1 1 Japan’s Public Timber Japan’s Public Timber Procurement Policy Procurement Policy Dr. Federico Lopez-Casero Dr. Federico Lopez-Casero Forest Conservation Project Forest Conservation Project Institute for Global Environmental Stra Institute for Global Environmental Stra tegies (IGES) tegies (IGES) Round-table Forum on Trade of Legal and Sustainable Round-table Forum on Trade of Legal and Sustainable Wood in China Wood in China Beijing, 26 Beijing, 26 April 2007 April 2007
Transcript
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Japan’s Public Timber Japan’s Public Timber Procurement PolicyProcurement Policy
Dr. Federico Lopez-CaseroDr. Federico Lopez-Casero
Institute for Global Environmental Strategies (IGEInstitute for Global Environmental Strategies (IGES)S)
Round-table Forum on Trade of Legal and Sustainable Wood in ChinaRound-table Forum on Trade of Legal and Sustainable Wood in China
Beijing, 26 April Beijing, 26 April 20072007
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OverviewOverview
1.1. Japan’s role in timber tradeJapan’s role in timber trade
2.2. Japan’s response to illegal wood importsJapan’s response to illegal wood imports
3.3. Framework of timber procurement policyFramework of timber procurement policy
4.4. Legal and policy context of PPP reformLegal and policy context of PPP reform
5.5. Reform of timber procurement policyReform of timber procurement policy
6.6. Definitions and verification modalitiesDefinitions and verification modalities
7.7. Policy implementation: a) Domestic; b) Imported timberPolicy implementation: a) Domestic; b) Imported timber
8.8. Preliminary observations: a) Certification / legality verifiPreliminary observations: a) Certification / legality verification schemes and b) Actorscation schemes and b) Actors
9.9. What does this mean for China?What does this mean for China?
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1. Japan’s role in timber trade 1. Japan’s role in timber trade
Share of tropical timber on total timber imports（2005）
• Japan’s Japan’s total wood demandtotal wood demand is about 89 million m is about 89 million m33 p.a.: p.a.: Roughly 80% are imported → World’s Roughly 80% are imported → World’s 33rdrd largest importer largest importer
• Largest importer of Largest importer of tropical plywoodtropical plywood (4.6 million m (4.6 million m33 in 2005) in 2005)
Source: ITTO (2006)
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2. Japan’s response to illegal wood imports2. Japan’s response to illegal wood imports
• Since the G8 Summit in 2002, Japan has repeatedly Since the G8 Summit in 2002, Japan has repeatedly expressed its expressed its commitmentcommitment to tackle to tackle illegal loggingillegal logging
• ““We will not use timber that has been produced illegally”We will not use timber that has been produced illegally” (Forestry Agency 31.03.2005)(Forestry Agency 31.03.2005)
• Government stresses financial/administrative support to Government stresses financial/administrative support to international organisations and producer countriesinternational organisations and producer countries
• Low engagement Low engagement of of private sectorprivate sector prior prior to PPP reform: to PPP reform:
– Only 12% of 115 firms claimed to make any effort to asseOnly 12% of 115 firms claimed to make any effort to assess the legality of the procured timber (survey by JFWIA)ss the legality of the procured timber (survey by JFWIA)
• Potential of PPP to represent Potential of PPP to represent “hard” policy option“hard” policy option::
– Public sector: Public sector: 3%3% of total wood procurement of total wood procurement （（ estimatestimated)ed)
– May prompt a response from the private sectorMay prompt a response from the private sector
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3. Framework of timber procurement policy3. Framework of timber procurement policy
(2) Accreditation under (2) Accreditation under industry associationsindustry associations
(3) Company’s (3) Company’s own procedureown procedure
For specified items, refers toFor specified items, refers to
For wood products, refers toFor wood products, refers to
SpecifiesSpecifies
Associations’ or companies’ codes of conductAssociations’ or companies’ codes of conductCertification schemesCertification schemes
Based onBased on
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4. Legal and policy context of PPP reform 4. Legal and policy context of PPP reform
• ““Green Purchasing Law”Green Purchasing Law”:: Law Concerning the Promotion of Procurement of Eco-FriendLaw Concerning the Promotion of Procurement of Eco-Friendly Goods and Services by the State and Other Entitiesly Goods and Services by the State and Other Entities of 200 of 2000 (Law No. 100/2000), enacted January 20010 (Law No. 100/2000), enacted January 2001
• Basic PolicyBasic Policy for the Promotion of Procurement of Eco-for the Promotion of Procurement of Eco-Friendly Goods and ServicesFriendly Goods and Services::
– Identifies Identifies specific itemsspecific items for public procurement for public procurement
– RevisedRevised on 1 April 2006 by requiring for on 1 April 2006 by requiring for timbertimber products: products:
◦ LegalityLegality as a as a “criterion for evaluation”“criterion for evaluation”
◦ SustainabilitySustainability as a as a “factor for consideration”“factor for consideration”
– Refers to Refers to GuidelineGuideline formulated by the formulated by the Forestry AgencyForestry Agency
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5. Reform of timber procurement policy 5. Reform of timber procurement policy
• ““Guideline Guideline for Verification on Legality and for Verification on Legality and Sustainability of Wood and Wood Products”:Sustainability of Wood and Wood Products”:
− Prescribes Prescribes modalities to verify legality and sustainabilitymodalities to verify legality and sustainability
− AimsAims to “promote verified products as appropriate items for to “promote verified products as appropriate items for procurement” of the procurement” of the public sectorpublic sector
− Is Is mandatorymandatory for for central-levelcentral-level ministries/agencies, Diet, ministries/agencies, Diet, courts and independent administrative institutions, courts and independent administrative institutions, but also addresses but also addresses local government local government andand administration administration
− Gives the Gives the suppliers suppliers a lot ofa lot of leeway when verifying legalityleeway when verifying legality
− Includes Includes revision revision process based on process based on multi-stakeholder multi-stakeholder consultation consultation (exploratory committee)(exploratory committee)
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6. Definitions and verification modalities6. Definitions and verification modalities
• Legality Legality (Criterion for evaluation)(Criterion for evaluation)::• Timber “should be harvested in legal manner consistent with Timber “should be harvested in legal manner consistent with
procedures in the forest laws of timber producing countries”procedures in the forest laws of timber producing countries”
• Sustainability Sustainability (Factor for consideration)(Factor for consideration)::• ““should be harvested from the forest under sustainable management”should be harvested from the forest under sustainable management”
• 3 different modalities3 different modalities for verification: for verification:
1.1. Forest certificationForest certification / chain of custody / chain of custody
2.2. Procedures established by Procedures established by codes of conductcodes of conduct of of wood industry wood industry associationsassociations
3.3. Self-establishedSelf-established procedures of procedures of individualindividual companiescompanies
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(1) Verification through(1) Verification through forest certificationforest certification
• Wood products certified under a national or international Wood products certified under a national or international forest certification schemeforest certification scheme
• Accepted schemesAccepted schemes include: include:− Local scheme: Local scheme: Sustainable Green Ecosystem CouncilSustainable Green Ecosystem Council (SGEC) (SGEC)
No justification, no prior assessmentNo justification, no prior assessment
• Very Very limitedlimited availability availability of certified timber in Japan/Asia: of certified timber in Japan/Asia:− Less than 1.85 % of total forest area in Less than 1.85 % of total forest area in JapanJapan
(461,000 ha) in 2005 (461,000 ha) in 2005
− Less than 1% of natural production forests in Less than 1% of natural production forests in AsiaAsia
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(2) Verification under (2) Verification under accreditation accreditation by by wood industry wood industry associationsassociations
• Voluntary Voluntary codes of conductcodes of conduct: : − established by established by wood industry associationswood industry associations− regulating regulating accreditationaccreditation of of manufacturers manufacturers andand suppliers suppliers
of verified wood and wood products of verified wood and wood products − mandatorymandatory for for membersmembers (incl. monitoring & penalisation)(incl. monitoring & penalisation)
• Leading role of the Leading role of the Japan Federation of Wood Industry Japan Federation of Wood Industry AssociationsAssociations (JFWIA) (JFWIA) as umbrella organisation: as umbrella organisation:
• Established code of conduct in March 2006Established code of conduct in March 2006• Has served as a template for most other associationsHas served as a template for most other associations• Exception: The Exception: The Japan Lumber Importers’ AssociationJapan Lumber Importers’ Association
(JLIA)(JLIA) formulated their code in November 2005 formulated their code in November 2005
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(3) Verification through (3) Verification through ownown procedure procedure set up by an individual company set up by an individual company
• Applies mainly to Applies mainly to suppliers,suppliers, which: which:• are are not membersnot members of wood industry associations of wood industry associations • prefer prefer handling timber under handling timber under own own code of conductcode of conduct
• Used by Used by chip/pulp chip/pulp importing/processingimporting/processing businesses businesses under the under the Japan Paper AssociationJapan Paper Association (JPA) (JPA)
• In principle it works similarly to modality (2)In principle it works similarly to modality (2)
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7. Policy implementation: 7. Policy implementation: a) a) Domestic timberDomestic timber
Association typeAssociation type Codes of Codes of conductconduct
Total Total membersmembers
Accredited Accredited membersmembers
Ratio of Ratio of accredited accredited membersmembers
National National timber timber industry associationsindustry associations
1919 1,8861,886 1,0301,030 55%55%
e.g.: Japan Lumber e.g.: Japan Lumber Importers’ AssociationImporters’ Association
• Modalities working since October 2006Modalities working since October 2006
Number of involved associations & accredited members (2007/03/16):Number of involved associations & accredited members (2007/03/16):
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b) b) Imported Imported timbertimber
Working groupsWorking groups (researchers) under (researchers) under Exploratory Committee Exploratory Committee for Measures against Illegal Logging for Measures against Illegal Logging investigating optionsinvestigating options
Major exporter countriesMajor exporter countries SchemeScheme
IndonesiaIndonesia BRIK, SKSHHBRIK, SKSHH
MalaysiaMalaysia Export Declaration, Form 2Export Declaration, Form 2
Papua New GuineaPapua New Guinea SGS for nowSGS for now
RussiaRussia Still being developed between JLIStill being developed between JLIA & partners in RussiaA & partners in Russia
ChinaChina (including(including re-export re-export of manufactured products)of manufactured products)
Options presently explored by Options presently explored by WoWorking Grouprking Group
Main schemesMain schemes considered by the government as evidenc considered by the government as evidence of legality: e of legality:
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c) Flow under modalities (2) and (3) for JLIA membersc) Flow under modalities (2) and (3) for JLIA members
LoggingLogging
Processing & Processing & distribution distribution
Delivery Delivery
Public Public ProcurementProcurement
Segregated Segregated Management:Management:
DOCUMENT DOCUMENT FLOW:FLOW:
STAGES:STAGES:DOCUMENT DOCUMENT FLOW:FLOW:
Modality (2)Modality (2) Modality (3)Modality (3)
Logging notification Logging notification or or other evidence (copy)other evidence (copy)
• Modality (1):Modality (1): • GovernmentGovernment has has no intention no intention to assess to assess certification certification
schemesschemes
• Modalities (2) and (3):Modalities (2) and (3):• Organised by the Organised by the private sectorprivate sector in Japan in Japan
• Key role of Key role of industry associationsindustry associations (especially JFWIA) (especially JFWIA)
Initial evidence Initial evidence ofof policy impact: policy impact: • National producersNational producers & & environmental NGOsenvironmental NGOs see new policy see new policy
as a chance to enhance demand for as a chance to enhance demand for domestic timberdomestic timber
• ImportersImporters under under pressure to demonstrate legalitypressure to demonstrate legality of of imported timber, as domestic timber is increasingly imported timber, as domestic timber is increasingly favouredfavoured
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b) Actorsb) Actors Main focusMain focus on the on the private sectorprivate sector::
• Granted wide Granted wide autonomyautonomy to establish their own voluntary co to establish their own voluntary codes of conduct for the verification of legalitydes of conduct for the verification of legality
• Considered Considered trustworthytrustworthy by the Japanese government by the Japanese government Prominent officials used the argument of the “Japanese waProminent officials used the argument of the “Japanese wa
y” based on the assumption of “the goodness of human naty” based on the assumption of “the goodness of human nature” (ure” ( 性善説 性善説 - theory developed by Mencius [- theory developed by Mencius [ 孟子孟子 ])])
Less focusLess focus on the on the public procurerpublic procurer:: Expected to Expected to acceptaccept provided documentation for legality ver provided documentation for legality ver
ification in accordance with one of the modalitiesification in accordance with one of the modalities No independentNo independent government/ 3 government/ 3rdrd party verification required party verification required No major capacity buildingNo major capacity building efforts or advice intended efforts or advice intended However, public procurer is free to pay a However, public procurer is free to pay a price premiumprice premium
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9. What does this mean for China?9. What does this mean for China?• ChinaChina andand JapanJapan areare important timber trade partners important timber trade partners
• However,However, presently presently ChinaChina hashas no completeno complete timber tracing atimber tracing and monitoring managementnd monitoring management systemsystem in placein place
ImpossibleImpossible to identify to identify oror verify verify the origin of timber the origin of timber
Only two ways Only two ways China’s timber industryChina’s timber industry can presently can presently supplysupply ppublic entitiesublic entities inin JapanJapan ： ：
− CertifiedCertified wood products wood products
− Enterprise able to provide Enterprise able to provide legality evidencelegality evidence throughout supply chain throughout supply chain
• NeedNeed for a for a timber monitoring system timber monitoring system inin ChinaChina:: PresentlyPresently, in close consultation with its Chinese partners, , in close consultation with its Chinese partners, thethe JFWIA JFWIA is exploringis exploring options to set up a legality verification options to set up a legality verification system for wood products system for wood products (re)exported from(re)exported from China China and procured and procured byby public entities in Japan public entities in Japan
