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Certification collaboration and government procurement backing would boost demand for FLEGT licenses
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The final session of the IMM Berlin Trade Consultation focused on private sector green procurement and its recognition of FLEGT as well as the Indonesian licensing system and sustainability.
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Discussion themes in workshop 2 covered the range of factors that play a part in any tropical timber transaction in the EU and set the context for market uptake of FLEGT licensed product and the relevance attached to the wider FLEGT initiative.
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The main section of the IMM Berlin Trade Consultation opened with a workshop on trends in EU tropical timber trade. The workshop’s primary purpose was to discuss drivers of market decline and future opportunities for tropical timber in Europe with private sector representatives.
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IMM's role is to use a combination of trade flow analysis and market research to track market impacts of FLEGT-licensed timber and wood products. The market research aspect lay at the heart of its Trade Consultation in Berlin in November.
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The EU imported 420,000 metric tonnes (MT) of wood products from Indonesia in the year ending September 2018 compared to 410,000 MT in the year ending September 2017. A continuing rise in EU imports of Indonesian plywood and charcoal has offset an on-going decline in imports of Indonesia flooring and other processed products.
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Guyana has become only the second Central/South American country to complete its FLEGT Voluntary Partnership Agreement, following the initialling by Honduras of its VPA earlier this year.
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The signature by the EU and Vietnam of the latter’s FLEGT Voluntary Partnership Agreement is scheduled for later this year, with ratification in 2019. They are being heralded as critical staging posts, and important moments both practically and psychologically, in the country’s progress towards full VPA implementation and its start of FLEGT licensing of timber and wood product exports to the EU.
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Vietnam’s role as a wood processing hub continued to rise during 2017. Vietnam is increasingly recognised as the primary location in South East Asia for supply of mid-range interior furniture and has become a major competitor to China in this sector. Vietnam’s imports of wood products are rising to supply the export-oriented furniture manufacturing sector as well as rising domestic demand.
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In the last 2 years, the level of trade between VPA partners and the EU has varied widely depending on the individual country and product. EU imports from Indonesia, currently the only FLEGT licensing country, have remained level at an annual average of €800 million since the start of 2016. This contrasts with imports from the five VPA implementing countries in Africa which declined continuously from an average annual level of €430 million at the start of 2017 to €330 million in March 2018.
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The FLEGT licensed information point is expanding its information for timber buyers. Recent IMM trade consultations revealed that the trade advantages of FLEGT licensed timber are relatively well-known. However, the private sector is keen to learn more about, and articulate to their clients, the social, economic and environmental benefits of FLEGT licensed timber.
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The Joint Implementation Committee for the Indonesian VPA met on 1 March 2018 in Jakarta to review experience with the first 15 months of licensing. According to information from the Indonesian SILK database and the Licensing Information Unit (LIU), more than 39,000 FLEGT licenses were issued during 2017. This means that FLEGT-licenses accounted for 18.2% of all V-Legal documents – paperwork accompanying Indonesian exports globally and guaranteeing timber legality – issued during that period.
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Comment from the EFI FLEGT-Facility: A quiet revolution has transformed Ghana’s forestry sector, laying the foundations for sustainable development, greater benefits for communities and improved access to international markets. One recent development is the Ghana Timber Transparency Portal, the result of a collaboration between the Forestry Commission and civil society organisation Civic Response.