City, Country Date, 2013

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1 City, Country Date, 2013

2 Overview Today s Plan Introduc)on and Opening Remarks Timber Trade Flows from Producers and Processing Countries to Major Markets Interna)onal Policies and Conven)ons Impac)ng the Timber Trade Australia Illegal Logging Prohibi)on Act The Lacey Act The European Union Timber Regula)on Lunch Due Care / Due Diligence in Establishing Legality Q & A Introduc)on to the Global Forest Trade Network Supply Chain Management Further Informa)on

3 TRAFFIC This course was prepared by TRAFFIC, the wildlife trade monitoring network TRAFFIC works to ensure that trade in wild plants and animals is not a threat to the conservation of nature.

4 TRAFFIC To encourage changes in behaviour (policy and practice) of specific target groups who are in a position to reduce that threat and, ensure that wildlife trade contributes to meeting human needs. To Encourage Change Policy Practice Solutions linked to trade in wild animals and plants

5 TRAFFIC TRAFFIC International TRAFFIC Europe TRAFFIC South Asia TRAFFIC North America TRAFFIC East Asia TRAFFIC South America TRAFFIC Central Africa TRAFFIC Southeast Asia TRAFFIC East and Southern Africa TRAFFIC Global marine program

6 Timber Trade Flows from Producers and Processing Countries to Major Markets - Viet Nam

7 Viet Nam s Role in the International Timber Trade Viet Nam is a major exporter and importer of timber and timber products Sources wood from some countries with big legality issues Imported wood is a risk

8 International Trade in Forest Products The demand for legal timber has increased in recent years due to concerns from importing countries over environmental sustainability. International efforts to achieve environmental sustainability are implemented through Policies and Conventions such as: The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) The European Union s Forest Law Enforcement, Governance and Trade (FLEGT) The European Union Timber Regulation (EUTR) and Voluntary Partnership Agreements (VPA) The USA s Lacey Act Amendment Australian Illegal Logging Prohibition Act (AILPA)

9 Viet Nam s Forests Around 16.2 million hectares of forestland (12.6 million covered by forest) Three main categories of forest: 6.28 Million hectares Production forest 22% Special use forest Protection forest Production forest Natural forest 78%

10 Viet Nam Wood Processing Sector Currently imports 80% of the industry s raw materials. Likely to remain highly dependent on imported materials from a large number of sources. China, the United States and the Mekong Countries are major sources value of timber and timber products imported into Viet Nam was around US$ 1.1 billion (32% of export revenue).

11 Viet Nam Forest Product Imports Main Import - Round wood, sawn timber, pulp and waste paper By Value By Volume Vietnam imports by Value (US$ million), 2008 Vietnam Forest Product Imports By Volume (million m3 RWE), 2008 Source: European Forestry Institute data, as compiled by James Hewitt (2008)

12 Viet Nam s Forest Product Imports by Volume Malaysia Thailand Estimated RWE volume (million m 3 ) China USA New Zealand Lao PDR Cambodia Brazil Myanmar EU- 27 Indonesia Others (million m 3 ) Source: Hewitt, 2008

13 Viet Nam and Illegal Timber Imports Estimated imports of illegally sourced wood products into Viet Nam ( ) Source: Sam Lawson and Larry MacFaul, July 2010

14 Vietnam s Timber Exports Timber export revenue reached around US$3.4 billion in 2010 (15 times higher than 2000 s) Average annual timber export revenue increased by around 40% between Over 80% of Viet Nam s wood product exports go to just three locations* Japan European Union USA *Mostly consisting of bedroom, dining room and kitchen furniture products

15 Viet Nam s Forest Product Exports By Value: (US$ billion), 2008 Main importing countries: (2007) Country US$ Millions USA 1,247 European Union 764 Japan 428 China 237 South Korea 91 Australia 84 Taiwan 83 Others 134 By Volume: USA China Main importing countries Jan Nov 2009 & 2010 (US% million) UK France Australia Germany Netherlands (million m 3 RWE), Source: European Forestry Institute data, as compiled by James Hewitt (2008)

16 Viet Nam Forest Product Exports by Value European Union US$ Million Estimated Viet Nam Timber Product Exports to EU by Product (US$ Million) Furniture 200 Mouldings and Joinery 100 Paper Other wood Source : Baseline study 3, Vietnam : Overview of Forest Governance and Trade (April 2011)

17 Viet Nam Forest Product Exports by Value USA US$ Million Estimated Viet Nam Timber Product Exports to US by Product (US$ Million) Furniture Mouldings and Joinery Paper Plywood Other wood Source : Baseline study 3, Vietnam : Overview of Forest Governance and Trade (April 2011)

18 Viet Nam Forest Product Exports by Value Australia US$ Million Estimated Viet Nam Timber Product Exports to Australia by Product (U S$ Million) Furniture Paper Other wood Source : Baseline study 3, Vietnam : Overview of Forest Governance and Trade (April 2011)

19 Viet Nam and Illegal Timber Exports Estimated percentage of illegal timber exports from producer countries Report Estimates: % of Illegal Logging 1. Indonesia: 70 80% 2. Malaysia: up to 35% 3. Gabon: 50 70% 4. Cameroon: 50% 5. Liberia: 80% 6. Brazil: up to 90% 7. Papua New Guinea: 70% 8. Myanmar: 50% 9. Cambodia: 90% 10. Laos: 45% 11. Thailand: 40% 12. Viet Nam: 20 40% 13. Latvia: 20% 14. Estonia: 50%

20 How Viet Nam Tackles Illegal Logging Certified or verified legal wood products, from either domestic or imported sources make up a small component of the industry. Forest Sector Development Strategy: Target 30% of the forest area under certification by 2020 (to date around 15,000 hectares of plantation forest and no natural forest are certified). Fewer than 8% of the 3,000 companies in Vietnam have obtained Forest Stewardship Council (FSC) Chain of Custody ( COC) certification Viet Nam s wood processing industry has been slow to respond to market requirements for proof of legal sourcing

21 Voluntary Partnership Agreement - Viet Nam 2010 Viet Nam starts on the path towards FLEGT licensing through VPA with the EU. Viet Nam FLEGT VPA Timeline Phase 1: Information and pre-negotiations Phase 2: Formal negotiations Phase 3: System development Phase 4: FLEGT licensing