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19TH ROUND TABLE ON SUSTAINABLE DEVELOPMENT OECD. The Economics of Illegal Logging and Associated Trade Paris, 8/9 January 2007. OECD Round Table on Sustainable Development. Ministerial level, multi-stakeholder, informal dialogue forum Achieving a shared understanding - PowerPoint PPT Presentation
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25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
11
19TH ROUND TABLE ON
SUSTAINABLE DEVELOPMENTOECD
The Economics of Illegal Logging and Associated Trade
Paris, 8/9 January 2007
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
22
OECD Round Table on Sustainable Development
Ministerial level, multi-stakeholder, informal dialogue forum– Achieving a shared understanding– Alternative to formal negotiating structures– Catalyst for action on global issues
Objectives for meeting on illegal logging– Analyse progress made to date– Discuss ideas for practical action (‘no regrets’)– Engage ministers and representatives with different backgrounds
and portfolios www.oecd.org/sd-roundtable see ‘meeting
papers’
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
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Analysis
Increased cost of compliance on the supply side– Licensing and certification
No discriminating market on the demand side– Trade displacement
No shared long term objective– Make UNFCCC, BDC and MDG goals operational for forest
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
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Unit Cost of Certification (in $)
Per ha Per M3
IMPACEL, Brazil (plantations) 8.75 0.04
CIKEL, Brazil (Natural Forest) 7.25 2.55
DRT, Indonesia (Natural Forest) 31.72 10.06
KPKKT Malaysia (Natural Forest) 2.76 0.67
PITC, Malaysia (Natural Forest) 25.53 4.60
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
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Number of hectares under different certification standards
Source: Cashore et al, 2006
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
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Area certified under each system as a % of total regional forest cover
Source: Cashore et al, 2006
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
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Analysis
Increased cost of compliance on the supply side– Licensing and certification
No discriminating market on the demand side– Trade displacement
No shared long term objective– Make UNFCCC, BDC and MDG goals operational for forest
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
88
Secondary Products
10 million m3
5 million m3 Intra-EU trade omitted
Arrow width directly proportional to RWE volume;
minimum shown: 1 mi m3Primary Products
Congo Basin as a unit
Scale
To Finland
To Rest of EU
European Union as
a unit
Major ‘high risk’ trade flows
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
99
Analysis
Increased cost of compliance on the supply side– Licensing and certification
No discriminating market on the demand side– Trade displacement
No shared long term objective– Make UNFCCC, BDC and MDG goals operational for
forest
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
1010
FLEGT ‘No regret”? (1)
FLEGT ineffective– Geographical coverage limited, – and not likely to be expanded….– Referring to FLEGT as ‘second best’ is ambiguous
but holds promise– financial assistance – Market pressure by creating awareness – Learning experience for multilateral trade agreement
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
1111
’No regrets’ (2)
Positive incentives climate change regime– High potential, high risk
– How to allocate benefits?
Closing information gaps for sound policy– Impact of illegal logging on the forest
– Interaction with deforestation
– Trade flows
– Cost of certification and effect on market prices
– Cost of certification and competitiveness
– Long term projections for demand and supply of wood products
25-26 January 2007 Chatham House, Illegal Logging Update and Stakeholder Consultation
1212
‘No regrets’ (3)
Improving information flows and cooperation between agencies and companies– engaging custom offices– engaging ministry of finance
Using modern technologies to increase transparency and governance– Satellite images– Web based tools– Log tracking technologies