BANGKOK (Thomson Reuters Foundation) – A landmark timber trade agreement between Indonesia and the European Union to combat illegal logging was signed on Monday, raising hopes it will also help root out corruption in the Southeast Asian country’s forest sector.
Under Asia’s first VPA, exports of timber from Indonesia must be licensed under a national assurance system known as Sistem Verifikasi Legalitas Kayu (SVLK), and EU customs controls will prevent any unlicensed Indonesian products from entering EU markets.
“(The signing today) is a very important step in terms of establishing this agreement as legally-binding on both parties,” said Andy Roby from Britain's Department for International Development (DFID), who has been facilitating the agreement.
Both parties still have to ratify the VPA, and jointly audit the SVLK before timber licenses can be issued.
Once that is done, customs controls in all 28 member states that make up the EU bloc will check Indonesian timber for these licenses, Roby told Thomson Reuters Foundation from the signing ceremony in Brussels.
“The licensing is the third and final step, and then the system is complete and fully operational. Hopefully (that’ll be) next year,” he added.
FOREST PROTECTION EFFORTS
Indonesia’s tropical rainforests - the world’s third-largest, at 94.4 million hectares – are dwindling due to illegal logging and concessions for mines and palm oil plantations, even though the rate of deforestation has declined in the past decade.
Illegal logging in Southeast Asia’s biggest economy has fallen by 75 percent since a peak in 2000, but still represents around 40 percent of timber production, London-based think tank Chatham House said in a 2010 report.
Monday’s VPA signing is a recognition of Indonesia’s efforts to tackle illegal logging, Roby said.
“They’ve got 20 million hectares of audited forest now and 700 companies that are licensed to process that timber as legal timber for the European market,” he said. “Those are big figures. They’re far bigger than anything that has ever gone on anywhere else in the tropics before.”
According to the European Forest Institute, the EU is the destination for around 15 percent of Indonesia’s forest product exports, and imports timber and paper with an average annual value of around $1.2 billion. The main markets within the EU are Germany, Britain, the Netherlands, Belgium, France, Spain and Italy.
The VPAs with key forest nations are part of an EU strategy that targets both the supply and demand of timber. Indonesia is one of 15 countries in Asia, Africa and Latin America that are developing the agreements.
In March 2013, with the entering into force of the EU Timber Regulation, timber importers became responsible for demonstrating the legality of the products they bring into EU member states.
The London-based Environmental Investigation Agency (EIA) gave a cautious welcome to the VPA with Indonesia, saying it would also serve as a test of official resolve to stamp out massive corruption in the country’s forest sector.
“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,” said Faith Doherty, head of the EIA’s forest campaign.
“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,” she added in a statement.
Doherty highlighted the ongoing investigation into Labora Sitorus, a Papuan police officer accused of involvement in illegal logging, money laundering and fuel smuggling, as a “test case of Indonesia’s commitment to meaningfully address the root cause of illegal logging – corruption”.
In May, the EIA released video footage of illegal loggers harvesting wood for Labora Sitorus’ timber company, PT Rotua, from forests in an ecologically outstanding part of West Papua.