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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?