Ethiopian Afromontane moist forests where coffee grows as understorey shrub are traditionally managed by the local communities for coffee production through thinning of the shade tree canopy and slashing of competing undergrowth. This management practice has a negative impact on the coffee shrubs, because the removal of shade tree saplings and seedlings reduces the succession potential of the shade tree canopy, which threatens the very existence of the shade coffee production system. We assessed the functionality of small exclosures to initiate coffee shade tree canopy restoration through natural regeneration. Our results show that small exclosures have a strong restoration potential for the coffee shade trees preferred by farmers (Albizia schimperiana, A. gummifera and Millettia ferruginea), as evidenced from their seedling abundance, survival and growth. The regeneration of late-successional tree species of the moist Afromontane forest was not successful in the small exclosures, most probably due to the low abundance or absence of adult trees as seed sources for regeneration. Therefore, temporary establishment of small exclosures in degraded coffee forest fragments where shade trees are getting old or dying is recommended for sustainable shade coffee production.