In 2011, the Government of Ethiopia launched a Climate Resilient and Green Economy Strategy (CRGE Strategy) with the goal of achieving middle-income status for the country by 2025 while following a carbon-neutral growth path. REDD+ implementation is one of the pillars of the CRGE Strategy. In 2014, the Government of Ethiopia requested the UN-REDD Programme to support the country in assessing the contribution of forest ecosystems to national income (GDP) in the context of the national REDD+ process. The primary objective of the project was to establish the contribution of Ethiopian forests to national income.
This report presents the outcome of the assessment, which shows that Ethiopian forests generated economic benefits in the form of cash and in-kind income equivalent to 111.2 billion Ethiopian Birr (ETB) (USD16.7 billion) or 12.86% of Gross Domestic Product (GDP) in 2012-13, considerably larger than previously thought. Of this, 6.09% of GDP is attributed to forest industries. The contribution of forest ecosystems to other sectors, particularly agriculture, is valued at 6.77% of GDP. In addition, 2.4 billion ETB was attributed to non-market benefits based on Ethiopians’ willingness to pay to maintain forests.
The largest market income benefits were associated with flows of wood fuel (firewood and charcoal) and livestock fodder from forests. Together, these accounted for 62% of forest use benefits (69.0 billion ETB, USD10.3 billion). Wood fuel and fodder are so valuable because their use is widespread in Ethiopia and, in the case of fodder, because agriculture is economically very important in the country. In addition, roundwood supply (11.4% of use benefits); forest coffee production (10.8%); control of cropland erosion (6%); pollination of crops by forest insects (4.5%); forest honey/ beeswax production (1.5%); and collection of wild medicinal plants (1.1%) were all important sources of forest-derived income.
The results of the project are to feed into the development of the Ethiopian national REDD+ strategy and inform the government’s on-going development planning.