The Private Forestry Programme: Indufor-Led Flagship Programme on Transformation of the Forest Sector in Tanzania

December 6, 2018

The core idea of the Private Forestry Programme (PFP) is to capture the opportunities for the forest sector to become an important actor in economic development in Tanzania, providing income and employment to the rural population, above all. The programme is a long-term partnership between the Governments of Tanzania and Finland, supporting private plantation forestry and strengthening wood industries in the Southern Highlands.

The vision is that by expanding the forestry sector and developing the domestic industrial capacity and wood supply, it is possible for Tanzania to become self-sufficient in utility poles, sawnwood and plywood, and even pursue export opportunities, and respond to the increasing domestic demand.

It is estimated that in Tanzania, by 2050, domestic demand for forest products will more than double to some 5 million m3 per year (roundwood equivalent). Unless the domestic wood industry production grows, the existing trade deficit in forest products will continue to increase. The economic growth projections combined with investment opportunities, especially in the Southern Highlands, provides for good opportunities for the forest sector to grow.

The first five-year phase of the programme is now coming to an end. The foundation has been laid and the first steps taken towards a real transformation of the forest sector. In the last Supervisory Board Meeting, held in Mafinga on 28th of November, the Ambassador of Finland, Mr Pekka Hukka and the Permanent Secretary of the Ministry for Natural Resources and Tourism of Tanzania, Prof. Adolf Mkenda, expressed their satisfaction with the achievements of the programme. The Ambassador further pointed out that the programme is a good example of the development cooperation approach, where the private sector is seen as an important partner in economic development.

The PS and Finnish Ambassador listening carefully TGA Representative’s description of their microfinance scheme.

Facilitation of Forest Sector Transformation – Achievements

The programme worked to ease a number of barriers to forest sector transformation, ranging from the policy and regulatory framework to inadequate information and weak capacities and skills. Some of the concrete achievements are presented below.

The PFP team provided specialist knowledge to support a broad stakeholder participation in formulation of the new forest policy. The new draft policy is based on a good understanding of smallholder private forestry and small wood-processing industries, and therefore it is likely to provide an appropriate framework for inclusive and business-enabling forest sector strategy, legislation and regulations.

Through a number of economic analyses carried out by the team, information is now available on existing plantations and investment opportunities. This information is fundamental for a greater understanding of the barriers and opportunities for forest sector development, both among decision-makers and potential investors. The programme shared this information and promoted plantation value-chain investments in the area though various interventions. (e.g. Forest Investment Conference, Trade Fare). At the moment, a total of 19 000 hectares of available land has been acquired for forest investment.

 

Improved Seeds and Establishment of High-quality Plantations

During the five years, more than 9 000 tree-grower farmers established almost 12 000 hectares of smallholder plantations supported by the programme. This major achievement in smallholder forestry, was achieved through working in 120 villages through the Tree Growing Incentive Scheme. In addition, a total of 93 hectares of seed orchards (derived from highly improved parent trees) has now been established in eight different locations in the Southern Highlands. These consist of five different Pine species, three different Eucalyptus species, as well as Tectona grandis and Gmelina arborea. These seeds orchards will allow Tanzania to become self-sufficient with improved tree seeds.

Pinus maximinoi planted at Idete Seed Orchard in 2015 (above)

Eucalyptus urograndis planted through TGIS in 2015

Transformation of the SME Wood Industry

The programme established the Forest Wood and Industry Training Centre (FWITC) in Mafinga in the Southern Highlands, a vocational training centre providing innovation, inspiration and demonstration of improved technologies. So far more than 30 sawmills have upgraded their processing technologies and doubled their sawnwood production.

The FWITC introduces new technologies for producing wood energy, providing alternatives to traditional charcoal production. Production of charcoal briquettes from plantation-grown wood waste is one of the innovations. Interest is growing rapidly, and through programme facilitation, four companies have already diversified and expanded their production into manufacturing of charcoal briquettes.

The FWITC, with new facilities and training and business planning support, acts as an incubator for further transformation of the industry. It also provides for a skilled work force with good understanding of safety and health issues. With the establishment of the FWITC, local industries and workers have a better access to relevant training. In short, the “tools” are now in place for providing the training to fulfil capacity gaps.

New sawmill being set up in FWITC

Integration of the Tree Growers to the Industry Value Chain

The programme applied two models for service provision to the tree growers to facilitate their integration to the industry value chain. One of the models covered the outgrower schemes through two wood industry companies. The other strengthened tree growers’ own organisations, which at the moment include close to 8 000 members. Their central organisation is now engaged in wood sales and cooperating with processing industry, in line with their business plan prepared with support from the PFP.

The Programme Contributes to Poverty Alleviation and Promotes Equality

Smallholder forestry means a focus on the rural poor. The inclusive approach in tree-growing, microfinancing and SME development means a strong emphasis on promotion of women’s equal participation in all income generation activities.

The programme updated the national methodology for Village Land Use Planning and supported the preparation of the actual land use plans. Through its efforts the framework for optimal as well as socially and environmentally sound land use is now established in 59 villages covering almost 850 000 hectares of land and benefitting more than 90 000 villagers.

More than 4 000 villagers, almost half of them women, have benefitted from the participation in microfinance schemes facilitated by the programme. New business ventures included various agricultural activities, shop-keeping and forestry processing.

Businesses supported by the programme, such as beehive production, weaving, pottery, and carpentry

Background:

The first phase of the programme began in January 2014 and it will run until the end of this year. The funding by the Ministry for Foreign Affairs has been about 19.5 MEUR while the contribution of the Government of Tanzania has been about 1 MEUR (5% of the total budget). The next four-year phase is now under planning, envisaged to start during first half of 2019.

Links:

Programme website.

A previous article on PFP at Indufor website.

Programme’s Facebook profile.

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Thomas Selänniemi

Head of Sustainability Consulting

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