forestry revenues (i.e., fees, taxes, royalties, forest levies, etc.) from the general treasury. Funding from other sources, such as international donors, can also supplement these resources. Five SIDS included in this report have an explicit forest fund (Table 1). A further nine countries have a fund supporting conservation and management of natural resources. For example, some funds support the protection of biodiversity and watersheds, which are potentially forest-relevant activities. The majority of forest funds in SIDS concentrate on conservation. Another area that is commonly supported is reforestation and afforestation. In most cases, the information on funds disbursement on a yearly basis is not available. Jamaica provides an example of a combination of a “traditional” forest financing mechanism, a forest fund, being


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established and capitalized through an innovative approach in the sector, a debt-for-nature swap. The result is the availability of approximately USD 16 million for forest conservation in Jamaica over a period of 19 years (see Table 1 and Box 3).

Table 1 Forest and conservation funds in SIDS

Country Name Description

Belize Belize Conservation Fund (BCF) Belize Protected Areas Conservation Trust (PACT)

The BCF provides funding for nature conservation in Belize. It partners with the Programme for Belize (PfB) and the Toledo Institute for Development and Environment (TIDE). The PfB aims to ensure the sustainable management and conservation of tropical forests in Northern Belize. The TIDE is working on conserving coastal and mangrove biodiversity in Belize.

PACT was founded in 1996, and it provides financial assistance for activities on protected areas that foster conservation, sustainable

development and management. The conservation fee of BZD 7.50/USD 3.75 and a 20 per cent commission from cruise ship passenger fees constitute the primary source of funding for the trust fund. Funds are also raised as donations from Belizeans and foreign individuals, corporations and foundations as well as from bilateral and multilateral organizations.

Cuba National Fund for Forest Development

Cuban law has created a National Fund for Forest Development to promote sustainable development of forest resources. The main objective of the fund is the promotion and financing of projects and activities to conserve and develop forest resources, particularly inventories, management, protection and research. Rules for the

Fund’s establishment and operation come from the Ministry of Finance and Prices, acting together with the Ministry of Economy and Planning. Advice comes from the Ministry of Agriculture and other interested bodies.

Fiji Sovi Basin Trust Fund

Fiji Water and Conservation International’s (CI) Global Conservation Fund established and endowed the Sovi Basin Trust Fund to ensure sustainable financing for the Sovi Basin Protected Areas as well as

to expand the approach to other nationally significant watersheds. The 20,000-hectare Sovi Basin Protected Area is leased from the Sovi Basin landowners through a 99-year lease to establish the Viti Levu Conservation Corridor. The Sovi Basin Trust Fund ensures financing to meet all obligations and activities under the lease, such as accounting for foregone timber royalties, providing community development opportunities and implementing the co-management plan for the protected area. The lease addresses landowners' food needs by allowing them to continue to use the protected area for traditional food-gathering and fishing purposes.

Dominican Republic

Special Fund and Forest Trust Fund

The Dominican Republic’s Forest Fund has two parts: a Special Fund and a Forest Trust Fund. The Special Fund receives income from the general treasury, the profits from administration of the state forests, fines, damages, taxes on wood, seizures and donations. It also receives income from the sale of special postage stamps. The Forest Trust Fund receives income from donations and compensation for environmental services. In addition, the Forest Fund may accept money provided for particular projects as part of international cooperation. The National Institute of Forest Resources is to use the Forest Fund for conservation and management of forest resources, reforestation and agroforestry, prevention of fire and diseases, and extension work.


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Federated States of Micronesia

Micronesia Conservation Trust (MCT)

The Trust was created in 2002 to support biodiversity conservation and related sustainable development. Main donors

are The Nature Conservancy (TNC), the United States and the Packard Foundation. MCT provides long-term, sustained funding through a grants programme that encourages people to adopt sustainable and appropriate solutions to local environmental challenges. The MCT is working to mobilize funding from a variety of public and private sources to build an endowment of USD 20 million to provide long-term support for sustainable biodiversity resource management in FSM. In addition to providing financial support, MCT is placing special emphasis on building the capacity of Micronesian organizations to design and manage conservation programmes. The MCT also provides a national forum to bring together people from government, private enterprise, and community and non-profit organizations to collectively address the challenges of natural resource management, enhance public-private partnerships, and share experiences and best practices.

Guyana Guiana Shield Initiative (GSI)

The GSI – started in 2000 – receives support from international donors. The initiative aims to develop an innovative financing mechanism for the conservation and sustainable management of

the Guiana Shield ecoregion. By conserving the vast forests of the Guiana Shield, it provides global/regional public goods such as carbon sequestration, biodiversity conservation and watershed services, and intends to get compensation for these from the international community. It also plans to promote the development of sustainable private business activities, such as sustainable ecotourism, production of non-timber forest products (NTFPs) for local and regional markets, and sustainable timber extraction.

Jamaica The Forest Conservation Fund (FCF)

The FCF was established pursuant to the United States Tropical Forest Conservation Act of 1998, which was enacted to offer eligible developing countries the opportunity to relieve identified official debt owed to the United States of America, while at the same time generating funds to support local tropical forest conservation activities. Based on an agreement between the governments of the United States and Jamaica, the Government of Jamaica will deposit USD 16 million into the FCF over a period of nineteen years. The funds are to be used for tropical forest conservation activities as

well as for support of the protection and management of the island’s forest reserves and national parks.

Mauritius The Conservation Fund, Mauritius

This fund finances projects aiming to conserve biodiversity and

ecosystems in Mauritius.

Papua New Guinea

Mama Graun (Mother Earth) Conservation Trust Fund

The Nature Conservancy has helped establish and capitalize this trust fund with initial grants from the GEF and AusAID. The Packard Foundation has also joined as a grantee to this fund. The objective of this fund is to provide long-term, uninterrupted funding for biodiversity conservation work in Papua New Guinea. Its ten-year

fundraising goal is a USD 30 million endowment that is estimated to generate about USD 1.5 million annually for conservation projects. This money will assist Papua New Guinea in increasing its protected areas coverage from 3 per cent to at least 10 per cent and will enable the areas to be effectively managed at the community level.

Solomon Islands

Forest Trust The Solomon Islands Forest Trust supports tree planting and reforestation. It is a “Special Fund” established by the Forest Act,

but does not appear to be a distinct agency. The Trust receives income from multiple sources, including forest-related fines, licence fees and levies, and it spends funds on tree planting and tending, reforestation and other purposes. In addition to government appropriations and outside donations, the Trust receives half the proceeds from fines and licence fees under the Act as well as revenue from forest development levies and sale of forfeited property.


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Trinidad and Tobago

Tropical Re-Leaf Foundation

The Tropical Re-Leaf Foundation supports projects like the Fondes Amandes Community Reforestation Project (FACRP), which was started in 1982 to reforest watershed areas with hardwood and

fruit tree species. This reforestation activity provides employment opportunities to the local people.

Suriname Suriname Conservation Foundation (SCF)

The SCF is committed to conserving the biodiversity and to

managing protected areas in Suriname. The Foundation receives funding from both the Surinamese Government and international donors.

Vanuatu Forestry Fund The Fund receives forest-related government income and donations. It spends on forest plantations, afforestation and reforestation.

The Forest Act 1982 established a Forestry Fund, to be kept by the Treasury. To be paid into the fund each year are (a) a sum equivalent to what the Minister receives in repayments under plantation agreements, reforestation charges and penalties; (b) other moneys Parliament may appropriate to the Fund; and (c) moneys granted to the Government of Vanuatu for such a purpose.

3.4 Private financing – domestic and foreign direct investments

Direct investment can be classified into domestic and foreign direct investment categories. For SIDS, no information on domestic direct investments was available for this report. The limited information available for foreign direct investment in SIDS is presented in Table 2. Table 2 FDI flows in agriculture, forestry and fisheries available in SIDS

Country FDI flow in agriculture,

forestry and fishing 2005-2007

FDI stock agriculture, forestry and fishing 2007

MUSD % of total

MUSD % of total

Fiji 0.3 2.3 - - Guyana 22.2 45.0 - - Mauritius 0.7 0.3 - - Papua New Guinea - - 141.4 9.6 Singapore -5.1 0 - - Vanuatu 0.2 2.5 - -

It is estimated that the majority of global direct investments are of domestic origin. However, according to the Inter-American Development Bank (IADB) 2004 (in Tomaselli 2006), regardless of the direct investment type (domestic or foreign), the forest industry takes a major portion of the investment due to its capital intensity, and only a limited amount is invested into forestland and activities such as harvesting. Further, only a small amount of FDI is apportioned to natural tropical forest, forest protection, NWFPs and environmental services, i.e., factors that are major components related to forests and trees in most SIDS (Tomaselli, 2006). Most SIDS do not present large-scale industrial forest production, and most have a negative trade balance on industrial roundwood, as can be observed in annex 5 in the Background to Forest Financing in SIDS, the first macro-level paper. In these countries, in the absence of traditional production-oriented downstream value-adding activities, the direct investment can be assumed to play a relative lesser role in the financing of forests and trees. In those relatively few SIDS that have a large forest resource base, value-adding downstream processing and significant export activities (Papua New Guinea, Suriname, Fiji, Samoa, the


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Solomon Islands, Guyana and the Dominican Republic), domestic and foreign direct investments and portfolio investments likely have a more pronounced role. However, only limited information on these investment flows exists. The foreign direct investment data available in this report is based on the UNCTAD World Investment Report (WIR) 2009. The data available is an aggregate for agriculture, forestry, and fisheries and does not allow reliable observations on foreign direct investment specifically related to forests. Much of the aggregated FDI is oriented towards developing countries, but the SIDS do not represent a large share of these. According to Tomaselli (2006), the relatively large aggregate FDI in countries such as Papua New Guinea and the Solomon Islands could be explained by the procurement of raw material by other countries in the region such as Japan, Malaysia, Republic of Korea and China. However, according to the study, changes in forest concessions (particularly in the concessions assignment rules), economic advantages and other reasons have made Japanese and Chinese companies shift investments towards other supply sources, such as Russia. The present study does not include enough resources to compile recent overall statistics on general FDI inflows to SIDS (forest FDI inflows are not available at all). However, according to UNEP (http://www.unep.org/ourplanet/imgversn/151/binger.html), SIDS have only received very limited foreign direct investment, and that limited FDI has been overwhelmingly in tourism and in the purchasing of utilities like electricity and telecommunications. Tourism is the fastest growing economic sector in SIDS. The tourism sector encompasses a large number of different travel-related activities, including, inter alia, hospitality enterprises, souvenir and craft businesses, travel agencies, transport enterprises, tour operators and tourist guides. Some of these businesses and professionals have links to the forest sector. It is, however, impossible to derive factual conclusions on the linkages between tourism sector investments and forests. According to Craigwell (2007), the tourism industry is widely recognized as the key engine of growth in SIDS, representing a significant source of foreign exchange earnings and employment both directly in tourism and indirectly in the ancillary sectors (primarily the distributive, agricultural, and transportation sectors) supporting the tourism industry. Over the period of 1986-2004, stopover tourist arrivals have risen by almost 10 per cent per annum, and visitor expenditure has risen by approximately 11 per cent, with concomitant increases in both direct and indirect contributions to total real output. In addition, foreign exchange earnings from tourism in SIDS were approximately three times that of exports of goods. Spending by visitors to SIDS has risen from USD 6.4 billion in 1988 to USD 17.6 billion in 2004, an average annual rate of increase of about 10.8 per cent; quite similar to the trends for the global travel industry. Nevertheless, SIDS are still price uncompetitive and appear to be losing ground in the global tourism market. The share of SIDS of the global travel market is relatively small, less than 2 per cent. In the early half of the review period, 1988 to 1995, there was some growth in the share of world tourists, from 1.6 per cent to about 1.9 per cent. From 1995 onward, however, there has been little or no change in SIDS’ market share of world travel. Indeed, since 2001, SIDS’ market share has actually declined. Nevertheless, it could be assumed that tourism sector investments in SIDS may have significant impact on forests, both positive and negative. The positive impacts are derived from the value changes brought about by the increasing tourism volumes: a green environment, biodiversity and forest scenery are important for tourism. Also, the alternative income generated from the tourism sector reduces the pressure on low-value-added use of forests or on conversion of forest lands to often poorly productive agricultural lands. On the other hand, investments in tourism require land, and some forests are converted to hotel grounds, roads and other infrastructure required for tourism. Similarly, the tourism industry requires agricultural products, which may increase food prices, which in turn may lead to agricultural expansion if it is more profitable than intensification of agricultural production. These linkages would need to be studied further.


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3.5 Innovative financing sources

Innovative mechanisms and sources (e.g., climate financing, payment for ecosystem services, forest-backed securities and debt-for-nature swaps) have received increasing attention during the recent years because they are considered to have the potential to create markets and to compensate some of the previously unremunerated services generated by forests and trees. Reliable data on financing generated for forests and trees in SIDS through innovative financing mechanisms is not readily available. This chapter will, however, provide examples of some of the innovative financing mechanisms currently in use in some of the SIDS included in this study. As forest and trees in SIDS provide multiple vital services not only for local inhabitants, but also nationally and globally, there is a need to support the development and adoption of innovative mechanisms that can convert the service provision of forests and trees into monetary flows and tangible benefits.

Watershed services are considered important services of trees and forests in SIDS. For example, watershed management features prominently in SIDS Poverty Reduction Strategies (PRSs) and other national development strategies (see section 4.1). In this context, payment for watershed services systems have the potential to mobilize financing for forests and trees in SIDS. Globally, various types of watershed services systems are in place, where the service provided, the stakeholders involved, and the payment and monitoring thereof are defined case-by- case to fit the local context. For example, in Fiji, two types of revenue generation systems linking water and forests can be identified. In some water catchment areas, the public National Water Authority pays the land owners in the watershed for land lease and for timber income forgone for keeping the forest cover unchanged, (see Box 1). In another case, the CI has facilitated the establishment of the Sovi Basin Trust Fund endowed by the Global Conservation Fund and Fiji Water. The Trust Fund pays for land lease, for forgone timber income, and for community reforestation and afforestation activities in order to generate both watershed services and carbon credits and to conserve biodiversity. Local livelihoods are also supported with the funds provided to agroforestry. Box 1 Revenue generation systems in Fiji linking water with forests and trees

In Fiji, some water catchments are managed to supply urban areas with water. The Vaturu water catchment and dam services western Viti Levu, and the Savura forest reserve/water catchment services the Tamavua Reservoir, which supplies water to the Suva City area. These water catchments supplying water to urban areas are managed by the National Water Authority, which leases the land from the indigenous Fijian landowners. The owners are compensated for the timber income foregone, thus enabling a permanent forest cover on the watersheds and regulated activities within. The payment is based on estimated timber value, which is updated every five years.


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Box 2 Watershed conservation, carbon credits and agro forestry in Fiji

Conservation International’s main interests in Fiji involve the establishment of conservation areas (e.g., Sovi Basin) as well as reforestation and afforestation for the conservation of biodiversity and the improvement of community livelihoods. FIJI Water and CI's Global Conservation Fund established and endowed the Sovi Basin Trust Fund to ensure sustainable financing for the Sovi Basin Protected Areas as well as to expand the approach to other nationally significant watersheds. The Trust Fund is currently capitalized at USD 3.75 million.

The Sovi Basin Trust Fund ensures financing to meet all obligations and activities under the lease, such as accounting for the land lease, assessing timber royalties foregone (the Fiji Forest Department does this), providing community development opportunities and implementing the co-management plan for the protected area.

In efforts to become carbon negative and to reduce impact on the environment and on climate, Fiji Water is also investing in a portfolio of verifiable and permanent forest carbon initiatives. With the payments from Fiji Water, CI supports community reforestation and afforestation activities in the Ra Province. This initiative has an annual budget of one million Fiji dollars to pay the annual lease, purchase tree seeds, and contract the communities to plant and maintain their young forest stands for the first five years in exchange for the carbon credits accrued over the 30 year period of the lease. This up-front payment method to finance reforestation and afforestation is a crucial point in the programme, as the Foundation assumes all the risks. The risks include natural disasters, such as fires and cyclones, and social risks that usually centre on land tenure security.

The forests are established at a rate of 100 hectares per year on naturally nutrient-poor soil that is common in the drier areas (locally called talagisa land). The funds are also in the process of being utilized for carbon/biomass assessment and certification via the Climate, Community and Biodiversity Alliance (CCBA) and the Voluntary Carbon Standard.

The community agreement between CI and the communities in the Ra Province is for 30 years, after which the communities have the choice to harvest their timber trees following SFM principles and practices that will allow the area to continue to be under forest cover. The potential for timber production has been a major incentive for the communities to participate in the programme. Agroforestry is also encouraged with forest establishment, whereby fruit trees, pineapple, vetiver grass and sandalwood trees are planted.

Five SIDS countries included in this report have current or committed REDD(+)financing, (see Table 3 ): Papua New Guinea, Guyana, Suriname and Vanuatu are members of the World Bank’s FCPF, and Papua New Guinea and the Solomon Islands participate in the UN-REDD Programme. Other financing relevant to forests and trees generated through climate financing is available to four SIDS countries. In total, 7 out of 38 SIDS countries currently have access to financing for forests and trees in the context of climate mitigation. There are no afforestation/reforestation or agriculture-related projects under the Clean Development Mechanism in SIDS. There are five biomass energy CDM projects in SIDS (in the Dominican Republic, Guyana and Singapore), that constitute 23 per cent of all CDM projects (a total of 22) in SIDS. However, none of these is using forest biomass.

In total, 9 countries of the 38 SIDS included in this report have carbon financing related to forests and trees (see tables 3 and 4). All credits appear to target the voluntary markets, as there are currently no CDM projects in SIDS related to afforestation/reforestation. Among the nine countries, only two (Trinidad and Tobago, and Vanuatu) have private sector involvement in their forest carbon projects, while in the rest of the countries (Belize, Dominican Republic, Fiji, Guyana, Maldives, Papua New Guinea and Suriname), the projects are supported either fully or partially by international donor agencies or bilateral donors. Most of these forest carbon projects have multiple objectives, including generation of ecosystem services and support of local livelihoods. Debt swap/debt reduction is another innovative source of finance. This instrument has been used in various sectors and in financing forest and tree-related activities. In this context, the instrument is called debt-for-nature swap. For example, The Nature Conservancy, Conservation International and the World Wildlife Fund (WWF) are large international non-governmental organizations (NGOs) facilitating the access of countries to the instrument. In


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Box 3, the debt-for-nature swaps facilitated by The Nature Conservancy between the United States and the Government of Jamaica (GOJ) and Belize and the United States are described.

Table 3 REDD(+) specific financing and activity in SIDS

Country Name of activity

Funder(s) Activity type

(status)6

Geographic scale

7

Time scale

Objective8

Investment/ budget/fund

Guyana FCPF

The World Bank

Readiness (planned)

National

2008-2012 R-strategy, I&CB MRV and I&CB R-funds

USD 0.7 million (estimated budget)

UN-REDD

UN-REDD Fund

Readiness (planned)

National

2008-2012 To be decided

USD 2.585 million (approved budget)

UN-REDD

UN-REDD Fund

Readiness (planned)

National

2008-2012 To be decided

USD 2.585 million (approved budget)

FCPF

The World Bank

Readiness (planned)

National

2008-2012 R-strategy and I&CB MRV

USD 1.319 million (estimated budget)

Papua New Guinea

PND-Australia

Australian Government

Readiness (planned)

National

2008-2012 R-strategy, I&CB MRV and I&CB R-fund

USD 3 million (initial fund)

Suriname FCPF The World Bank

Readiness (planned)

National

2008-2012 R-strategy and I&CB MRV

To be decided

Vanuatu

Vanuatu Carbon Credit projects

University of Wellington and the United Kingdom Government

Readiness (ongoing)

Sub-national

To be decided

I&CB MRV NZD 0.275 million (grant)

Source: Wertz-Kanounnikoff and Kongphan-apirak (2009)

6 REDD+ demonstration activities: REDD+ demonstration activities refer to the activities that focus on experimenting with mechanisms of reducing forest-based emissions. These activities range from site-specific projects to activities covering a substantial portion of a province/state of a country. The key activities included in this category are the promotion of sustainable forest management practices (e.g., reduced impact logging), forest conservation through incentive payment schemes, and monitoring systems for measuring the change in forest carbon stock and fluxes. REDD+ readiness activities: This term refers to all activities that are designed to create an enabling framework for REDD+ deals. These can include land tenure reforms, enforcement of land use laws and regulations, and establishment of systems to reliably monitor, report and verify forest-based emissions. All activities under the UN-REDD program and the FCPF Window II (Readiness Fund) are categorized as readiness activities. Planned activities: These activities are those which are still in the planning phase and not yet under implementation. Ongoing activities: Ongoing activities are activities under implementation.

7 Sub-national activities cover or affect only a part of a country. National activities cover the whole country.

8 PA: protected area management, SFM: sustainable forest management, R-strategy: preparation of national REDD+ strategy, MRV: monitoring, reporting and verification, I&CB MRV: institution and capacity building for MRV, I&CB R-fund: institution and capacity building for handling REDD+ funds.


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Table 4 Forest carbon-related funding in SIDS


Belize

The Rio Bravo Climate Action Project (RBCAP) Boden Creek Ecological Preserve (BCEP) project

In the RBCAP, TNC mobilizes the private sector companies to finance the conservation and sustainable management

of about 50,000 ha of mixed lowland, moist sub-tropical broadleaf forest in northwest Belize to produce carbon credits worth USD 5.6 million.

The project is located in the Toledo district of Belize. The project has a 20-year span and is managed by the Belize Lodge and Excursions – an ecotourism operator. The aim of the project is generating carbon credits equivalent to about 1.3 million metric tons of CO2 in avoided emissions through the conservation of a forested area of

5,211 ha. Biodiversity conservation and job creation are the secondary objectives of the project.

Dominican Republic

Dominican Republic Rio Blanco Reforestation

The BioCarbon Fund through The Nature Conservancy provides funding to enable the local communities to protect and restore native forest ecosystems within the Juan B.

Perez Rancier/Valle Nuevo National Park and its buffer zone of an area over 6,000 ha. The initiative, which began in 2006, aims to sequester forest carbon worth about USD 1.7 million.

Fiji Development of Fiji REDD programme

The SPC/GTZ Pacific-German Regional Programme on Adaptation to Climate Change in the Pacific Island Region (ACCPIR) is helping Fiji to develop a national REDD programme. The additional funding for the programme is

expected to come from private and public sectors as grants. The programme is also expected have its own funding in future by selling carbon credits and ecosystem services to be generated by conserving forest.

Guyana GSI

The GSI – started in 2000 – receives support from international donors. The initiative aims to develop an innovative financing mechanism for the conservation and sustainable management of the Guiana Shield ecoregion.

By conserving the vast forests of the Guiana Shield, it provides global/regional public goods such as carbon sequestration, biodiversity conservation and watershed services, and it intends to get compensation for these from the international community. It also plans to promote the development of sustainable private business activities, such as sustainable ecotourism, production of NTFPs for local and regional markets, and sustainable timber extraction.

Maldives Maldives Climate Change Trust Fund

The trust fund is administered by the World Bank and has already received funding of USD 8.8 million from the European Union. The goal of the fund includes the conservation of terrestrial biodiversity in the Maldives.

Papua New Guinea

Kamula Doso Improved Forest Management Carbon Project (IFMCP)

This project is currently under validation at CCBA by Tume Timbers Development Limited. The main goal of the project is to develop a carbon finance revenue stream to improve natural resource-based livelihoods by preventing logging in the Kamula Doso. The project is expected to generate carbon credits equivalent to about 37 million metric tons of CO2 in avoided emissions over the next 40 years. The

secondary goals of the project are to conserve biodiversity and enhance local capacity in natural resource management and community management in Kamula Doso.

Suriname GSI

Suriname is also a part of the GSI. The country intends to receive compensation for providing carbon sequestration, biodiversity conservation and watershed services by conserving forests in its part of the Guiana

Shield ecoregion.


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Trinidad and Tobago

Trinidad & Tobago Nariva Wetland Restoration (TTNWR)

The TTNWR is an eleven-year project started in 2006 to reforest, restore and protect the ecosystem of the Nariva wetlands, which covers 2,500 ha of area. It receives support

from Ducks Unlimited, the Prototype Carbon Fund and the

United States Department of Agriculture (USDA) Forest Service. It aims to generate a total revenue of USD 1.75 million in selling carbon credits.

Vanuatu Reforestation project in Malakula for timber and carbon

This is a project of a private company called ECO2 Forest Inc that aims to generate carbon credits equivalent to 7 million metric tons of CO2.

Box 3 Debt-for-nature swaps in Jamaica and Belize

Jamaica In 2004, the Government of Jamaica and the United States, together with The Nature Conservancy, concluded a debt-for-nature swap under the Tropical Forest Conservation Act programme. Under this debt swap, approximately USD 16 million will be paid into the Forest Conservation Fund by the GOJ over a period of nineteen years, and these moneys will be used to fund local tropical forest conservation activities as well as to support the protection and management of the island’s forest reserves and national parks.

The activities that are eligible for funding include the following: - Establishment, restoration, protection and maintenance of reserves, parks, and protected

areas - Development and implementation of natural resource management - Implementation of training programmes to build the capacity of entities involved in

conservation efforts - Sustainable use, restoration and protection of diverse animal and plant species - Research on the medicinal uses of tropical forest life to treat human health-related concerns - Development and support of alternate livelihoods of buffer zone communities

The eligible entities include the following: - Environmental, forestry or conservation NGOs - Local or regional entities active in Jamaica - Individuals through a NGO, community-based organization (CBO) or other similar group - In exceptional instances, the GOJ Belize In 2001, the Nature Conservancy provided USD 1.3 million for a swap that helped purchase USD 1.4 million of Belize’s debt to the US government. These funds were used to secure approximately 9,300 ha of vulnerable forest in Belize’s Maya mountain marine corridor, and they continue to fund forest conservation annually. The Maya Forest stretches into Mexico and Guatemala and is home to wildlife such as jaguars and scarlet macaws. It also contains the ruins of hundreds of ancient Mayan cities.

Sources: Forest financing survey and the CI, 2010 http://www.nature.org/wherewework/centralamerica/tropicalforests/news/news2113.html


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4. DEMAND FOR FOREST AND SFM FINANCING

4.1 Forests and trees in development strategies

In a global forest financing study, Simula (2008) found that country demand for forest ODA is relatively weak and influenced by donor policies and priorities. Two thirds of the surveyed 43 countries in Simula’s study mentioned forests in their PRSs, but only 28 per cent include a coherent national strategy for forests. As analysed in the Background to Forest Financing in SIDS (the first macro-level paper), 12

9 out of the 38 SIDS included in this report have a PRS.

Of those 12 countries, 910 have included forests and trees in their PRS. Although relatively few

countries in the group have prepared a PRS, other existing strategies often recognize the role of forests and trees. For those countries that do not have a PRS, a national development strategy, a Barbados Programme of Action document or a similar one were used to observe the role and priority given to forests and trees in the context of development in the respective countries (see annex 11 in the Background to Forest Financing in SIDS, the first macro-level paper). Thirteen of these strategies acknowledge the important role of forests and trees. As shown in annex 8, 18 out of 38 SIDS countries (47 per cent) included in this report have forest cover exceeding 30 per cent of their total land surface. Among those, half have forests and trees included in their PRS or other national development strategy. Among the 19

11 SIDS

countries that have less than 30 per cent of the total land area covered by forests, half also include forests and trees in their development strategies. This implies that SIDS countries, regardless of the extent of forest resources, have acknowledged the importance of forests and trees and have subsequently included the issue in their national development agendas. The forest and tree-related thematic areas present in the PRSs and other national development strategies clearly indicate the cross-sectoral emphasis of forests and trees in SIDS. The most common theme is watershed management, which is mentioned in a third of those strategies that include forests and trees. Another major theme is management and protection of biodiversity. Need for support given to agro-forestry and afforestation/ reforestation are also common themes. Other forest-relevant issues present in the strategies include protection, production, energy/biofuel, participatory management, tourism, prevention of fires and prevention of erosion. Based on the strategy papers, few countries (Fiji, Papua New Guinea, Samoa and Tonga) take a production-oriented approach. All strategies place forests and trees within the broader concept of providing multiple services, such as biodiversity and watershed management services; and of providing opportunities, such as agroforestry, energy and tourism opportunities. In total, 22 SIDS countries of the 38 included in this report have identified forests and trees in their development strategies. This clearly indicates the countries´ demand for financing for increased services provision from forests and trees, especially in the context of the aforementioned thematic areas. Two countries, Haiti and Grenada, recognize climate change in their PRSs. Haiti emphasizes adaptation to climate change and, specifically concerning forests, mentions the need to promote forests for carbon sequestration and energy production. Grenada’s PRS mentions climate change and climate change vulnerability. A third country, Fiji, is finalizing a separate policy for climate change and REDD.

9 Cape Verde, Comoros, Dominica, Grenada, Guinea-Bissau, Guyana, Haiti, the Maldives, Sao Tome and Principe, St. Lucia and Timor-Leste

10 Cape Verde, the Comoros, Guyana, Dominica, Haiti, the Maldives, Sao Tome and Principe and Timor-Leste.

11 Marshall Island does not have information available on forest cover.


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Box 4 Thematic areas of the PRS and national development strategies

The following thematic areas relevant to forests are included in the PRS and other national development strategies accessed for this report. The thematic areas are listed according to order of appearance.

• Watershed

• Biodiversity/conservation

• Agroforestry

• Afforestation/reforestation

• Protection

• Production

• Energy/biofuel

• Participatory management

• Tourism

• Fire prevention

• Erosion prevention/soil management

13 out of 38 countries mention forests and trees in their Millennium Development Goal (MDG) strategies or reports (see Annex 6). This represents one third of the countries, indicating that forests and trees are not high priorities in the countries’ strategies to meet the MDG objectives. Most SIDS included in this report have natural resource-related sector strategies relevant to forests and trees. Many countries have, for example, a National Biodiversity Strategy and Action Plan (NBSAP), which is facilitated by the CBD (see Annex 7). The NBSAPs mention forests in the biodiversity conservation context, but do not usually assign forests a major role, acknowledging forests only on a general level. 4.2 Forest policies of SIDS

Currently, the forest policies of SIDS do not generally include a financing strategy or an investment programme; hence, analysis of the demand for forest financing cannot be performed in monetary terms. However, according to FAO (2009), the development of national financing strategies embedded into national forest policies and programmes would be highly necessary in order to diversify the financial basis of SFM to guarantee SFM practices and reduce deforestation and forest degradation. As described in the Background to Forest Financing in SIDS, the first macro-level paper, 18 countries out of the 38 have an official forest policy document, and an additional four countries have a draft under preparation. Generally, of the SIDS countries included in this report, two thirds (66 per cent) of the countries with large forest cover (more than 30 per cent), but only less than half of the countries with smaller forest cover have at least one of following in place: NFP, forest policy, forest strategy and/or forest legislation. Some countries have also identified the potential to mobilize funds through an approach of environmental services and mitigation of climate change. Of the SIDS countries included in this report, at least three have identified climate change and environmental services in their forest policies. First, Samoa considers the establishment of a legal framework to enable the trading of carbon credits and conditions conducive to a reforestation programme to be necessary. Second, the Dominican Republic aims to develop a valuation mechanism for environmental services. Third, Tonga has a comprehensive policy that also covers climate change, NTFP/NWFP and tourism. Although environmental services could potentially provide opportunities for improved internal and external fund mobilization for trees and forests, only 3 out of 18 SIDS countries with forest policy documents available recognize this potential explicitly in a forest context.


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5. FINANCING GAPS AND OBSTACLES

According to the Organization for Economic Cooperation and Development (2008), the aid provided during 2005 - 2006 to forestry by thematic area, as defined by the OECD, was apportioned as follows: forestry development (63 per cent), policy and administration management (33 per cent), research (2 per cent), education and training (1 per cent), services (1 per cent) and fuel wood and charcoal (less than 1 per cent). More than 80 per cent of aid commitments in 2005-2006 to forestry were targeted to desertification, biodiversity and climate change issues. In SIDS, more than half (54 per cent) of the ODA was targeted to forest policy and administration management. Another major thematic area of ODA payments was forestry development (28 per cent). Forestry research received a small share of the contributions (10 per cent) and other areas received minor shares. According to the OECD’s Creditor Reporting System, approximately one third (36 per cent) of aid targeted biodiversity, climate change and/or desertification. This is much less than in the global figure on aid commitments, which is especially concerning, as the before-mentioned thematic areas and multiple services of forests are emphasized in the context of forests and trees in SIDS. Within the geographical areas in the SIDS group were differences in the thematic areas of ODA. In the Pacific region, forest policy and administration management received the majority (73 per cent) of ODA flow. In the Caribbean region, much of the ODA went to policy and administration management (42 per cent), but also to forest development (37 per cent) and services (14 per cent). The AIMS received a marginal share of all ODA (3.5 per cent). From this ODA flow, a majority was dedicated to forestry development. 22 out of 38 SIDS (58 per cent) had included forests and trees into their PRS or other national development strategies. This share is slightly less than the two thirds identified in the global study by Simula (2008). Also, many countries mention forests and trees only briefly, in the context of other natural resources, or give the resource a minor role, which, as also concluded in the Simula (2008) study, reflects a weak understanding of and/or low political priority given to forests and trees. In approximately half of the poverty strategies, trees and forests were not included at all. This is cause for concern because for many SIDS countries, ODA is significant source of financing for forests and trees. The absence of forests in the PRSs and other national development strategies could impede the mobilization of donor financing. Thirteen countries that mentioned forests in their PRS or other development strategy did have ODA flows to forests during 2002-2008. However, nine countries that also mention forests did not have forest ODA (as defined by the OECD) during the same period. Forests are not high on the list of government priorities in most of the smaller SIDS, as only about half of the countries in this report have a forest policy document and/or forest legislation. Forestry agencies, where they exist, often have limited financial and human resources to implement the policies and laws and to monitor their effectiveness, i.e. the existence of a forest policy and legislation does not guarantee their implementation on ground. External assistance has often supported forest-related activities, and in the decline and concentration of forest-related development funding, the sector often suffers from insufficient financial resources. An additional constraint is that inadequate information on the resource base makes it difficult to effectively address the issues at hand. A particular challenge in SIDS is that the forests and trees provide many non-market products and services which, on the one hand, do not materialize as monetary income, but which, on the other hand, can effectively constrain the income generation rights from the resource (e.g., in the case of protection forests). Especially in the case of environmental services, much of the biodiversity, watershed and soil management (among other) services go uncompensated. In this regard, capacity development is often necessary, as only few countries have identified the potential for generating funds through environmental services in their national strategies. This could also imply a need to channel more ODA to forest education and training, which currently has had a minor share of forestry ODA in SIDS.


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In some SIDS, the management of watersheds can be mandated to the institution responsible for water services instead of to the department with a forest mandate. The role of forests and trees may be potentially less emphasized in the former scenario, which in turn may negatively impact the management and fund allocation to the forest resource in watersheds. For example, in Fiji, the Water Authority is mandated to manage watersheds that provide urban areas with water. However, there is no formal cooperation agreement between the Forestry Department and the Water Authority for the collaborative management of the water catchments. As also concluded by Pauku (2009) concerning the Solomon Islands, the institutional framework under which water, land and forest resources are placed needs to work interactively so as to provide a platform for effective resource management and for efficient financial resource allocation. Relatively few SIDS have thus far been able to benefit from climate change-related financing for forests and trees. Only 9 countries of the 38 SIDS included in this report have received or have current commitments to receive carbon-related forest financing.


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6. CONDITIONS FOR INVESTMENT AND THE ENABLING ENVIRONMENT FOR FINANCING FORESTS AND SFM IN SIDS

Conditions for investment include a wide array of physical, environmental, economic, financial, political, legal, institutional, cultural etc. variables which can be positive drivers or negative bottlenecks for investments. The aggregate total of such conditions is normally called the “investment climate”, which is composed of (a) direct physical (real world) conditions such as size of market (population), transport, availability of raw material; (b) direct economic and financial conditions such as demand for product, supply of inputs; and (c) so-called enabling environment, which includes, inter alia, policies and legislation, predictability / uncertainty of such policies and their changes, cultural issues, financial infrastructure, quality of training and education. The World Bank has carried out comprehensive investment climate surveys among firms in a vast number of countries. According to Hallward-Driemeier and Stewart (2004), the importance or significance of various variables of investment climate, according to World Bank investment climate surveys in developing countries, is as follows (listed according to order of importance):

1. Policy uncertainty 2. Macro instability 3. Tax rate 4. Corruption 5. Cost and access to finance 6. Crime 7. Regulations and tax administration 8. Skills 9. Courts and legal system 10. Electricity 11. Labour regulations 12. Transportation 13. Access to land 14. Telecommunications

It is interesting to see that physical conditions such as transportation, land and telecommunications are perceived as least important determinants for investment decisions by firms, whereas policy stability or uncertainty and other policy issues are ranked as most important factors. The present study did not find any SIDS-specific surveys, but it is likely that the developing countries’ general results are more or less applicable to SIDS. The present survey did not find any forest-specific survey either. The closest to the general investment climate surveys of the World Bank comes from the Inter-American Development Bank’s (IADB) Forest Investment Attractiveness Index

12 . However, the IADB’s index focuses on ranking countries by an

aggregate investment climate index, not by studying the relative order of importance of various sub-indices (variables). The weights for the variables are taken from general studies, such as the World Bank investment climate survey, and they are not based on forest sector-specific surveys. In SIDS, there are some special features that should be taken into consideration concerning investment climate, such as the small size of the domestic market (economies of scale), capacity constraints due to the small size of population (institutions, training & education, skills), high costs of overseas transport

13 and limited access to land. These issues may rank

higher in SIDS than on average in developing countries. However, such an assumption would need to be validated by a detailed SIDS- specific investment climate survey.

12 See, for example, http://idbdocs.iadb.org/wsdocs/getdocument.aspx?docnum=975603

13 It is a paradox that sea freights to and from ports of many SIDS (in the middle of a sea) are very high. The reasons for high freight costs are small volume of shipments, distance from regular commercial navigation routes and high handling costs per unit of cargo in posts, due to low volume.


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FAO (2009) refers to the enabling environment for forest financing as the political, legal and institutional environment with stability, transparency and long-term security. Direct investments, both domestic and foreign, are highly dependent on the investment climate of countries. Because SFM is a long-term activity with a long maturity period for the yield, both domestic and foreign direct investments are sensitive to the investment climate of a country. The World Bank rates countries yearly according to the ease of doing business

14, from 1 to

183, with first place being the best. A high ranking in the Ease of Doing Business index (aggregated from various indicators) means that the regulatory environment is conducive to the operation of business (Table 5). Three SIDS are included in the top 20 of this index; Singapore is ranked first in the world, Mauritius is seventeenth and Bahrain is twentieth. However, as stated in the macro-level paper Background to Forest Financing in SIDS, Singapore can be considered as an exception in the group of SIDS for being a trade hub in the region and for possessing a forest products industry based on imported raw material. However, almost half of the SIDS rank in the bottom half, indicating a business environment that is not conducive to investments. Many SIDS do well in the individual indicators that form the “ease of doing business” aggregate indicator. In the “dealing with construction permits”

15 indicator, 10 of the 20 best

ranked countries are SIDS. In the “employing workers” indicators, nine SIDS are among the top 20, and “paying taxes”

16 indicators, seven SIDS countries are among the top 20. However,

certain indicators reduce the general “doing business” category ranking of the individual SIDS countries. For example, for the “getting credit”

17 indicator, only Singapore ranks high, while

other SIDS, except Trinidad and Tobago (thirtieth) and Fiji (forty-sixth) rank low. Also. In the “enforcing contracts”

18 indicator, only Singapore (thirteenth) ranks high; Cape Verde (thirty-

eighth) has a relatively good ranking, while other SIDS are positioned much lower.

In addition, one key issue concerning the enabling environment for forest financing is the level of clarity regarding the ownership of the forest resource. Of the SIDS included in this report, 21 out of 38 countries (55 per cent) do not have information available on ownership of forests. These countries include Island States that are large and small and that have large forest cover or little forested areas. The lack of formally recognized ownership and clear tenure arrangements hinder long-term investment in such a way that land owners are more likely to invest in a land use system that generates short-term income, such as agricultural activities.

14 The reader should note that according to the World Bank, the Ease of Doing Business index is limited in scope. It does not account for an economy’s proximity to large markets, the quality of its infrastructure services (other than services related to trading across borders), the strength of the financial system, the security of property from theft and looting, macroeconomic conditions or the strength of underlying institutions.

15 Procedures, time and cost to obtain construction permits, inspections and utility connections.

16 Number of tax payments, time to prepare and file tax returns and to pay taxes, total taxes as a share of profit before all taxes borne.

17 Strength of legal rights index, depth of credit information index.

18 Procedures, time and cost to resolve a commercial dispute.


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Table 5 Business environment indicators in SIDS

Ease of doing business rank19 2009

Country Position

Antigua and Barbuda 50 Bahamas 68 Bahrain 20 Barbados n/a Belize 80 Cape Verde 146 Comoros 162 Cuba n/a Dominica 83 Dominican Republic 86 Fiji 54 Grenada 91 Guinea-Bissau 181 Guyana 101 Haiti 151 Jamaica 75 Kiribati 79 Maldives 87 Marshall Island 98 Mauritius 17 Micronesia 127 Nauru n/a Palau 97 Papua New Guinea 102 Saint Kitts and Nevis 76 Saint Lucia 36 Saint Vincent and Grenadines 70 Samoa 57 Sao Tome and Principe 180 Seychelles 111 Singapore 1 Solomon Islands 104 Suriname 155 Timor-Leste 164 Tonga 52 Trinidad and Tobago 81 Tuvalu n/a Vanuatu 59

For example, according to Pauku (2009), the prevailing customary land tenure provides a welfare safety-net for the vast majority of Solomon Islanders and supports the country’s robust village-based subsistence gardening. However, according the same study, the customary land tenure system in the Solomon Islands is also regarded as a constraint to larger scale development as it can be often problematic, costly and fraught with uncertainty due to the inevitable and often multiple disputes that arise between owners and developers, or between different landowner groups. Fiji provides an interesting example of clear tenure arrangement; the country´s customary tenure system is integrated into the legislation. By law, the customary land cannot be sold, but the owners can lease it and hence derive income. Many arrangements in Fiji combine lease payments with other income streams from the forest land, such as estimated timber income forgone in conservation areas.

19 The ease of doing business index ranks economies from 1 to 183, with first place being the best. For each economy, the index is calculated as the ranking on the simple average of its percentile rankings on each of the 10 topics covered in Doing Business 2010 covering the period June 2008 through May 2009. http://www.doingbusiness.org/economyrankings/.


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Political stability is also an important component of the investment environment. In SIDS, since 1995, five countries (the Comoros, Fiji, Guinea-Bissau, Timor-Leste and Haiti) have experienced turmoil such as military or civil coups. In many cases, such conflicts have led to further marginalization of the forest sector in political decision-making and in receiving budget allocations. Furthermore, political conflicts can reduce donor support to forests and trees, primarily because of security concerns but also for political reasons. In post-conflict situations, the forest sector is not commonly among the top priority sectors either in receiving national budget allocations or in receiving post-conflict donor support for reconstruction of damaged infrastructure, for example. In a political conflict, the forest resource can also been seen as a quick income earner, and the conflict can potentially increase unsustainable exploitation of the resource. Furthermore, conflicts have a negative impact on direct investment, as the investors do not have the confidence to make a long-term investment in an unstable political environment with risks of, for example, potential state appropriation. The availability of adequately educated staff and trained labour is among the key conditions for investment decisions. Many SIDS are small economies with fairly small populations. The limited size of the population does not warrant higher and vocational education institutions in all sciences and trades, such as forest sciences, environment, tourism, and climate change. In many cases, ODA could be effectively used to support regional education and training arrangements in such fields that are important but too marginal to merit national arrangements. In many SIDS, forest-related sciences and trades are cases in point.


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7. STRATEGIES FOR INCREASING FINANCING FLOWS FOR SFM, INCLUDING NEW AND INNOVATIVE SOLUTIONS

A strategic approach is needed in the domestic financing for forests and SFM, as forests provide multiple services, many of which currently go unremunerated. At present, more than half of the SIDS included in this report do not have a forest strategy outlining the national objectives for forests and trees and defining the value of economic, social, environmental and cultural service provision of the resource. In the preparation or revision of a forest strategy, in order to emphasize the important functions of forests and trees and simultaneously facilitate fund mobilization, the policy should encompass a financing strategy to identify potential sources of funding for the priority activities. This would also help in overcoming the issue of forest strategies remaining only on paper, without concrete means of implementation. Further, in tapping the resources allocated from the national budget, an understanding of the country’s budgeting process and entities in charge of the budget is crucial. Communication and interaction with the departments responsible for budgeting is necessary to highlight the needs and especially the potential for increasing service provision of forests and trees. For example, in Fiji, the Forest Department has been successful in increasing the Department´s budget, as the appointed Permanent Secretary in the Ministry of Agriculture, Fisheries and Forest is knowledgeable in Government budgetary submissions and in preparing funding proposals; skills which he trained his staff in, thereby increasing their fundraising capacity and budget allocation of the Department. As forests and trees in SIDS must be dealt with multi-sectorally, and as they have close linkages to other natural resources, cross-sectoral strategies can emphasize the role of forests and trees. These cross- or multi-sectoral strategies have the potential to make forests and trees figure among the important issues in many SIDS, such as watershed and soil management and biodiversity conservation. In addition to coordinating and potentially integrating strategies and policies across sectors, in the institutional frameworks, an integrated approach to the management and financing of land, water and forests could be facilitated and supported. Moreover, stand-alone national forest strategies could be linked to other sectoral strategies to identify synergies in natural resources service provision and to avoid the exclusion and sidelining of forests and trees in political decision-making and in fund allocation at national level. Identification of multi-sectoral linkages will also allow the design of suitable compensation mechanisms so that critical services provided by the forests and trees have adequate and sustainable sources of financing. In tapping into international public sources, the integration of forest and tree issues into the national development strategies through relevant strategies and programmes is crucial. In many SIDS (just under half of those SIDS included in this report), national development strategies do not recognize at all the role of forests and trees. As stated also in Simula (2008), the inclusion of forests and trees into the national development strategies has become increasingly important because bilateral donors are channelling a significant portion of their assistance through budget support, using domestic systems and procedures. All these processes require new capacities and capabilities for articulation and lobbying-activities and awareness-raising from the forest institutions and professionals. They also require heightened priority for the concrete inclusion of forests and trees into all the sources mentioned above. The country-level forest institutions could benefit from recruiting a communication professional as well as personnel who have the requisite institutional experience in public sector budgeting, the development of national development strategies and donor liaison activities. In only a few countries, the forest policy or national development strategy or PRS documents highlight climate change and compensation for ecosystem services/payment for environmental services in the context of forests and trees. However, as the generation of multiple services of natural resources is emphasized in the development policy documentation in SIDS, there is a clear need to include these issues in the national forest policy and strategy documents and in the development strategies. Compensation mechanisms for ecosystem services are location specific and require capacity in design and implementation; it is likely that the capacity at country level is currently suboptimal. The inclusion of the issue in relevant development


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strategies and through donor liaison would enable the mobilization of donor financing to support the capacity development and the design of PES mechanisms in SIDS on a larger scale. Although countries like Brazil, Indonesia and the Democratic Republic of Congo have the largest potential for receiving funds based on REDD+, in relative terms, some SIDS could benefit greatly from REDD+ revenues. According to the CI

20, among the SIDS, the following

countries would receive the highest annual percentage increases to their GDP from REDD+: the Solomon Islands (31 per cent), Papua New Guinea (8 per cent), Timor-Leste (5 per cent) and Guinea Bissau (5 per cent). However, most SIDS are not likely to benefit to a large extent from REDD+ financing and are not expected to have comparative advantage in afforestation/reforestation under CDM financing because of generally limited land resources and often high forest cover, particularly in countries where physical forest growth conditions are favourable.

In various SIDS, there are significant linkages between forests and trees and other sectors of the economy. According to FAO (2005), tourism is currently one of the most important income-earning industries in many SIDS endowed with tropical climate and sandy beaches. Although the forests on these islands rarely are the primary attraction for overseas visitors, they can contribute to the tourism appeal. Various islands have already made special efforts to develop the tourist potential of their forested areas, including the Federated States of Micronesia, Mauritius, the Seychelles, Dominica, Jamaica and St. Lucia. However, at country level, only a few direct monetary flows from tourism to forestry were identified in this report. The services and products generated should be identified at country level and compensation systems should be designed. Some options for this were discussed in the country case study workshops: one was to introduce a plant-a-tree programme at natural parks, whereby park visitors would buy and plant a seedling in lieu of paying park entrance fees; another was to introduce mandatory or voluntary payments made by hotel guests for fresh water generation.

Debt-for-nature swaps have been used in some SIDS. These have the potential to generate substantial funding, as demonstrated by the case of Jamaica (see Box 3). Shared experiences and capacity development could allow other countries in the group to tap into this opportunity. Debt swaps often target conservation, and considering the biodiversity and watershed services generated by the forests in SIDS, the mechanism would be highly suitable for indebted SIDS countries. Timberland investment, in countries where suitable growth potential for high-value commercial species (teak, mahogany, agarwood, sandalwood, etc.) exists, has not been fully tapped into in SIDS. For example, according to Pauku (2009), in the Solomon Islands, the Government recognizes the importance of plantation forestry as a “sunrise” industry to meet the increasing demand for wood from both local and overseas customers. To take advantage of opportunities in increased domestic and foreign timberland and other direct investments, various internal and external factors need to be in place to facilitate the investments. Internal factors include clear policies concerning forests and other sectors, political stability, level of transparency and clarity of land tenure. The external factors include, for example, status of the global economy. SIDS countries should review their policies so that policies in interlinked sectors are not counterproductive. For example, existing agricultural policies might encourage land use for agricultural production and even provide subsidies for the conversion of forest land into agricultural land. Without such distorting subsidies, forestry could offer adequate income and multiple services. Direct investments require clear land and forest tenure arrangements and access to financing. Credit guarantees have been used in, for example, the energy sector, which has some similar characteristics to forest investments, i.e., high upfront cost and a potentially long maturity period for the yield and profit. This mechanism has not been used in SIDS to support forest investments, but it could be considered, for instance, in large-scale investment projects in countries with potential for plantations and existing or potential for downstream processing.

20 Calculation according to the OSIRIS model developed by Conservation International's Center for

Applied Biodiversity Science). http://forestcarbonmarketplace.com/article.php?item=1057.


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In a study on the Solomon Islands, Pauku (2009) sees a huge potential in NWFPs and agroforestry products becoming major contributors in the country’s economy. The contribution of these products in sustaining the livelihoods of the people in terms of food, medicines, dyes, resins and fuel is traditionally significant. The same presumably applies to most of the SIDS countries where land is scarce and hence there is a need to maximize the provision of services and products. However, significant support in capacity development and extension is needed. Agroforestry in particular can easily be neglected when departments mandated with forests and departments mandated with agriculture fail to work together, leaving a gap with respect to service provision. Inter-sectoral communication and strategic planning has the potential to overcome this gap.

This report furthermore highlights the need for an increased fund mobilization for forests and trees in SIDS. Access to forest and tree-related financing data, especially on the domestic fund flows in SIDS, is a key issue in the process of creating effective financing strategies for increased fund mobilization. One opportunity for collecting the required information would be to ask countries to report this data at the regional forest financing workshops, which are organized as a part of the UNFF facilitative process.


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8. CONCLUSIONS

ODA is a major source of funding for forests and trees in SIDS. Inclusion of forests and trees into the national development strategies is crucial to enabling the mobilization of donor funds. However, a significant share of the countries (slightly less than half) have not included forests and trees in their PRSs or other development strategies, which can reflect a weak understanding of or low political priority for forests and trees. Also, more than half of the SIDS included in this report do not have a forest strategy, which might suggest that there is a lack of political interest in forests and trees in those SIDS. Watershed, soil management and biodiversity conservation, among others, are important issues in SIDS. These thematic areas are cross-sectoral, meaning that various sectors, especially the forest, agriculture, water, energy and tourism sectors, need to address the issues together or in some combination. An integrated approach to the management and financing of land, water, and forests could be facilitated and supported to achieve better coordination and integration of strategies and policies. A good example of cross-sectoral financing strategies is the Global Mechanism (GM) facilitated Integrated Financing Strategy (IFS) process. Domestic budgets are a significant source of financing of forests and trees in SIDS. In tapping the resources of the national budget, an understanding of the domestic budgeting process and liaison with the national planning entity in charge of the budget has the potential, as mentioned in the Fiji case study, to increase the budget allocation to the forest-relevant agency. In various SIDS, there are significant linkages between forests and trees and other sectors of the economy. Tourism is the fastest growing economic sector in SIDS. The services and products that forests and trees generate for the tourism sector should be identified at country level, and systems for paying for forest environment services (PES) should be designed. Presently only few countries have identified the potential for generating funds through environmental services in their national strategies. PES systems could provide an opportunity for increased fund generation for forests and trees in SIDS; however, PES capacity development is necessary in most countries. This could also imply a need to channel more ODA to forest education and training, which currently has benefited from only a minor share of forestry ODA in SIDS. Land and forest tenure is an important component of investment attractiveness and in the designing of PES systems. Fiji provides an interesting example of clear tenure arrangement: the country’s customary tenure system is integrated into the legislation. By law, the customary land cannot be sold, but the owners can lease it and hence derive income from it. Many arrangements in Fiji combine lease payments with other income streams from forest land, such as estimated timber income forgone in conservation areas or carbon sales. Debt-for-nature swaps have been used in some SIDS and have the potential to generate substantial funding, as demonstrated by the case of Jamaica. Experience sharing and awareness- raising could allow other countries in the group to tap into this opportunity. Timberland investment, in countries where suitable growth potential for high-value commercial species (teak, mahogany, agarwood, sandalwood, etc.) exists and where suitable land is available, has not been fully tapped in SIDS. To benefit from the opportunities in increased domestic and foreign timberland and other direct investments, various internal and external factors need to be in place to facilitate the investments. Internal factors include clear policies concerning forests and other relevant sectors, political stability, level of transparency and clarity of land tenure. The external factors include, for example, cycles in the global economy. SIDS countries should review their policies so that policies in interlinked sectors are not counterproductive.


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9. REFERENCES

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Conservation International 2010, Accessed 30.6.2010. http://www.nature.org/wherewework/centralamerica/tropicalforests/news/news2113.html

Conservation International 2010. http://www.conservation.org/explore/asia-pacific/pacific_islands/fiji/projects/Pages/sovi_basin.aspx

Eliasch, J. 2008. Climate Change Financing: Global Forests. London: The Stationery Office Limited.

FAO 2001. An Overview of National Forest Funds: Current Approaches and Future Opportunities.

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Pauku, Richard L. 2009. Asia-Pacific Forestry Sector Outlook Study II Working Paper Series. Working Paper No. APFSOS II/WP/2009/31.

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The Global Mechanism undated. Latin America and Caribbean Programme. http://global-mechanism.org/dynamic/documents/document_file/lac.pdf

Tomaselli, Ivan, 2006. Brief Study on Funding and Finance for Forestry and Forest-Based Sector.

UN stats 2010. http://unstats.un.org/unsd/default.htm

UNFCCC, 2007. Vulnerability and Adaptation to Climate Change in Small Island Developing States. Background paper for the expert meeting on adaptation for small island developing States.

Wertz-Kanounnikoff, S. and Kongphan-apirak, M. 2009. Emerging REDD+ : A priliminary survey of demonstration and readiness activities. CIFOR Working Paper No. 46. Bogor, Indonesia.

Annex 1


1

Annex 1 Value added21 (%) of agriculture, fisheries, hunting and forestry

Country Value added of agriculture, fisheries,

hunting and forestry (%)

Antigua and Barbuda 2.8 Bahamas 1.6 Bahrain 0.3 Barbados 3.2 Belize 11.6 Cape Verde 9.7 Comoros 48.3 Cuba 5.0 Dominica 14.9 Dominican Republic 6.1 Fiji 13.1 Grenada 5.4 Guinea-Bissau 59.3 Guyana 30.9 Haiti 30.4 Jamaica 5.4 Kiribati 5.0 Maldives 6.0 Marshall Islands 10.0 Mauritius 4.0 Micronesia (Federated States of) 19.1 Nauru 12.2 Palau 3.2 Papua New Guinea 33.3 Saint Kitts and Nevis 2.4 Saint Lucia 3.8 Saint Vincent and the Grenadines 7.4 Samoa 12.1 Sao Tome and Principe 18.7 Seychelles 2.7 Singapore 0.0 Solomon Islands 35.3 Suriname 5.9 Timor-Leste 30.8 Tonga 26.4

Trinidad and Tobago 0.3 Tuvalu 16.6 Vanuatu 13.7

21 Gross value added is the value of output less the value of intermediate consumption; it is a measure of the contribution to GDP made by an individual producer, industry or sector.

Annex 2


1

Annex 2 ODA in SIDS during 2002-2008

2002

2003

2004

2005

2006

2007

2008 Average 02-08

SIDS bilateral ODA - MUSD 7.1 5.3 3.5 3.3 2.5 5.3 4.9 4.6

SIDS multilateral ODA - MUSD

1.1 1.3 0.9 1.4 0.8 1.0 0.002 0.9

Share of bilateral ODA -% 86.4 80.4 79.4 70.2 75.7 84.0 100.0 82.3

Share of multilateral ODA% 13.6 19.6 20.6 29.8 24.3 16.0 0.04 17.7

SIDS share from total forestry ODA -%

3.3 2.2 1.2 1.1 0.6 1.1 0.9 1.5

Annex 3


1

Annex 3 Forestry ODA contributions (%) by donor in SIDS during 2002-2008

Donor 2002 2003 2004 2005 2006 2007 2008 Average of total 02-08

Australia 25.7 35.7 27.7 25.6

16.1 14.7 26.6 25.1

Canada 11.1 18.1 25.2 6.4 3.0 3.2 6.4 10.7

Finland - - - - 3.0 1.6 - 0.5

Germany 0.5 4.5 9.1 8.6 20.3 24.0 5.7 9.4

Italy - - - - - 3.2 0.7 0.6

Japan - 8.5 10.0 20.5

28.5 28.7 36.8 17.0

Korea - - - - 0.2 1.6 0.4 0.3

Luxembourg - - - - 0.6 0.5 2.0 0.4

Netherlands 33.2 3.0 - 4.3 - 1.2 2.0 8.6

New Zealand 0.2 4.5 - - - - - 0.8

Norway - - - - - - 1.0 0.1

Portugal - - 0.6 0.6 0.8 0.6 - 0.3

Spain - - - - - - 0.04 0.0

Switzerland - - - 2.1 3.0 3.2 16.3 3.1

United Kingdom 15.8 4.5 6.9 2.1 - 1.6 2.0 5.7

United States - 1.5 - - - - - 0.3

Multilateral donors:

EU Institutions 13.4 19.6 20.6 38.4

24.3 16.0 - 18.0

IDA 0.1 - - - - - - 0.0 GEF - - - - - - 0.04 0.0

Annex 4


1

Annex 4 Forestry ODA received by country in SIDS during 2002-2008

Country Region LCD 2002 2003 2004 2005 2006 2007 2008

Antigua and Barbuda Caribbean - - - - - - -

Bahamas Caribbean - - - - - - -

Bahrain AIMS - - - - - - -

Barbados Caribbean - - - - - - -

Belize Caribbean - - - - - - -

Cape Verde AIMS 0.1 0.3 0.2 0.1 0.02 0.5 -

Comoros AIMS Yes - - - - - - -

Cuba Caribbean 0.3 0.3 0.6 0.3 0.2 0.2 1

Dominica Caribbean - - - - - - -

Dominican Republic Caribbean - 0.3 0.3 0.5 0.5 0.8 1.1

Federated States of

Micronesia Pacific - 0.1 - - - - 0.019

Fiji Pacific 0.006 0.1 - 0.1 0.02 0.1 0.1

Grenada Caribbean - - - - - - -

Guinea-Bissau AIMS - - - - - - -

Guyana Caribbean 2 0.3 0.3 0.1 - 0.7 0.1

Haiti Caribbean Yes 0.00 0.037 - -0.40 0.1 0.3 0.4

Jamaica Caribbean 0.7 0.8 0.6 0.2 - 0.4 0.01

Kiribati Pacific Yes - - - - - - -

Maldives AIMS Yes 0.01 - - - - - -

Marshall Islands Pacific - - - - - - -

Mauritius AIMS - - - - - - -

Nauru Pacific - - - - - - -

Palau Pacific - - 0.02 0.3 0.1 - 0.02

Papua New Guinea Pacific 2.4 2.3 1.1 2.1 1 1.5 1.1

Samoa Pacific Yes 0.0029 0.02 - 0.1 0.1 0.2 0.035

Sao Tome and Principe AIMS 0.02 - - - 0.027 0.037 -

Seychelles AIMS - - - - - - -

Singapore AIMS - - - - - - -

Solomon Islands Pacific Yes 0.9 1.1 0.9 0.4 0.2 0.2 0.1

St. Kitts and Nevis Caribbean - - - - - - -

St. Lucia Caribbean - - - - - - -

St. Vincent and the

Grenadines Caribbean - - 0.02 0.1 0.036 0.01 0.1

Suriname Caribbean 1.5 0.2 - 0.2 - 0.0076 0.1

Timor-Leste Pacific Yes 0.20 0.3 0.2 0.1 0.0058 - 0.6

Tonga Pacific - 0.3 0.0007 0.1 0.04 0.02 -

Trinidad and Tobago Caribbean 0.0047 - - - - - -

Tuvalu Pacific Yes - - - - - - -

Vanuatu Pacific Yes - 0.1 0.2 0.3 0.1 0.3 0.1

Total 8.1456 6.557 4.4407 4.60 2.4488 5.2746 4.8879

Annex 5


1

Annex 5 Percentage shares of forestry ODA in SIDS by thematic area during 2002-2008

2002 2003 2004 2005 2006 2007 2008

Average 02-08

Forestry policy & admin. management 65.6 53.4 63.0 56.6 61.2 30.7 43.7 53.5

Forestry development 6.3 35.2 16.5 22.2 22.8 55.6 35.0 27.7

Forestry research 10.2 - 6.6 16.4 11.1 11.3 11.3 9.6

Forestry services 10.2 8.9 12.8 - - 1.3 - 4.7

Fuel wood/charcoal 0.2 - - - - - 7.7 1.1

Forestry education/training

7.6 2.4 1.1 4.9 4.9 0.9 2.4 3.5

Annex 6


1

Annex 6 Forests and trees in national MDG strategy or report

Country Forests/trees appear in MDG strategy or report?

(Level)

Antigua and Barbuda No

Bahamas No

Bahrain No

Barbados Yes (Priority is given to formulating new forest policy and forest management plan to achieve Goal 7.)

Belize Yes (generally)

Cape Verde Yes (generally)

Comoros No

Cuba Yes (generally)

Dominica No

Dominican Republic No

Federated States of Micronesia No

Fiji Yes (generally)

Grenada No

Guinea-Bissau No

Guyana Yes (generally)

Haiti No

Jamaica

Yes (Sustainable forestry management is being promoted through the National Forest Management and Conservation Plan (NFMCP) and the Trees for Tomorrow Project.)

Kiribati Yes (generally)

Maldives No

Marshall Islands No

Mauritius Yes (generally)

Nauru No

Palau No

Papua New Guinea Yes (generally)

Samoa No

Sao Tome and Principe Yes (generally)

Seychelles No

Singapore No

Solomon Islands No

St. Kitts and Nevis No

St. Lucia No

St. Vincent and the Grenadines No

Suriname Yes (generally)

Timor-Leste Yes (generally)

Tonga No

Trinidad and Tobago No

Tuvalu No

Vanuatu No

Annex 7


1

Annex 7 Forests and trees in national agricultural, environmental or related strategy in SIDS

Country Name of strategy Forests/tree

mentioned? How

Antigua and Barbuda NBSAP Yes In a biodiversity conservation context

Bahamas

National Environmental Policy NBSPA

Yes

Generally, from a a biodiversity conservation point of view

Bahrain

National Environmental Strategy and Action Plan

No

--

Barbados NBSAP Yes Generally

Belize An Environmental Agenda NBSAP

Yes Yes

In the context of climate change mitigation From a Biodiversity conservation point of view

Cape Verde n/a -- --

Comoros NBSPA Yes Generally

Cuba

National Environmental Strategy 2007-2010 NBSAP

Yes Yes

In the context of natural resources management and environment Generally

Dominica NBSAP Yes Generally

Dominican Republic n/a --

--

Federated States of Micronesia NBSAP Yes In a terrestrial

biodiversity context

Fiji NBSAP Yes From a biodiversity conservation point of view

Grenada NBSAP Yes From a biodiversity

conservation point of view

Guinea-Bissau n/a -- --

Guyana

Low-Carbon Development Strategy NBSAP

Yes Yes

In the context of combating climate change using REDD+ From a biodiversity conservation point of view

Haiti

Haiti Environment Strategy 1994 NBSAP

Yes Yes

Generally From a biodiversity conservation point of view

Jamaica NBSAP Yes Generally

Annex 7


2


mentioned? How

Kiribati

National Environmental Management Strategy

Yes Generally

Maldives

Maldives: Environment Assessment NBSAP

Yes Yes

In the context of biodiversity loss From a terrestrial biodiversity conservation point of view

Marshall Islands NBSAP -- --

Mauritius NBSAP No --

Nauru n/a -- --

Palau

National Environmental Health Action Plan NBSAP

No Yes

-- From a biodiversity loss , conservation and environmental problem point of view

Papua New Guinea n/a -- --

Samoa

NBSAP Yes From a sustainable use and management of species and bio-security perspective

Sao Tome and Principe n/a -- --

Seychelles NBSAP Yes Generally

Singapore The Singapore Green Plan 2010

Yes From a nature conservation point of view

Solomon Islands

National Environmental Capacity Development Action Plan

Yes Generally

St. Kitts and Nevis NBSAP Yes Generally

St. Lucia NBSAP Yes Generally

St. Vincent and the Grenadines NBSAP Yes From a biodiversity

conservation point of view

Suriname

NBSAP Yes From a biodiversity management and conservation point of view

Timor-Leste

National Action Programme to Combat Land Degradation

Yes From the point of view of combating land degradation

Tonga NBSAP Yes Generally

Annex 7


3


mentioned? How

Trinidad and Tobago NBSAP Yes Generally

Tuvalu

NBSAP Yes In the context of biodiversity conservation and environmental protection

Vanuatu n/a -- --

Annex 8


1

Annex 8 Forest resources, inclusion of forests in a PRS or other national development strategies in SIDS, and existence of national forest programme (NFP), forest policy (FP), forest strategy (FS) or forest legislation (FL)

Country Forest1000 ha

% of total land area

PRS(P) or other

development strategy

Forest included? (level)

NFP/ FP/FS/FL?

Antigua and Barbuda

9 21.4 BPOA Yes (generally)

INA

Bahamas 515 51.5 BPOA Yes (generally)

FP

Bahrain n.s. 0.6 BPOA Yes (minor role)

No

Barbados 2 4.0 The Nat. Strategic Plan 2005-2015

No No

Belize 1653 72.5 BPOA (follow-up report 2003)

Yes (major role)

NFP, FP, FS, FL

Cape Verde 84 20.7 PRS (2008) Yes FP

Comoros 5 2.9 PRS (2005) Yes None

Cuba 2713 24.7 None --- NFP, FP, FS, FL

Dominica 46 61.3 PRS (2006) Yes No

Dominican Republic

1376 28.4 Estrategia Nacional de Desarrollo 2010-2030

No, only mentioned in background

NFP, FP, FS, FL

Federated States of Micronesia

63 90.6 National Development Plan (NDP)

No No

Fiji 1000 54.7 BPOA No FP, FS, FL

Grenada 4 12.2 PRS (2006) Yes (generally)

FP

Guinea-Bissau 2072 73.7 PRS (2000) No INA

Guyana 15104 76.7 PRS (2002) Yes FP, FL

Haiti 105 3.8 PRSP (2008), PRSP progress report

Yes FL

Jamaica 339 31.3 Vision 2030-NDP

Yes NFP, FP, FS, FL

Kiribati 2 3.0 NDP 2008-2011 No No

Maldives 1 3.0 PRS (2006-2010), NDP (2006-2010)

Yes No

Marshall Islands

- - Strategic NDP Framework (2003-2018)

No No

Mauritius 37 18.2 BPOA, National Development Strategy

No FP, FL

Nauru 0 0 Nat. Sustainable Dev. Strategy 2005-2025

No No

Palau 40 87.6 Nat. Master Dev. Plan 2003

Yes No

Annex 8


2

Country Forest1000 ha

% of total land area

PRS(P) or other

development strategy

Forest included? (level)

NFP/ FP/FS/FL?

Papua New Guinea

29437 65.0 Medium-term Dev. Strategy 2005-2010

Yes NFP, FP, FS, FL

Samoa 171 60.4 Strategy for the Development of Samoa 2008-2012

Yes FP, FS, FL

Sao Tome and Principe

27 28.4 PRS (2002), follow-up reports (2005 & 2007)

Yes INA

Seychelles 40 88.9 Seychelles Strategy 2017

No FP, FL

Singapore 2 3.4 Sustainable Singapore (2009)

Minor note No

Solomon Islands

2172 77.6 National Economic Recovery, Reform and Development Plan

No NFP, FP, FS, FL

St. Kitts and Nevis

5 14.7 National Development Strategy

No FP, FS

St. Lucia 17 27.9 Interim PRS and Action Plan 2003

Yes, (Generally)

No

St. Vincent and Grenadines

11 27.4 NDP (2008-2020)

No FS, FL

Suriname 14776 94.7 National Development Strategy

No NFP, FP, FS, FL

Timor-Leste 798 53.7 PRS (2002) Yes NFP, FP, FS

Tonga 4 5.0 Strategic Development Plan Eight (2006-2009)

Yes FS, FL

Trinidad and Tobago

226 44.1 Vision 2020 – Draft National Strategic Plan

Yes FL

Tuvalu 1 33.3 BPOA Assessment

No No

Vanuatu 440 36.1 None -- NFP, FP, FS, FL

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