Based on a study involving 28 different types of community-based forest enterprises (CBFEs), this policy brief summarises the important constraints affecting CBFEs in Nepal. It identifies key areas for intervention and suggests specific developmental and regulatory interventions for the government and other key organisations involved in promoting CBFEs.
The paper hails the development of CBFE’s as an ideal development intervention in poor forest communities as they have the potential to generate income and employment for the poor while supporting sustainable management of forest resources. The potential for the establishment of forest-based enterprises in Nepal increased with the enactment of Nepal’s Forest Act of 1993 and its Forest Rules of 1995 which institutionalized community-based forest management (CBFM) as the national platform for forest management. However, like any starting industry, the CBFEs face various constraints in business start-up and formalisation, increasing production, and achieving enterprise profitability and sustainability.
Key recommendations include:
- to improve business operations and profitability of the CBFEs, interventions need to address their various weaknesses and business management needs;
- policy support - at the policy level, interventions should be directed at reviewing and rationalising existing laws affecting CBFE’s;
- donor support - in addition to influencing key forest policies and the CBFM programme provisions for the poor, donors could encourage the institutionalisation of a constant dialogue among the stakeholders to promote pro-poor-focused CBFEs;
- CBFEs federation and greater involvement in policy-making - CBFEs should influence policy-makers and government line agencies to act in their favour. They could do this by strengthening their existing umbrella organisations and the Nepal Federation of Forest Resources User Groups.