World Rainforest Movement

The plantation issue in the OED report

The World Bank is apparently willing to play a major role in the promotion of tree plantations. This can mean good or bad news, depending on the type of plantations it is willing to promote. The country studies provide useful -though incomplete- information on the issue, which we believe the Bank should use as a starting point for its own research on the positive and negative impacts of different types of plantations. It appears clearly that large-scale monoculture tree plantations should not be promoted, given their negative environmental impacts and their few positive social effects. It is noticeable, however, that while all the country studies provide information on both positive and negative aspects of plantations, the OED’s main report only focuses on those which appear to be beneficial. As evidence on the above, we have selected some few quotes from the six country studies and from the main report

OED Main Report

“Increased emphasis on tree planting for production and productivity growth (including investment in research and extension on public forest lands, watersheds, community lands, and private farms) in the Bank’s agricultural and forest sector investments will increase supplies to meet the burgeoning local, urban and international demand and will meet many of the environmental objectives served by forests. Only then will illegal logging of natural forests decline and environmental stewardship improve.” (page 9)


“Whereas smallholder agriculture results in a gradual transformation of the landscape as fallows shorten over generations, large-scale plantations are created following the direct conversion of forest lands using mechanical or manual techniques of site preparation to remove existing forest vegetation. In the 1960s, 1970s, and continuing into the early 1980s, Bank-funded projects in the southwestern portion of country focused on the development of tree crop plantations. From 1967 to 1985, nine industrial tree crop projects were approved. Since 1985 there have been no examples of such lending. All of these parastatal enterprises either are now in the process of being privatized or are already sold. Unfortunately these conversions (totaling over 100,000 ha) occurred in the Atlantic coastal forests around Mount Cameroon and south of Douala, which are now recognized as among the world’s most biologically diverse tropical rainforests. These efforts can also be criticized on equity grounds especially when compared to outcomes under smallholder strategies for export crop development.” (page 4)

Costa Rica

“Costa Rica’s forested areas are increasing annually, largely because of reforestation and the regeneration of secondary forests in abandoned pastures. The quality of forest cover and the state of biodiversity (defined as the number of different species and their relative frequency) are more controversial. Deforestation continues, and the increased area of plantations and secondary forests has less environmental value than that of natural forests.” (page 6)


“the plantation sector in Brazil is among the strongest in the world and vast tracts of land are available for the creation of new plantations. However, the social and environmental issues associated with large-scale plantation industries must be recognized.” (5.1)

“… plantations have brought about significant concentrations of landholdings and reforesting large-scale plantations is more costly than small scale plantations (Bacha and Marquesini 1999). Moreover, plantations cannot match the biodiversity of natural forests.” (5.11)

“… some observers are concerned about the use of large-scale, commercial reforestation (eucalyptus and pine plantations) because of its perceived negative social and environmental impacts. There also are doubts about whether commercial plantations would result in “net incremental carbon sequestration, …” (5.12)

“These issues might be overcome if reforestation were limited to small- scale plantations or based on high-diversity agroforestry systems for which there is also substantial potential …” (5.12)


“Timber and tree-crop plantations have grown rapidly since the early 1980s. Timber plantation concessions have been promoted by the government, through subsidies and preferential regulations, in anticipation of the growing demand for industrial wood, primarily for the pulp and paper industry. However, because of perverse incentives (subsidies, permission to clear cut logged-over forests, and unattractiveness of the long-term investment in timber because of low log prices and pervasive illegal logging) natural forests have been degraded, while the area actually planted has been well below the area allocated. At the same time, significant investments have been made in pulp and paper industrial capacity, which has significantly increased the demand on natural forests to meet their growing raw material requirements. The growth of tree-crop plantations has also been rapid, particularly for oil palm, in response to strong financial incentives. These trends have added substantial pressures on the forests, and the incentives have increased in the aftermath of the recent financial crisis.” (page vii)

“The sector is plagued by governance problems, which have made the official forest policy de facto ineffective. This is well demonstrated by the events following the 1997/98 forest fires. Of the 176 companies found responsible for starting the fires to clear land for plantations, including 133 oil palm companies, virtually no action has been taken against any company. … The timber plantation concession system is ironically leading to degradation of forest areas rather than regenerating them, while unclear and overlapping forest boundaries have resulted in granting concessions and conversion rights in areas meant to be protected and conserved.” (page viii)


“Industry requires forest lands with a soil depth of at least 1 meter. Such fertile lands, even when not having much tree cover, would regenerate on their own without much cost. Thus, regeneration would be a cheaper economic option than plantations. However, it would not produce species of interest to industry. Besides, industry has no credible plan to resolve the demands that local communities have over such lands. As such, any leasing of forest land is likely to result in hardships and oppression for the local communities who have historically depended on such lands for meeting their basic needs.” (page 104 – 105)

“The industry on such forests will raise short-term and quick-growing species in place of the multi-layer mixed forests that are obtained through regeneration. Its ecological and environmental implications need to be taken into consideration. Using forests for growing raw material for industry will be setting the clock back to the 1960s, showing that nothing has been learned from the mistakes of the past 30 years of trying to create plantation forests, which were ecological disasters, besides completely alienating the people and leading to faster degradation.” (page 104 – 105)


“Available data suggest that forest cover in China increased 15 percent between 1980 and 1993, and forest volume has recovered sharply in the past decade after a long, steady decline. Much of the newly forested area is covering land that was originally bare wasteland and highly susceptible to erosion. The most recent data suggest that these trends are continuing. The optimism must be guarded, however, since China still faces a number of challenges. Because the rise in forest area has come from an increase in timber plantations, shelterbelts, and commercial plantations, the rise in forest diversity and its associated environmental services has been minimal. Moreover, analysis of China’s forest statistics suggest that harvesting practices by forest farms and collectives have limited the contribution of plantation expansion to forest cover increases and may have reduced diversity. During the first 15 years of reform, China has apparently transformed the structure of at least 30 percent of its forest area; on the one hand, forest plantations in some areas have increased; on the other hand, natural and old growth forests in other areas appear to be declining. While such a transformation may increase individual profits and may not greatly affect the ability of the newly forested areas to provide (or eventually provide) environmental services such as erosion control, their other environmental contributions are limited. For example, limited-species forests do not greatly increase the natural forest’s diverse flora and habitat for large groups of wildlife only to the extent that they indirectly reduce pressure on natural forests. These and other adverse environmental impacts also may have indirect effects on the livelihoods of certain groups of forest dwellers in that some non-timber products also are tied to the diversity of natural forests. The 1998 logging ban may slow this trend, but the substantial tradeoffs between environmental and socioeconomic objectives in the short and medium term could make the economic and socioeconomic costs of the ban very high.” (page 11)

“The expansion of commercial plantations (orchards and other non-timber product tree crops) accounts for one of the most noticeable changes in rural China’s forest area today. The area of commercial plantations, consisting of oil bearing trees, fruit and nut orchards, and other cash-producing, non-timber tree species, rose by about 40 percent during the reform era…” (3.12)

“Much of the reforested area is monocultured; and the drop in natural and old growth forest may signal a decline in biodiversity, wildlife habitats, and other environmental services provided by natural forests”. (4.3)

“The direct creation of forest area has spawned many benefits and costs in terms of non-market environmental services and expenses, but these are difficult to value. Recent projects tend to focus on poorer areas with more fragile environments and provide farmers with more choice (grow 18 species rather than 4), including horticultural trees and fast-growing plantations (a change that in part has been driven by the requests of farmers. This should reduce the costs and increase the benefits, and marginally improve biodiversity. But until the most recent lending effort, almost all projects have emphasized the development of plantations and orchards. Projects with heavy social forestry or natural forest management components are complicated to run at the scale of Bank projects. This may be one source of pessimism about the future of Bank lending in China.” (9.44)