Supporting Policy, Legal and Institutional Frameworks for the Reform of Forest Tenure in China s Collective Forests and Promoting Knowledge Exchange

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1 Supporting Policy, Legal and Institutional Frameworks for the Reform of Forest Tenure in China s Collective Forests and Promoting Knowledge Exchange Implemented by FAO and SFA With financial support from EU Time:2009,7-2012,7

2 The fragmentation of forests and forest management The forest land was divided into small pieces and been separately managed by small farmers households. About 0.5 hectare to 2 hectare per household - very small Relevant service on forestry information, technical training and forest protection was apparently insufficient and difficult to be carried out for separated pieces of forest lands. Reducing risk from the market For example, a forest farmer in Liuyang County of Hunan province owns 6 plots of forests with a total area of only 0.75 ha.

3 Objectives Overall objective: Sustainability of forest management increased and rural livelihoods improved through enhanced on-going tenure reform for collective forests in China. Specific objective: Strengthened policies and legal and institutional frameworks for the reform of forest tenure in China s collective forests and shared knowledge and experiences on forest tenure reform within China and with other countries.

4 The Location of the Project Pilot Provinces 贵州 GUIZHOU 江西 JIANGXI 安徽 ANHUI 浙江 ZHEJIANG 福建 FUJIAN 湖南 HUNAN

5 Pilot Villages Fujian Province, two counties and four villages Hunan Province, two counties and four villages Guizhou Province, one county and two villages Anhui Province, one county and two villages Jiangxi Province, one county and two villages Zhejiang Province, one county and two villages

6 Estimated results Improved effectiveness of forest farmer cooperatives Improved effectiveness of trade centres for forest ownership and land use rights Forests managed in more participatory and sustainable way Regular information exchange and networking on forest tenure reform within China and with other countries

7 Activities Implemented 30 Case studies on assessment of existing forest farmer cooperatives 26 case studies assessment of Forest Tenure Trade Centers at the levels of county and township level Consultation meetings and workshops at the levels of village, county and national To give policy options including legislation governance and finance for the development of FFCs and forest tenure trade centers in China The training needs analysis and capacity building strategy for Forest Farmer Cooperatives, and guides on PFM have been developed

8 Free Template from 8

9 Type of Forest Farmer Cooperatives Forestry Associations Forestry Protection Association Bamboo Association Forest Industry Association Afforestation or Silviculture Association Camellia Association Forestry committee Specialized Forestry Cooperatives National Law on Specialized Farmers Cooperatives Shareholder Forest Farm (established early and registry as a specialized cooperative from 06-08)

10 The types of formation Formed by farmers their own Formed by village committee Formed by business driven Formed by government departments supporting Other types: by international organizations supports

11 Comparison among forest farmer specialized cooperatives, shareholder forest farm, and forestry association 林业专业合作社 股份合作林场 专业协会比较.doc

12 FFC-Strength To reduce the cost of management and protection on forest resource Be conducive to the extension of new technologies and new varieties Do better in providing market information Have advantages on infrastructure, development of forest management plan, quality control and improve forest management Linkage of farmers with market to resolve the contradiction between small-scale operation and large market More opportunity to get the support from government and other institutes Adequate local human resources (skilled craftsman, labour) To reduce transaction cost and increase negotiation capabilities

13 Weakness of FFCs FFCs current operation and performance are poor (transparency) Need to improve in system construction, operation mechanism standardization and benefits distribution The level of forestry production and management is low and lack of appropriate guidance Poor capacity building, need to strengthen guidance and training to FFCs (capacity of facing to market, capacity of boards of director and supervisory boards, financial management, etc.) Inactive participation by forest farmers Difficult to raise money if they find market opportunity

14 Opportunities The national preferential agricultural policy supports The attention and support from national and local governments Forestry tenure reform and policy are consistent with the needs of forestry farmers development and forestry production Play a demonstration role in forestry development and operation, setting good examples and making driving effect Forest product certification is a global trend.

15 Opportunities Forest farmer s operation areas are small, this made a chance for FFCs development Unified management, scale operation, higher organization level will make scale economies and promote industrialization To protect farmers right, to endeavour to farmers right of speak and increase farmers income Urbanization Formation of scale enhances competitiveness ability Market open, the international arena, international market competition Favourableness in negotiation

16 Threats to FFCs The policy supports need the cooperation of related departments and implementation is the key. Some difficulty in technical guidance and services, project support and implementation, capital raising, selfimprovement and regulation. Lack of related national and local legal and policy support Inadequate government support, support channel and direction need to be improved Assistance policy can not keep up, forest law enforcement charges confusingly Organization and management need to be improved and standard management to be strengthen.

17 Threats to FFCs Information management need be to enforced, how to share information and any other ways? What is the ideal model? The lack of appropriate market mechanisms, weak market adaptability Open market, increasingly fierce competition, forest farmers growing sense of protection. they must do everything possible to protect forest farmers interests Market economy liberalization, competition facing FFCs is growing, while support and preferential policies can not keep up Survival (self-sustained)

18 Recommendations-Policy Local forestry government department need to give more concentration on FFCs and give more supports from relevant policies; The needs for supporting policies were mainly focusing on the reducing of forestry tax and fees, preferential policies in forest tenure mortgage loan and the fully implementation of current policies; Made special policies for the supporting of FFCs development, including supporting policies on technologies, information and capacity building; Listen to the opinions and suggestions of forestry farmers and make adjustment to current policies to improve the effectiveness of policy execution;

19 Recommendations-Policy Listen to the opinions and suggestions of forestry farmers and make adjustment to current policies to improve the effectiveness of policy execution; Improve the dissemination of forestry policies to increase farmers and FFCs understanding of relevant policies; Supply capacity building for farmers and FFCs to improve their capacity in the participation policy making.

20 Legislation Specific regulations and management rules should be issued specifically for FFCs FFCs authority, electoral system, benefits and management should be mentioned in the provisions FFCs operational guidelines should be prepared to strengthen the management of FFCs and their standardization and regularization. Local government should make detail regulations for the management of FFCs; Improve the dissemination of relevant laws and supply training and education for forestry farmers and FFCs to increase their legal consciousness of self protecting and reduce the happening of illegal affairs; Improve the executing capacity of relevant institution and staff in the implementation of laws.

21 Governance and institutions Farmer-owned: It should not be regarded as a tool of policy implementation, or an administrative task imposed. Managed by members: Decision was often made by a few people. Profit distribution: Members benefited. Supervised by members.

22 Governance and institutions Local forestry departments strengthen the management and guidance for FFC development with special institutions and staff; To facilitate the transparency of FFCs management and promote members participation in decision making; Provide information guidance platform for the development of FFCs. Organize capacity building for both FFCs committee members and forestry farmers on FFCs management and bring up good leaders to facilitate sustainable development;

23 Governance and institutions Support the FFCs exploration and practices and cultivate typical models. Some awards may be established to encourage the development of FFCs and finance their next stage of development by bonus. Increase publicity of outstanding FFCs. Try to establish collective and beneficial FFCs will also present practical reference to major problems. Strengthen the information network construction, set a platform for sales information and technical information for members.

24 Strength-Forest tenure trade centers Formal trade platform protects the legal interests of trade parties; Transparent trade process and trade procedures make the trade open, fair and impartial relatively; Full-bid trade methods between trade parties improve trade price and further improve the income of forest farmers; Supply a one-stop forest tenure trade services to the traders; The advanced technology platform helps traders obtain related trade information

25 Weakness of Forest tenure trade centers Relatively complex trade procedures Trade cost expenses (charges in the trade) Many forest farmers still don t understand the trade centre Need more trained professional staff such as the lack of professional auctioneer, assets appraiser; The trade centers at county level are far away from forest so that the forest farmers take part in trade in the centre inconveniently; Trade mostly limited to the local counties (cities), not open to other cities and counties, which restricts the competition.

26 Recommendations- Financial Policy To alleviate forestry charges and tax, and regard forestry as the equal status as agriculture in terms of providing production subsidies and favorable measures To subsidize or deduce interest to forestry tenure certificates mortgage loans, and take at least 10 years long term of loan to support forest cultivation. To intensify the capital attribute of forestry tenure rights through financial monetary instruments e.g. mortgage loan, asset restriction, insurance and ect To expand national policy forestry insurance by providing more subsidies and financial input for forests resources.

27 Recommendations-Policy for transaction To encourage farmers to conduct transaction on the forest tenure property rights by taking multiple forms such as joint-venture and share holding, and joining in forestry cooperatives To entitle forestland use rights and forests ownership of public-benefit forests eligible in forestry trade in the precondition of no change of forests nature and use; to encourage the utilization of scenery or tourism value of public-benefit forests, and attract social capital to invest in ecological forests.

28 Recommendations-Legislation Formulate a law or regulations for forest tenure transferring/trade at national level National provisions special for FTTCs transaction The scope of forestry tenure rights eligible to trade and the objects of forestry rights compulsory to be traded in FTTCs General legal principles and procedures of forestry tenure rights trade Legal status of FTTCs and managerial provisions of FTTCs. Specific rules and procedures of each trade form in FTTCs, e.g. auction, bidding, negotiation ect. Certificate to professionals in trade and transaction service for forestry tenure rights Services quality and fee charge National provisions special for forests asset appraisal

29 Governance and institutions Separate personnel employment, financial revenues and expenditures, organization structuring and other aspects from local Forestry Bureau To improve disclosure system of trade information to ensure the two-way and transparent process To improve the operation of centralized auction trade To Simplify the trade process and improve trade efficiency in the centres To reduce charging items and standard of charging fees

30 Others including trade system The scope for trade in FTTCs needs to be expanded The equity social principle for FTTCs has to be introduced A free trade environment needs to be defended More effective means of information collection and dissemination need to be taken Forestry tenure trade system has to build up a linkage with general asset trade systems

31 Thanks!