Forests for People, the Planet and Climate

The International Day of Forests is a reminder of the valuable role forests play for people and the planet. Forests provide an important source of income for the rural poor, offer solutions to the challenges of mitigating and adapting to climate change and meet the demands of a rapidly-growing global population.

Forests for People

Forest goods provide an important hidden harvest for rural populations, keeping many people out of extreme poverty. About 350 million people who live within or close to dense forests depend on them for their subsistence and income. Forests are an important aspect of rural livelihoods, with households living near forested areas deriving as much as 22 percent of their income from forest sources. This contribution is greater than that of wage labor, livestock, self-owned businesses or any other category aside from crops.

Forests support rural economies in many countries and create jobs and wealth for populations with few alternative off-farm employment options. Forests produce more than 5,000 types of wood-based products, and generate an annual gross value add of just over US$600 billion, about 1% of global GDP (in some countries that contribution is much higher, reaching for example 6% of GDP in Cameroon).

We also know that the right incentives need to be in place for communities and governments to sustainably manage forests. For over a decade, the World Bank has been developing programs that provide benefits for reducing emissions from deforestation and broader land use. These programs take a landscape approach to address the underlying drivers of forest and land degradation and have catalyzed exciting new initiatives and partnerships between governments, local communities, civil society and the private sector. To achieve global climate targets, we will need to push even further to scale up these results-based emission reductions programs.

Forests for the Planet

Healthy forests provide critical ecosystem services important to nature, people and economies, including the provision of drinking water, water and climate cycle regulation, erosion prevention, crop pollination, soil fertility, and flood control. Forests, especially rainforests, are also vital habitats for biodiversity

Fueled in part by unsustainable land use, about one million animal and plant species are now threatened with extinction, many within decades. Forest protection and sustainable land use remains one of our best options to limit this biodiversity loss. The World Bank continues to work with countries to put policies in place so that biodiversity is valued as essential for sustainable development. The Bank’s forest and land use emission reductions programs also help to restore healthy ecosystems for a healthy planet.

Forests for Climate

Forests provide a critical carbon sink to slow climate change, however deforestation and forest degradation contribute about 12% of the world’s greenhouse gas emissions. The special report on Climate Change and Land by the Intergovernmental Panel on Climate Change affirmed that planting forests and protecting existing forests is key to all pathways for limiting global warming to 1.5^oC or well below 2^oC.

Investment in forest conservation and sustainable forest management is urgently needed as many of the world’s remaining forests are under increasing threat due to agriculture expansion, timber extraction, fuelwood collection and other activities. Guided by the World Bank’s Forest Action Plan, the Bank’s active forest portfolio now sits at US$3.05 billion (FY19).

The World Bank also supports large-scale sustainable forest and land use programs, such as the Forest Carbon Partnership Facility and the BioCarbon Fund Initiative for Sustainable Forest Landscapes. These initiatives, which work across more than 50 countries, have to date unlocked over $180 million for results-based payments for emission reductions, incentivizing countries to scale up sustainable forest management to help achieve global climate targets. What’s more, through PROGREEN, a new global partnership for sustainable and resilient landscapes, the World Bank is scaling up support to help countries invest in forests to improve livelihoods, reverse biodiversity loss, and tackle climate change in an integrated and cost-effective manner.  

If the world is to confront the challenges of mitigating and adapting to climate change while meeting the demands of our global population, it is vital that we work together to find the balance between conserving and regenerating forest areas with economic growth for poverty reduction.