Between the 1990s and 2000s, Kenyan-born environmental activist and Nobel laureate Wangari Maathai shifted mindsets in East Africa and globally away from haphazard deforestation and towards an enduring legacy of environmental conservation – specifically to protect trees and forests. Her Green Belt Movement, which planted over 51 million trees across Africa, exemplified this shift. Since her passing in 2011, collective consciousness has only grown stronger around the negative impact humans are having on the planet and the severity of climate change.  

With the forest cover in East Africa diminishing annually, the need for sustainable practices has never been more urgent. At the same time, economic development in East Africa continues. The region enjoyed strong 5-6% annual economic growth in recent years as well as a reduction in extreme poverty. The World Bank projects its real gross domestic product (GDP) will continue to expand at this pace. With more rural electrification, urbanization, population growth, construction, and infrastructure projects, comes more demand for resources: water, energy, wood, metal, as well as other inputs and materials.  

The demand for wood products across Africa exceeds local supply, according to the Center for International Forestry Research (CIFOR) and World Agroforestry (ICRAF). In East Africa specifically, the situation is even more pronounced. Alfred N. Gichu, Head of the Climate Change Response Program of the Kenya Forest Service and National REDD+ Coordinator, reports that the supply of wood products in Kenya is 33% lower than the demand. 

Can a shift to sustainable forestry bridge the gap between supply and demand without further depleting our forests?

The following dynamics may surprise you:

Timber serves multiple purposes in East Africa

A sizable proportion is used as fuel, while other major uses include construction materials (sawn wood, plywood, and fiberboards), furniture production, and paper and pulp manufacturing. Additionally, timber plays a crucial role in utility infrastructure, particularly for telecommunication and electrical transmission poles. Due to electrification expansion programs across East Africa, there is a significant demand for transmission poles. The poles are used to extend the national grid, as well as for overhanging fiber optic cables by telecom companies. Interestingly, only 7% of all trees possess the necessary qualities for load-carrying. In East Africa, the utility poles are predominantly made from eucalyptus. 

According to the World Bank, Uganda’s electrification rate is 47% as of 2022, rising from 18.5% in 2015. A combination of expanding the main grid, and introducing micro and mini solar grids, provides evidence that the demand for transmission poles will continue to remain strong as rural electrification projects increase. 

Uganda and Kenya initially shifted towards concrete and steel poles for infrastructure projects, driven by public concerns about deforestation. However, this trend has reversed due to several factors: 

• Cost: Concrete and steel poles are significantly more expensive than wooden alternatives. 
• Logistical challenges: The weight of these poles and their lack of flexibility makes them difficult to transport and install. 
• Reliability issues: Several instances of structural failure in concrete poles have raised concerns about their long-term durability.

The carbon emissions from concrete production are higher than those from timber production

Concrete production is a carbon-intensive process, involving the heating of limestone, which releases carbon dioxide. On the other hand, sustainable timber production is a more environmentally friendly option, as growing trees facilitates carbon dioxide absorption from the atmosphere. 

The United Nations Environment Programme (UNEP) reports that buildings and construction are the biggest contributors to greenhouse gases. This sector alone is responsible for more than a third (37%) of all global emissions. 

When we compare concrete, steel, and wood:  

• Making one steel pole uses 8 times more fossil fuels than making a wooden pole. 
• Concrete is also a big polluter. For every cubic meter of concrete made, 0.3 metric tons of carbon dioxide are released into the air. 
• On the other hand, wood actually helps reduce carbon dioxide in the air. Each cubic meter of wood can absorb between 0.75 to 1 metric ton of carbon dioxide as the tree grows. 

This means wood can help remove more than twice the amount of carbon dioxide that concrete releases. These findings come from research by The New Forests Company and BuildX Studios. 

Looking at forestry in Kenya, Uganda, and Tanzania:

These three countries combined have about 836,000 hectares of forestry – excluding indigenous closed forests and open woodlands. Out of this total, about 172,000 hectares (or 21%) are used for large-scale commercial forestry plantations. 

The rest of the forestry land is split between: 

• • Government-owned forests 

• • Smaller, privately-owned tree plantations  

Sustainable forestry balances the needs of the environment, wildlife, and forest communities—supporting decent incomes while conserving our forests for future generations. A pursuit that can also be profitable. It ensures that forests continue to provide essential goods and services, such as timber, water filtration, carbon storage, and recreational opportunities, while preserving their ecological integrity. 

According to the Rainforest Alliance, the hallmark of sustainable forestry, from a purely ecological perspective, is the extent to which forestry practices emulate natural patterns of disturbance and regeneration. Key principles include conserving biodiversity, maintaining the health and vitality of forest ecosystems, promoting economic viability through responsible harvesting, and respecting the rights and needs of local communities and indigenous peoples​.  

The Forest Stewardship Council (FSC) certification ensures responsible forest management by evaluating environmental impact, sustainable harvesting, social and labor rights, legal compliance, and economic viability. This enables:  

• Involvement of local communities in the decision-making process  
• Promotion of conservation of biological diversity 
• Maintenance of the ecological functions and integrity of the forest, including; 

• • protecting species at risk and their habitats 
  • ensuring that the rate of harvest does not exceed the forest’s natural capacity to regenerate  

Corporate demand for certified wood products is already increasing due to public and shareholder pressure on climate action. FSC certification includes a Chain of Custody (CoC) system to trace products from the forest to the consumer, ensuring transparency and sustainability throughout the supply chain. This helps prove that products originate from FSC certified forests and have not been illegally logged. It also discourages the sale of wood products from unverified sources. Regional suppliers can take proactive steps to strengthen their market position by focusing on the production of premium Forest Stewardship Council™ (FSC) certified wood products. This approach will help them build prospects with large multinational companies, most of which now require certified wood for their operations.   

The combined population of Kenya, Tanzania, and Uganda has reached 171 million and continues to grow

This expanding population has driven up demand for various wood products, ranging from furniture to construction materials. Furthermore, rapid urbanization has created a demand for new housing and infrastructure projects, which will continue to increase the demand for building materials, including plywood and other engineered wood products (EWP), in the coming years. 

With increasing urbanization in East Africa, there is a growing business opportunity for sustainable forestry practices. Here are some considerations that highlight this opportunity: 

1. Increasing demand for eco-friendly construction: Urbanization often spurs construction activities, creating a market for eco-friendly building materials. This includes a rising demand for certified wood products from sustainably managed forests. Sustainable forestry can cater to this demand by providing timber and other materials that comply with green building certifications, for example, Leadership in Energy and Environmental Design (LEED) certification, thereby tapping into the growing market for environmentally conscious construction practices. 
2. Carbon offsetting and environmental benefits: Sustainable forestry initiatives in urbanizing regions can play a crucial role in carbon sequestration and biodiversity conservation. This presents opportunities for businesses involved in carbon offset projects, biodiversity conservation, and ecosystem services management. The New Forests Company has planted 30.2 million trees as of 2023, have a current carbon sink of 2.6 million MT of CO2e, with a third of their land reserved for conservation. NFC’s forestry operations, along with the trees being grown by their out growers, have offset over 210,000 MT of CO2 in 2023.  
3. Community and small-scale enterprises: Sustainable forestry practices often involve partnerships with local communities and small-scale enterprises. There is an opportunity for businesses to invest in community-based forestry initiatives, supporting livelihoods while ensuring sustainable management of forest resources. 
4. Technology and Innovation: “Innovations in forestry management can enhance the sustainability credentials of forestry businesses in East Africa. These include satellite monitoring, blockchain for tracking wood supply chains, and eco-friendly harvesting techniques. These sustainable practices appeal to environmentally conscious consumers and investors alike.

To build sustainably in East Africa, it is important to consider the life cycle of the building materials used, including sourcing responsibly, manufacturing, transportation, and disposal

Using locally sourced materials can reduce transportation emissions, and using materials with a long lifespan can reduce the need for replacements and disposal. 

Sustainable commercial forestry and timber products can help fill the regional market gap and support export-led growth, contributing to development gains. This is possible if forest activities deliver social, environmental, and economic benefits, balance competing needs, and maintain and enhance forest functions both now and in the future. If commercial actors are adaptable, the mixture of industry regulation and premium certifications can help grow profitability while doing right by the planet.  

The insights provided by the author, with support from AgDevCo and The New Forests Company, are part of CrossBoundary Advisory East Africa team’s work supporting the Uganda Strategic Investments Activity (SIA). SIA is a 5-year Program funded by the United States Agency for International Development (USAID) to facilitate and mobilize financing for investments in agriculture and food security, the productive use of energy for agriculture and related industries, and health in Uganda. 

CrossBoundary Advisory supported AgDevCo with commercial due diligence and market assessment support in Uganda on their US$10.75 million investment into The New Forests Company, a leading FSC-certified forestry company in East Africa with production and processing facilities in Uganda and Tanzania. 

AgDevCo is a specialist impact investor in African agriculture. AgDevCo invests to grow sustainable agribusinesses that achieve positive social and environmental impact at scale. Between 2022 and 2023, AgDevCo invested $10m in The New Forests Company, a leading FSC-certified forestry company in East Africa with production and processing facilities in Uganda and Tanzania.  

The New Forests Company Group (NFC) is a sustainable forestry and value-added timber products business with operations and offices in Kenya, Uganda, Tanzania, South Africa, and Mauritius. It is unrelated to New Forests Asset Management, which is an Australian and Asian registered company. The company supports over 6,000 smallholder farmers (~4,000 in Uganda and ~2,000 in Tanzania) through an outgrower program and has invested in community-based healthcare and agriculture initiatives including the establishment of grain and livestock operations such as a maize mill, piggery, fish farm, 18 beekeeping groups, as well as development of 16 health centers and schools, some of which use solar as a clean energy source.