The Government of Nepal (GON) is implementing the World Bank funded Forests for Prosperity Project (FFPP) in selected municipalities of Madhesh and Lumbini Provinces from July 2021. The project aims to improve sustainable forest management, increase forest benefits, and reduce net greenhouse gas emissions in the participating municipalities. The Project is anchored on the success of Nepal's community-based forest management (CBFM) model and strongly aligned with the Government of Nepal's policy to increase forest landscape's productivity and catalyze private sector investment in the forestry sector through improved access to finance for forest-based Small and Medium Enterprises (SMEs). The project area is 25 municipalities of 8 districts in Madhesh Province and 25 municipalities of 10 districts in Lumbini Province. The target municipalities were selected based on their sustainable forest management potential and suitable locations for forestbased Small and Medium-Scale Enterprises (SMEs) and their importance for emission reductions in the Terai Arc Landscape. The other criteria for inclusion in the project are- potential for community-based sustainable forest management, new plantation establishment, location of forestsbased enterprises, low levels of rural employment and incomes, and the willingness and essential capacity to participate in the project. The project became effective in July 2021 and closes on July 16, 2026.