Illegal Logging in the Congo Basin: an Overview

Forest Legality Alliance – Dec. 16th, 2015

Washington, DC.

Element of background (optional)

• Average production of 8 million m3/year, Central African countries produce about 80% of the total volume of African timber (Megevand 2013)

• Small player when compared to the two other major tropical forest regions: the annual production of the Congo Basin represents less than 5% of global production of tropical round wood (ITTO 2015).

• The Congo Basin logging sector is known for its dualistic configuration composed of:

• a formal sector that is quasi-exclusively export oriented and dominated by large industrial groups with foreign capital;

• an informal sector of artisanal “chainsaw loggers” that primarily meet the domestic demand for forest products and to some extent neighboring countries (see Lescuyer et al. 2012).

• Logging is the most extensive land use in Central Africa: 25% the region’s total lowland tropical forests (de Wasseige et al. 2014).

2

Timber trade trends on the production side

-

500,000,000

1,000,000,000

1,500,000,000

2,000,000,000

2,500,000,000

3,000,000,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Trad

e va

lue

(US$

)

Year

Central African Rep.

Equatorial Guinea

Dem. Rep. of the Congo

Congo

Gabon

Cameroon

36%

31%

17%

7%

6% 3%

Source: EIA based on UN Comtrade data3

Timber trade trends on the demand side

-

200,000,000

400,000,000

600,000,000

800,000,000

1,000,000,000

1,200,000,000

1,400,000,000

1,600,000,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Trad

e va

lue

(in

US$

)

Year

China

EU

Rest of the world

USA

Source: EIA based on UN Comtrade data

47%

33%

17%

3%

In 2014

4

The Congo Basin – China – USA connection

China,

5

Illegalities: from theory to practice

6

An example from Cameroon

7

An example from DRC

• The German EUTR competent authority (BLE): “This case shows that in the case of countries ranked as particularly susceptible to corruption, proof that timber has been legally harvested cannot solely rest upon the presentation of official documents.” (http://www.nepcon.net/newsroom/eutr-lesson-beware-dubious-documentation)

8

An example from Gabon

9

Let’s clear the air: forest sector credibility has increased but…• It has been commonly recognized that:

- A lot of technical expertise has been put into the preparation of the management plans for logging concession;

- Some flagship FSC-certified concessions are frequently taken as example of sustainable forest management;- VPAs have lead to improvement in legality verification and transparency;- Drafts of the new forest legislation integrate key elements regulating large-scale logging concessions,

recognizing community rights, and sharing the benefits of logging.

• BUT- Much less attention has been given to implementation of the plans, and the respect of national regulation;- Certification cannot be taken as faced-value (several controversial certified concessions);- Still an obvious lack of transparency regarding basic sector data (national production, forest concessions and

timber exports);- CSOs not always involved or contributions not taken into accounts in the preparation of the new laws;- The level of law enforcement is still far from satisfactory.

• Despite the fact that key demand countries and Congo Basin governments have introduced measures aimed at tackling the issue, illegal logging remains widespread across the region and illegal timber continue to be placed on markets across the world.

10

Illegality #1: Illegal access to the forest resources• Main illegalities reported by the Mandated Independents Monitors

(MIM) in Cameroon, Democratic Republic of Congo, Republic of Congo, by the External Independent Monitors (EIM) in Gabon, and by the Civil Society Organizations (CSOs) in all the region:

• Logging without a valid title;

• Obtaining an annual logging permit despite an incomplete and/or inadequate application;

• Flaws in the allocation of concession (non-competitive process);

• Recurrent use of “small”, “artisanal” or “provisory” logging title;

• Logging rights allocated in excess of the maximum area defined by law;

• Sub-contracting of logging rights by industrial concessionaires to third parties (a practice known as “fermage”).

11

Illegality #2: Infractions related to the timber exploitation• Main illegalities reported :

• logging of trees below the minimum diameter;

• harvesting in excess of the annual volume allotted to concessionaire (in total or for a specific species);

• logging of protected species;

• improper documentation of timber (manipulation of records);

• duplication of tag log or stump lumber;

• absence of required hammer marks or incorrect marks;

• incorrect listing of volumes on waybills;

• logging outside of concession perimeters;

• logging in national parks.

12

Illegality #3: Tax avoidance

In 2013 Global Witness published a report showing that

the vast majority of forest taxes in the DRC were not paid

in 2012.

Part of the fiscal shortfall can be explained by special tax

arrangements with the logging industry. Documents seen

by Global Witness show that the majority of loggers in

DRC did not pay Surface Tax on the entirety of their

concessions during 2011 and 2012. Instead they paid tax

on a smaller “exploitable” surface area.

13

Illegality #4: Trade & export rules breaking• Persistence of log export from Gabon to China after the 2010 log-ban

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Vo

lum

e (i

n m

3)

Year

14

Source: EIA based on Chinese Customs data

Illegality #5: Corruption

15

Illegality #6: “New” forms of illegalities

• Timber harvested from development projects, the so-called “conversion timber”.

• With large-scale investment in infrastructure, development of agriculture project and mining projects, forest conversion is becoming an increasingly important source of timber in the Congo Basin and could become more significant as a source of illegal timber.

• Illegalities in the allocation of small permits for timber extraction linked with development projects and in the establishment of agricultural plantations have been documented (Achobang et al. 2013)

16

Monitoring is not enforcement, independent verification is not political will• Timber Illegalities covered so far by the MIM:

• #2: mainly

• #1: partially

• #3, 6: superficially

• #4, 5: not really

• Broadening mandate vs. prioritizing actions

• MIM will not replace or even mitigate dysfunctioning legislative, executive and judicial powers.

• MIM is not enforcement and should not be taken as an alibi for structural reform of forest gouvernance

17

Thank you for your attention

18

Bibliography

• AFP, 2015. Top Gabon civil servants probed over hardwood traffic (Nov. 27, 2015):

• Business Insider, 2015. China pledge $60 billion to Africa Development (Dec. 4th, 2015):

• Fon Achobang, C. et al. 2013. SG Sustainable Oils Cameroon PLC (SGSOC) in South West Cameroon Conflict or Consent? The Oil Palm Sector at a Crossroads. Marcus Colchester and Sophie Chao (Editors), FPP, Sawit Watch and TUK INDONESIA.

• Global Witness, 2013. The cut-price sale of DRC’s forests. Tax avoidance, illegal deals: 90% of taxes missing from public coffers. London.

• International Tropical Timber Organisation (ITTO). 2015. Biennial review and assessment of the world timber situation 2013-2014. Yokohama, Japan.

• Lescuyer, G. et al. 2012. An Appraisal of Chainsaw Milling in the Congo Basin. In The Forests of the Congo Basin—State of the Forest 2010.

• Megevand, C. 2013. Deforestation Trends in the Congo Basin: Reconciling Economic Growth and Forest Protection. Washington, DC: World Bank.

• Nepcon, 2013. EUTR lesson: beware of dubious documentation (Dec. 17th, 2013): http://www.nepcon.net/newsroom/eutr-lesson-beware-dubious-documentation

• de Wasseige et al. 2014 C., J. Flynn, D. Louppe, F. Hiol Hiol, Ph. Mayaux. 2014. The Forests of the Congo Basin - State of the Forest 2013. Weyrich. Belgium.

19