Europe and Tropical Timber: Proposals to Regulate the Tropical Timber Trade

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WORLDWIDE FOREST/BIODIVERSITY CAMPAIGN NEWS

Europe and Tropical Timber: Proposals to Regulate the Tropical Timber

Trade

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Forest Networking a Project of Ecological Enterprises

10/25/96

OVERVIEW & SOURCE by EE

Following is a photocopy of an Environmental News Network article,

circulated here on request of the author, which questions the current

movement to require the certification of tropical timber's harvest

method. While this list has generally been in favor of an approach

which allows consumers to choose timbers that are harvested benignly;

the idea's problematic points, including concern that certification in

fact would have little effect on tropical timber's environmental impact,

are made.

g.b.

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Europe and tropical timber: A case study in trade and the environment

The rapid destruction of tropical forests has led certain non-

governmental organizations to advocate various measures to regulate the

international timber trade in view of getting it play a positive role in

conserving forests.

--By Jean-Pierre Kiekens

This article is a slightly adapted version from "The Tropical Wood Trade

in Europe" published in the Autumn 1995 issue of Ecodecision, the

environmental policy journal of the Royal Society of Canada.

"Europe and tropical timber are the components of a sad case study in

trade and the environment ," says Kiekens. During the 1980s, tropical

forests drew the attention of the international community. Their rapid

destruction rate led certain non-governmental organizations to promote a

boycott of tropical timber, the reasoning being that trade in this

commodity was a major cause of tropical deforestation. While this type

of pressure has not been completely abandoned -- Greenpeace, Friends of

the Earth and the World Wildlife Fund support for example a boycott of

Brazilian mahogany -- NGOs have gone on to advocate various voluntary

and compulsory measures to regulate the international timber trade in

view of getting it play a positive role in conserving forests.

As a reaction, various trade measures have been suggested, from

voluntary environmental labelling to import quotas. Can they be expected

to contribute to sustainable forestry management?

Proposals for regulating the tropical timber trade The first effort at

regulation was undertaken by the European Parliament in 1988. It sought

to establish quotas for tropical timber, to be negotiated in advance

with the producer countries and to come into force by 1995. It also

suggested a ban on timber imports from Sarawak, claiming that the

Malaysian state was overexploiting its forests and violating the rights

of indigenous populations. The European Parliament passed as well

resolutions to make tropical timbers subject to a European Regulation

under the Washington Convention on International Trade in Endangered

Species. However, these resolutions were never implemented, mainly

because of the disagreement of tropical countries and of the European

timber industry.

Two European countries -- Austria and the Netherlands -- have drawn up

national trade policies. In 1992, Austria introduced a special import

duty of 70 per cent and a compulsory labelling system for tropical

timber. Certain tropical timber producing countries quickly brought

these measures to the attention of the GATT, which had just prohibited

the use of trade measures to achieve environmental objectives in third

countries. Confronted by this opposition, the Austrian government was

forced to cancel these two trade components of its policy on tropical

forests.

For its part, the Dutch policy sought, by 1995, to allow imports of

tropical timber only from regions where sustainable forestry management

is practiced. As the Netherlands was bound not only by the GATT but also

by the Treaty of Rome, it opted in 1993 for a voluntary accord, and

undertook bilateral consultations with its main suppliers. Because of a

lack of enthusiasm - and an insufficiency of sustainably produced

tropical timber to supply the Dutch market, the Netherlands government

canceled the agreement one year after it was signed. The outcome was the

same as in Austria -- that is, a continuation of free trade.

The emergence of voluntary timber certification/labelling Other European

countries have followed a more prudent course. In Germany, professional

associations in the timber sector have pressured their members to import

only tropical timber if produced sustainably. They launched the

"Tropenwald Initiative", the main objective of which was to set up a

voluntary certification system so as to distinguish sustainably produced

timber during marketing.

In the United Kingdom, the main initiative is the "1995 Group", launched

by WWF in 1991. Participating companies undertook, by the end of 1995,

to only purchase timber from sustainably managed sources. WWF insists

that these firms hire the services of private agencies to establish an

independent system for certifying the origin of the timber they

purchase. By 1995, no participating company had reached the assigned

objective. Some of them have even come to endorse the Year 2000 target,

initially proposed by the International Tropical Timber Organization,

but considered as too distant by most environmental NGOs.

These private certification initiatives -- as well as others in

countries such as Belgium, Switzerland and Austria -- were particularly

influenced by the Forest Stewardship Council, created in 1993 by several

NGOs (WWF, Greenpeace, World Resources Institute, Friends of the Earth,

etc.). The goal of the Council is to supervise the certification of

timber throughout the world by accrediting private certification

agencies.

At the same time, national certification systems are being established

in various countries such as Finland and Sweden. Industrialized

countries outside the EU are also developing certification systems. For

example, in Canada, a standard has been developed by the Canadian

Standards Association for forestry certification, in response mainly to

pressures in Germany against the practice of clear cutting. In boreal

and temperate zones, the impetus for these initiatives does not come so

much from consumers' "willingness to pay" as from the danger of seeing

competitors adopt timber certification.

Timber certification and its marginal role in international timber trade

It is important to analyze the foreseeable effect of certification on

the international timber trade before studying its environmental impact.

With regard to the demand for certified timber, only a few market

segments in a few countries would be affected: the sector of do-it-

yourself chain stores and public markets in certain cities in such

countries as Germany, the Netherlands and the United Kingdom. Outside

these niche markets, it is not clear whether certification will be

adopted on any significant scale. Compared with world-wide production,

the demand for certified wood remains negligible. It is probably the

paper industry that could have the most significant impact because of

the development of eco-labels for paper.

In the tropics, timber certification is proceeding more slowly, although

in principle it has been accepted in various countries, for example

Indonesia, Mexico and several West and Central African countries member

of the African Timber Organization. Certain tropical countries -- in

particular, Malaysia and Brazil -- seem to reject any international

certification program before the year 2000, although studies and limited

projects are being implemented and discussions on timber certification

are being held in the context of ITTO. See table.

These supply and demand patterns indicate that certification will only

have a slight effect on the international timber trade. They also

suggest that it will be producers in industrialized countries who will

mostly benefit thereby. If these trends become more pronounced, tropical

timber will be replaced by timber from temperate and northern zones, and

the result will be a form of environmental protectionism. Also to be

expected are trade diversions and their associated economic costs,

including a lower competitiveness of timber versus substitute materials.

Timber certification and its dubious impact on sustainable forestry

management

Similarly to its limited effect on the timber trade, certification will

have only a slight direct impact on sustainable forestry management.

This particularly applies to tropical timber-producing countries, where

sustainable forestry management remains especially uncommon (Kiekens, et

al. 1995; Poore 1989). The main markets for the two main exporters

(Malaysia and Indonesia) are in Asia (Japan, South Korea, China, etc.),

where there is no demand whatsoever for certified wood. Only a few

African countries are somewhat dependent on environmentally sensitive

markets. Of course, certification can perturb some markets, but it can

hardly be expected to lead to significant changes in forestry resource

management.

While the direct effects of certification on forestry management ought

to be marginal, that is not necessarily the case for indirect effects.

For developing countries, there is a great danger that timber

certification be considered as a substitute for financial and technical

assistance. This fear was substantiated by the "Forest Protocol"

recently added to the Lom‚ IV Convention - the main instrument of

development cooperation in the hands of the European Union. In contrary

to the initial proposal (Kiekens 1995) and the commitments made by

industrial countries in Rio de Janeiro, the Lom‚ Forest Protocol does

not include any new financial resources for forestry. It requires,

however, the developing countries of Africa, the Caribbean and the

Pacific to "support the definition and development of certification

systems... as part of envisaged internationally harmonized certification

systems for all kinds of timber and timber products" (see Zolty, 1995).

In industrialized countries, timber certification presents the problem

of choosing between voluntary and compulsory regulation. The original

impetus for certification comes from international trade issues, i.e.

the need to avoid non-tariff trade barriers. Its voluntary nature can

however be called into question in domestic situations -- for example,

in respect to forestry in countries such as Finland, Sweden and Canada.

A voluntary instrument that affects only part of the sector can indeed

be expected to be less effective than a compulsory regulation.

Timber certification: sound politics maybe, but hardly a sound policy

Europe's difficulties in introducing trade measures to promote

sustainable forestry management show that the only measure on which some

consensus exists -- timber certification -- cannot be expected to play

any significant role as an incentive toward sustainable forestry. The

harmful effects of this measure, in particular on tropical forestry

management, could more than wipe out the environmental benefits it is

supposed to bring about.

Despite these limitations, European decision makers seem enthusiastic

about timber certification. In supporting it, they are responding

positively to the demands of environmental NGOs, which greatly influence

public opinion. Through certification they can perhaps slow the

introduction of new domestic forestry regulations. Finally, by

supporting certification, they have found an unexpected argument in

favor of limiting their forestry aid to developing countries. So,

despite the considerable difficulties and costs for implementing

certification in the highly fragmented European forests, EU decision

makers seem about to recognize "the importance of timber certification

as a means of promoting the sustainable management of all types of

forests" (EC, 1995).

Europe and tropical timber are the components of a sad case study in

trade and the environment. The lesson to be learned from this should be

obvious, especially when an extra-territorial objective is being

pursued. Effective policies in international forestry co-operation

should be preferred to dubious trade measures to promote sustainable

forestry, especially in the tropics.

(Jean-Pierre Kiekens lectures development economics at the "Universite

libre de Bruxelles" and heads the consulting firm Environmental

Strategies Europe, which specialises in strategic policy studies

regading the environment. His recent academic and consulting work

focused on sustainable forest management and international timber trade.

He can be contacted at kiekens@ibm.net. Other papers by Jean-Pierre

Kiekens can be consulted at http://www.infobahnos.com/~kiekens.)

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European Commission. 1995. Draft terms of reference. European Working

Group on Timber Certification. Brussels, European Commission.

Kiekens, J-P. 1995. Proposal of a Forest/Timber Protocol in the Lom‚

Convention: Integrated Approach to Promote Sustainable Forestry in the

ACP Countries". Afrique Agriculture, 227:37-39.

Kiekens, J-P. et al. 1995. Sustainable Forest Management, International

Registration of Forests and Timber Certification. Report submitted to

the French Ministry of Co-operation and the European Commission.

Brussels, Environmental Strategies Europe.

Poore, Duncan et al. 1989. No Timber Without Trees. Earthscan

Publications Ltd. London.

Zolty, A. 1995. The ACP/EU Compromise: a Small Jewel of Inconsistency.

Afrique Agriculture, 227:34.

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