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Build FLEGT achievements into future forest policy, Fern urges EC

Jan 10, 2022 | FLEGT Policy News, News

With questions hanging over the future direction of the FLEGT initiative, forest and rights NGO Fern has set out principles for ‘ensuring the most effective parts of FLEGT Voluntary Partnership Agreements (VPAs) are not dismantled in a broader policy environment’. It describes the achievements and merits of VPAs and how they can be integrated into EU forest policy development in a new discussion document titled “FLEGT Voluntary Partnership Agreements 2.0 – A response to the European Commission FLEGT Fitness Check and options for the future’.  The 27-page publication is based on interviews with a range of forest sector stakeholders and responses to questionnaires sent to civil society, government and private sector experts in Latin America, West and Central Africa and Southeast Asia.

Besides the EC FLEGT and EUTR Fitness Check, which expressed doubts over FLEGT’s impact in combating illegal logging and concerns over its slow progress, with only Indonesia to date achieving FLEGT licensing status, Fern’s consultation exercise and dissection of FLEGT and its impacts is also a response to the EU’s publication of its proposed new ‘Deforestation Regulation’. As it stands, the latter would involve assimilation of some elements of FLEGT, with ‘forest partnerships offered to forest commodity suppliers, including those engaged currently in VPAs’. However, rather than providing EU operators exemption from further due diligence, a FLEGT licence would only fulfil the new Regulation’s legality requirement.  Due diligence would be needed to demonstrate that licensed imports met its demands on ensuring zero implication in deforestation and forest degradation.

Among the strengths of FLEGT identified in FERN’s examination and consultation process is that multi-stakeholder decision making structures are integral to how legally binding, bilateral VPAs are negotiated, implemented, monitored and revised. VPAs, it concludes, have also helped clarify and revise national legality definitions, making them more compatible with principles of good forest governance, local community rights and livelihoods.

“Evidence is also emerging that VPAs contribute to an overall reduction in illegal logging,” states FERN.

Consultation respondents also highlighted that VPAs have an impact beyond the EU, with countries at implementation and negotiation stage accounting for 79% of total global trade in tropical wood products. In addition, most VPA standards also apply to producer countries’ domestic markets.

Examples were also cited of the VPA multi-stakeholder approach being integrated into ‘parallel spaces’.  These include the Central African Forest Initiative’s REDD+ programme and efforts to improve the deforestation footprint of agricultural commodities in Côte d’Ivoire and Ghana. 

“The recent US-Vietnam timber agreement is also clearly and explicitly based on the foundation provided by the EU-Vietnam VPA,” says Fern.

Turning to the EC Fitness check, Fern states that perspectives from outside the EU were underrepresented in the process. It also concludes that criteria it used to assess the performance of   FLEGT differ from those applied in VPA countries. The latter look at national level changes, such as governance improvements, legal clarity and coherence and reductions in volume of illegal timber produced and placed on export and domestic markets. The Fitness Check ‘emphasised performance indicators linked to the EU’s role as a timber consuming market, namely the volume of illegal timber and number of licensed-timber products entering it’.

“This set of metrics is more straightforward to measure than ‘governance improvements’ , but has limited value in revealing the VPA’s impacts in the forest,” states Fern.

It also highlights that VPAs are legally binding agreements between the EU and supplier countries and that their assimilation into ‘non-legally binding instruments’ would be a retrograde step.

Shortcomings in FLEGT were also acknowledged by participants in Fern’s survey and interviews. These included the shrinkage of the EU’s tropical timber market share, which diminished the power of FLEGT’s promise of ‘green lane access’ to EU countries to ‘keep actors at the table’.  The slow progress of supplier countries through VPAs had also led to ‘FLEGT fatigue’ in the EU and its timber trade, resulting in ‘fewer resources and political capital being dedicated to VPA processes’.

Looking forward, Fern lays out ‘core principles’ for making decisions on FLEGT VPA’s interaction with the EU’s proposed new Regulation.

These include:

  • Not moving the focus to only EU-destined supply chains. “Focusing [via FLEGT] on affecting change beyond the EU’s forest footprint has allowed the EU to punch above its weight,” says Fern.
  • That the new Regulation should learn from existing multi-stakeholder VPA structures, with the latter informing deforestation and degradation-free approaches to national frameworks.
  • That legally binding agreements (with clear consequences for transgressions) are crucial to advancing a more sustainable, pro-poor agenda within forest sectors
  • That clear incentives must be ensured ‘to bring people to the table and keep them there’.

The discussion document also proposes options for increasing the benefits of FLEGT VPAs and their operation alongside and integration with new EU policy.

National stakeholders, it suggests could ‘revisit the minimum standards contained within VPAs to establish a sustainability or deforestation and degradation-free standard’.  Timber legality definitions within VPAs would be made compatible with agreed sustainability standards, with minimum requirements based on internationally agreed principles, such as the Voluntary Guidelines on Governance and Tenure (VGGT). 

“The EU already supports VGGT implementation in eight countries currently engaged in VPA processes,” says Fern.

It adds that VPA Timber Legality Assurance Systems could be adapted to additionally monitor whether timber is ‘forest degradation-free’.  “FLEGT licences issued thereafter might be considered to comply with all elements of the Deforestation Regulation,” says Fern.

Also recommended is development by the EU and producer countries of ‘joint implementation roadmaps’ for VPAs, with public monitoring systems established for gauging progress towards key milestones along the way.

“Public progress assessment could help funders assess best areas for investment and allow producer countries to demonstrate progress on priority governance issues,” says Fern.  “This would give them reputational benefits even before FLEGT licensing and encourage persistent implementation of reforms by introducing (reputational) consequences for implementation failures.”

The draft Deforestation Regulation proposes deforestation and forest degradation risk benchmarking of supplier countries, with due diligence tailored accordingly.  VPAs, concludes Fern, could be adapted to the bench marking process, for instance, in terms of producers’ adherence to annual allowable cut and other aspects of forest management plans.

“The implication would be that issuing FLEGT licences would mean the country automatically achieved a ‘low risk’ benchmark for timber, on the understanding that the legality standard achieved reflects required conditions for degradation-free production,” states FLEGT.

VPAs, it is proposed, could also form a core element of the new EU Regulations’ Forest Partnerships, holding lessons for reform of other commodity supply chains.

“Most FLEGT VPAs have addressed forest and land governance and livelihood themes extending beyond the immediate reach of narrow timber supply chains and many contain a legality framework around conversion timber,” says Fern. “Gains achieved through VPAs are likely to benefit future work to improve governance linked to [other] forest risk commodity supply chains and processes linked to these commodities should build on those gains.”

The discussion document also urges wider incorporation of FLEGT licences as proof of legality and sustainability in central and local government procurement policy, not just in EU consumer countries, but in VPA countries too.
“Improving public procurement policy is a relatively easy campaign that could be championed by MEPs,” says Fern. “It offers an entry point to broader recognition of the FLEGT licence as conferring more than ‘just’ legality.”

To give FLEGT added momentum, it’s also recommended that VPA implementation is integrated in relevant climate and sustainable development policies at national, regional and international levels.

“At national level, this could mean building VPA implementation into Nationally Determined Contributions (NDCs) to the Paris Climate Agreement and national development policies,” says Fern. “The EU could assist by requiring VPA implementation indicators are included in reporting frameworks of climate-linked finance offered to VPA countries.”

Fern’s research also concludes that key for the future of FLEGT is achieving global recognition of FLEGT licences.  “Greater global recognition of FLEGT – with a particular focus on China – would be a useful first step towards establishing a framework for new VPAs where the EU [and UK are] not the only consumer market,” says Fern. “This could potentially bring in additional participants for whom easier EU market access is a less significant incentive.”

The NGO stresses that none of the options laid out in its document have been worked out in detail. “They are intended only as a departure point for discussion rather than prescriptions,” it says.

But it adds that the ‘nationally-owned, deliberative approach embodied in FLEGT processes has enabled the EU to affect positive change well beyond the scope of its own timber supply chains’.

“It therefore needs to ask itself whether it has the appetite to support a global transition to more sustainable and equitable use of forest resources, or whether it will be limited to cleaning up its own supply,” it says.

Click here for the full report.