The potential role of timber trade in promoting economic development in the east and central africa

Abstract

The African Economic Community an African Union organ aimed at establishing foundation for mutual economic development in Africa through economic integration. The EAC and COMESA are some of its key pillars for Eastern Africa. Construction sector is one of the key drivers of Kenya's economy currently undergoing rapid growth consequently need high materials inputs including timber that is further strained by prevailing ban on logging in public forests. Faced with timber shortage one of the fall back strategy is to imports from COMESA members endowed with vast forestry resources. Thus the differential endowments in forestry resources within COMESA provide opportunities for regional trade and investments to enhance sustainable economic contribution of the forestry sector to overall regional economic growth. To realize such vision there is need to harness information on the current status on forestry resources, industrial capacities, trade opportunities and potential investments within the regional economic blocks. In 2010 KEFRI initiated a study to evaluate the potentials of the forestry sector in Kenya, Ethiopia, Uganda, Tanzania, Rwanda and South Sudan to spur regional economic development through trade and investments in forestry business. The results revealed that the region is endowed with vast forest resources in total but greater disparity between countries. Smaller countries with high populations such as Rwanda, Uganda and Kenya are less endowed as compared to larger states of Tanzania and Ethiopia. The key forest based industries located in the region included biomass energy for textile and food processing, transmission pole treatment plants, saw mills and wood panel and constituted wood processing industries. Kenya was the most industrialized country with 441 industries, Tanzania (138), Uganda (103) and Ethiopia (45) most being saw mills. In terms of trade Kenya was the main importer of tree products that rose from 21,199 m3 in 2004 to 51,400m3 in 2009. The products imported were timber, treated poles and roundwood for carvings mostly from Tanzania, DR Congo, South Sudan, Malawi and Angola. Some of the key products that are traded heavily within the member countries were timber and transmission poles. The EAC countries are net importers of various manufactured wood based products mostly paper and paper products and reconstituted wood from Europe and Asia that can be manufactured within the region. The study reveals that there are vast opportunities in the region for investment in processing to meet the growing regional demand for processed wood based products and surplus for export. However, policy, legal and infrastructure challenges need to be improved to facilitate efficient trade in forest products between member countries.