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New trade measures present challenges for timber markets in the UNECE region

UNECE/FAO and WTO Workshop, 23 March 2010, Geneva
24 March 2010

New trade measures present challenges for timber markets in the UNECE region - Image?Regulations affecting the trade of timber products are evolving quickly, and this evolution should be closely monitored because of the impacts on the entire forest sector.? So concluded the workshop on ?Emerging Trade Measures in Timber Markets?, organised by the United Nations Economic Commission for Europe (UNECE) and the Food and Agriculture Organization of the United Nations (FAO) jointly with the Economic Research and Statistics Division of the World Trade Organization (WTO), on 23 March 2010 in Geneva.

IES Pathfinder Project Coordinator G?raud de Ville attended the workshop with more than 100 stakeholders from government, industry, trade associations, intergovernmental and non-governmental organisations and academia. There is currently considerable concern and debate about the entire range of trade and trade-related measures impacting on the timber markets.

World trade of wood and paper products, including value-added products, has doubled over the last 10 years. This has occurred notwithstanding various policies and measures affecting the timber trade. China is the motor of the global timber trade, having become the major importer of roundwood and the major exporter of value-added wood products such as wooden furniture. China?s wood products exports expanded 5-fold from 2000 to 2008.

Among other measures, participants discussed the emergence of non-tariff measures aimed at curbing illegal logging and the trade of illegally produced forest products and other trade measures, favouring the use of timber harvested from sustainably managed forests, e.g. certification systems and public procurement policies. Such measures are desirable as the issue of illegal logging and trade of illegal timber products remains critical for the global forest sector.

The approaches to this question vary from one country to the other and the regulatory framework is still evolving. For example, under the European action plan for forest law enforcement governance and trade, Voluntary Partnership Agreements are in the process of being negotiated with partner countries. Internally, discussions on the draft due diligence European Union regulation continue between the EU institutions.

However, some participants cautioned against the possible negative impacts on trade and undesired collateral effects on some forest resources, notably in some developing countries. They discussed the respective roles of measures designed to fight against illegal logging and certification schemes. Stakeholders agreed that these measures must be recognised and coordinated internationally to promote fair competition and efficiencies in forest products production and trade.

Subsidies, notably those that encourage renewable energy consumption based on woody biomass, are an important issue having either positive or negative impacts on different stakeholders within the forest sector. There are many different ways to subsidise an industry, e.g. upstream subsidies, support to intermediate consumption or support to final consumption. There are also difficulties linked with the measurement of subsidies and the subsequent analysis of their market effects taking into account externalities and possible market failures.

Finally, participants noted that the economic and trade impact of measures like subsidies, export taxes or non-tariff measures merits more attention and research in the future.

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