Trends in forest area are crucial for monitoring SFM. The first sub-indicator focuses on both the direction of change (whether there is a loss or gain in forest area) and how the change rate is changing over time; the latter is important in order to capture progress among countries that are losing forest area, but have managed to reduce the rate of annual forest area loss.

Forests fulfil a number of functions that are vital for humanity, including the provision of goods (wood and non-wood forest products) and services such as habitat for biodiversity, carbon sequestration, coastal protection and soil and water conservation. The indicator provides a measure of the relative extent of forest in a country. The availability of accurate data on a country's forest area is a key element for forest policy and planning within the context of sustainable development.