Sweeping reforms since the late 1970s have turned China upside down. ’China’s Forests, Global Lessons from Market Reforms’, edited by Bill Hyde, Brian Belcher, and Jintao Xu and co-published by Resources for the Future and CIFOR, shows what the reforms have meant for forests.

In the early 1980s, the collectives that own about 60% of China’s forests handed most of them over to individual families to manage. Fifty-seven million households received 30 million hectares of degraded land to plant trees on. Millions more were allowed to manage existing forests and share the profits. The government partially liberalized forest product markets, particularly for bamboo, fruits, and pine resin.

Many families that received forests initially overexploited or deforested them. But after a few years both forest area and timber stocks started to grow as farmers planted more trees. Things improved quicker in regions that handed over forests faster, went further towards liberalizing markets, charged lower taxes and had more consistent policies.

The reforms made some farmers better off, particularly those who were more educated and well connected and who grew bamboo and fruit trees. Planting windbreaks increased many farmers’ crop yields. However, there are still too many taxes and regulations for most farmers to prosper from selling timber. Over 80% of the country’s poorest counties are in forested mountainous regions and in many of them life is improving slowly.

The total area in forests grew five million hectares between 1980 and 1993. Yet, while the plantations area increased by 21 million hectares, the area in natural forests declined by 16 million hectares. The net result was good for reducing soil erosion, but bad for biodiversity. The government has since banned logging in several major regions and set aside millions of hectares as nature reserves, which may have improved the biodiversity side.

To meet the growing demand for paper, small factories using agricultural residues sprung up all over. However, those factories soon became the largest source of rural water pollution, so the authorities shut down 2,000 of them. The government is now trying to encourage foreign companies to build large modern pulp and paper mills that use wood instead of residues, but it is unclear where the wood will come from.

They may get it from imports. China is rapidly becoming one of the largest importers of all sorts of forest products. So what happens in China may dramatically affect forests all over the world; and we all need to pay attention.