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Consultancy Services for Forestry Economic Sector Study in Kosovo

Kosovo is rich in forest. Data from the National Forest Inventory completed in 2003 estimated that the total area of forest and forest land in Kosovo is 464,800 ha, which amounts to 42% of the total Country area. Of this, the surface of 278, 880 hectares of forest land area is public property, while the area of 181,920 hectares is private property. Based on Forest Inventory data, the total standing volume of public forest is estimated at 33.5 million m³ and the volume of private forest is around of 19.5 million m³. The annual growth (increment) calculated is approximately 1.3 million m³. From estimated data is derived that the allowable annual harvesting could be from 900,000 m³- 1.3million m³. Forest areas are dominated by broadleaves and the main species are oak and beech species, while the main coniferous species are Common Silver Fir (Abies Alba), Norway spruce (Picea Abies) and Pinus species. The wood stock per hectare is calculated to be around 100.5m³/ha in higher forest and 77.7 m³/ha in low forest with an average annual growth of 3.3 m³/ha.

On one side, the data mentioned above show that Kosovo is rich in forest and forest land. On the other side climate, soil and geological conditions do allow for a higher amount of wood stock per hectare. Also, the annual average growth per hectare can be higher through proper management. Forest degradation and associated loss of ecosystem services represents one of the major environmental challenges facing Kosovo. Given this situation, there is an urgent need for application of policies and incentives to address forest rehabilitation and sustainable use, more efficient use of available finance sources, and reparation of the gap between the demand and supply of wood material.

The economic value of forests and forestry related products and activities are not well known and sparsely investigated. Available data in all respect is limited but particularly so for economic data. For further analysis there is a need to develop economic indicators related to forestry so that the costs and benefit analysis of forestry could be updated on a regular basis.

The overall aim of the study was to assess, analyze and calculate the present and potential economic cost and benefits of forestry and forestry related activities in Kosovo in the short, medium and long term. The scope of the study was limited to assessing the income, value-added and employment in the forestry sector, following standard national income accounting methodologies (e.g. as set out in the UN System of National Accounts). On the cost side the study assessed current and future public expenditure with a view to recommend cost effective measures to enhance the economic benefits of forestry in the country.

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