inter-american Development Bank recently commissioned 10 papers to investigate the key policy issues affecting Latin American forests.

One paper on policies that affect forests in Latin America, by Jan Laarman, uses regional examples covering both traditional forestry policies as well as those that affect the forests: macro-economic, trade, cultural and infrastructure policies.

It points out that most policies can have positive or negative impacts depending on what objectives they seek to attain.

The paper makes several suggestions, crucial ones being that the governments should not give out more or larger forest concessions they can effectively monitor or control though giving such concessions longer might be helpful, but will not ensure that the concession holders engage in effective forest management. Competitive bidding for concessions produces desirable results for pricing revenue only where the companies strongly compete against each other, it does not unambiguously advance environmental objectives.

According to Laarman's paper, regulatory policies should seek to minimise the sum of transactions costs (money spent by governments to regulate and by landowners to enforce these regulations) plus damage costs (the negative environmental and social consequences of not regulating). The paper also suggests greater freedom be given to public interest groups to monitor the impacts of these policies.