Notorious Malaysian Loggers Interested in Forest Certification
09/10/00
OVERVIEW & COMMENTARY
by Forests.org
To the credit of the notoriously environmentally unsustainable and socially unjust Malaysian timber industry, they see the writing on the wall, and are now investigating Forest Stewardship Council (FSC) certification of their timber harvesting practices. Certifying practices in Malaysia's remaining largely fragmented and diminished forests is relatively less important at this point than reigning in excesses of Malaysian logging companies that are ramping upon operations in essentially all remaining large rainforest expanses. The Malaysian industry has been known for trampling upon the rule of law, wantonly destroying ecosystems and mistreating local peoples worldwide.
It is critical that FSC not reduce standards to the lowest common denominator in order to accommodate logging operations known for such atrocious and wanton abuses. One standard must apply to all. It is far from clear that the Malaysian logging industry has a real interest in responsible, sustainable business practices. By engaging with known industry bad actors, FSC must be certain that they are not being manipulated. This said, if the Malaysian loggers and other known industrial over-exploiters of ancient forests are willing to change their business model all along the chain of custody, and get serious about ecological sustainability in ancient forests they manage, then this is truly a watershed event. But I have my doubts that this mafia like timber industry has anything but continuation of their windfall profits in mind, and are engaging as a delaying tactic. I hope they prove me wrong.
g.b.
RELAYED TEXT STARTS HERE:
Green Light In the Forest
Copyright 2000, Review Publishing Company Limited, Hong Kong
September 7, 2000
By Bruce Gilley/KUALA LUMPUR
JUST A FEW years ago, Malaysia's timber industry was thundering against Western-based environmental groups.
Environmentalists, to the industry's displeasure, were trying to deter consumers from buying Malaysian timber products on the grounds that the products weren't eco-friendly.
Today, the industry is seeking the blessing of those same environmental groups. Later this year, with good business and good politics in mind, Malaysia will launch a timber "certification" scheme to show that its products meet international guidelines on protecting forests. It hopes to have the scheme endorsed by the biggest non-governmental group that accredits such schemes--the Mexico-based Forest Stewardship Council.
The council wields a lot of power in the European market and growing influence in the United States and Japan. Malaysia's timber industry, its fourth-largest export earner, sees the council's backing as critical for long-term access to these key markets. That access is increasingly important because Malaysia is being undercut in less green-sensitive markets--China, Taiwan and South Korea--by low-cost producers in countries such as Indonesia and Cambodia.
The switch is also a political ploy. Malaysian officials hope to buy time for their timber exports while lobbying for a government- controlled body, such as the United Nations-run International Tropical Timber Organization, to take over monitoring of certification schemes from the council. In that sense, Malaysia is merely switching from one strategy--outright hostility--to another to defeat the council.
"We want an inter-governmental body to have this role," says Chew Lye Teng, head of Malaysia's new government-run National Timber Certification Council. "How can you ask governments to be answerable to a non-governmental organization?"
For now, prospects of replacing the FSC are dim. Founded in 1993, the council has grown stronger as green-sensitive consumers in Western markets lost faith in the ability of timber-producing countries to police their industries. The council now accredits forestry projects on 18 million hectares in 33 countries.
The idea behind certification is to use consumer power to save forests from destruction. Research by the government-run European Forestry Institute shows that European consumers are willing to spend 10% more for certified timber products, while certification adds less than 1% to a producer's costs, and usually improves company management.
CERTIFICATION HAS CACHET
Even without this so-called "green premium," institute researchers say certified sellers usually boost their market share because of the cachet of certified timber in eco-sensitive markets. The FSC signs off on certification schemes and accredits monitors to ensure that its standards are met. If they are, timber companies can stamp the council's logo on their products to signal their green credentials to consumers.
There is already one FSC-certified forest project in Malaysia covering 55,000 hectares in Sabah state. Innoprise Corp., the state company in charge of logging that forest, says it has seen better efficiency and booming sales of its garden furniture to Germany since the project started in 1994 with German aid.
This has prompted forest concession-holders in the states of Perak and Terengganu to seek direct FSC certification too. But the rest of Malaysia's timber business is counting on the new national certification scheme receiving the FSC's blessing.
In Europe, consumers who buy only FSC-certified products account for 25% to 50% of major markets like Germany, Britain and the Netherlands. This trend is hurting Malaysia's sales, its officials complain. Malaysia's exports of timber products worldwide grew 20% in 1999, but exports to the European Union grew only 8%, to 2.2 billion ringgit ($580 million). Exports to the United States are roughly the same as to Europe. FSC-certified timber accounts for only about 5% of all timber products in the U.S. market. But that is expected to grow fast since home-products giant Home Depot has promised to buy only FSC-certified timber by 2002.
Malaysian timber officials say exports to Japan are also slowing. "The Japanese don't tell you directly, but environmental concerns are driving their decisions more and more," says Aimi Lee Abdullah, a spokesperson for the Malaysian Timber Council.
Enter Malaysia's own certification scheme. Set up last year, the National Timber Certification Council sets standards and picks monitors to see they are met. The national programme, concerned with 14 million hectares of natural forest, covers everything from where and how to cut timber, to how to make sure timber products reach the consumer without being tampered with.
Malaysia approached the FSC in early 1999, says the council's executive director Timothy Synnott, and since then both sides have worked together quietly on the certification scheme. Cooperation with the council is a big step for Malaysia. "The Malaysians have become more pragmatic and are comfortable with a low-profile relationship with the FSC," says Mok Sian Tuan, a former Malaysian forestry department manager who is now the council's representative in Malaysia.
But getting the FSC to sign off on the Malaysian certification scheme has been elusive. Synnott says collaboration is happening "quite slowly." One major sticking point is better forest management. Malaysian officials see no problems with their current practices; certification "is just a way to inform the market of this," says the NTTC's Chew.
But the FSC wants changes in areas such as removing felled logs from forests (the council prefers overhead winching to on-the-ground dragging) and ecological diversity (the council favours efforts to increase it). The FSC will approve Malaysia's scheme, Synnott says, only if its forest managers make the necessary improvements.
RIGHTS FOR WORKERS AND INDIGENOUS PEOPLES
The second sticking point is more contentious: the rights of workers and indigenous peoples. This is a foundation of the environmental groups that make up the FSC--many of which started by protecting people dispossessed by the forestry industry in Central and South America. The FSC wants Malaysia to entrench more legal rights for workers and indigenous peoples on issues such as compensation and consultation. Malaysia says its own system is adequate and, like other timber-producing countries, sees such demands as an encroachment on its national sovereignty.
Still, officials on both sides are optimistic that Malaysia's scheme will eventually receive FSC approval. It is, after all, a simple matter of doing what the market demands. "We're talking about keeping up with change," says the FSC's Mok.
Once approval is secured, Malaysian officials can turn to their next aim: replacing the FSC with another body. Publicly, officials say that a proliferation of government-run certification schemes globally means an intergovernmental body is needed to set common standards. But they admit privately that their top concern is loss of sovereignty.
Canada, Australia and Brazil are also lobbying for a government solution to the accreditation problem. But so far, the only possible group to accredit tropical timber--the International Tropical Timber Organization--is reluctant to move in the face of opposition by environmental groups which see it as an appendage of the tropical timber industry.
Malaysian officials have convinced the ITTO to consider the accreditation issue at a November meeting in Japan. But even if it agreed, building a credible rival to the FSC would take years.
Until then the Forestry Stewardship Council will be the only independent assessor of certification schemes. "The Malaysians must have some way of demonstrating to the cynic that their scheme is credible," says Mok. "That means being accepted by the FSC."