This report provides a comprehensive review of previous studies on the frankincense value chain in Ethiopia, complemented by field assessments, group discussions with producers, key informant interviews and a stakeholder workshop. Analysis of this information allowed a deeper understanding of frankincense production and the conservation status of dry forest resources. Specifically, it examined whether the efforts of governmental organizations and NGOs are inclusive of smallholders, if they enhance benefits for local people, and whether this incentivized them to participate in sustainable dry forest management. The study strongly recommends improving arrangements for community involvement, and a shift from collaborative management of state owned forests to community owned and managed forests at village or kebele levels. This would also help local communities to benefit from expanded use and management rights provided for community forestry under the 2018 Forest Proclamation.