Is market-oriented forest conservation a contradiction in terms?

Abstract

The destruction of forest ecosystems appears economically rational because many of the values of intact ecosystems are not recognized in land-use decisions. Many authors have suggested that the conservation of intact ecosystems requires that markets be extended to increase economic benefits derived from the standing forest to the point where they out-compete alternative, destructive land-uses. Three such strategies for market-oriented forest conservation are natural forest management for high-value timber, the collection of non-timber forest products, and biodiversity prospecting. In each case the proposed use of the ecosystem is likely to prove socially and economically unsustainable, or to generate significant alterations in ecosystem structure which endanger its diversity, or both. The success of market-oriented conservation requires that sustainable extraction of useful organisms over the long term yields more profit than destructive activities. The market-oriented conservation strategies examined, however, appear to yield too little profit to out-perform alternatives such as agricultural production or the replacement of forests by pastures or plantations. In each case, key factors limit profits. The slow growth rates of natural forests combined with discounting hinders natural forest management. In the case of non-timber forest products, the typically low density of resources in tropical forests creates disincentives for sustainable commercial production. The profitability of biodiversity prospecting is undermined by the low probability of discovering species with medicinal properties and developing countries' inability to capture the information value of the genetic content of species. Furthermore, each of the three strategies also has potentially negative ecological impacts. In the drive to increase profits, each is likely to degrade ecosystems through over-exploitation of the resource, and prompt simplification of the ecosystem through forest management designed to increase the density of profitable species. Ultimately, such activities are likely to lead to the loss of biodiversity.

Several conditions must be met for market-oriented conservation to be effective. Scientific understanding of forest ecosystems, and the ecological knowledge of both users and regulators must be sufficiently advanced to allow appropriate management regimes to be designed to assure maintenance of the forest ecosystem despite alterations caused by resource harvesting. The natural reproduction rate of the harvested resource must also be sufficiently rapid to justify leaving most of the resource undisturbed to guarantee its reproduction. Furthermore, the resource must be more cheaply and reliably produced in a natural forest than in a plantation, than by a synthetic substitute, or replacement through domestication. Finally, even where ecological and economic conditions support market-oriented conservation, those making land-use decisions must be in a position to benefit from the sustainable harvest of forest resources. If they are unable to enforce exclusive rights to the forests, the conservation effect of market-oriented strategies is likely to prove elusive.

Nevertheless, strategies for market-oriented forest conservation are a vital component of efforts to conserve biodiversity, and they must be improved to harness their full conservation potential. Resource management regulations, strong enforcement, and stable and secure property rights are essential preconditions. In addition, land-use planning should identify ecosystems with lower biological diversity where marketable products are concentrated at economic densities. Areas of high biological diversity will require non-market mechanisms to ensure their protection. In this context, there is no substitute for fully protected areas, and their expansion is vital.