World Bank Financing and Sustainable Management of Tropical Forests

Abstract

ABSTRACT Tropical forests contribute to maintaining the global ecological balance and to climate regulation. In 2002, the World Bank adopted a revised Forest Strategy to harness the economic potential of tropical forests, reducing poverty and promoting sustainability. This paper conducts a comparative analysis of forest sector project allocations between 2002 and 2020 using the institution’s global project database. The research results confirm that the forest cover of tropical countries is not a priority for World Bank funding, thus contradicting the stated aims of this institution. Only US$ 4.33 billion was allocated to tropical forests between 2002 and 2020, representing 0.41% of the total resources managed. At a particular disadvantage, due to the limited support received, is the African forest, which experienced a decline of more than 10% in its forest cover between 2002 and 2020. The evidence reported in this study justifies the need to significantly increase funding, reinforcing the link between productive development and sustainable forest management. In order to combat deforestation and restore forest cover in low-income countries, the World Bank must extend project benefits to more tropical countries, tailor new mechanisms to local conditions, and make it a priority to facilitate access to financing and increase non-repayable aid.