Indonesia, EU sign historic deal to end the illegal timber trade

Submitted by: The Two Sides Team October 4, 2013

Indonesian and the European Union signed a deal that aims to curb illegal logging by ending all trade in illegal wood products between Asia's largest exporter of timber to Europe and each of the EU's 28 member states.

Indonesian and the European Union signed a deal on Monday that aims to curb illegal logging by ending all trade in illegal wood products between Asia's largest exporter of timber to Europe and each of the EU's 28 member states. The deal marks Asia's first Voluntary Partnership Agreement on Forest Law Enforcement Governance and Trade (FLEGT-VPA) and is the product of six years of negotiations between EU and Indonesian officials as well as civil society groups and the private sector. Under the VPA, all timber exported to the EU from Indonesia must be certified under the country's timber legality certification system (SVLK), which aims to track the chain of custody of timber products and ensure that timber is harvested in compliance with Indonesian law.

The EU banned the sale of illegally-harvested timber through a new law that entered into force in March. Once the VPA with Indonesia is fully implemented, all timber imported from the country will be deemed fully compliant with the new law, and companies trading in timber in the EU will no longer need to carry out due diligence to verify that Indonesian-certified wood is legal.

"The agreement demonstrates both parties have zero tolerance on illegal logging and its associated trade, and reflects our commitment to promoting the trade of legally certified timber, Indonesia's Forestry Minister Zulkifli Hasan said in an official statement on Monday. Zulkifli signed the agreement in Brussels together with European Commissioner for the Environment Janez Poto?nik.

Ghana, Cameroon, the Republic of Congo, Liberia and the Central African Republic have all signed similar deals with the EU, however Indonesia is the biggest timber exporter to enter into a VPA so far. The country boasts the world's third-largest expanse of rainforest, after the Amazon and the Congo basin. Rapid deforestation and peatland destruction has also made it the world's third largest greenhouse gas emitter, and concern over climate change has focused global attention on efforts to preserve the country's forests.

Environmental groups have expressed cautious optimism over the deal, praising in particular the formal role Indonesian civil society will be able play in monitoring compliance. However, they stressed that much still needs to be done to reform Indonesia's timber industry and end illegal logging in the country. "Today's signature of the FLEGT agreement is an important step to improve forest governance and law enforcement in Indonesia," Bustar Maitar, head of the Indonesia Forest Campaign at Greenpeace International, said in a statement on Monday.

"It shows Indonesia's willingness to expel corruption and illegal practices from its forestry sector, and the EU's engagement to continue to support Indonesia, especially for the independent CSO forest monitor."

Bustar said the agreement should be seen as a stepping-stone to further reform and that "the country must take steps to improve enforcement such as prohibiting forest conversion for industrial timber plantations and ensuring transparency and access to relevant data and maps. As long as companies such as Asia Pacific Resources International Holdings (APRIL) are allowed to destroy biodiversity rich forests and turn peatlands into pulpwood plantations, the green credentials of the Indonesian legality standard will be seriously flawed," Bustar added.

Wood certified under the SVLK system should be able to be traced back to a licensed forest concession or a privately-owned forest operating in compliance with Indonesian law. However, green groups and human rights organizations have long criticized Indonesia's concession-granting process, which they say has led to the conversion of valuable primary forests and fails to respect the rights of local communities.

A recent Human Rights Watch report, "The Dark Side of Green Growth, described the SVLK as a major advance in improving transparency and legality in Indonesia's timber sector." The report, however, also pointed to major shortfalls in the system, particularly its inability to protect against land tenure rights abuses.

The VPA requires timber producers to respect land tenure and land use rights of local communities. However, the SVLK audit process does not guarantee that permits were issued by the government on land without pre-existing land claims or that companies compensated communities for lost land or obtained free, prior and informed consent before beginning operations. Land conflicts linked to logging and plantation concessions are common in Indonesia, and this oversight represents a significant gap in the SVLK certification.

"The SVLK is a necessary but insufficient first step toward reform. In addition to weaknesses in oversight and transparency, the legality audits are silent on the widespread violations by both the state and forestry companies of the land and compensation rights of local communities living in and around forest concessions," Emily Harwell, a consultant with Natural Capital Advisors and the author of the HRW study, told Mongabay-Indonesia in an email on Tuesday. "These violations, which are becoming more numerous with the rapid expansion of pulp and oil palm plantations, have led to widespread and entrenched land conflicts that often turn violent," Harwell added. "Without clear timelines and a framework for how to address these weaknesses, not only in the SVLK but in Indonesia's forest governance as a whole, the EU risks complicity in branding as 'legal' wood products that in fact were harvested in violation of community rights."

Widespread corruption in Indonesia, including in the forestry sector, is another major obstacle to an effective verification system. In a media statement responding to the VPA signing, Faith Doherty, head of the London-based Environmental Investigation Agency's Forest Campaign, pointed to an ongoing case in which a police officer was implicated in illegal logging in Papua to illustrate that efforts to address corruption will be critical to ending illegal logging. "The ongoing investigation into the activities of corrupt cop-turned-timber smuggler Labora Sitorus serves as a high-profile test case of Indonesia's commitment to meaningfully address the root cause of illegal logging corruption," Doherty said. "Its conclusion will define the next steps to be taken in the international fight against illegal logging and the ruination of the world's last precious forests."

Doherty echoed Bustar's comments, praising the deal as an important step forward while underlining the challenges that still lay ahead. "It's been a long, hard journey for all concerned to arrive at this point and we are encouraged to see the VPA come into effect; in particular, we welcome the multi-stakeholder process and the formal role for Indonesia's civil society in monitoring the compliance of the country's timber industry. " There are still issues to be addressed within Indonesia and while this signing is a significant step forward, it does not mean that there is not a substantial amount of work still to be done."

This story, written by Diana Parker, originally appeared on the MongaBay.com website.

Share this story