This report identifies ways in which long term environmental change, rather than short term fluctuations in rainfall, affect output and living standards. It shows that in communal areas, where the majority of Namibians depend on the land, the impacts of desertification are complex and inter-related, affecting the subsistence and cash income they get from livestock, the time and effort needed for fuelwood and fencing, and family food security. Costs faced by communal farmers from lost output and increased expenditure can be estimated at around N$100 million per year. The particular impact on those with least cash, livestock, transport, and power in the growing competition for natural resources is highlighted.