Based on detailed income data of 478 rural households, the nexus between forest, trees and rural livelihoods in Ghana is investigated and applied to assess implications of the Voluntary Partnership Agreement (VPA) between the EU and Ghana on illegal logging. It is found that, after crops, environmental income (cash and subsistence) is the most important contributor to households’ total yearly net income. Fuelwood, bushmeat and wild foods from plants are the most important environmental products. The survey shows meagre income from timber and poles, but is likely to underreport this source due to its illegal nature. Yet, when the likely incomes from illegal timber harvesting as estimated by other studies are compared with this study’s comprehensive livelihood data, it is obvious that an imagined full implementation of the VPA would have limited impact on the majority of rural households. Rather than focusing on social safeguards to mitigate any perceived or real negative impacts in the short-term, policy makers in Ghana—and the donors supporting them—should focus on other aspects of the VPA, notably forest policy reforms and in particular reforms that devolve management rights and benefits to trees on farm and fallow land to those occupying and cultivating the land. Such efforts would provide incentive for timber production and thus enhance rural livelihoods, while combatting illegal logging, deforestation and forest degradation.