Sandra Thiam (Christophe Van Orshoven and Lea Turunen) Making Legality Work to Recognize Land Rights, Improve Land Governance, and Combat Forest Conversion Sandra Thiam (Christophe Van Orshoven and Lea Turunen) Washington, DC March 21, 2017

Introduction FLEGT – introduction Key Lessons for land governance Fosters governance reforms through trade Ongoing accountability improvements Opening political dialogue and making stakeholder voices more equal Potential limitations to application of FLEGT to land governance Discussion For those less familiar with the Voluntary Partnership Agreements, a very short introduction on what the VPAs actually are. Highlight a few lessons based on EU FLEGT Facility experience. We are operating and supporting all 15 VPA countries. I have chosen a few that I think help demonstrate the unique character of the tool and yet also show there are challenges as a result of these aspects. Talk you through a few challenges we are seeing. And then close with a few words about the Facility.

FLEGT Action Plan Objective: Reduce illegal logging Prevent the import of illegal timber into EU Improve the supply of legal timber Increase the demand for timber from responsibly management forests Current period of taking stock of what has worked and what hasn’t What has changed in the context in the meantime and how to address the new context Land governance issues are part of the new context – looking at lessons from FLEGT to think about how to address these new challenges

FLEGT Action Plan Development cooperation with timber-producing countries Trade arrangements between the EU and timber-producing countries Public procurement Encouraging private sector action Encouraging financial institutions’ action Using existing or new EU legislation Addressing conflict timber Trade: supply side and demand side Private sctor: opens a platform for dialogue that includes all stakeholder groups but in particular elicits commitment from the private sector becuase of the implications for trade National lens: legality defined by stakeholders - work through techincial issues based on exisitng legal framework

FLEGT Stands Out Focus on legality Through a trade lens Mobilizes the private sector Addresses technical and legal matters through a national lens

What is a VPA? Support countries to advance and reform their forest sector in order to minimize the trade in illegally produced timber A legally binding trade agreement between the EU and partner country Key elements framed by the EU, but solutions and specific requirements defined by national multi-stakeholder dialogue Voluntary The measures in VPAs were to help timber-producing countries address their forest governance challenges, and advance towards sustainable forest management so they can respond to more scrutinizing markets, and be a contributor to minimize the illegal trade. It concerns management reforms and capacity development, supported by measures to develop multilateral co-operations, as well as side measures on the demand side. These reforms are to ensure that illegally-produced timber is banned from international and national trade in a partner country, and incorporate the FLEGT licensing scheme for trade between partner countries and the EU. -- Have producer and exporting countries contribute to efforts to minimize illegal trade in wood and wood products. Helping them build up the capacity and necessary evidence to participate in legal trade as well as address the underlying forest governance challenges. VPAs are different from most other trade agreements. Negotiation is often around achieving similar goals vs negotiating the best position

What is negotiated? Country’s system to ensure legal compliance of products is ensured Commitments to improve transparency and other aspects of forest governance Framework for monitoring and evaluating implementation You will see the usual annexes that make up a VPA. These are negotiated as are the annexes. A lot of time is spent on outlining and discussing the checks and balance system to ensure timber being exported under the VPA is verified legal. Showing they can track and verify legal requirements have been checked.

Supporting 3 regions and 18 countries VPA countries Work in other countries Africa Asia Central and South America Cameroon CAR Congo Côte d’Ivoire DRC Gabon Ghana Guyana Honduras Indonesia Laos Liberia Malaysia Thailand Vietnam China Myanmar Cambodia

A new lead driver of deforestation Conversion of forest land to other uses A decision to allocate land for a non-forest use Leads to clearing of the forest for a mine, agriculture, infrastructure, etc. Either through land planning or through allocating resource rights of some kind

Conversion of intact forest in Gabon by Olam for a rubber plantation since 2013 Image credit: Maps for Environment

Cocoa plantations in Cote d’Ivoire 2001 - 2014 Credit: Mighty Earth/MapHubs

Conversion 73 percent of tropical and subtropical deforestation from 2000 - 2010 was caused by agriculture: 40 % commercial agriculture/ 60% local/subsistence farming (Hosonuma et al. 2012) 65 percent of deforestation in the tropics and subtropics between 2000 and 2008 was due to agricultural expansion (Cuypers et al. 2013) Beef, soy, palm oil, and wood drive 50% of tropical deforestation The growing importance of commercial agriculture as the greatest threat to the world’s tropical forests is closely linked to increasing overseas demand for the internationally traded commodities of soy, beef/leather, palm oil, tropical timber, pulp and paper, and plantation-grown timber Growing world population, growing middle class, increasing demand for these commodities In many tropical timber-producing countries, there has been a dramatic shift over the last ten years in how the majority of this wood is produced. In the past, almost all tropical timber was selectively logged from natural forests, which could in theory be sustainable. More recently, however, a growing proportion of production in key countries originates from the clear-felling of tropical forests, mostly to make way for commercial agricultural plantations. In Indonesia, for instance, forest conversion has grown from 37 percent of total production in 2005 to 72 percent of reported consumption in 2012 (Blundell 2014).

Governance factors associated with conversion Insecure land tenure Inconsistencies among sectoral laws Power imbalances Government policy … approximately 50% illegal Illegal but more than that, unclear legal frames, rights not know or protected… a governance problem even where laws and mechanisms exists to govern land allocation, they’re often not followed. It’s not necessarily a driver, but certainly a contributing factor that links this problem with our solution (legality). Not necessarily illegal; mining or hydropower might fit country priorities more than forestry Nonetheless a detailed global study of conversion in 2014 found that approximately 50% of it is illegal – so strategies will have to address both legal and illegal conversion if the goal is protect forests

FLEGT LESSONS I picked a few lessons that I thought characterize some of the unique features of the VPA

Though not a focus, VPAs have addressed land governance VPAs require evidence of a range of rights related to land as a starting point for verifying legality: Land ownership Use rights Procedural requirement of Free, Prior, and Informed Consent of affected land users Permit to harvest Accompanying measures Implementation

Fosters reform through trade

Fosters governance reform through trade Stakeholders define scope of legality standard based on national law Legality assurance systems provide a means to identify and verify legal compliance – i.e. in conversion area Results in filling in gaps and harmonizing laws Can bring about reform

Ongoing accountability improvements

Process, with ongoing accountability improvements Not just transparency… Yes, public disclosure requirements Monitoring and oversight Independent audit Independent observation Complaints mechanism

Opening political dialogue and bringing more voices in

Opening political dialogue, bringing more voices in Requires multi-stakeholder institutions Brings in stakeholders required for given topic High profile process with participation of European Commission/Delegation

FLEGT beyond VPAs EU timber regulation Public procurement policies Support to producer countries Investment institutions Private sector initiatives Addressing conflict timber

Limitations of FLEGT and VPAs for conversion VPAs take substantial commitment Long time horizons Most directly addresses illegal conversion Unless illegal, can only address future Depend on stakeholder priorities – trade not always a factor Would zero-deforestation commitments be a sufficiently strong lever? Accompanies a political process, not a project

Discussion? Consider: Mighty Earth/Olam deal Guyana’s LD

Thank you! sandra.thiam@efi.int