Whereas the Authority has had commendable progress in its first three years of operation, there are challenges that it faces:

• Encroachment: The physical and legal integrity of the forests is at stake, with encroachers pouring into the reserves for subsistence cultivation, and increasingly turning hostile to investments in the forest reserves to the extent of causing grievous bodily harm. Clearly the level of lawlessness is on the increase and the solution lies in getting political will and support from the political leadership to inform the encroachers to evacuate the forest reserves.
  
  
• The management of land outside gazetted areas is poor resulting in rapid degradation causing a threat to the forest which is looked at as alternative land. This is further aggravated by the high rate of population growth among the poor rural communities

• The timber market in Uganda is developing after serious fight against illegal logging and trade. The challenge is to promote increased professionalism in timber trade, monitoring and law enforcement to improve long term profitability.
  
  
• Planting and maintenance of young crops have been largely neglected in the past. It is a management challenge to ensure proper quality, where we must continue to focus on skills development, introduction of new technology and good practice.
  
  
• Sustainable Management and conservation of the natural forest has always been a key challenge for NFA. Many are now under proper control, but those, which, were never given priority under previous conservation projects, are in a sorry state and the demand to change CFRs to other land uses is growing every day.
  
  
• Safe Guard. The interest from private sector in planting in the forest reserves is increasing. A key challenge is for NFA is to satisfy the needs of interested parties and guard against applicants that are only interested in land.
  
  
• Technical Assistance. There is a growing demand for technical assistance to private sector in tree planting. It's a challenge to secure funding to provide assistance to small-scale tree farmers.
  
  
• NFA cannot work in isolation. There is need to strengthen partnership with districts leaderships, local communities, government institutions, civil society and NGO's.
  
  
• Financial sustainability for the NFA is a challenge as currently the revenue from NFA products and services is still so low to finance NFA activities.

Addressing the Challenges
Broadening of the NFA revenue base in terms of new products, services, development assistance and other innovative sources of funding as well as better marketing strategies of the already existing products are a way forward to addressing some of the challenges of capacity and limited funding.