Action against illegal logging interaction with international trade agreements
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Action against illegal logging: interaction with international trade agreements. Duncan Brack Associate Fellow, Energy, Environment & Development Programme, Chatham House. Forest Governance and Trade: Exploring Options Chatham House, 24 January 2007. Questions.

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Action against illegal logging interaction with international trade agreements

Action against illegal logging: interaction with international trade agreements

Duncan Brack

Associate Fellow, Energy, Environment & Development Programme, Chatham House

Forest Governance and Trade: Exploring Options

Chatham House, 24 January 2007


Questions

Questions

  • How do these agreements affect measures taken to exclude illegal timber products? (mainly FLEGT); and

  • Do they provide opportunities to promote these measures?

    • WTO

    • US Free Trade Agreements

    • EU Economic Partnership Agreements

    • International Tropical Timber Agreement

  • Issues around potential development and extension of the FLEGT licensing system


World trade organisation

World Trade Organisation

  • Doha Round started 2001

  • Suspended July 2006

  • US trade promotion authority ends summer 2007

  • Some progress over aid for trade – but not really WTO issue


Liberalisation of trade in forest products

Liberalisation of trade in forest products

  • Roundwood production +0.5%, trade +2%; South–South trade increases more (higher barriers)

  • Trade in value-added products increases; logs falls, except where log export bans removed

  • Most export-oriented developing countries benefit most

  • Environmental impact negative; increased pressures

  • Some increased incentives for SFM; also for expansion of plantations

  • Many negative social impacts


Wto conclusion

WTO: Conclusion

  • Liberalisation of trade in forest products will exacerbate problems of illegal logging where they exist

  • Measures taken to exclude illegal products can be seen as WTO-supportive


Us free trade agreements

US Free Trade Agreements

  • More focus now on bilateral FTAs, as multilateral talks (WTO, FTAA), in trouble

  • FTAs/TIFAs with Cambodia, Honduras, Indonesia, Malaysia, Peru

  • Some FTAs have environmental side agreements – e.g. US–Singapore MoI, US–Indonesia MoU

  • FTAs have increased trade in forest products; side agreements ineffective against illegal logging

  • 2006 election will reduce trend to FTAs, increase pressure for side agreements

  • FTAs could offer opportunity to include controls


Eu economic partnership agreements

EU Economic Partnership Agreements

  • Bilateral trade agreements with ACP countries, currently under negotiation

  • Should enter into force 2008, but currently in trouble

  • Trade liberalisation impacts limited, as tariffs already low

  • FLEGT VPAs will be preferred route to tackling illegal products

  • Need for coherence of development assistance, EPAs, VPAs


International tropical timber agreement

International Tropical Timber Agreement

  • ITTA 2006 due to replace ITTA 1994 in 2008

  • Illegal logging controversial issues during negotiations, though includes some references

  • ITTO’s activities limited to project funding and data analysis

  • No likelihood of extending role to control trade


Developing flegt

Developing FLEGT

  • In basic form, three major flaws:

  • Product coverage limited: raw timber, sawnwood, plywood, veneer

  • Really designed to deal with simple case of single country exporting directly to the EU, and VPA partners under no obligation to control imports– so potential problems:

    • Circumvention

    • Laundering

  • Covers only EU amongst consuming nations


Extending product coverage

Extending product coverage

  • Product coverage should be extended to all products

  • Impact assessments for all VPA partners


Covering multiple cross border movements

Covering multiple cross-border movements

  • System should evolve so that license travels with the timber through every stage of chain of custody

  • Need to segregate licensed and unlicensed products (as in certification schemes)

  • Need for independent monitoring / verification

  • VPAs need to cover imports into partner countries

  • Regional VPAs would make sense

  • Licensing system should cover all exports from participating countries

  • Pressures will encourage these moves anyway


Extending licensing to consumer countries

Extending licensing to consumer countries

  • Imports of high-risk products (2005): EU 23%, China 19%, Japan 12%, US 11%

  • Japan: possibilities of G8 initiative; procurement policy; imports from VPA countries

  • China: sensitive as re-exporter

  • US: generally hostile to trade controls; sensitive as exporter; political changes


A flegt mea

A FLEGT MEA?

  • Balance of responsibilities between countries; what requirements for evidence of legality?

  • Financing mechanism

  • Compliance system – against non-complying parties, and against non-parties?


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