Avoiding legality: Timber producers’ strategies and motivations under FLEGT in Ghana and Indonesia

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Highlights

  • Timber producers in Ghana and Indonesia engage in a number of practices to avoid timber legality due to challenges.

  • Instrumental, normative and contextual factors influence timber producers’ compliance with legality verification.

  • The VPA and EUTR implicitly stipulate an instrumental perspective to compliance.

  • An instrumentalist approach to compliance under FLEGT is unlikely to be successful.

  • FLEGT policy makers and implementers must also pay attention to the normative and contextual factors of compliance.

Abstract

Large-scale illegal logging and associated trade in illegally sourced wood products are recognized as pervasive drivers of deforestation and forest degradation in many developing countries. To address the problems, the European Union (EU) adopted the Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan in 2003 with the Voluntary Partnership Agreements (VPAs) and the EU Timber Regulation (EUTR) as key components. Following the introduction of these initiatives, concerns have been raised about the potential of timber producers to avoid the new legality requirements. Based on interviews with timber actors in Ghana and Indonesia, this paper explores the practices of timber producers, identifying various strategies they undertake to circumvent timber legality requirements. It also explores their motivations for doing so. The study found that timber legality verification presents challenges to timber producers in Ghana and Indonesia. They therefore engage in a number of practices to avoid timber legality. These practices entail a range of actions that bypass EU market legality requirements and/or domestic laws. Motivations included instrumental, normative and contextual factors, such as the costs associated with complying with the legality requirements, and the perception that the new regulations are overly burdensome. Moreover, for many operators, there is the feeling that timber legality as it is unfolding in the countries is an imposition that fails to take into account local realities; as such, evading legality becomes a legitimate response. Through their focus on legal formalisation and strengthened enforcement, the VPA and EUTR implicitly stipulate an instrumental perspective to compliance. The paper, therefore, contends that, for the FLEGT Action Plan to achieve its objective of addressing illegal logging and, ultimately, deforestation and forest degradation in developing countries, FLEGT policy makers and implementers must also pay attention to the normative and contextual factors of compliance.

Introduction

The past few decades has seen high levels of forest loss and degradation and, largely, this has been attributed to 'illegal' logging. The European Union (EU), recognizing that it is a significant player on the global timber market since its imports of timber and wood products often come from the countries with widespread illegal forest activities (Hoare, 2015; Ramcilovic-Suominen et al., 2010; Turner et al., 2007), adopted the Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan in 2003 with the aim of combating illegal logging and trade of illegal timber products in global markets to help address (tropical) deforestation and forest degradation (Brack, 2013). A key component of the FLEGT Action Plan is the negotiation of bilateral Voluntary Partnership Agreements (VPAs) between the EU and tropical timber producing countries. Under a VPA, the partner country is expected to develop a Timber Legality Assurance System (TLAS) which specifies the definition of legal timber and incorporates a timber tracking system and a licensing scheme designed to ensure that only legal timber products are exported to the EU from those countries (Jonsson et al., 2015; Hoare, 2015; Brack, 2013; Maryudi, 2016). Thus, under the VPAs only timber licensed as legal (that is, with a FLEGT licence) can be imported into Europe from partner countries (Hoare, 2015). By the end of 2018, VPAs had been concluded with Cameroon, Ghana, Republic of Congo, Central African Republic, Indonesia, Liberia, Honduras, and Vietnam. Côte d’Ivoire, Democratic Republic of Congo, Gabon, Laos, Myanmar, Guyana, and Thailand are still in negotiations (FERN, 2018). Of the countries that have signed the VPAs, only Indonesia has started issuing FLEGT export licenses on 15 November 2016 (EU FLEGT Facility, 2018; Maryudi et al., 2017a). The second significant development of the FLEGT Action Plan is the introduction of the EU Timber Regulation (EUTR) which, from March 2013, prohibits the placing of illegally harvested timber and timber products on the EU market, and requires operators to implement ‘due diligence’ systems in order to minimize the risk of doing so (Brack, 2013).

Following the introduction of the FLEGT VPA and EUTR, concerns have been raised about the potential of timber producers circumventing and/or avoiding the legality requirements of the VPA and the EUTR, particularly in relation to shifting to sale in non-EU markets with less stringent legality verification. For example, a Chatham House study on tackling illegal logging and related trade (Hoare, 2015) revealed that efforts to tackle illegal logging have been eclipsed by new markets for timber and these have diluted the impact of policies introduced by some developed countries. The study found that half of all the trade in illegal wood-based products is now destined for China, the largest consumer as well as a major processing hub while at the same time, domestic demand for timber has been rising in producer countries, providing a market for both legal and illegal timber (Hoare, 2015). The study reported that, in 2013 volumes of illegal wood-based products imported by the US fell by one-third compared with their peak in 2006 and, in the case of the three EU countries (France, the Netherlands, the UK) included in the assessment, volumes halved over the same period. Meanwhile, the quantity of illegal products imported by the emerging economies of China, India and Vietnam increased by over 50 %. The study asserts that, this shift renders the policies of the EU and the US (so-called ‘sensitive’ markets) less influential (Hoare, 2015).

Notwithstanding these concerns, inadequate attention has been given to the strategies employed by timber producers to evade timber legality and especially, their motivations for doing so. The aim of this paper is to redress this knowledge gap, drawing from the VPA countries of Ghana and Indonesia. The investigations were guided by two main research questions: (1) how do timber producers avoid or evade the legality requirements of the VPA and the EUTR, (2) why do some timber producers try to avoid or evade legality? The focus was on the legality requirements of the VPA and EUTR.

The paper is structured as follows. The next section discusses the underlying theories that underpinned the study. The subsequent section focuses on the study areas and methods used for data collection and analysis. Next, the results of the study are presented. The discussion section synthesizes the findings, relates them to the theories of compliance and presents their implications for the VPA and EUTR. The concluding section highlights policy recommendations that can help improve the design and implementation of timber legality verification.

Section snippets

Theoretical considerations

To put this study which examines how and why timber producers avoid or circumvent timber legality in Ghana and Indonesia in a broader perspective, it is useful to review the underlying theories that generally explain why people comply or violate rules and regulations. The compliance literature reveal two main perspectives: the instrumental and normative (Zaelke et al., 2005; Kagan et al., 2011; Winter and May, 2001; Tyler, 1990; Sutinen and Kuperan, 1999). In their work on analytical framework

Study sites and methods

The paper is based on research undertaking in Ghana and Indonesia under the ‘ProdJus’ Project1, which focused on understanding

Strategies and motivations for avoiding or circumventing timber legality

This section presents our empirical findings on strategies adopted by timber producers to avoid timber legality and their motivations for engaging in such practices. The discussion centres around five main strategies, namely shifting exports to non-EU markets with less stringent monitoring, renting timber legality documents in order to export timber, focusing more on the local market, combining timber with other materials in production in order to avoid legality verification, and quitting the

Discussion

This study has revealed a number of strategies adopted by timber producers to avoid timber legality verification and their motivations for engaging in such practices. While some of these strategies are a perpetuation of business as usual, albeit being taken up by an increasing number of operators, others, such as renting legality, are new tools in the toolbox in response to the new FLEGT/TLAS regime. It is essential to distinguish ‘legal avoiding’ and ‘illegal avoiding’ in relation to the

Conclusion

This study reveals that timber legality verification, as it is unfolding in Ghana and Indonesia, presents some challenges to timber producers in meeting the legality requirements. They therefore engage in a number of practices to avoid or circumvent timber legality: shifting timber exports to markets with less stringent legality verification, renting timber legality documents, focusing more on the local market, combining timber with other materials in production in order to avoid legality

Acknowledgements

This paper is an output of the ProdJus (Supranational Forest Governance in an Era of Globalising Wood Production and Justice Politics) Project, a partnership of the University of East Anglia, UK; Kwame Nkrumah University of Science and Technology, Ghana; Universitas Gadjah Mada, Indonesia; and Vietnam Academy of Social Sciences, Vietnam. ProdJus is funded by the Europe and Global Challenges initiative of Riksbankens Jubileumsfond in partnership with The Wellcome Trust and VolkswagenStiftung. We

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