After agriculture, forests are probably the greatest generators of environmental income for the poor. Rural communities are frequently found in or near forest areas, which vary widely in density and composition, from closed canopy rainforests to alpine coniferous forests to woody savannas. The productivity and variety of forest ecosystems, as well as their habitat value for game species, make them important contributors to the local subsistence and commercial economies. (See Box 2.2 Brazil Nuts And Palm Hearts: Bringing Forest Livelihoods To The City.)

Substantial research corroborates the importance of forests to the world’s poor. In 2004 the World Bank completed a review of studies on the income that forests provide to those who live in or near them. The review examined cases from 17 countries on three continents, focusing especially on Africa. The results were striking: environmental income from forests was found to be important at every income level and on every continent, providing an average of 22 percent of total income—the equivalent of $678 per year (adjusted for purchasing power parity (PPP) worldwide)—in the households examined (Vedeld et al.2004:28-29). (See Table 2.4 Annual Household Income From Forests.)

As many other studies have concluded, the Bank found that the most significant income from forests came from wild foods, fuel, fodder, and thatch grass. Timber and medicines were also found to be important to total income. Unfortunately, much of the economic value of forests to the poor is missed in the official state accounting of the forest economy (Mogaka et al. 2001:4).

Woodfuels

The poor rely overwhelmingly on woodfuels as their household energy source. In developing nations alone, some 2.4 billion people—more than a third of the world population—rely on wood or other biomass fuels for cooking and heating (IEA 2002:26). For example, nearly all rural households in Kenya, Tanzania, Mozambique, and Zambia use wood for cooking,and over 90 percent of urban households in these countries use charcoal imported from the countryside (IEA 2002:26). In India, 62 percent of rural households depend on woodfuels(Vadivelu 2004:5).

Wood used as fuel is fundamentally important in the household economies of the rural poor. It is not only a source of energy in the home, but a supplemental source of cash income through the collection, processing, and sale of firewood and charcoal. Charcoal in particular, due to its high energy content and easy portability, is an important income-producer and a sole source of employment for many. In Kenya alone, the charcoal economy is estimated at about 23 billion Kenyan shillings per year—on a par with tourism as an income generator (Kantai 2002:16).

Non-Timber Forest Products

The poor have traditionally not been able to capture much of the income generated from the harvest and sale of timber.

Because of its high value, more powerful interests—in private commerce and in the state bureaucracy—have generally dominated this resource. For the poor to reap greater benefits from timber production, forest ownership and governance regimes would have to change substantially.

But forests produce many other goods and services—collectively known as “nontimber forest products (NTFPs)—that are critical income sources for the poor. Typical NTFPs include various foods, fodder, fuel, medicines, and many other collectibles—literally every product derived from a forest besides timber (Wickens 1991:4). (See Table 2.5 Uses Of Selected Non-Timber Forest Products (NTFPS).) The variety can be staggering. Forest dwellers in the Brazilian Amazon, for example, regularly sell some 220 NTFPs at Belem’s daily open market— 140 of which are wild products, and the rest cultivated in the forest (Shanley et al. 2002, in Molnar et al. 2004:35). If harvested correctly, NTFPs can make not only a substantial, but a sustainable, contribution towards livelihoods. In addition to their market value, many NTFPs have social, cultural, or religious significance as well.

The use of NTFPs is quite varied, and it is well documented that they provide a wide range of subsistence and cash income to a large number of households in many nations (Neumann and Hirsch 2000:53-55). On Mexico’s Yucatan peninsula, for example, the market value of palm thatch used or sold as roofing material is estimated at US$137 million per year (Bye 1993, in Molnar et al. 2004:35). In India, NTFP production contributes about 40 percent of total official forest revenues and 55 percent of forest-based employment. (Tewari and Campbell 1996:26). In Botswana, the government recently admitted the value of NTFPs exceeds that of timber (Taylor 1996:76-77).

As impressive as these national-scale estimates are, they tend to understate the importance of NTFPs to households. Since the values of NTFPs are generally difficult to calculate, they are often underestimated (Lampietti and Dixon:1995:1-2). This undervaluation causes decision-makers to assign a lower priority to intact forest ecosystems as an economic asset than they should.