Economic Analysis of Deforestation in Ethiopia: Evidence from Wild Coffee Arabica in the Afromontane Rain Forest of South West Ethiopia
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Date
2009-05
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A.A.U
Abstract
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
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Keywords
Afromontane Rain Forest, Wild Coffee Arabica