Lessons of the Ukrainian Forest Sector Development Prof. Orest Kiyko Ukrainian National Forestry University (UNFU) Head of the furniture and wooden articles technology Department INTERNATIONAL SCIENTIFIC-PRACTICAL CONFERENCE Current Challenges of Sustainable Forest Management in Caucasus October, 2013, Tbilisi, Georgia

Ukranian National Foresty University. Department of the furniture and wooden articles technology 2 Contents I. Introduction II. Ukrainian forest sector development III. The simulation results IV. Discussion and conclusions

Ukranian National Foresty University. Department of the furniture and wooden articles technology 3 Forest recourses of Ukraine Forest area of Ukraine - 10,4 mio. ha (15,9%). Total forest volume –2,1 bio. m 3. National natural parks and other protected objects of State Forest Agency of Ukraine - 13,9 % of total area. Annual volume of harvesting - 16 mio. m 3. Forest property structure in Ukraine is characterized with prevalence of public forests - 99%. I. Introduction

Ukranian National Foresty University. Department of the furniture and wooden articles technology 4 Carpathian region of Ukraine The forest cover of the area %. Transcarpathian oblast – 51.2%; Ivano-Frankivsk oblast – 41.4%; Chernivtsi – 29.4%; Lviv oblast – 28.7%. Overall growing timber stock amounts to 0.52 billion cubic meters. Average annual growth of forest land is 4.3 cubic meters per hectare. Forests of region produce about 9 million m 3 of wood annually. The current harvest in in the forests of the State Forestry Agency of Ukraine in region amounts to 4.9 million m 3 (63% of the annual growth). I. Introduction

Ukranian National Foresty University. Department of the furniture and wooden articles technology 5 Ukrainian National Forestry University (UNFU) I. Introduction UNFU is the only university in Ukraine, which trains bachelors and masters in all fields relevant to forest cluster. More than 7000 students. 35 departments More than 400 professors, lecturers and scientists. Academic degrees: Associate (younger) specialist, Bachelor, Engineer (Specialist), and Master in 17 fields of study (specialties). Ukrainian National Forestry University was founded in 1874

Ukranian National Foresty University. Department of the furniture and wooden articles technology 6 Relative ranking of the Ukraine’s forest complex among other sectors by their share of employment of total producing industries (KVED) in 2010 (Source: State Statistic Committee of Ukraine, 2010) II. Ukrainian forest sector development The main characteristics of the Ukrainian Forest sector (Source: State Statistic Committee of Ukraine, 2011) Number of employees – 250 ths persons; Turnover – 5.1 billion EUR; Number of enterprises – 32 ths units

Ukranian National Foresty University. Department of the furniture and wooden articles technology 7 II. Ukrainian forest sector development Structure of turnover in Ukraine‘s forest sector Sources: State Statistic Committee of Ukraine, 2011

Ukranian National Foresty University. Department of the furniture and wooden articles technology 8 Ukraine’s industry development (Source: State Statistic Committee of Ukraine, 2011) II. Ukrainian forest sector development

Ukranian National Foresty University. Department of the furniture and wooden articles technology 9 Ukraine’s GDP and forest sector’s share development (Source: State Statistic Committee of Ukraine, 2011) II. Ukrainian forest sector development

Ukranian National Foresty University. Department of the furniture and wooden articles technology 10 II. Ukrainian forest sector development Development of the Ukrainian forest sector‘s turnover. Sources: State Statistic Committee of Ukraine, 2011 Development of the Ukrainian forest sector‘s employees. Sources: State Statistic Committee of Ukraine, 2011

Ukranian National Foresty University. Department of the furniture and wooden articles technology 11 II. Ukrainian forest sector development Development of the Ukrainian furniture production. Sources: State Statistic Committee of Ukraine, 2011 Development of the Ukrainian forest sector‘s enterprises. Sources: State Statistic Committee of Ukraine, 2011

Ukranian National Foresty University. Department of the furniture and wooden articles technology 12 II. Ukrainian forest sector development Share of the forest sector‘s turnover for the Carpathian region of Ukraine in Sources: State Statistic Committee of Ukraine, 2011 Share of the forest sector‘s turnover for the Polesia region of Ukraine in Sources: State Statistic Committee of Ukraine, 2011

Ukranian National Foresty University. Department of the furniture and wooden articles technology 13 III. The simulation results Regional (for any Ukraine's administrative unit) forest sector in Ukraine Number of the employees in the RFS X1X1 X2X2 X3X3 Turnover of the regional forest sector Y Y=f(X 1,X 2,X 3,X 4,X 5,X 6,X 7,X 8,X 9,X 10 ) X4X4 Overall regional turnover Regional industry’s turnover Wood output, sawn or split Procurement of merchantable wood Percentage of regional forest land Gross regional product X5X5 X6X6 X7X7 X8X8 X9X9 X 10 Number of the enterpr. in the RFS Number of the employees in the AR Number of the enterpr. in the AR RFS – regional forest sector; AR – all region.

Ukranian National Foresty University. Department of the furniture and wooden articles technology 14 The main characteristics of the mathematic-economical model 1.Number of the factors – Number of the experiments – 135 (5 years×27 administrative units in Ukraine). 3. Period of the researching – 5 years (2006…2010). 4.Kind of the model – quadratic regression model. 5.Number of the coefficients – 66. III. The simulation results

Ukranian National Foresty University. Department of the furniture and wooden articles technology 15 Nothing new! III. The simulation results

Ukranian National Foresty University. Department of the furniture and wooden articles technology 16 We need additional explanations! III. The simulation results

Ukranian National Foresty University. Department of the furniture and wooden articles technology 17 We didn’t expect such results! III. The simulation results

Ukranian National Foresty University. Department of the furniture and wooden articles technology 18 Forestry sector’s contribution to employment and gross domestic product, 2006 Source: State of the World’s Forests 2011, Food and Agriculture Organization of the United Nations IV. Discussion and conclusions Strategic base for common future cooperation

Ukranian National Foresty University. Department of the furniture and wooden articles technology 19 IV. Discussion and conclusions Is it necessary to develop forest sector? Why is it necessary to develop forest sector? 1. Forest sector offers a simple way to reduce the CO 2 emissions that are the main cause of Climate Change, through: the carbon sink effect of the forests; the carbon storage effect of wood products; substitution for carbon-intensive materials. 2. There are four extraordinary properties of wood as a unique material: wood is renewable material; wood is reused material; wood is recycled material; wood is refined material.

We have only two options Ukranian National Foresty University. Department of the furniture and wooden articles technology 20 IV. Discussion and conclusions or

Ukranian National Foresty University. Department of the furniture and wooden articles technology 21 IV. Discussion and conclusions Without understanding that any forest sector should consists of all subindustries which have deal with such common resource as “forest” we will not be able to decide very important problem of any forest sector – the installation and keeping of balance between the creating of protection forest area and needs of forest (wood) production. New definition is not only definition

Ukranian National Foresty University. Department of the furniture and wooden articles technology 22 Structure of the forest sector IV. Discussion and conclusions

Ukranian National Foresty University. Department of the furniture and wooden articles technology 23 New triple helix is the new understanding of the prospects for future development Cluster organization Forest sector Sustainable development IV. Discussion and conclusions

Ukranian National Foresty University. Department of the furniture and wooden articles technology 24 THE MAIN OPPORTUNITIES OF UKRAINE’S FOREST SECTOR 1.Strengthening of the co-ordination within the framework of the forest sector. 2.The forest sector of the Carpathians region of Ukraine has the best pre-conditions for its development. 3.Creation of analytical center for the forecast and the strategy elaboration development of the forest a sector. 4.Prospects of cluster organization for the subindustries of the forest sector, especially in rural areas. 5.Development of wooden constructions production, as one of the most important industries for the forest sector. 6.Development of the energy from wood production. 7.Complex utilization of wastes. IV. Discussion and conclusions

Ukranian National Foresty University. Department of the furniture and wooden articles technology 25 Thank you for your attention! UNFU Prof. Orest Kiyko Ukrainian National Forestry University (UNFU) Head of the furniture and wooden articles technology Department