In case of traditional investments, the goal is to yield in teak or mahogany. Wood, especially hardwood, is a highly demanded resource on the world market, which represents a relatively safe investment. In addition, every tree adds value to the environment. However, the entry prices need to be low in order to generate a decent yield.
The problem of traditional investment lies in the fact that neither wood nor the money gained from the wood, remain in the production country. The plantations provide some jobs, but all profits are derived. But if the wood does not stay in the country, illegal logging will not be stopped.
Especially illegal logging is a gigantic problem, because the enormous demand of emerging countries for building material promotes this destruction.
X Illegal logging of the natural forests
X One of the reasons of big flooding
X Draining money out of the country
X People in need sell their trees at ridiculous prices
X Big corporations buy land and plant monocultures
X If people stay poor, they will continue to cut down trees illegally