Natural Resource Accounting in Kenya:a Case Study of Forestry Sector

Abstract

The use of natural resource in Kenya while undoubtedly enhances our economic growth, has not left the state of our natural resource and the environment at large, unaltered because of an increasing pressure on natural resource from the economic and population expansion which has led to environmental degradation and natural resource depletion. This study therefore applies some of the theoretical adjustments suggested in the natural resource accounting literature to the forestry sector in Kenya. The problem is that the macroeconomic policy making in Kenya is highly insensitive to the reality of natural resource depletion and degradation. While SNA would capture the annual depreciation of harvesting and processing equipment used to manufacture commercial wood products and commercial logging of fuel wood, it does not capture the depreciation of natural capital. This paper will enhance an appreciation of the need to improve SNA by incorporating natural resource degradation and depletion through coming up with the framework for the natural resource accounting in the commercial forestry sector through the use of ,satellite account. In this study an attempt will be made to use the net price method for the net .~ accumulation as it is much applicable to the existing data in the country despite the weaknesses it faces. The results of this study show very clearly how forest can be mismanaged and overexploited leading to resource depletion and degradation as a result of excluding or underestimating the true contribution of such resources to human well being.