Forests power economies: Growing prosperity from the roots up

On the International Day of Forests 2026, celebrated under the theme “Forests and Economies,” the International Tropical Timber Organization (ITTO) highlights how sustainably managed tropical forests support economic prosperity while safeguarding the precious ecosystems on which mankind depends.

Forests are fundamental to healthy economies. On the International Day of Forests 2026, celebrated under the theme “Forests and Economies,” the International Tropical Timber Organization (ITTO) highlights how sustainably managed tropical forests support economic prosperity while safeguarding the precious ecosystems on which mankind depends. 

Healthy and sustainably managed tropical forests sustain families and communities by providing food, water, medicines, wood and non-wood resources and livelihoods for millions of people—especially in tropical regions where forests are closely tied to local economies and cultures.

As countries pursue more sustainable development routes, forests are increasingly recognized as essential to building resilient and inclusive economies.

“Prosperous economies and healthy forests are not separate ambitions—they depend on each other,” said Sheam Satkuru, Executive Director of ITTO. “When forests are managed sustainably, they generate jobs, support communities, and supply renewable nature-based materials while protecting biodiversity, water and climate. This is the foundation of a truly sustainable bioeconomy.”

Wood at the heart of the bioeconomy

Forests are often discussed in terms of timber volumes or tree cover, yet their value extends far beyond the number of trees or the wood they yield. From climate change and biodiversity loss to water security and rural livelihoods, forests are central to many of the world’s most pressing challenges.

Sustainably managed forests store and sequester carbon, conserve biodiversity, regulate water cycles, maintain soil quality and protect communities from natural disasters. Simultaneously,  they generate revenue and employment across forest value chains.

Wood is the foundation of forest-based bioeconomies. When produced and used sustainably, it is a natural, renewable and climate-friendly material that supports economic development while maintaining healthy ecosystems.

Demand is rising not only for timber but also for non-timber forest products (NTFPs), ecosystem services, carbon benefits and other nature-based solutions. Meeting this demand without compromising forest resources requires innovation across the entire forest product supply chain—from responsible harvesting and processing to improved product design and markets.

“Wood is not just a commodity, it is a renewable nature-based solution,” said Ms Satkuru. “When sourced from sustainably managed forests, wood reduces emissions, supports rural economies and connects markets with the stewards of forest landscapes.”

Forests as engines of inclusive economic solutions

Sustainable forest management goes far beyond timber extraction. It integrates biodiversity conservation, landscape restoration, water and soil protection and livelihood development for forest-dependent communities.

Legal and sustainable supply chains bolster markets to support forest conservation. This approach lies at the heart of a circular bioeconomy—linking healthy forests, responsible production/consumption and inclusive markets so that economic opportunity reinforces social and environmental integrity.

Forests also serve as vital food sources for many communities. Fruits, honey, nuts, fungi, bush foods and other forest products strengthen food security, particularly in remote tropical regions. NTFPs provide income, nutrition and traditional medicines while maintaining cultural connections to forest landscapes.

Strengthening these value chains is essential for building inclusive forest-based bioeconomies.

A renewable alternative for a low-carbon future

Wood is one of the most natural environmentally friendly materials available. It is an effective substitute for carbon- and energy-intensive materials such as concrete, steel and plastics, making it indispensable to the transition toward low-carbon and circular bioeconomies.

Advances in engineered wood products, improved cultivation and harvesting practices and more efficient processing technologies are expanding the possibilities for sustainable wood use. Stronger collaboration between science, policy and industry will support wood’s even greater role in climate mitigation and adaptation while contributing to sustainable growth.

Investing in people, innovation and responsible markets

Unlocking the full economic potential of forests requires strong governance, predictable investment and human capacity. In many producing countries, sustainable timber production and forest-based value chains still face barriers such as unregulated logging, limited investment and low consumer awareness about responsibly sourced wood.

Smallholder farmers also play a critical role in supplying wood for a sustainable bioeconomy. Areas managed by smallholders across diverse production systems already provide a substantial share of roundwood in several countries. With the right policies, technical assistance, market access and science-based support, empowering smallholders can help meet the growing wood demand while reducing pressure on natural forests.

Capacity-building is therefore central to ITTO’s work. ITTO continues to support initiatives that strengthen smallholder participation in sustainable forest product value chains. Forest communities, smallholders, government agencies and private enterprises all need the knowledge, tools and financing to implement sustainable practices effectively.

Through training, knowledge-sharing and technology transfer, including traceability tools like the CUBIFOR timber-tracking application and the use of GIS and remote sensing in forest monitoring, ITTO supports countries to strengthen transparency, improve forest management,  and gain responsible market access.

“The transition to a sustainable forest-based bioeconomy very much depends on society,” Ms Satkuru emphasized. “Investing in knowledge, technology and partnerships empowers countries and communities to turn sustainable forest management into real economic opportunity.”

Building partnerships for a sustainable forest-based bioeconomy

A thriving forest bioeconomy requires collaboration among governments, Indigenous Peoples and local communities, the private sector, financial institutions, academia, scientists and international organizations.

Through ITTO initiatives such as the Legal and Sustainable Supply Chains Programme and its engagement in global partnerships promoting the use of sustainable wood, ITTO consistently endeavours to strengthen these connections and expand responsible forest product markets.

Sustainably managed forests and responsibly produced wood are both a climate solution and a development opportunity. Sustained efforts that value ecosystem services, support rural livelihoods, build human capacity and mobilize finance enable forests to become powerful drivers of resilient and inclusive bioeconomies.

On this International Day of Forests 2026, ITTO reemphasizes the role of sustainably managed tropical forests in supporting livelihoods, strengthening economies, and protecting the systems on which future prosperity depends. We invite all stakeholders to join us on this quest!