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UN-REDD Programme study highlights significant economic contribution of forests to Ethiopia

Blog | Wed, 04 May, 2016 · 4 min read
UN-REDD Programme study highlights significant economic contribution of forests to Ethiopia’s Gross

A year has passed since an inception workshop was held in Addis Ababa to economically value Ethiopia’s forests. Now a validation workshop has ushered in the final phase of the initiative. The full studies are expected to be launched in June at a high-level event.

The validation workshop, opened by H.E. Ato Kebede Yimam, State Minister, Ministry of Environment and Forests, highlighted the importance of Ethiopia’s forests for its national income. Why is this relevant for the national REDD+ process? The relevance of forests extends beyond timber and carbon sequestration to its ability to regulate water flows, reduce soil erosion, generate non-wood forest products, etc. Understanding the magnitude of these values provides a basis to strengthen REDD+ implementation. After all, investments to reduce deforestation and forest degradation or removing carbon through rehabilitation of degraded land is not only in the interest of mitigating climate change, but also makes macro-economic sense!

The UN-REDD Programme is supporting the Government of Ethiopia through Targeted Support to identify the actual contribution of forests to its Gross Domestic Product (GDP). Preliminary findings of the study show that the contribution of forests to GDP is underestimated. This has two reasons. First, the study found a substantially higher value added of wood fuel than currently estimated by the Ministry of Finance and Economic Cooperation. Figures for roundwood were also slightly revised upward. Second, forests contribute significantly to other sectors, particularly agriculture. The collection of fodder for livestock, but also forest coffee, honey production and prevention of soil erosion are all tangible economic contributions that forest ecosystems provide to Ethiopia’s agricultural sector. These are tangible economic contributions and compatible with the System of National Accounts (SNA), which forms the basis for estimating GDP. Given that agriculture contributes significantly to Ethiopia’s GDP and that a substantial part of the population works in this sector, the study has effectively visualized the indirect but tangible contribution that forests make to this important sector.

So what’s next? First, the results will be shared with senior politicians during a high-level event scheduled for 15 June. Following the release, and even before, the Government of Ethiopia is looking for ways to embed the key results and recommendations in the REDD+ policy process. Stay tuned!