Frequently Asked Questions

Q: What opportunities are there for carbon finance in the forest sector?
A: Emissions due to deforestation and unsustainable agricultural practices contribute 20 percent of current greenhouse gas emissions and are a significant part of the global warming problem. At the same time, forestry and agriculture are part of the solution because they offer the potential for large “carbon sinks”, i.e. stores of carbon.  Emissions from land systems can be reduced by protecting and conserving carbon in existing vegetation and soils, or additional carbon can be taken up from the atmosphere and stored through activities such as reforestation or revegetation. Actions to enhance carbon sinks are also referred to as land use, land-use change and forestry (LULUCF) activities.

The World Bank is the only large buyer of LULUCF on the market through its Carbon Finance Unit.  There are two LULUCF projects under the Prototype Carbon Fund and 20 under the BioCarbon Fund which has been operation since May 2004.  The fund has 11 private and public participants and has a total value today of US$43.8 million. 

Q: What is the Bank’s involvement in the forest sector in Cambodia?

A: The World Bank has been involved in Cambodia’s forestry sector to help improve forest management, law enforcement, monitoring, and access to information about developments in the sector.  The Bank  aims at improving the way forests are managed in Cambodia, including effective monitoring and enforcement of laws; a credible system for managing the way that forest resources are used and preserved; ensuring that local community needs are adequately addressed, and ensuring that people are consulted.

There have been some improvements in the Cambodian forestry sector – the area under concessions has been significantly reduced and the forest concession plans were publicly disclosed for the first time – but many serious problems remain, including continuing illegal logging, corruption, and a lack of meaningful engagement of local people in forestry decisions affecting their lives. The fight against corruption in the forestry sector requires everyone’s cooperation; yet any progress will depend on the willingness of the government to confront these issues and take steps to improve the governance of forest resources.

Q: What is the Bank’s role in the Democratic Republic of the Congo (DRC)?

A: Along with the deepening of peace and reconciliation in the Democratic Republic of Congo (DRC), environmental sustainability, economic growth, and poverty alleviation are among DRC's priorities. The rehabilitation of infrastructure will lead to new investments in many fields, including in forestry activities.  DRC is home to the second largest rainforest in the world after Brazil, and harbors more than 50% of the Congo Basin’s unique biodiversity. Since 2002, the Bank has been working with the Government, donors and NGOs to lay the foundation for greater transparency, environmental sustainability and social equity in the forest sector. 

Some of the Bank supported Government initiatives include the assessment of the legal base of forest concession contracts still in existence with the participation of an internationally-recruited Observer, the carrying out of a participatory forest zoning plan, the rehabilitation of national parks (supported by the Global Environment Facility) and the establishment of a multi-donor trust fund for forest governance. Conclusions from the Forest Forum held in Kinshasa - November 13, 2004. 

Q: What is the Bank doing to improve the well being of forest-dependent communities in India?

A: In India, forests account for the largest land use after agriculture. Approximately 275 million rural poor depend on forest lands to varying degrees. For approximately 100 million people, forests provide the main source of livelihoods and generate cash income. Half of India's 70 million tribals, arguably the poorest and most disadvantaged section of society, subsist on forests. Clearly, forests make a significant contribution to the economic livelihoods of the poor, and at the same time, also provide critical ecosystem services, including a refuge for biodiversity.

In India, the Bank is engaged in projects that are community-driven, improve the incomes and welfare of poor communities, and enable communities to benefit from significant additional income streams from the sustainable use and marketing of forest resources.