Private Sector Views on TLAS MYANMAR

Transcription

1 Private Sector Views on TLAS MYANMAR 4 th Sub-Regional Training Workshop on Timber Legality Assurance System October 2014, Vientiane, Lao PDR Dr. Myo Lwin Central Executive Committee Member Myanmar Timber Merchants Association 10/28/2014 1

2 Who are Private Sector MTMA members ( Mostly Export target ) Non-MTMA members ( Mostly Domestic target ) - Home Industry Level Furniture Manufacturers - Local Sawmills (under License from FD) - Home Industry/Cooperatives Sculpture Work ( for Tourism, household utensils ) In this presentation, Private Sector means covering both MTMA members and Non-MTMA members, unless otherwise referring individually. 10/28/2014 2

3 WHO ARE MEMBERS OF MTMA 1. Sawmills and Manufacturing Indusries 2. Traders/Agents 3. Plantation 4. Logistics 5. Extraction Sub-Contractors 6. Affiliated/Related Associations Bamboo and Rattan Entrepreneur Association, Saw millers Association (Upper Myanmar) and Furniture Association 10/28/2014 3

4 The source of raw material for Private Industry Forest belongs to the Nation and Forest Department (FD) administer the forest. With the approval of FD, Myanma Timber Enterprise (MTE) extract LOGs. ( Both State Institutions has to comply with: - AAC under Myanmar Selection System(MSS) - Reduced Impact Logging/Extraction Manuals, etc ) Private Industry is liable to buy raw material ( logs or in any form) only from MTE, no other ( unknown source ) at all. Manufacturers deliver raw materials to respective industry for further processing with MTE Delivery Order through approval from FD. (Delivery Order of MTE is of Prime documentation which mentions clearly species, quality, quantity, area of origin,invoice already paid) 10/28/2014 4

5 MTE (Delivery Order) 10/28/2014 5

6 Procedure and Regulation for Export Trade Private Industries have to saw logs, pertaining to FD permission and constantly under its surveillance After production, FD inspects timber products under consignment basis, and then issue the Certificate for Legality of Forest Products for ongoing export process. (They apply the quantitative control which is known as Outturn Percentage locally) Together with certificate from FD, The Ministry of Commerce issues Export License THEN procced to export from Port ( by Normal Trade procedures along rules/regulations of other relevant Ministries ) 10/28/2014 6

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8 Quantitative Control- Outturn Percentage Outturn Percentage allowable Teak Logs (Quality-wise) 6 & above(%) Under 6 (%) Sr Quality No 1 SG 1 Width Thickness Above 6 & Above 2 & 6 under 2 under Sub- Total 60 Width Thickness Above 4 & Above 2 & 4 under 2 under Sub- Total Total SG SG SG SG SG SG /28/2014 Remark ; SG is sawing Grade 8

9 Forest Department Inspection Wood Products for the Export 10/28/2014 9

10 Certified Letter of Forest Department for Forest Products Export 10/28/

11 Custom, Forest and MTE Officers Inspecting the Forest Products at Check Point 10/28/

12 Requirements for a manufacturer to do export Area Procedure/Document Controlling Authority Remark Incorporation 7 documents Various Raw Material Procurement 8 procedures and documents Myanma Timber Enterprise Production 5 procedures Forest Department Export 1 Export Licence Trade Department 1 procedure The State Bank Evidence of Payment 1 procedure Custom Department To check compliance of quality, quantity, HS Code, bills etc.. 10/28/

13 Who should bear responsible Since Production Forest is managed by FD and Extraction done by MTE, Logs purchased from Myanma Timber Enterprise(Only one State Owned Enterprise), manufacturing under the control of FD, Exporting under Trade, Custom regulation, What else manufacturers can do to ensure LEGALITY! The Authority of Myanmar is fully responsible as long as Manufacturers do not use any raw materials from unknown source ( Illegal source) That means: The Authority is obliged to do all necessities to ensure the legal compliance and the industry must commit to use raw materials only from legal source. 10/28/

14 Awareness Level of most manufacturers Most of Myanmar Manufacturers are in the opinion that we are performing all sorts legally since we buy the raw material from the state-owned MTE(Myanma Timber Enterprise), producing the timber products under the regulations of Forest Department, paying tax subjected and then exporting conforming to the regulations of Commerce and Custom. We are not much aware of the definition of legality acceptable internationally linking to social and environmental affairs in addition to the forest conservation. We feel that s unfair if our products are denied access to market by assuming lack of proof to be Legal Timber. However, Myanmar Timber Merchants Association tries to disseminate international perspectives to its members. 10/28/

15 Issues The existing Forest Policy/Law/Regulation is addressed more to Conservation and Preservation of Forest since it has been enacted long before the current market driven Certification/Legality Issues were not high lighted. As a developing country where there is not yet clear land use policy and where there are still unsettled political and ethical conflicts, relying on natural resource use as life essentials, Myanmar has to do a lot in tackling the Illegal Timber Trade. 10/28/

16 Level Playing Field While there are remarkable volumes of illegal trade between Myanmar and Neighboring Countries such as China and Thailand, and while there is no actions and measures from consumer countries/ingos to stop this illegal cross border trade., Is it reasonably fair to put pressure on Myanmar Manufacturers on legal trade? 10/28/

17 The Way Forward Association alone cannot handle the matter of legality The Government have to enhance their political commitment The International Community should assist whatever to Myanmar Manufacturers and The Government as well Only such condemning will not solve the issue. 10/28/

18 Interim Solution to support Private Industry in export to EU under Due Diligence Myanmar Timber Merchants Association (MTMA) is providing one set of export documentation to meet the Access to Information under Due Diligence 10/28/

19 Unwanted Result Myanmar Timber Industries had experienced various levels of obstacles As a result, it is still in her infancy stage Afraid to be victims if the market requirement cannot be fulfilled in case of slow progress in VPA Negotiation between Myanmar and Consumer countries (like EU) 10/28/

20 General view on certification and legality For reasons of cost effectiveness, private sector has a clear preference to only one certified scheme; The comparability and acceptability of different certification systems remain key issues, particularly for tropical timber products; Strongly believe that Myanmar should have own feasible TLAS System, which should be cornerstone for negotiation and alignment with any certification and licensing system ( for instance EUTR-VPA) 10/28/

21 Conceptual approach to TLAS 1. To identify the area of - (1) Compliance (2) Partial Compliance (3) Non-Compliance These Compliance should be regarded acceptable. 2. Then to carry out measures First from Non-Compliance to Partial Compliance Second from Partial Compliance to Compliance 10/28/

22 Origin, Compliance and Actors Origin Status Controlled by: Actors Target Market Conflict Area, such as Kachin State bordering with Yunan Province Ceasefire-established Area, such as Kayin State bordering with Thailand Illegal at all Minority- armed Group Local people, Authority of Minority Group and Traders from Yunan, China Authorised logging, but very low level to Legal Compliance Jointly by Forest Dept.: and Minority-armed Group Local people, Authority of Minority Group Yunan Mostly to industry through Myanma Timber Enterprise(MTE) and some may enter to Thailand illegally Forest controlled by Forest Department Legal Logging with the compliance with the MSS (Lacking verification procedure) The State Forest Department Myanma Timber Enterprise(MTE) and her Sub-contractors for extraction To manufacturers for export Forest controlled by Forest Department Illegal Logging The State Forest Department Local Traders and corrupted government personnel To local sawmills for domestic requirement 10/28/

23 Who are responsible for what? Players Activities Forest Department (FD) Myanmar Timber Enterprise (MTE) Private Other Institution (Commerce, Finance, Custom and Port,.. etc.) Pre-harvesting Procedure Harvesting Procedure Transportation and Milling Export 10/28/

24 The underlying causes of illegal operations Lack of recognition in the multiple forest values and poor valuation of ecosystem services weakness in policy and legal provision to cope with changes in illegal logging pattern Inefficient mechanism to combat illegal loggers well equipped with advanced facilities inadequate cooperation among the enforcement agencies; broad-ranging magnitudes in punishment insufficient data and information about the forest resources and illegal operations Dilemma in accountability inclining to corruption weak internal coordination of relevant government agencies as well as internal cooperation security constraints and inaccessibility (eg. Border areas and armed conflict areas) lack of decent markets despite the increasing global demand on timber and forest products as a result of long before trade embargo and economic sanctions neighboring with resource hungers Low valuation on Corporate Social Responsibility Unstable decent job opportunity for local community 10/28/

25 Queries & Thoughts; Brain storming Extents of market acceptable, accessible Extents of capacity building and funding support Any new scheme/system/law in parallel potential, launching from other developed countries ( Japan, China,. other than FSC, PEFC, FLEGT, Lacey Act, ) Gradually notable paradigm shift; from tropical timber to temperate timber consumption & non-wood substitutes etc. Demand side perspectives & measures Vs. Supply side perspectives & measures We are facing more gradually the environmental campaigns, a task to differentiate that is political or environmental agenda.? At worst, if Nation coming to zero logging ban, how would be the scheme going on? 10/28/

26 Prepared and Presented for MTMA by Dr. Myo Lwin Central Executive Committee Member Myanmar Timber Merchants Association myolwin21@gmail.com Tel : /28/