Abstract:

Investors always expect to invest the item of higher income and lower risk. Plantation income and risk can affect investment quantities. Beforetime, people believe that plantation income is lower. However, in recent years, because of reduction of timber tax and fee and policy to support forestry coming on, plantation income rate have enhanced and private forest have developed speedily. It may be demonstrated in Fujian Province. Bankers and potential investors are afraid of plantation risks, for example fire and diseases and insects, and are short of confidence for plantation investment. To analyze plantation risk of Fujian Province by real data, the paper concludes that from 1993 to 2002, average nature risk loss of plantation is lower in Fujian Province. Nevertheless, if a private forest happens fire or has diseases and insects, he will lose. Therefore, government must establish system to decentralize risks.

Key words: plantation, financing, income, risk, system