Economic Analysis of Deforestation in Ethiopia: Evidence from Wild Coffee Arabica in the Afromontane Rain Forest of South West Ethiopia

No Thumbnail Available



Journal Title

Journal ISSN

Volume Title




Cloud forests in highlands of south west Ethiopia are the last refuges to the wild population of Coffea Arabica. Global community is benefiting from the forests, but all conservation costs are imposed on subsistence farmers that are unable to afford. This in turn results in divergence between benefits and high rate of deforestation . This paper attempts to identify area specific factors that induce small holders to deforest, factors that determine profitability of competing land us e options and seeks incentives available to reconcile conflicting interests. To do this, primary data is collected from 151 households. The regression results firstly, indicated the trade off between deforestation and maximization of the livelihood of the poor. Secondly, institutional interventions have possibilities to achieve sustainable development. Thirdly, there are some opportunities to cooperate conflicting interests by extending benefits. Therefore, the results suggest the importance of functional institutions firstly, to compensate the forest users through global transfer payments for the revenue they forgone due to strict conservation . Secondly, institutions are important to realize premium for environmental friendly production, in so doing to increase the value of remaining forest. Thirdly, institutions are required to increase productivity of already cleared land via agricultural intensification, to invest on family planning and to reduce value chain by greater farm level processing of primary products. Key words: Ethiopia, deforestation, sustainable use, coffee Arabica, fair trade



Afromontane Rain Forest, Wild Coffee Arabica