CHALLENGE

To control and reduce deforestation in the Amazon, the Brazilian government created the National REDD+ Strategy (NRS), which has provided a framework to compensate entities protecting the Amazon along a jurisdictional scale (states). In 2015, to support the coordination and implementation of the NRS, the Brazilian Government established the National Commission for Reducing Emissions of Greenhouse Gases from Deforestation and Forest Degradation, Conservation of Forest Carbon Stocks, Sustainable Management of Forests and Increase in Carbon Stocks Forestry - REDD + (CONAREDD). Representing federal, state and municipal governments as well as local and civil society organizations, CONAREDD has worked to advance dialogue and cooperation amongst the various stakeholders and members. However, certain representatives of society, including indigenous people, smallholders, and traditional communities are still not fully included in the REDD+ debates. The process of how and to whom the benefits of Brazil’s NRS can be offered and allocated amongst the stakeholders of the Amazon forest states remains largely undetermined and un-informed.

Therefore, there is the need for a healthy debate about the alternatives for benefit-sharing mechanisms for REDD+ that reflects the interests of different social groups in the Amazon. PROFOR’s program seeks to engage with leaders of the Amazon and representatives of the states and federal governments to debate and devise options on benefit sharing that could support the NRS and the REDD+ initiatives of regional states.

APPROACH

PROFOR’s program will work closely with identified local organizations such as the Amazon Environmental Research Institute (IPAM), a Brazilian NGO that will be leading many of the activities, to conduct the following:   

• Report on the current benefit-sharing mechanisms being used or proposed in Brazil;
• Apply PROFOR’s Options Assessment Framework with stakeholders during a series of workshops to obtain recommendation on the benefit-sharing mechanism to be applied to Brazil’s context;
• Develop an interim report based on stakeholder´s opinions derived from the Framework results;
• Conduct a final workshop to discuss the benefit-sharing mechanisms identified;
• Draw a best practice guide to implement the mechanisms identified during the workshops.

RESULTS: 

• The workshops participants  claimed a higher participation of the private sector in the REDD+ process,  as a way to reach more robust mechanisms, not only as direct beneficiaries of carbon sequestration but as protagonists in the management of financial mechanisms that can enable a cost-effective forest-based economy. The argument is that the governmental machine has many bureaucracy, lack of agility and lack of transparence that commits the implementation of REDD+.   
• Both national and subnational governments need to establish a closer dialogue with local actors, despite the dimensions, access difficulties and multiculturalism characteristic of the Amazon. This dialogue is key to improve their understanding of REDD+ and increase their participation in the whole process.  
• Communities, although they are the protagonists of the process, have a marginal involvement so far. A heavy and intense process of leadership strengthening, and capacity building is one of the key measures that needs to be improved. 
• The role of NGOs is fundamental in REDD+ initiatives. However, it is not their role to fulfill the obligations of the governments. Besides, NGOs need more resources to increase their capillarity and support more communities.  
• The public sector should incorporate the variables of private management in the management of funds. Funds should be managed by the private sector, NGOs or both together.  

• The states developed their REDD+ strategies and policies before the federal government. Therefore, a harmonized approach  between Federal and State polices will be necessary. Such approach include mutual recognition, equivalency, and reference standards 
• The consultations that are made to communities may not be valid since they can reflect better on their consent.     

• In a transition to incentive policies for the conservation of forests, the command and control approaches continue to be essential in the routines of environmental agencies. 
• Setting up a quality center for intelligence gathering and spatial monitoring is a critical, yet resource intensive task, requiring appropriate equipment and specialized human resources. Only through robust investments can states be able to monitor and deter illicit actions in a timely manner. 
• The technology does not replace the human capacity to read the images, especially in natural features that are confused with deforestation and degradation. There is a lack of human resources able to do this job, as well as to exercise command and control actions, once the situations in which they should intervene have been detected. 
• There is a major bottleneck in measures to detect and measure environmental degradation in relation to deforestation that needs to be observed. 

CHALLENGE

To control and reduce deforestation in the Amazon, the Brazilian government created the National REDD+ Strategy (NRS), which has provided a framework to compensate entities protecting the Amazon along a jurisdictional scale (states). In 2015, to support the coordination and implementation of the NRS, the Brazilian Government established the National Commission for Reducing Emissions of Greenhouse Gases from Deforestation and Forest Degradation, Conservation of Forest Carbon Stocks, Sustainable Management of Forests and Increase in Carbon Stocks Forestry - REDD + (CONAREDD). Representing federal, state and municipal governments as well as local and civil society organizations, CONAREDD has worked to advance dialogue and cooperation amongst the various stakeholders and members. However, certain representatives of society, including indigenous people, smallholders, and traditional communities are still not fully included in the REDD+ debates. The process of how and to whom the benefits of Brazil’s NRS can be offered and allocated amongst the stakeholders of the Amazon forest states remains largely undetermined and un-informed.

Therefore, there is the need for a healthy debate about the alternatives for benefit-sharing mechanisms for REDD+ that reflects the interests of different social groups in the Amazon. PROFOR’s program seeks to engage with leaders of the Amazon and representatives of the states and federal governments to debate and devise options on benefit sharing that could support the NRS and the REDD+ initiatives of regional states.

APPROACH

PROFOR’s program will work closely with identified local organizations such as the Amazon Environmental Research Institute (IPAM), a Brazilian NGO that will be leading many of the activities, to conduct the following:   

• Report on the current benefit-sharing mechanisms being used or proposed in Brazil;
• Apply PROFOR’s Options Assessment Framework with stakeholders during a series of workshops to obtain recommendation on the benefit-sharing mechanism to be applied to Brazil’s context;
• Develop an interim report based on stakeholder´s opinions derived from the Framework results;
• Conduct a final workshop to discuss the benefit-sharing mechanisms identified;
• Draw a best practice guide to implement the mechanisms identified during the workshops.

RESULTS: 

• The workshops participants  claimed a higher participation of the private sector in the REDD+ process,  as a way to reach more robust mechanisms, not only as direct beneficiaries of carbon sequestration but as protagonists in the management of financial mechanisms that can enable a cost-effective forest-based economy. The argument is that the governmental machine has many bureaucracy, lack of agility and lack of transparence that commits the implementation of REDD+.   
• Both national and subnational governments need to establish a closer dialogue with local actors, despite the dimensions, access difficulties and multiculturalism characteristic of the Amazon. This dialogue is key to improve their understanding of REDD+ and increase their participation in the whole process.  
• Communities, although they are the protagonists of the process, have a marginal involvement so far. A heavy and intense process of leadership strengthening, and capacity building is one of the key measures that needs to be improved. 
• The role of NGOs is fundamental in REDD+ initiatives. However, it is not their role to fulfill the obligations of the governments. Besides, NGOs need more resources to increase their capillarity and support more communities.  
• The public sector should incorporate the variables of private management in the management of funds. Funds should be managed by the private sector, NGOs or both together.  

• The states developed their REDD+ strategies and policies before the federal government. Therefore, a harmonized approach  between Federal and State polices will be necessary. Such approach include mutual recognition, equivalency, and reference standards 
• The consultations that are made to communities may not be valid since they can reflect better on their consent.     

• In a transition to incentive policies for the conservation of forests, the command and control approaches continue to be essential in the routines of environmental agencies. 
• Setting up a quality center for intelligence gathering and spatial monitoring is a critical, yet resource intensive task, requiring appropriate equipment and specialized human resources. Only through robust investments can states be able to monitor and deter illicit actions in a timely manner. 
• The technology does not replace the human capacity to read the images, especially in natural features that are confused with deforestation and degradation. There is a lack of human resources able to do this job, as well as to exercise command and control actions, once the situations in which they should intervene have been detected. 
• There is a major bottleneck in measures to detect and measure environmental degradation in relation to deforestation that needs to be observed. 

CHALLENGE

To control and reduce deforestation in the Amazon, the Brazilian government created the National REDD+ Strategy (NRS), which has provided a framework to compensate entities protecting the Amazon along a jurisdictional scale (states). In 2015, to support the coordination and implementation of the NRS, the Brazilian Government established the National Commission for Reducing Emissions of Greenhouse Gases from Deforestation and Forest Degradation, Conservation of Forest Carbon Stocks, Sustainable Management of Forests and Increase in Carbon Stocks Forestry - REDD + (CONAREDD). Representing federal, state and municipal governments as well as local and civil society organizations, CONAREDD has worked to advance dialogue and cooperation amongst the various stakeholders and members. However, certain representatives of society, including indigenous people, smallholders, and traditional communities are still not fully included in the REDD+ debates. The process of how and to whom the benefits of Brazil’s NRS can be offered and allocated amongst the stakeholders of the Amazon forest states remains largely undetermined and un-informed.

Therefore, there is the need for a healthy debate about the alternatives for benefit-sharing mechanisms for REDD+ that reflects the interests of different social groups in the Amazon. PROFOR’s program seeks to engage with leaders of the Amazon and representatives of the states and federal governments to debate and devise options on benefit sharing that could support the NRS and the REDD+ initiatives of regional states.

APPROACH

PROFOR’s program will work closely with identified local organizations such as the Amazon Environmental Research Institute (IPAM), a Brazilian NGO that will be leading many of the activities, to conduct the following:   

• Report on the current benefit-sharing mechanisms being used or proposed in Brazil;
• Apply PROFOR’s Options Assessment Framework with stakeholders during a series of workshops to obtain recommendation on the benefit-sharing mechanism to be applied to Brazil’s context;
• Develop an interim report based on stakeholder´s opinions derived from the Framework results;
• Conduct a final workshop to discuss the benefit-sharing mechanisms identified;
• Draw a best practice guide to implement the mechanisms identified during the workshops.

RESULTS: 

• The workshops participants  claimed a higher participation of the private sector in the REDD+ process,  as a way to reach more robust mechanisms, not only as direct beneficiaries of carbon sequestration but as protagonists in the management of financial mechanisms that can enable a cost-effective forest-based economy. The argument is that the governmental machine has many bureaucracy, lack of agility and lack of transparence that commits the implementation of REDD+.   
• Both national and subnational governments need to establish a closer dialogue with local actors, despite the dimensions, access difficulties and multiculturalism characteristic of the Amazon. This dialogue is key to improve their understanding of REDD+ and increase their participation in the whole process.  
• Communities, although they are the protagonists of the process, have a marginal involvement so far. A heavy and intense process of leadership strengthening, and capacity building is one of the key measures that needs to be improved. 
• The role of NGOs is fundamental in REDD+ initiatives. However, it is not their role to fulfill the obligations of the governments. Besides, NGOs need more resources to increase their capillarity and support more communities.  
• The public sector should incorporate the variables of private management in the management of funds. Funds should be managed by the private sector, NGOs or both together.  

• The states developed their REDD+ strategies and policies before the federal government. Therefore, a harmonized approach  between Federal and State polices will be necessary. Such approach include mutual recognition, equivalency, and reference standards 
• The consultations that are made to communities may not be valid since they can reflect better on their consent.     

• In a transition to incentive policies for the conservation of forests, the command and control approaches continue to be essential in the routines of environmental agencies. 
• Setting up a quality center for intelligence gathering and spatial monitoring is a critical, yet resource intensive task, requiring appropriate equipment and specialized human resources. Only through robust investments can states be able to monitor and deter illicit actions in a timely manner. 
• The technology does not replace the human capacity to read the images, especially in natural features that are confused with deforestation and degradation. There is a lack of human resources able to do this job, as well as to exercise command and control actions, once the situations in which they should intervene have been detected. 
• There is a major bottleneck in measures to detect and measure environmental degradation in relation to deforestation that needs to be observed. 

CHALLENGE

To control and reduce deforestation in the Amazon, the Brazilian government created the National REDD+ Strategy (NRS), which has provided a framework to compensate entities protecting the Amazon along a jurisdictional scale (states). In 2015, to support the coordination and implementation of the NRS, the Brazilian Government established the National Commission for Reducing Emissions of Greenhouse Gases from Deforestation and Forest Degradation, Conservation of Forest Carbon Stocks, Sustainable Management of Forests and Increase in Carbon Stocks Forestry - REDD + (CONAREDD). Representing federal, state and municipal governments as well as local and civil society organizations, CONAREDD has worked to advance dialogue and cooperation amongst the various stakeholders and members. However, certain representatives of society, including indigenous people, smallholders, and traditional communities are still not fully included in the REDD+ debates. The process of how and to whom the benefits of Brazil’s NRS can be offered and allocated amongst the stakeholders of the Amazon forest states remains largely undetermined and un-informed.

Therefore, there is the need for a healthy debate about the alternatives for benefit-sharing mechanisms for REDD+ that reflects the interests of different social groups in the Amazon. PROFOR’s program seeks to engage with leaders of the Amazon and representatives of the states and federal governments to debate and devise options on benefit sharing that could support the NRS and the REDD+ initiatives of regional states.

APPROACH

PROFOR’s program will work closely with identified local organizations such as the Amazon Environmental Research Institute (IPAM), a Brazilian NGO that will be leading many of the activities, to conduct the following:   

• Report on the current benefit-sharing mechanisms being used or proposed in Brazil;
• Apply PROFOR’s Options Assessment Framework with stakeholders during a series of workshops to obtain recommendation on the benefit-sharing mechanism to be applied to Brazil’s context;
• Develop an interim report based on stakeholder´s opinions derived from the Framework results;
• Conduct a final workshop to discuss the benefit-sharing mechanisms identified;
• Draw a best practice guide to implement the mechanisms identified during the workshops.

RESULTS: 

• The workshops participants  claimed a higher participation of the private sector in the REDD+ process,  as a way to reach more robust mechanisms, not only as direct beneficiaries of carbon sequestration but as protagonists in the management of financial mechanisms that can enable a cost-effective forest-based economy. The argument is that the governmental machine has many bureaucracy, lack of agility and lack of transparence that commits the implementation of REDD+.   
• Both national and subnational governments need to establish a closer dialogue with local actors, despite the dimensions, access difficulties and multiculturalism characteristic of the Amazon. This dialogue is key to improve their understanding of REDD+ and increase their participation in the whole process.  
• Communities, although they are the protagonists of the process, have a marginal involvement so far. A heavy and intense process of leadership strengthening, and capacity building is one of the key measures that needs to be improved. 
• The role of NGOs is fundamental in REDD+ initiatives. However, it is not their role to fulfill the obligations of the governments. Besides, NGOs need more resources to increase their capillarity and support more communities.  
• The public sector should incorporate the variables of private management in the management of funds. Funds should be managed by the private sector, NGOs or both together.  

• The states developed their REDD+ strategies and policies before the federal government. Therefore, a harmonized approach  between Federal and State polices will be necessary. Such approach include mutual recognition, equivalency, and reference standards 
• The consultations that are made to communities may not be valid since they can reflect better on their consent.     

• In a transition to incentive policies for the conservation of forests, the command and control approaches continue to be essential in the routines of environmental agencies. 
• Setting up a quality center for intelligence gathering and spatial monitoring is a critical, yet resource intensive task, requiring appropriate equipment and specialized human resources. Only through robust investments can states be able to monitor and deter illicit actions in a timely manner. 
• The technology does not replace the human capacity to read the images, especially in natural features that are confused with deforestation and degradation. There is a lack of human resources able to do this job, as well as to exercise command and control actions, once the situations in which they should intervene have been detected. 
• There is a major bottleneck in measures to detect and measure environmental degradation in relation to deforestation that needs to be observed. 

CHALLENGE
At the heart of whether growth in a country is green and sustainable is the issue of accumulation of wealth. It is wealth — broadly defined to include manufactured capital, natural capital (including forests), human and social capital— that underlies the generation of national income. Gross domestic product (GDP) has conventionally been used to assess economic performance, measuring economic growth from one year to the next. But GDP does not take into account depreciation and depletion of wealth, and therefore does not provide an indication of whether growth is sustainable: an economy could appear to be growing in the near term by running down its assets such as its forests. Assessments of economic performance should therefore be based on both measures of annual growth (such as GDP) and measures of the comprehensive wealth of a country, which indicate whether that growth is sustainable in the long term.

For the past 15 years, the World Bank has provided indicators to measure the sustainability of a country’s growth path, such as Adjusted Net Saving (ANS), adjusted Net National Income (aNNI), and comprehensive wealth estimates.  Underpinning these indicators are data on natural resource rents (from forests, minerals, and energy) which provide policy makers with information on potential revenues from natural capital.

The comprehensive wealth accounts, which have been published for 1995, 2000, and 2005, include estimates for forest wealth which is calculated as the sum of the net present value of rents from timber extraction and annual benefits from non-timber resources, including minor forest products, hunting, recreation, and watershed protection. ANS, which is published annually and covers the period 1970-present, is defined as net national saving adjusted for investments in human capital, depletion of natural resources (including forests), and damages to human health caused by pollution, and provides an estimate of the annual change in wealth.

Recent findings suggest that while wealth data and ANS data are used by researchers and policy analysts, the greatest demand is for data on natural resource rents.  However, while minerals and energy rent data have gained a lot of traction, rent data for forests are not used as frequently. Interviews have revealed concerns with the credibility of the underlying data, such as the FAO data on forest area and growing stock. The authors of the indicators have also concluded that a number of methodological changes could improve estimates for forest wealth, potential forest rents, and net forest depletion.  

APPROACH
This activity hopes to increase the use of improved World Bank forest data (forest rents, net forest depletion, and forest wealth), so that countries and data users are better equipped with credible and more accurate information on the physical area and value of forest resources. Countries should consider not just the flow of revenues from forest resources, but also the sustainable management of the asset (stock of forest resources).

• Data on the value of forest wealth, its share in total wealth, and how the value is changing over time can help governments assess the contribution of forests to current development outcomes and whether forests are being managed sustainably.
• Data on potential forest rents when combined with information on actual rent recovery and use of these revenues will allow governments to assess whether contribution of forest resources to sustainable development is being realized and who is benefitting from the revenue.  Such data and assessments can equip policymakers to better manage forest resources, improve forest governance, increase transparency in the rent captured, and ultimately lead to increased reinvestment of forest rents in other forms of capital to grow the total wealth of the country.
• These policy changes could, in turn, promote the sustainable management of forest resources for poverty reduction and economic growth.

RESULTS

The activity has been successfully completed.

A report is being finalized and will be released soon. The report reviews the latest literature, explores improved data sources, evaluates key parameters and assumptions in the methodology, and outlines the steps and resources required to improve the data and methods.

An implementation plan for updating the forest database that includes a plan for country surveys if the report finds insufficient global data will be finalized in the coming months.

For stories and updates on related activities, follow us on Twitter and Facebook, or subscribe to our mailing list for regular updates

CHALLENGE
At the heart of whether growth in a country is green and sustainable is the issue of accumulation of wealth. It is wealth — broadly defined to include manufactured capital, natural capital (including forests), human and social capital— that underlies the generation of national income. Gross domestic product (GDP) has conventionally been used to assess economic performance, measuring economic growth from one year to the next. But GDP does not take into account depreciation and depletion of wealth, and therefore does not provide an indication of whether growth is sustainable: an economy could appear to be growing in the near term by running down its assets such as its forests. Assessments of economic performance should therefore be based on both measures of annual growth (such as GDP) and measures of the comprehensive wealth of a country, which indicate whether that growth is sustainable in the long term.

For the past 15 years, the World Bank has provided indicators to measure the sustainability of a country’s growth path, such as Adjusted Net Saving (ANS), adjusted Net National Income (aNNI), and comprehensive wealth estimates.  Underpinning these indicators are data on natural resource rents (from forests, minerals, and energy) which provide policy makers with information on potential revenues from natural capital.

The comprehensive wealth accounts, which have been published for 1995, 2000, and 2005, include estimates for forest wealth which is calculated as the sum of the net present value of rents from timber extraction and annual benefits from non-timber resources, including minor forest products, hunting, recreation, and watershed protection. ANS, which is published annually and covers the period 1970-present, is defined as net national saving adjusted for investments in human capital, depletion of natural resources (including forests), and damages to human health caused by pollution, and provides an estimate of the annual change in wealth.

Recent findings suggest that while wealth data and ANS data are used by researchers and policy analysts, the greatest demand is for data on natural resource rents.  However, while minerals and energy rent data have gained a lot of traction, rent data for forests are not used as frequently. Interviews have revealed concerns with the credibility of the underlying data, such as the FAO data on forest area and growing stock. The authors of the indicators have also concluded that a number of methodological changes could improve estimates for forest wealth, potential forest rents, and net forest depletion.  

APPROACH
This activity hopes to increase the use of improved World Bank forest data (forest rents, net forest depletion, and forest wealth), so that countries and data users are better equipped with credible and more accurate information on the physical area and value of forest resources. Countries should consider not just the flow of revenues from forest resources, but also the sustainable management of the asset (stock of forest resources).

• Data on the value of forest wealth, its share in total wealth, and how the value is changing over time can help governments assess the contribution of forests to current development outcomes and whether forests are being managed sustainably.
• Data on potential forest rents when combined with information on actual rent recovery and use of these revenues will allow governments to assess whether contribution of forest resources to sustainable development is being realized and who is benefitting from the revenue.  Such data and assessments can equip policymakers to better manage forest resources, improve forest governance, increase transparency in the rent captured, and ultimately lead to increased reinvestment of forest rents in other forms of capital to grow the total wealth of the country.
• These policy changes could, in turn, promote the sustainable management of forest resources for poverty reduction and economic growth.

RESULTS

The activity has been successfully completed.

A report is being finalized and will be released soon. The report reviews the latest literature, explores improved data sources, evaluates key parameters and assumptions in the methodology, and outlines the steps and resources required to improve the data and methods.

An implementation plan for updating the forest database that includes a plan for country surveys if the report finds insufficient global data will be finalized in the coming months.

For stories and updates on related activities, follow us on Twitter and Facebook, or subscribe to our mailing list for regular updates

CHALLENGE
At the heart of whether growth in a country is green and sustainable is the issue of accumulation of wealth. It is wealth — broadly defined to include manufactured capital, natural capital (including forests), human and social capital— that underlies the generation of national income. Gross domestic product (GDP) has conventionally been used to assess economic performance, measuring economic growth from one year to the next. But GDP does not take into account depreciation and depletion of wealth, and therefore does not provide an indication of whether growth is sustainable: an economy could appear to be growing in the near term by running down its assets such as its forests. Assessments of economic performance should therefore be based on both measures of annual growth (such as GDP) and measures of the comprehensive wealth of a country, which indicate whether that growth is sustainable in the long term.

For the past 15 years, the World Bank has provided indicators to measure the sustainability of a country’s growth path, such as Adjusted Net Saving (ANS), adjusted Net National Income (aNNI), and comprehensive wealth estimates.  Underpinning these indicators are data on natural resource rents (from forests, minerals, and energy) which provide policy makers with information on potential revenues from natural capital.

The comprehensive wealth accounts, which have been published for 1995, 2000, and 2005, include estimates for forest wealth which is calculated as the sum of the net present value of rents from timber extraction and annual benefits from non-timber resources, including minor forest products, hunting, recreation, and watershed protection. ANS, which is published annually and covers the period 1970-present, is defined as net national saving adjusted for investments in human capital, depletion of natural resources (including forests), and damages to human health caused by pollution, and provides an estimate of the annual change in wealth.

Recent findings suggest that while wealth data and ANS data are used by researchers and policy analysts, the greatest demand is for data on natural resource rents.  However, while minerals and energy rent data have gained a lot of traction, rent data for forests are not used as frequently. Interviews have revealed concerns with the credibility of the underlying data, such as the FAO data on forest area and growing stock. The authors of the indicators have also concluded that a number of methodological changes could improve estimates for forest wealth, potential forest rents, and net forest depletion.  

APPROACH
This activity hopes to increase the use of improved World Bank forest data (forest rents, net forest depletion, and forest wealth), so that countries and data users are better equipped with credible and more accurate information on the physical area and value of forest resources. Countries should consider not just the flow of revenues from forest resources, but also the sustainable management of the asset (stock of forest resources).

• Data on the value of forest wealth, its share in total wealth, and how the value is changing over time can help governments assess the contribution of forests to current development outcomes and whether forests are being managed sustainably.
• Data on potential forest rents when combined with information on actual rent recovery and use of these revenues will allow governments to assess whether contribution of forest resources to sustainable development is being realized and who is benefitting from the revenue.  Such data and assessments can equip policymakers to better manage forest resources, improve forest governance, increase transparency in the rent captured, and ultimately lead to increased reinvestment of forest rents in other forms of capital to grow the total wealth of the country.
• These policy changes could, in turn, promote the sustainable management of forest resources for poverty reduction and economic growth.

RESULTS

The activity has been successfully completed.

A report is being finalized and will be released soon. The report reviews the latest literature, explores improved data sources, evaluates key parameters and assumptions in the methodology, and outlines the steps and resources required to improve the data and methods.

An implementation plan for updating the forest database that includes a plan for country surveys if the report finds insufficient global data will be finalized in the coming months.

For stories and updates on related activities, follow us on Twitter and Facebook, or subscribe to our mailing list for regular updates

CHALLENGE
At the heart of whether growth in a country is green and sustainable is the issue of accumulation of wealth. It is wealth — broadly defined to include manufactured capital, natural capital (including forests), human and social capital— that underlies the generation of national income. Gross domestic product (GDP) has conventionally been used to assess economic performance, measuring economic growth from one year to the next. But GDP does not take into account depreciation and depletion of wealth, and therefore does not provide an indication of whether growth is sustainable: an economy could appear to be growing in the near term by running down its assets such as its forests. Assessments of economic performance should therefore be based on both measures of annual growth (such as GDP) and measures of the comprehensive wealth of a country, which indicate whether that growth is sustainable in the long term.

For the past 15 years, the World Bank has provided indicators to measure the sustainability of a country’s growth path, such as Adjusted Net Saving (ANS), adjusted Net National Income (aNNI), and comprehensive wealth estimates.  Underpinning these indicators are data on natural resource rents (from forests, minerals, and energy) which provide policy makers with information on potential revenues from natural capital.

The comprehensive wealth accounts, which have been published for 1995, 2000, and 2005, include estimates for forest wealth which is calculated as the sum of the net present value of rents from timber extraction and annual benefits from non-timber resources, including minor forest products, hunting, recreation, and watershed protection. ANS, which is published annually and covers the period 1970-present, is defined as net national saving adjusted for investments in human capital, depletion of natural resources (including forests), and damages to human health caused by pollution, and provides an estimate of the annual change in wealth.

Recent findings suggest that while wealth data and ANS data are used by researchers and policy analysts, the greatest demand is for data on natural resource rents.  However, while minerals and energy rent data have gained a lot of traction, rent data for forests are not used as frequently. Interviews have revealed concerns with the credibility of the underlying data, such as the FAO data on forest area and growing stock. The authors of the indicators have also concluded that a number of methodological changes could improve estimates for forest wealth, potential forest rents, and net forest depletion.  

APPROACH
This activity hopes to increase the use of improved World Bank forest data (forest rents, net forest depletion, and forest wealth), so that countries and data users are better equipped with credible and more accurate information on the physical area and value of forest resources. Countries should consider not just the flow of revenues from forest resources, but also the sustainable management of the asset (stock of forest resources).

• Data on the value of forest wealth, its share in total wealth, and how the value is changing over time can help governments assess the contribution of forests to current development outcomes and whether forests are being managed sustainably.
• Data on potential forest rents when combined with information on actual rent recovery and use of these revenues will allow governments to assess whether contribution of forest resources to sustainable development is being realized and who is benefitting from the revenue.  Such data and assessments can equip policymakers to better manage forest resources, improve forest governance, increase transparency in the rent captured, and ultimately lead to increased reinvestment of forest rents in other forms of capital to grow the total wealth of the country.
• These policy changes could, in turn, promote the sustainable management of forest resources for poverty reduction and economic growth.

RESULTS

The activity has been successfully completed.

A report is being finalized and will be released soon. The report reviews the latest literature, explores improved data sources, evaluates key parameters and assumptions in the methodology, and outlines the steps and resources required to improve the data and methods.

An implementation plan for updating the forest database that includes a plan for country surveys if the report finds insufficient global data will be finalized in the coming months.

For stories and updates on related activities, follow us on Twitter and Facebook, or subscribe to our mailing list for regular updates

CHALLENGE
At the heart of whether growth in a country is green and sustainable is the issue of accumulation of wealth. It is wealth — broadly defined to include manufactured capital, natural capital (including forests), human and social capital— that underlies the generation of national income. Gross domestic product (GDP) has conventionally been used to assess economic performance, measuring economic growth from one year to the next. But GDP does not take into account depreciation and depletion of wealth, and therefore does not provide an indication of whether growth is sustainable: an economy could appear to be growing in the near term by running down its assets such as its forests. Assessments of economic performance should therefore be based on both measures of annual growth (such as GDP) and measures of the comprehensive wealth of a country, which indicate whether that growth is sustainable in the long term.

For the past 15 years, the World Bank has provided indicators to measure the sustainability of a country’s growth path, such as Adjusted Net Saving (ANS), adjusted Net National Income (aNNI), and comprehensive wealth estimates.  Underpinning these indicators are data on natural resource rents (from forests, minerals, and energy) which provide policy makers with information on potential revenues from natural capital.

The comprehensive wealth accounts, which have been published for 1995, 2000, and 2005, include estimates for forest wealth which is calculated as the sum of the net present value of rents from timber extraction and annual benefits from non-timber resources, including minor forest products, hunting, recreation, and watershed protection. ANS, which is published annually and covers the period 1970-present, is defined as net national saving adjusted for investments in human capital, depletion of natural resources (including forests), and damages to human health caused by pollution, and provides an estimate of the annual change in wealth.

Recent findings suggest that while wealth data and ANS data are used by researchers and policy analysts, the greatest demand is for data on natural resource rents.  However, while minerals and energy rent data have gained a lot of traction, rent data for forests are not used as frequently. Interviews have revealed concerns with the credibility of the underlying data, such as the FAO data on forest area and growing stock. The authors of the indicators have also concluded that a number of methodological changes could improve estimates for forest wealth, potential forest rents, and net forest depletion.  

APPROACH
This activity hopes to increase the use of improved World Bank forest data (forest rents, net forest depletion, and forest wealth), so that countries and data users are better equipped with credible and more accurate information on the physical area and value of forest resources. Countries should consider not just the flow of revenues from forest resources, but also the sustainable management of the asset (stock of forest resources).

• Data on the value of forest wealth, its share in total wealth, and how the value is changing over time can help governments assess the contribution of forests to current development outcomes and whether forests are being managed sustainably.
• Data on potential forest rents when combined with information on actual rent recovery and use of these revenues will allow governments to assess whether contribution of forest resources to sustainable development is being realized and who is benefitting from the revenue.  Such data and assessments can equip policymakers to better manage forest resources, improve forest governance, increase transparency in the rent captured, and ultimately lead to increased reinvestment of forest rents in other forms of capital to grow the total wealth of the country.
• These policy changes could, in turn, promote the sustainable management of forest resources for poverty reduction and economic growth.

RESULTS

The activity has been successfully completed.

A report is being finalized and will be released soon. The report reviews the latest literature, explores improved data sources, evaluates key parameters and assumptions in the methodology, and outlines the steps and resources required to improve the data and methods.

An implementation plan for updating the forest database that includes a plan for country surveys if the report finds insufficient global data will be finalized in the coming months.

For stories and updates on related activities, follow us on Twitter and Facebook, or subscribe to our mailing list for regular updates

CHALLENGE
At the heart of whether growth in a country is green and sustainable is the issue of accumulation of wealth. It is wealth — broadly defined to include manufactured capital, natural capital (including forests), human and social capital— that underlies the generation of national income. Gross domestic product (GDP) has conventionally been used to assess economic performance, measuring economic growth from one year to the next. But GDP does not take into account depreciation and depletion of wealth, and therefore does not provide an indication of whether growth is sustainable: an economy could appear to be growing in the near term by running down its assets such as its forests. Assessments of economic performance should therefore be based on both measures of annual growth (such as GDP) and measures of the comprehensive wealth of a country, which indicate whether that growth is sustainable in the long term.

For the past 15 years, the World Bank has provided indicators to measure the sustainability of a country’s growth path, such as Adjusted Net Saving (ANS), adjusted Net National Income (aNNI), and comprehensive wealth estimates.  Underpinning these indicators are data on natural resource rents (from forests, minerals, and energy) which provide policy makers with information on potential revenues from natural capital.

The comprehensive wealth accounts, which have been published for 1995, 2000, and 2005, include estimates for forest wealth which is calculated as the sum of the net present value of rents from timber extraction and annual benefits from non-timber resources, including minor forest products, hunting, recreation, and watershed protection. ANS, which is published annually and covers the period 1970-present, is defined as net national saving adjusted for investments in human capital, depletion of natural resources (including forests), and damages to human health caused by pollution, and provides an estimate of the annual change in wealth.

Recent findings suggest that while wealth data and ANS data are used by researchers and policy analysts, the greatest demand is for data on natural resource rents.  However, while minerals and energy rent data have gained a lot of traction, rent data for forests are not used as frequently. Interviews have revealed concerns with the credibility of the underlying data, such as the FAO data on forest area and growing stock. The authors of the indicators have also concluded that a number of methodological changes could improve estimates for forest wealth, potential forest rents, and net forest depletion.  

APPROACH
This activity hopes to increase the use of improved World Bank forest data (forest rents, net forest depletion, and forest wealth), so that countries and data users are better equipped with credible and more accurate information on the physical area and value of forest resources. Countries should consider not just the flow of revenues from forest resources, but also the sustainable management of the asset (stock of forest resources).

• Data on the value of forest wealth, its share in total wealth, and how the value is changing over time can help governments assess the contribution of forests to current development outcomes and whether forests are being managed sustainably.
• Data on potential forest rents when combined with information on actual rent recovery and use of these revenues will allow governments to assess whether contribution of forest resources to sustainable development is being realized and who is benefitting from the revenue.  Such data and assessments can equip policymakers to better manage forest resources, improve forest governance, increase transparency in the rent captured, and ultimately lead to increased reinvestment of forest rents in other forms of capital to grow the total wealth of the country.
• These policy changes could, in turn, promote the sustainable management of forest resources for poverty reduction and economic growth.

RESULTS

The activity has been successfully completed.

A report is being finalized and will be released soon. The report reviews the latest literature, explores improved data sources, evaluates key parameters and assumptions in the methodology, and outlines the steps and resources required to improve the data and methods.

An implementation plan for updating the forest database that includes a plan for country surveys if the report finds insufficient global data will be finalized in the coming months.

For stories and updates on related activities, follow us on Twitter and Facebook, or subscribe to our mailing list for regular updates