Day 3, Session 7: Experience with extraction and management of non-timber forest products Presentation by Sophie Grouwels, Forestry Officer, FAO

1. Small and Medium Forest
Enterprise (SMFE) Development
A mechanism for sustainable forest
management and fostering wealth
at the local level
Sophie Grouwels,
Yaoundé, May 2009

2. Outline presentation
• context & definition SFE/CBFE
• the CBED program of FAO: overview
activities
• Facilitation of an enabling environment for
SMFE – Forest Connect Alliance

3. The development context
• Millennium Development Goals: reduce
global poverty and ensure environmental
sustainability by 2015
• High stakes in forest communities: poverty
more pervasive and deeper and importance
of protecting natural resources
• Development of small and medium forest
enterprises (SMFEs): opportunity for
strengthening forest-based livelihoods and
conserving the natural resource base

4. Definition SFE?

5. Definition
An enterprise can be defined as an entity - without
thinking of its legal form - that executes an economic
activity. The activities done by an individual, family
or an association with an economic concern can
therefore be considered as an enterprise. The key
factor is the economic activity and not the legal
form. We understand under “economic activity” all
activities that are aiming to produce income. (EC)
Une entreprise peut être définie comme une entité, indépendamment de sa
forme juridique, exerçant une activité économique. Les activités exercées à
titre individuel, familial ou associatif avec une préoccupation économique
peuvent donc être considérés comme des entreprises. Le facteur
déterminant est l’activité économique et non la forme juridique. Par activité
économique il faut entendre toute activité destinée à produire des revenus
(Communautés Européennes, 2006)

6. FAO’s Community-Based Forest
Enterprise Development (CBED) program
Part of FAO’s support to Participatory
Forestry:
The focus is on people centered,
sustainable NRM

7. Community-Based Forest Enterprise
Development (CBED) program
CBED Program aims to facilitate support to local
people in developing income generating enterprises
while conserving tree and forest resources in:
– Areas where Poverty Alleviation & Natural Resource
management are priorities and supported by adequate
frameworks
– Areas where natural resource-dependent
populations are in need of
alternative sources of income

8. CBED program
HOW are we doing this?
• Support capacity building to all stakeholders
to enhance better understanding of SMFE -
on request (using MA&D training approach)
• Stimulate the ongoing discussion on the
need for an enabling environment for SMFE
(Conferences, publications, studies,...);
• Support inter-institutional information
sharing and in- and cross-country
networking on SMFE (such as FC);

9. Facilitating an Enabling Environment for
Small Forest Enterprises
Linking small forest enterprises to each other, to
markets, service providers and policy processes

10. New diagnostics
Brazil China Guyana India S. Af. Uganda
NUMBER as >98%. 87% 93% 87-98% 33-95% -
% of total
EMPLOYEES 49-70% 50% 75% 97% 25% 60%
as % of total
REVENUE as 75% 43% 50% 82% 3% 60%
% of total

11. New / useful approaches
FAO MA&D approach
Examples in Mali, Burkina Faso,
Ghana, RD Congo, Uganda, The
Gambia, Colombia, Laos, ,...

12. Central problem for small forest enterprises
Isolation from:
• each other
• markets and market information
• providers of business
development services (BDS) and
financial services (FS)
• policy and decision-makers that
shape the business environment
Issues of geography, transport and
communication infrastructure,
informality, scale, staff capacity,
language etc.

13. Lessons about success 1
• Enabling environment – improve
institutional and legal framework: Regional
Directives to improve management and
commercialization of NWFP in COMIFAC
countries with national adaptations for
Cameroon and DR Congo; - securing
resource rights through Community Forestry
in the Gambia;
• Service providers –linking community
enterprises to business development service
providers to improve their management skills
and their marketing strategies; ex. Ugandan
Honey Association training bee farmers in
order to improve the quality and packaging of
the honey;

14. Lessons about success 2
• Intelligence: Improve
bargaining power through
accurate market Information e.g.
NTFPs MIS in Southern
Cameroon, through rural radios
(Bush Mango + other products
are adding on)
• Marketing – identifying niche
markets like ‘Community Based
and/or certified Fair Trade’. e.g.
Ten Thousand Villages, a North
American fair trade dealer welcomes
this month its partners from Burkina
Faso to celebrate Certified Fair Trade
shea butter.

15. Lessons about failure 1
• Disabling environment –
e.g. Cameroon: cumbersome
access rights (need for
permits) for economic use of
NTFPs leading to illegality for
micro entrepreneurs
• Isolated producers – e.g.
DR Congo where community
producers are disorganised,
un-reached by financial
services, and poorly linked to
business service providers

16. Lessons about failure 2
• Unsustainable sourcing – Guyanese
Amerindian small loggers associations
responding to buyers rather than
ecological capacity to supply.
• Low qualities and volumes – NTFPs
available on markets tend to be of low
quality (lack of standards)
• Poor marketing knowledge – Fumbwa
wholesalers market in Kinshasa: bundles
are lying on the ground in mud which
implies deterioration
• Inferior design – Cameroon's honey
produced by rural entrepreneurs
packaged in plastic bottles which are not
closing properly and with labels falling of
after purchase

17. Shifts in the search for solutions
• From direct supply or intervention
relating to:
– Provision of Financial Services (bank or group
loans, equity finance, insurance, leasing)
– Provision of Business Development Services (ICT,
business training, bureaucratic advice, design and
packaging, technology support, courier and delivery,
networking, market info, advertising and trade fairs).
– Advocacy for policy change (business registration,
forest resource allocation, management stipulations,
transport rules, taxation, labour laws)
• To facilitation of a sustained
increase in the above
– Provision of information about SMFEs and service
providers, catalysing collective action, underwriting
business linkage events, developing public-private
fora, training trainers etc.

18. A new support framework
• Forest Connect is an alliance (nat. &
internat.) dedicated to action learning
in support of SMFEs
• Institutional hubs/national SMFE
support institutions and
communication platforms now being
established in Burkina Faso, China,
Ethiopia, Ghana, Guatemala, Guyana,
Laos, Mali, Mozambique, Nepal and
RDC
• Diagnostics of SMFEs and their
associations undertaken (or
underway)
• Service providers being mapped
within and outside forest sector
• Value chain analysis to identify
bottlenecks
• Communication strategies set up

19. some of the ongoing activities
• Toolkit under development
for the facilitation of support
for small and medium forest
enterprises
• International communication
platform maintained
• Facilitating support to Forest
Producers’ associations
• WFC October 09 : session on
SMFE enabling environment
+ side event FC + SMFE
business info exchange faire

20. For more information:
Website Forest Connect:
http://forestconnect.ning.com/
Website community-based forest
enterprises
http://www.fao.org/forestry/enterprises/en/
Contact person in FAO:
sophie.grouwels@fao.org