hewitt by yaosaigeng


									 Which 10 bilateral product flows have most salience
to future international effort against “Illegal Timber”?

                Presented by   James Hewitt      (Independent business consultant)
          Illegal Logging Update & Stakeholder Consultation, Chatham House, 21/07/2006


Statistics abstracted from http://www.globaltimber.org.uk/IllegalTimberPercentages.doc (@ 17/07/2006)
         Who knows how much Illegal Timber is traded?

Producer countries - are those who have power a major part of the problem?

Failure of G8 under its 2005 President Blair to act on Civil Society
request to measure and monitor trade in Illegal Timber

World Bank’s US$10-15bi pa - now out of date; not subdivided by country

FAO and UNECE - considering how to report on Illegal Timber

Baltic 21 - focusing on transparent timber trade flows

Estimated RWE volume and import value of trade in Illegal Timber during 2005:
70 million m3 (c5-10% greater than 2004) and US$13 billion
        Why estimate how much Illegal Timber is traded?

 Fundamental to multi-national strategy against trade in Illegal Timber

1) to identify which bilateral~product flows warrant international scrutiny

2) to optimise effort, devote 20% of scrutiny to the leading 80% of trade flows

3) to design targets and appraise progress

4) to lobby for support

5) to assess impact on legitimate trade (e.g. AF&PA)

But risk of:
denigrating timber vis à vis alternative materials for boats, building, furnishing, etc.
However, those materials might be associated with illegality (and conflict)
              Transparency - a tool to inhibit illegality

Major concessions: visibility, management resources, export earning

Maintain a public register devoted to major concessions, giving details of:
 1) location (GIS), ownership, duration, management plans, etc
 2) annual log production Vs volume authorised
 3) major court cases, judgements and any penalties actually paid
Compile separately for conversion forest, permanent forest or plantation

Failure to publish - implies illegality (corruption)

State secrets? X      Stewardship? √

Maintain a public register devoted to persistent large mismatches between
export and import declarations. Include notes on action taken, the shipping
company, consignee/consignor, product, port etc - Indonesia/Malaysia/China

Repackage the data, with annotations, to maximise its usefulness
    Why not measure legality against specific parameters?
    Estimates of the percentage of timber exports that is suspect under the given heading
        Modify these to reflect the range of likely sources supplying each bilateral flow

                                   Major Concessions
                      Allocation                                          Permits
                                   Manage-    Illegal       Economic                    Others
                         / Re-                                              and
                                     ment    Logging          crime
                      Allocation                                         Elsewhere
Brazil (Amazonia)        40%         40%       20%            30%           30%           -
Burma                     ?           ?           ?            ?            90%           -
Cameroon                 20%         30%       10%            10%           30%           -
China                    10%          ?        20%             ?            10%          20%
Congo (Brazzaville)      30%         60%       40%            30%             0           -
Equatorial Guinea        80%         80%       80%            90%             0           -
Gabon                    10%         60%       10%            50%           10%           -
Ghana                    30%          ?        20%            30%           30%           -
Indonesia – Timber       30%         20%       20%            30%           50%           -
Indonesia – Pulp          ?          0%        30%            30%           50%          70%
Ivory Coast               ?           ?           ?            ?              ?          70%
Malaysia                 10%         5%           0           10%             ?          5%
Papua New Guinea         90%         90%       20%            20%             0           -
Russia (East)             ?           ?        10%            20%           40%           -
Russia (West)            5%           ?        10%            15%            5%           -
Solomon Islands          50%          ?        50%            70%           10%
  In order to improve these “first iteration” estimates, please contact info@globaltimber.org.uk
           Top Ten bilateral flows of Illegal Timber products
                                      Estimated trade (2005)           Illegal + Legal trade (2005)
                                          Illegal Timber                   (RWE volume basis)
                                                                      For the given      Given product
                                                                         product:       as a proportion
                                        RWE         Import value        Importing          of importing
 Supplying   Importing
                         Product       volume        (US$ billion   country’s imports       country’s
  country     country
                                     (million m3)       cif)         as a proportion     timber imports
                                                                      of supplying       from supplying
                                                                    country’s exports        country
   China       USA       Furniture       1.8            1.6               56%                48%

   China       USA       Plywood         2.0            0.3               34%                32%

 Indonesia    Japan      Plywood         3.4            0.7               40%                88%

  Malaysia    Japan      Plywood         1.3            0.2               43%                76%
  Russia        EU                       1.9            0.2               43%                33%
 Cameroon       EU                       0.5            0.2               96%                81%
  Russia      China        Logs          12             0.9               43%                94%

   PNG        China        Logs          1.7            0.2               75%                99%
              China        Logs          0.4            0.1               69%                98%
  Gabon       China        Logs          0.5            0.1               53%                83%

Top Ten = 35% (RWE volume basis) of trade in Illegal Timber (25mi m3 RWE & US$4.5bi cif)

The estimates relate only to those imports which do not have credible
chain of custody certification to forest stump (low cost Vs high benefit)

The percentages should not be applied to trade from concessions which
are - credibly - progressing towards FSC or equivalent certification

The two flows shown for each of the USA and Japan probably account for
half of those two countries’ Illegal Timber imports

FLEGT VPA’s would be appropriate for the EU trade flows shown - if
established (or scrapped) by, say, 2008

One enterprise logs the great majority of China’s Illegal Timber from Congo
(Bz), Equatorial Guinea, Gabon, PNG, & the Solomon Islands - whose
Illegal Timber exports derive primarily from links to those in power

Economic crime (which is neither confined to the wood-based products
sector nor to producer countries) accounts for much of the illegality
 Which single action would achieve most impact on these flows?

Imports from China (especially by the USA):
cease importing wood products made in China unless these are accompanied
by a credible chain of custody back to forest stump for both:
a) the species which accounts for most of the product’s volume and
b) the species which dictates how the product is marketed (e.g. its surface

Imports from South Western region of Congo (Brazzaville):
urge prospective importers (in the EU and the USA) to not procure veneer and
plywood from the mills being established by that region’s leading logging group
– until independent public audits credibly confirm that that group’s concessions
have been properly awarded, that it has (and adheres) to plans for the
sustainable management of its concessions, and that it has paid all its arrears
of applicable taxes and fines (e.g. relating to log exports) to the correct part of
        Illegal Timber imports during 2005 - importing country by product
                              Total roundwood equivalent volume: c70 million m3

   25% Others
                                                                                                  China 30%


                    Others                                                                Plywood
10% USA                                                                                  Logs
                     Lumber                              Lumber
                        Others                       Plywood                                        EU 20%
               15% Japan            Lumber Logs Others

 Japan and USA would each import only 5% of world trade in Illegal Timber if their imports of plywood from Indonesia and
Malaysia (Japan) and from China (USA) and wooden furniture from China (USA) were credibly certified back to forest stump
                                          Bilateral Trade in "Illegal Logs" - 2005
Roundwood Equivalent Volume

                              5                                                            Solomon Islands
    (million cubic metres)

                                              Note: excludes imports from Russia
                                                                                           Papua New Guinea
                              2                                                            Gabon
                                                                                           Equatorial Guinea
                                                                                           Congo (Brazzaville)
                                  China    Japan      EU      India   Other East   Other
                                                   Importing Country

                >?50% of China’s imports are used by its export-oriented industries
                Should consumer countries offer to help China minimise its illegal imports?

                If China can, so can India? Nip India’s Illegal Timber (& Paper) trade in the bud
    Bilateral trade flows - “Illegal Sawn Wood” (2005)
                     Showing flows greater than c100,000m3 RWE

               Arrow width directly proportional
              to roundwood equivalent volume:
                2 million cubic metres RWE
                                                                        To be read in conjunction with
               0.5 million cubic metres RWE              http://www.globaltimber:org.uk/IllegalTimberPercentages.doc

Indonesia: export ban (but, gross import~export mismatch in prior years)

Russia: address EU trade and apply the new norm to West Asia~North Africa
Demons in Central Asia cutting a tree - Muhammad Siyah Qalam c.1300-1500 AD - Topkapi Saray Museum, Istanbul

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