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China: Sustainable Forest Management and Financing


The objective of this activity is to improve the knowledge of the Chinese government on sustainable forest management so that China‚Äôs Nationally Determined Contributions (NDC) can be achieved.


Forests rose to prominence in the 2015 Paris Agreement and in many countries‚Äô policies on Nationally Determined Contributions (NDC), including China‚Äôs. Since 2015, the Chinese Government has included in its NDC a commitment to increase its forest stock volume by an estimated 4.5 billion cubic meters by 2030, compared to the 2005 level, and to enhance mechanisms and capacities to reduce climate change risks in forest management. However, China‚Äôs efforts are hampered by a number of challenges, including poor forest quality, low-production plantations with fragile forest ecosystems, unsustainable financing, and weak coordination between sectors. China‚Äôs NDC, therefore, presents an opportunity for the Chinese Government to shift focus from measures that promote bigger acreage to, instead, improve forest quality and enhance the benefits and poverty-reduction that forests bring to forest-dependent populations. However, in order to achieve the goals of China‚Äôs NDC, the Chinese Government must use a different approach in planning and implementation than what was done before.


This activity will review, assess and disseminate best practices from other forestry projects in order to extract replicable forest management models and financing mechanisms to inform China’s efforts. Recommendations will be made to the Chinese government regarding technical models, long-term financing mechanisms, multi-sector coordination for landscape management, and public and private partnerships for forest management. This effort aims to enhance the benefits of forests, including carbon sequestration capacity and tolerance to natural disasters, such as extreme climate, fire, and pest attacks. Specifically, this activity will provide analysis to the following:

  • Close-to-nature forestry management

  • Forest carbon financing

  • Key government ecological afforestation and production operations

  • Technical improvement and investment effectiveness of government programs

  • Financing regimes


This activity is complete. The outcomes of this activity have been achieved.

The review reports relevant to various key areas have been prepared with the synthesis report approved by the Bank management. The review identifies the challenges of forest management in China, assesses the lessons learned from selected domestic and international organization financed forestry programs, and recommends a pathway toward the sustainable forest management, with recommendations on policy that need to be further improved to enable scaling-up of improved forest management practice. It is recommended (with models provided) that traditional monoculture should be transferred to species mixed multifunction forests with diversified species and stand structure, which would improve forest quality and functions with balance of ecological, economic and social benefits; non-public sector should be incentivized in investing in forest  management with the participation oriented payment of ecological service (PES) being taken account; and the enabling conditions should be further improved such as further forest carbon trading marketing scheme development  to promote sustainable forest financing and sustainability.   
The dissemination of the knowledge and innovative forest management practice from this ACA work on sustainable forest management (SFM) and financing would help Chinese government improve forest management and  ecosystem restoration, with that the case studies provided strong evidence that the transfer of traditional monoculture plantation management to diversified species and structure forests will improve forest quality, stand growth and resilience, resulting the increase forest multifunction including carbon sequestration capacity, which will contribute to the achievement of forest NDC committed by the Chinese government.  
The lessons learned from this ACA work concludes that the Bank and Sino-Germen programs are promoting the transfer of the traditional monoculture plantation to diversified species planting, near-natural resilient forest management and forest ecosystem restoration technical regime, which is a fundamental conceptual change. The relevant policy and regulatory recommendations are drafted and will impact the next stage forestry development strategy including 14th five-year plan development and long team forestry management planning, to extend the knowledge and technical revelations national-wide in China.  
The key uptake and influence of this work mainly include the follows:  
  • The knowledge generated from the ACA work has been taken into consideration in developing long-term National Forest Management Planning (NFMP), which promotes the long-term, mixed species and multifunction forest management. Based on the NFMP, the provincial and county level Forest Management Plans are developing their long-term forest management plans, which will put into the best practice national-wide.   
  • The knowledge generated from this work has also provided inputs to an IBRD forestry Program-for-Results operation titled as Forest Ecosystem Improvement in the Upper Reaches of Yangtze River Basin Program, which is under preparation and will be present to the Board for approval around December 2019.  

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Last Updated : 05-05-2020