China: Poor Farming Communities Reap Benefits of Increased Forest Coverage

December 3, 2007


China has been a forest-poor country for a long time with only 0.12 ha of forest per capita. The increasing gap between timber supply and demand is a key constraint to sustainable forestry development which in turn has led to a significant threat to biodiversity and natural forest protection.

Managing forest resources is not only an environmental challenge, it’s also a priority in China’s development strategy since poverty is mostly concentrated in the remote mountainous areas of central and western China, where agricultural land is extremely poor and forest resources are the most important production asset available.


  • In 1998, after devastating floods along the Yangtze River, the Government declared a logging ban across vast areas of the country and laid out an ambitious plan to restore denuded ecosystems around watershed areas, protect remaining areas of high biodiversity and reduce the pressure on natural forests through a high-yielding timber plantation program.
  • Although the government’s initial emphasis was on large state-owned tree plantations, the greatest success in sustaining the growth in forest coverage has come from involving poor farming communities in small-scale forestry alongside their regular agricultural activity.
  • The World Bank-financed Forestry Development in Poor Areas project involved more than 890,000 people across 12 provinces in central and western China in a reforestation effort which focused primarily on timber and economic tree crop expansion, supported by strong technical services to develop new genetic materials and training for participants to extend new technologies and forest management skills. Project design included a wide range of trees to ensure that poor households would receive a diversified income over both short and long terms.


Sustainable forestry development contributed to a significant decline in poverty in project areas, from 40 percent in 1998 to 17.5 percent when the project closed in 2005.

  • A 2005 evaluation of this project showed dramatic environmental and social changes. In six years – from 1998 to 2004 - average annual per capita income increased by 150 percent. Most of that increase (85 percent) came from the products of ‘economic’ trees like chestnut, ginkgo and bamboo while the remainder came from off-farm employment.
  • Forest coverage across the 12 participating provinces increased by 6.7 percent over 1997 levels, according to the evaluation, helping to reduce water loss and soil erosion substantially. More than 375,000 hectares of new timber plantations were established and close to 290,000 hectares of economic trees (fruits, nuts, tea and medicinal/industrial oils) and bamboo were planted.
  • About 1.5 billion Grade 1 seedlings were produced to meet the project demand of 1.1 billion. The surplus – some 400 million seedlings - was made available to non-project households.
  • More than 121,000 farmer leaders were trained to provide on-the-spot routine technical information. Demonstration forests were established in 161 project counties. Since project areas are largely located in the remote poor counties, and most of the project households were poorly educated and unfamiliar with improved silvicultural practices, the training and extension program was extremely important to improve farmers’ capacity in planting technologies, production and management.

World Bank Contribution

  • Between 1998 and 2006, IDA and the IBRD provided $200 million in credits and loans towards the $364 million project cost. (China was still eligible for credits from the International Development Association, the World Bank’s fund for low-income countries, when the project was approved.)
  • Liaison between technical forestry staff and local poverty alleviation offices to ensure appropriate selection of high-return tree species and identification of poor farmer participants.
  • Training for both forestry bureau staff and farmers, complementing existing institutional capacity in timber management.

Next Steps

This project is part of a larger World Bank effort to preserve and expand forests in China: Overall, the World Bank has supported China’s forestry sector through 8 projects covering 21 provinces since 1985, resulting in over 3.8 million ha of forest plantations.

The most recent forestry project, approved in December 2006, will establish approximately 200,000 ha of fast-growing, high-yield timber plantations and improve the conservation of the globally significant biodiversity of the Guangxi Zhuang Autonomous Region.