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This report was prepared by Cesar Environmental Economics Consulting under awards CRI-3, 4 and 5 from the US Department of the Interior and National Oceanographic and Atmospheric Administration. The statements, findings, conclusions, and recommendations are those of the author(s) and do not necessarily reflect the views of the Department of Interior, NOAA, or the government of the CNMI.

With a population of 34 million and an extremely high reliance on charcoal, Tanzania is a classic example of the social and environmental risks faced by many developing countries. About 85% of the total urban population uses charcoal for household cooking and energy provision for small and medium enterprises (Sawe 2004). In 1992 the total amount of charcoal consumed nationwide was estimated to be about 1.2 million tons (Sawe 2004). In 2002, the charcoal business generated revenues of more than 200 billion TShs (US$ 200 million), with more than 70 000 people from rural and urban areas employed in the industry (TaTEDO 2002b). Dar es Salaam, Tanzania’s largest city, accounts for more than 50% of all charcoal consumed in the country. The charcoal sector is far from sustainable. The forest resources that the industry is relying on are disappearing rapidly and the productivity of the sector has not seen any improvement either. The charcoal sector in Tanzania is operating economically, socially and environmentally in a suboptimal manner. However, solutions that safeguard the charcoal sector’s future are not straightforward.