itto · timber. meanwhile, china is the world's most important wood-based forest product...

INTERNATIONAL TROPICAL TIMBER ORGANIZATION

ITTO

PROJECT PROPOSAL

TITLE: RESEARCH ON CHINA’S GREEN PUBLIC PROCUREMENT POLICY TO PROMOTE MARKET DEVELOPMENT OF ENVIRONMENT FRIENDLY TROPICAL FOREST PRODUCTS

SERIAL NUMBER: PD 461/07 Rev.2 (M)

COMMITTEE: ECONOMIC INFORMATION AND MARKET INTELLIGENCE

SUBMITTED BY: GOVERNMENT OF P.R. CHINA

ORIGINAL LANGUAGE: ENGLISH

SUMMARY: The issues of illegal forest logging and related trade, especially the illegal logging and trade of tropical forests, have aroused the attention and concern of all the countries across the world, including China. Targeted on tropical forest products, the proposed project aims at the elaboration of policy proposals on the procurement of ecologically sound produced and traded tropical forest products. This will be reached mainly by the investigation and study on the current status of tropical forest products production, consumption and trade in China as well as through collection and analysis of policies, practices and experiences from “green public procurement” from main countries in the world. Moreover, the proposed project intends to establish an international website of Green Tropical Forest Products Procurement Information and publish a newsletter of China Green Tropical Forest Products Procurement. The main objective of the proposal is to contribute to the sustainable use, sound trade and responsible consumption of the resources for timber forest products in P.R. China. This is envisaged by the development of national guidelines for the green public procurement of tropical forest products, the establishment of a platform to extend related information, the enhancement of stakeholders’ awareness of green public procurement, the promotion of China’s use of tropical and non-tropical timber from sustainable sources and the improvement of the forest law enforcement and execution in China. Meanwhile, the proposed project also intends to provide experience and reference for researches on the green public procurement policies for non-tropical timbers which is to be supported by other channels besides ITTO.

IMPLEMENTING AGENCY:

RESEARCH INSTITUTE OF FORESTRY POLICY AND INFORMATION (RIFPI), CHINESE ACADEMY OF FORESTRY (CAF)

DURATION: 24 MONTHS

BUDGET AND PROPOSED SOURCES OF FINANCING:

SOURCE CONTRIBUTION IN US$

ITTO: 296,590

Implementing Agency: 108,943

TOTAL: 405,533

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TABLE OF CONTENTS

PART I. CONTEXT ······························································································· - 1 -

1. ORIGIN ······················································································································ - 1 -

2. SECTORAL POLICIES ································································································· - 2 -

2.1 International Policies ·······························································································- 2 -

2.2 Chinese Policy ······································································································- 2 -

2.3 Multilateral Policy ···································································································- 3 -

3. PROGRAMS AND OPERATIONAL ACTIVITIES ································································· - 4 -

PART II. THE PROJECT ························································································· - 5 -

1. PROJECT OBJECTIVES ······························································································· - 5 -

1.1 Development Objective ···························································································- 5 -

1.2 Specific Objectives ·································································································- 5 -

2. JUSTIFICATION ·········································································································· - 5 -

2.1 Problems to Be Addressed ·······················································································- 5 -

2.2 Intended Situation after Project Completion ·································································- 8 -

2.3 Project Strategy ··································································································· - 11 -

2.4 Target Beneficiaries ······························································································ - 11 -

2.5 Technical and Scientific Aspects ·············································································· - 11 -

2.6 Economic Aspects ································································································ - 12 -

2.7 Environmental Aspects ·························································································· - 12 -

2.8 Social Aspects ····································································································· - 13 -

2.9 Risks ················································································································· - 13 -

3. OUTPUT ·················································································································· - 14 -

3.1 Specific Objective 1 ······························································································ - 14 -

3.2 Specific Objective 2 ······························································································ - 14 -

4. ACTIVITIES ·············································································································· - 14 -

4.1 Output 1.1 ·········································································································· - 14 -

4.2 Output 1.2 ·········································································································· - 14 -

4.3 Output 1.3 ·········································································································· - 15 -

4.4 Output 1.4 ·········································································································· - 15 -

4.5 Output 2.1 ·········································································································· - 15 -

5. LOGICAL FRAMEWORK ···························································································· - 16 -

6. WORK PLAN ············································································································ - 19 -

7. BUDGET ·················································································································· - 22 -

PART III. OPERATIONAL ARRANGEMENT ································································· - 34 -

1. MANAGEMENT STRUCTURE ······················································································ - 34 -

2. MONITORING, REPORTING AND EVALUATION ······························································ - 34 -

3. FUTURE OPERATION AND MAINTENANCE ·································································· - 34 -

PART IV. TROPICAL TIMBER FRAMEWORKS ····························································· - 35 -

1. COMPLIANCE WITH ITTA 1994 OBJECTIVES ································································ - 35 -

2. COMPLIANCE WITH ITTO YOKOHAMA ACTION PLAN 2002-2006 ····································· - 35 -

ANNEX 1. PROFILE OF THE EXECUTIVE AGENCY ························································ - 37 -

ANNEX 2. CURRICULA VITAE OF KEY STAFF ······························································ - 38 -

ANNEX 3. TERMS OF REFERENCE FOR DOMESTIC AND INTERNATIONAL CONSULTANTS ···· - 39 -

ANNEX 4. THE 34TH

EXPERT PANEL RECOMMENDED ··················································· - 41 -

ANNEX 5. THE 35TH

EXPERT PANEL RECOMMENDED ··················································· - 43 -

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PART I. CONTEXT 1. ORIGIN “Forestry Development Planning” prepared by State Forestry Administration of China makes a prediction that in 2015 the total timber demand in China will reach 438-443 million m

3 (including about 100 million m

3

fuel-woods), and in terms of the situation of forest resources and the timber supply capacity in China, there will be a large shortfall in high-quality large-diameter timber, in particular high-quality large-diameter hardwood timber, of which timber markets are in need. Consequently, in order to make up for the structural timber supply shortage in a long time in the future, it is a must for China to maintain a certain amount of timber import. China is the world's largest importer of tropical timber. In 2006, China imported 7.739 million m

3 tropical

timber, accounting for 24.1% of the total log import in China and 50% of the total world export of tropical timber. Meanwhile, China is the world's most important wood-based forest product processing base as well, and the production and export of such forest products as panel (especially plywood and fiberboard), furniture, paper and paper board, and wood flooring have leapt to the top of the world rankings. In 2006, China's export of forest products has mounted to 27.68 billion US dollars. Some large-diameter tropical hardwood timber that China imports is to meet the requirement of growing domestic market, and a relatively big share of the import timber is processed as raw materials to manufacture finished products for export. In recent years, the opening-up of the Chinese market and the growing import of various forest products have attracted the attention of the international community (including ITTO, FAO, EU, CIFOR) and a many of forest-product producing and export countries. The said international organizations and major timber producing countries have sent their representatives to make a visit to and hold discussions with China Forest Product Market Research Center for the purpose of understanding the situation of Chinese timber market. Due to the important role of tropical timber and tropical rain forest in the world ecological environment and their unique ecological values, an increasing number of international institutions, governmental and non-governmental organizations set out to cast concern on sustainable tropical forest management, utilization and development. In China, the implementation of green procurement policy is particularly important either in upstream resources purchases or downstream finished product sales because of the enormous magnitude of forest products purchased by the government and large sum of money involved. If the green public procurement policy for tropical forest products is carried out in the procurement, the purchase of “legal and sustainable forest products” will effectively promote the harvesting and trade of legal timber, ensure the sustainable supply of timber and further the sustainable management of tropical forests. Under the support of ITTO and the Chinese government, the implementing agency has implemented such projects as PD 25/96 Rev.2 (M), PD 55/99 Rev. 1 (M) and PD 171/02 Rev.4 (M), which involved the issues of China’s tropical forest resources, forest products supply and demand and tropical forest products statistics, and the market flow and trend in China's tropical forest products. The achieved results of these projects have created a good condition for launching and unfolding the proposed project. To launch and conduct the study is, at first, of great significance and value to meet China's future market demand for tropical forest products, improve circulation situation of timber market, and guide forest products processing enterprises in China toward a standardized, orderly, balanced, sustainable and environment friendly development. Secondly, it is conducive to elevating the understanding of companies and enterprises engaged in tropical forest product trade and of the majority of consumers in China in the matter of globally concerned forest product certification as well as the combat against illegal logging and related trade, so that they will consciously carry on business activities pursuant to relevant laws and regulations at home and abroad. Thirdly, it will facilitate the sustainable use, sound trade and responsible consumption of the resources for timber forest products in China by using tropical and non-tropical timber from sustainable sources and improving the forest law enforcement and execution in China. Fourthly, the proposed project can provide experience and reference for researches on the green public procurement policies for non-tropical timbers supported by other channels besides ITTO.

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2. SECTORAL POLICIES 2.1 International Policies

On May, 1998, G8 Foreign Ministers agreed to launch and support “G8 Forest Action Plan”. There are 5 important issues in the action plan, one of which is illegal logging.

The year of 2001 witnessed the launch of East Asia Forest Law Enforcement and Governance Process, which identified the following objectives:

- To commit to enhancing the bilateral collaboration in terms of illegal logging related to illegal trade;

- To explore the approaches to eradicate the import and export channels of illegally obtained timber;

- To help to raise the awareness of forest offences and threats;

- To increase transparency, eliminate potential corruption, ensure impartiality to greater extent and minimize the improper influence of privilege groups.

On March, 2005, G8 Environment and Development Ministerial Conference acknowledged that to solve the problem of illegal logging requires timber producing countries and consuming countries to take actions together.

The EU Forest Law Enforcement, Governance and Trade recognizes that it shall link the requirement of good governance by developing countries to legislative instruments and levers provided by the EU market. Supporting timber producing countries to improve their governance and establishing permit system are the determining elements to ensure the mere legal timber to enter the EU market.

On November 25, 2005, Northeast Asian and European Forest Law Enforcement Ministerial Conference passed the St. Petersburg Declaration. The declaration delivers the commitment made by the 44 central governments in Europe and Northeast Asia as well as other participating countries to combat illegal logging and crimes related to forest.

On September, 2005, Asian Forest Law Enforcement and Governance Process conducted the Ministerial Conference in the Philippians to study the focus of work and action plan as well as to discuss illegal timber logging and related trade which is an international hot issue.

To better blow the illegal timber logging and related trade, protect global forest resources and ensure the sustainable supply of timber, “green public procurement policy for forest products” has been developed by some developed countries such as Japan, UK, Denmark and Germany, with the purpose to promote sustainable development and utilization of timber by purchasing “legitimate” forest products “from good managed sources”

2.2 Chinese Policy (1) Forest products trade policy and environmental protection policy The sustained demand for timber as the result of rapid economic development propelled the Chinese government to prepare and implement the ambitious fast-growing and high-yielding planted forest cultivation project. The project is aimed to strike against illegal logging and related trade at the prerequisite of maintaining necessary timber import, meanwhile effectively improving the self-sufficient capability of timber. With a view to settling the increasing demand for forest products in China, State Forestry Administration presented the following policies and measures in Tenth Five-year Forestry Plan (2001-2005) and Long-term Planning towards 2010:

To give extensive publicity and popularization to the necessary knowledge concerning sustainable forest management, forest product certification system and combats against illegal logging and illegal timber trade, so as to raise pubic awareness of ecological and environmental conservation and repel illegal timber trade and the influx of illegal timber into markets;

To promote forestry internationalization process. To achieve it requires: First, it shall expand opening-up to the outside world, and make full use of the two markets and the two resources by actively participating in international economic cooperation to the end that a multi-level opening-up pattern will be constituted to expand the development space of forestry; Secondly, it shall sign multilateral agreements or multi-national or international agreements to make control of illegal logging and illegal timber trade;

To strengthen the supervision and governance over domestic forest product markets so as to create conditions for orderly market flow, forest sustainable management and the extension of forest product certification system through the formulation of medium- and long-term sector planning, the timely release of information regarding market supply/demand, market flow and the change in prices, and the update of product standardization system (including quality standards and

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environment protection standards);

To implement sustainable management strategy and harvesting quota system for existing forest resources in China, in particular natural forest resources, and reinforce the inspection intensity;

To establish fast-growing and high-yielding industrial planted timber forest in the southern regions where the natural condition is better, with the objective that in 2010, it shall basically achieve the self-sufficiency of major forest products (e.g. non-veneer panel and pulp) supplied by planted forests;

To make the best of wood and agricultural residues as well as bamboo resources for vigorously developing pulp and paper-making industry and panel industry. Thus, enterprises will be spurred to accelerate technical advancement and improve resource use rate and scale benefit.

(2) Government procurement policy The implementation of Government Procurement Law of China lays the foundation for the launch of the proposed project. Government Procurement Law of China took effect in January, 2003 and Article 9 stipulates that “government procurement shall be beneficial to national environmental protection”. In the preceding 5 years, the number of forest products purchased by the Chinese government, either the material object amount or the value amount, has presented the increasing tendency. The enforcement of government procurement policy lays the foundation for the research, formulation and implementation of green forest products procurement policy. The enforcement of Chinese government procurement policy for environmental products has created a favorable condition for the launch of the proposed project. To facilitate the smooth execution of government procurement, “Implementation Proposal on Government Procurement for Environmental Label Products” and the first “Government Procurement List of Environmental Label Products” issued jointly by State Environmental Protection Administration and Ministry of Finance of China were implemented in central budget units as well as provincial budget units on January 1, 2007, and will come into effect on January 1, 2008. The implementation of the project and the research and preparation of green procurement list of tropical forest products and the guidelines will further the perfection of the green public procurement policy.

2.3 Multilateral Policy Despite that illegal logging and related trade primarily occurs in the upstream industrial chain, it is required that the upstream, middle-stream and downstream parties of the entire industrial chain forge together to establish a global system of combating and controlling illegal logging, which will be more conducive to building an effective system for promoting sustainable forest resource management across the globe. The Chinese government has expanded the collaboration with all the countries worldwide in the field of forest resources with a vision of development. Especially in the tropical forest products trade has China constantly amplified the content of collaboration and shared more common interests with collaborating countries. Meanwhile, China has followed the trend of the times to constructively participate in international affairs with respect to forest resources, develop friendly cooperation relations with different countries, properly address differences and sensitive issues, and actively keep bilateral and multilateral relations stable. With a highly responsible attitude and practical actions, China has accelerated virtuous circle of the world's tropical forest products and other forest resources, improved the global eco-environment and promoted sustainable economic development. Currently, the Chinese government has signed cooperation agreements, or made statements, with the EU, Russia, Indonesia, Myanmar and other countries, committing to jointly combating illegal logging:

On December 18, 2002, State Forestry Administration of China and Ministry of Forestry of Indonesia on behalf of each government signed the “Memorandum of Understanding on Cooperation in Combating Illegal Forest Products Trade between the Government of People's Republic of China and the Government of the Republic of Indonesia” in Beijing. The two governments agreed to combat illegal forest products trade (including threatened and endangered species), strengthen forest law enforcement to curb related illegal trade as well as illegal logging and seize on forest resources products, improve the understanding of the threats that the destruction of forests would pose to future environmental, economic and social prosperity, and promote forest management mode towards sustainable management;

On September 5, 2005, Chinese Premier Wen Jiabao, British Primary Minister Blair, the President of European Commission Barroso and the Secretary-general of the European Council Solana jointly signed “Joint Declaration Issued in the Eighth Sino-Eu Leaders Meeting”, committing to addressing illegal logging in Asian region all together;

On November 3, 2005, Joint Communiqué of the Tenth Sino-Russian Regular Meeting advanced

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that China and Russia would “forward forest resource development and utilization, increase the intensity to combat illegal logging and trade, and strengthen the cooperation in the areas of forest law enforcement, resource cultivation, forest fire prevention and insect pest and disease control, control of desertification and wildlife protection”;

In 2006, the Chinese government held training courses on forestry management personnel from resource producing countries to help forestry sector of Myanmar improve their forest governance level of sustainable forest resource management. Meanwhile, the Chinese government and the Myanmar government unfolded the bilateral cooperation on sustainable forest resources management, development and utilization.

On September 8, 2007, Secretary-general Hu Jingtao proposed to establish a “Asia-Pacific Forest Restoration and Sustainable Management Network” to enhance the capacity building and information sharing in terms of forestry sector when he attended the 15

th APEC informal

Leader meeting in Australia. The proposal got the support and agreement of the attending leaders at large, which indicates the political will and action of the Chinese government in forest protection and ecological environment improvement.

On September 19-20, 2007, China, the EU, Germany and British held “EU-China Conference on Forest Law Enforcement and Governance” in Beijing. The Chinese government attached great importance on the conference. Director-general of State Forestry Administration of China, on behalf of Mr. Hui Liangyu, the Deputy Prime Minister of the State Council of China, expressed the will and determination of the Chinese government in combating illegal logging and related trade, promoting sustainable forest management across the world and protecting human ecological environment.

3. PROGRAMS AND OPERATIONAL ACTIVITIES The Chinese government now strives for a resource-saving and environment friendly community. As such, the Chinese government has adopted a series of specific actions to standardize the green tropical forest products production, consumption and trade, establish and update green public procurement policy system for tropical forest products, and then promote the transparent trade and green consumption of global tropical forest products. Since the entrance to WTO in November, 2001, China has lowered the duty and gradually annulled non-duty measures for 249 forest products and opened her forest product market to the world strictly pursuant to its commitment. In 2003, the average duty of timber, paper and its products was the mere 7%, while in 2005, the import duty of furniture was reduced to zero, and the duty of paper and its products was decreased from 7.5% to 4.6%, with all the restrictive measures for forest product import annulled. This adequately indicates that the Chinese government has made an arduous effort and positive contributions to strengthening international forestry economic cooperation and constantly improving investment environment. China signed series of agreements with the EU, Russia, Indonesia, Myanmar, etc. in a bid to promote global forest sustainable management and utilization. Targeted to control illegal logging and related trade together, these agreements have achieved a positive progress. China has sets out to carry out the work on the green public procurement since the condition is available. For the purpose of boosting the smooth implementation of green public procurement, State Environmental Protection Administration and Ministry of Finance of China jointly issued the “Implementation Proposal on Government Procurement for Environmental Label Products” and the first “Government Procurement List of Environmental Label Products” (including some forest products), which were implemented in central budget units and provincial budget units on January 1, 2007, and will come into effect on January 1, 2008. By the end of 2006, the Chinese government had joined 5 International Covenants on forestry or directly related to forestry. Moreover, the Chinese government had acceded to the International Union for the Protection of New Variety of Plants (UPOV) and International Tropical Timber Agreement (ITTA). The joining into the International Covenants is the evidence that China has made great contributions to promoting sustainable tropical forest resources management, facilitating market development of environment friendly tropical forest products and updating green public procurement policy system for tropical forest products. The long-term strategy that Chinese government adopted to settle the timber demand is to basically achieve self-sufficiency, turning the trade oriented to supply the lack into the trade centered on reallocation. On August, 2002, the Chinese government started the key-area fast-growing and high-yielding timber forest base project. It is planned to achieve full self-sufficiency or even more than self-sufficiency in fiber feedstock and non-veneer panel by 2015, while importing a small amount of high-quality large-diameter timber that China is short of.

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Part II. THE PROJECT

1. PROJECT OBJECTIVES 1.1 Development Objective Contribute to the sustainable use, sound trade and responsible consumption of the resources for timber forest products, stable construction of environment-friendly society and sustainable development of economy in P.R. China. This is envisaged by the development of national guidelines and international information exchange website for the procurement of “green” tropical forest products. 1.2 Specific Objectives 1.2.1 To develop a national Governmental strategy for the green public procurement of tropical forest products in China through the establishment of policy guidelines. 1.2.2 To create awareness among all parties involved in terms of resource management, products’ trade and consumption by analyzing and distributing relevant information, thus to promote the use of tropical forest products from legal sources and transparent trade. 2. JUSTIFICATION 2.1 Problems to Be Addressed 2.1.1 The illegal timber harvesting and the illegal trade have become a hot issue of increasing global concern in recent years. Illegal logging and trade in the emergence have seriously affected the sustainable development of ecology, economy and society, by not only infringing on the local government’s revenue, escalating the regional poverty and conflicts of interests, and damaging the legitimate business interests, but also leading to the destruction of the ecological environment and forest resource constraints. They have become a prominent problem in the global forest resources development. It has become the consensus of the international community to crack down on illegal logging and trade. China has also actively joined in the action, participated in the signing of a number of bilateral and multilateral agreements, and made commitment to work together with other countries to combat these illegal acts. On the EU-China Conference on Forest Law Enforcement and Governance held on September 19-20, 2007, in Beijing, the Director-general of State Forestry Administration of China, on behalf of Mr. Hui Liangyu, the Deputy Prime Minister of State Council of China, expressed the will, determination and actions of the Chinese government to combat the illegal logging and related trades. The implementation of the green procurement policy will promote the circulation and use of legal timber from the institutional angle. It helps co-establish sound laws and regulations with related tropical timber supplying countries, safeguard the forest safety and promote the sustainable management of global forest including tropical and non-tropical forests. 2.1.2 The special status and role of China in the global tropical timber production and trade determines the necessity to study and prepare the green public procurement policy for tropical forest products. As one of the world’s main timber importing and consuming countries, China is an important driver to the international forest products market and a major participator in the global industrial chain. With China’s rapid economic development, she has become the second (only to the United States) largest forest products importing and consuming country and the largest exporting country of furniture and major wood flooring and plywood. China has a large demand for timber, especially her demand for tropical timber increases every year. Now China has become the largest importing country of logs and tropical timber in the world. To study and formulate China’s green public procurement policy for tropical forest products, carry out related market survey and compile a list of enterprises and products conformant to green procurement policy will be proactive in leading China to consume tropical timber, promoting tropical timber import countries and producing countries to import and export tropical timber from illegal sources and regulating timber production and trading behaviors. 2.1.3 As there is an increasing number of countries in the world issuing the green public procurement policy for forest products, China paid more attention to the urgency of the policy’s research, formulation and implementation. To date, a number of countries including Germany, Belgium, Denmark, France, Japan, New Zealand, Switzerland, Britain, the USA, Canada, etc. have issued the green public procurement policy for forest products and are encouraging purchasers and processing enterprises to use legal and certified timber, by adopting measures including prohibiting the import of timber without identified legal sources, formulating

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and enforcing the green procurement policy, and signing trade agreements on forest issues with supplying countries. This will facilitate the legal logging and good forest management in forest products supplying countries, and is conducive to the stability of the world's timber market and the promotion of sustainable forest management. China is now in urgent need of studying and formulating feasible green public procurement policy and guidelines for tropical forest products, so as to attract enterprises and merchants to use certified timber and strengthen consumers’ awareness of eco-environment protection. 2.1.4 Chinese enterprises of forest products and forestry still lack the awareness and information of purchase of green tropical wood. They know little about the domestic and international timber market, in particular the international tropical timber market. They are not familiar with relevant rules and agreements prepared by related international organizations on tropical forest products production and trade. They have little idea about how to purchase green tropical timber and whether the companies and enterprises engaged in tropical forest products production and management, at home and abroad, have been certified. As a result, there is an urgent need to implement the proposed project to provide systematic and complete information on green procurement of overseas tropical timber to Chinese enterprises of forest products and forestry, merchants and consumers. 2.1.5 China lacks a platform for forestry information exchange and service with international community. As China’s increasing demand for tropical timber and the forest products’ enlarging share in the international market, those countries and enterprises in forest products trade with China also wish to understand China’s current and future supply and demand of forest products and changes in the consumption structure, and to establish long-term and close relationship with China for information exchange. In spite of the establishment of China Tropical Forest Products Information Consultation Center and the publication of the monthly newsletter China Forest Product Market Information in both English and Chinese versions, and the development of a network for information exchange as well, through the implementation of ITTO projects PD 25/96 Rev.2 (M) and PD 55/99 Rev.1 (M). The current situation is still unsatisfactory, with the problems including the narrow covered areas (e.g. vast tropical forest products producing countries excluding Malaysia are not covered and related green procurement is lacking), limited information, delayed reportage, etc. Problem tree See next page.

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Diagram1. Problem Tree

Chinese Government and enterprises lack from a systematic and practical green public

procurement policy for tropical forest products

Lack of awareness on different levels on green public procurement for tropical forest products

Lack of sufficient dissemination and exchange of information regarding tropical forest products between

purchasers and suppliers

Missing systematic information on tropical forest products’ production, consumption and trade in

China

Lack of laws and regulations in respect of green public procurement for tropical forest

products

Lack of information and policy on green public procurement for tropical

forest products

Lack of detailed information about world’s policies and practices on green public procurement for forest product

Lack of lists of certified forestry enterprises and

products

Lack of green public procurement criteria for tropical forest

products

Purchasers do not know specific green public procurement procedure and methods and fail to conduct commercial activities to positively promote green public procurement

Lack of paper media to extend information on the green public procurement for tropical forest products in

China

No international website for the exchange of information on green public procurement for tropical forest products

- 8 -

2.2 Intended Situation after Project Completion The proposed project is expected to be completed in two years. The proposed project intends to enhance wood processing enterprises’, merchants’ and consumers’ awareness and capacity of green procurement for forest products, promote China’s use of tropical and non-tropical timber from sustainable sources, improve the transparency of trades and upgrade the forest law enforcement and execution in China. These will be envisaged by studying, formulating and extending the green public procurement guidelines for tropical forest products, proposing related policy, preparing a list of certified forestry enterprises and products,, establishing information sharing platform and publishing related data. 2.2.1 Status Quo of Green Tropical Forest Products Production, Consumption and Trade in China, the study report to be published upon the project completion, will focus on the analysis of the current situation of production, consumption and trades of tropical forest products in China, and identify wood processing enterprises’ interests, procurement practices, demands and challenges in regard to the green public procurement of tropical forest products. 2.2,2 Relevant countries’ procurement policies are mentioned in the report of ITTO CEM-CFI (XLI) /6. It is of help to collect more detailed data sources for the proposed project and will facilitate the preparation of the study report The World’s Green Procurement Policies and Practices for Tropical Forest Products. The study report will help enterprises involved in the trade and processing of tropical forest products, either at home or abroad, to fully understand both national and international green public procurement policies for tropical forest products. It can also provide wood enterprises with access to more information and technical support in purchasing green timber, improve the macro-management of responsible governmental authorities and sectoral departments, and thus advance the sustainable management of tropical and non-tropical timber. 2.2.3 Upon the project completion, A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China will be prepared for Chinese wood processing enterprises, including criteria of green public procurement of tropical forest products, lists of certified forestry enterprises and products, applicable scopes, environmental management evaluation, and evaluation, integrated judgment guidelines, application and operation steps of the public procurement of forest products. It will provide reference for Chinese wood processing enterprises to develop the green public procurement of tropical forest products and lay a foundation for the formulation of The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products. It is effective to promote China’s use of tropical and non-tropical timber from sustainable sources, improve the transparency of trades and upgrade the forest law enforcement and execution in China. 2.2.4 The study report The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products will be prepared upon the project completion, including convening symposia for stakeholders to discuss on the feasibility and necessity of green public procurement policy, studying the scope and contents of China’s green tropical forest products procurement, and composing and submitting the study report to related decision-making administrative authorities, so as to enhance people’s idea of green consumption, integrate the green public procurement policy for tropical forest products in the national green public procurement policy and accelerate the formulation of national policy and strategies on green public procurement for tropical forest products. 2.2.5 During the project implementation, based on the China Tropical Forest Products Information Consultation Center and the International Tropical Forest Products Information Exchange Network established by the two previously executed ITTO projects PD 25/96 Rev.2 (M) and PD 55/99 Rev.1 (M), an international website of Green Tropical Forest Products Procurement Information will be established and a newsletter of China Green Tropical Forest Products Procurement will be published. In this way, a regular, open, transparent and convenient information sharing platform will be established among China and related international organizations as well as major ITTO member countries (both producing and consuming), so as to help countries across the world understand green procurement policies for tropical forest products of each other, further widen the information channel of green procurement to enhance purchasers’ and suppliers’ understanding of related green procurement information, and stop illegal logging and related trade to the end. 2.2.6 At the end of the project implementation, a training workshop will be held to strengthen the dissemination and communication of related information. At least two or three wood processing enterprises will be encouraged to practice the green public procurement of tropical forest products and other wood processing enterprises of importance in China will be involved in the implementation of the Guide. Therefore, Chinese wood processing enterprises’ awareness and capacity of the implementation of the green public procurement policy will be enhanced and the green production and consumption of tropical and non-tropical timber in China will be developed.

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Objective tree See next page.

- 10 -

Diagram 2. Objective Tree

Enhancement of awareness of green public procurement of tropical forest

products

Establishment of information sharing platform for tropical forest product purchasers and

suppliers

Collection, survey and analysis of the status quo of green production, consumption and trade of tropical forest products in

China

Acceleration of the development of laws and regulations in respect of green public procurement of tropical forest

products.

Collection of complete information and offering of policy proposal on governmental green

procurement

Collection of detailed information of the world’s green public procurement policy and practices for

forest products.

Preparation of a list of certified forestry enterprises and products by major certification

systems.

Development of criteria for green public procurement of tropical forest products based on certification systems of environmental

products.

Development of green public procurement guidelines for tropical forest products and pushing forward enterprises to implement green public procurement practices

Publication of a newsletter of China Green Tropical Forest Products Procurement.

Establishment of an international website of Green Tropical Forest Products Procurement

Information.

Policy guidelines for the green public procurement of tropical forest products from legal resources, transparent trade and responsible consumption are developed and implemented

in China

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2.3 Project Strategy

To closely collaborate with related industrial associations and carry out a systematic investigation and analysis of the status quo of green tropical forest products production, consumption and trade in China;

To collect information and experiences about green public procurement policies and practices for tropical forest products from major countries in the world;

To assist the Chinese government in preparing and implementing a policy proposal on the green public procurement for tropical forest products;

To formulate China Green Public Procurement Criteria for Tropical Forest Products and List of Certified Forestry Enterprises and Products by Main Certification Systems;

To formulate guidelines for green public procurement of tropical forest products in China and contribute to the sustainable use, sound trade and responsible consumption of the resources for timber forest products in China ;

To establish a website of China Green Tropical Forest Products Procurement Information and publish the newsletter of China Green Tropical Forest Products Procurement, so as to provide a platform for dissemination and information exchange between purchasers and suppliers;

To encourage at least two or three wood enterprises to start green procurement practices in line with the green public procurement guidelines and policy proposal for tropical forest products.

2.4 Target Beneficiaries 2.4.1 The project’s direct beneficiaries include following departments and organizations: - China’s forestry policy and decision-making agencies and international authority organizations; - Consumers of tropical forest products; - Companies, enterprises and markets engaged in tropical forest products trade and management in

China; - Companies and enterprises engaged in tropical forest products production and processing in China; - Forest farms and companies engaged in tropical forest resources cultivation in China; - Overseas companies and enterprises in trade of tropical forest products with China; - Overseas companies and enterprises engaged in tropical forest products production and processing. 2.4.2 The project’s indirect beneficiaries mainly include: - Governmental departments and sector agencies in China in charge of forest products production, trade,

supply and circulation; - Related scientific research and education institutes; - Related governmental departments and sector agencies of ITTO member countries (both producers and

consumers) engaged in large forest products trade with China, and their agencies or offices in China as well;

- Related international organizations, e.g. ITTO, FAO, UNECE, WWF, WB, etc. 2.5 Technical and Scientific Aspects Technical aspects of the proposed project mainly refer to the development of China’s green public procurement policy for tropical forest products and the national strategies through following efforts: - Access to related information about the green public procurement of tropical forest products,

analysis of the status quo of the green production, consumption and trades of tropical forest products in China, and preparation of the survey report The World’s Green Procurement Policies and Practices for Tropical Forest Products through surveys, interviews, study tours abroad, consulting related literatures and etc..

- Promoting ideas of green production and consumption and providing an information platform for the close collaboration between tropical forest product buyers and suppliers, through the establishment of an international website of Green Tropical Forest Products Procurement Information and the publication of a newsletter of China Green Tropical Forest Products Procurement with abundant information,

- Closely cooperating with stakeholders including buyers, suppliers and forestry enterprises related to the green procurement of tropical forest products, consulting relevant information and developing practices of green public procurement.

- Meanwhile, the proposed project will also hold personnel training based on the use of Internet and paper media, extend and communicate information about green public procurement of tropical

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forest products in China, and instruct at least two or three wood enterprises to start procurement practices in line with the policy proposal and guidelines of green procurement, so as to enhance the awareness of production and consumption of green products.

Scientific aspects are: - Bottom-up policy development approach. The approach is a mode to develop policies on the

basis of sufficient interaction among governments, the public and social groups and shows the public’s demands. The proposed project will formulate A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China and The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products, based on the study and survey on the status quo of production, consumption and trade of tropical forest products in China, the understanding of stakeholders’ demands, interests and challenges, and the collection of the world’s green procurement policies and practices for tropical forest products, and through convening symposia, so as to express stakeholders’ demands.

- Establishment of a database for green production, consumption and trade of tropical forest products in China, a database for the world’s green procurement policies and practices for tropical forest products, and a database for lists of certified enterprises and forest products. The project will facilitate the dissemination and exchange of information and upgrade stakeholders’ awareness of green procurement through the international website of Green Tropical Forest Products Procurement Information and the newsletter of China Green Tropical Forest Products Procurement, so as to promote China’s use of tropical and non-tropical timber of sustainable management and upgrade the forest law enforcement and execution in China.

2.6 Economic Aspects The successful implementation will not only help meet the Chinese market’s demand for tropical forest products, but also help the government and related enterprises understand the situation of tropical timber market at home and abroad and break through the green trade barriers. However, it should be realized that the adoption of the green public procurement policy for tropical forest products will lead to the increases of three kinds of costs: (1) the costs incurring in the course of policies research and formulation at national level; (2) the extra purchase costs, personnel training costs and institutional setup costs during the procurement; and (3) the costs for suppliers to obtain related certification, carry out personnel training and implement the enterprises’ market promotion. The project research to a certain extent can help increase the economic benefits for the government, purchasers and suppliers, and regulate and control related costs. On one hand, the formulated guidelines on green procurement can instruct purchasers to purchase according to related procurement procedures and methods and reasonably control the costs. On the other hand, thanks to the clear criteria, expedite information and equal and rational procedures of green procurement policy, producers and suppliers at home or abroad will work hard to meet the requirements for green products, which will make them easy to enter the Chinese market and obtain corresponding economic benefits soon. As a result, the development of green public procurement for tropical forest products will facilitate the shaping of a green industry market, the expansion in China’s green market for tropical forest products producing countries, the promotion of green production and consumption of tropical forest products, and the realization of multi-win situation in the production, processing, trades and consumption of tropical forest products and protection of resources and environment. 2.7 Environmental Aspects Upon project completion, the green public procurement of tropical forest products will give the first priority to certified timber and forest products in government procurement through the control of sources. In this way, it will exert significant impact on enterprises’ environmental performance in all aspects and will play a good role of demonstration and guide in the public’s green consumption, so as to effectively protect the global forest resources and ecological environment. The implementation of the green public procurement of tropical forest products can help to regulate the production, consumption and trade behaviors, effectively restrain the illegal logging and trades, promote the sustainable management of tropical forests, reduce the damages of forest resources and forest lands by illegal logging, protect tropical forest biodiversity, effectively reduce the soil and water loss and prevent landslides. The formulation and implementation of such policy can provide a demonstration for protection of non-tropical forest resources and environment. Besides a large number of tropical forest products,

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China also imports many non-tropical timbers. However, due to the serious illegal logging existing in some non-tropical timber producing countries, part of China’s imported non-tropical timbers are considered as from countries short of good forest management. The illegal logging of non-tropical timber has brought very severe environmental problems to related countries, including the speeding up of forest disappearances, the reduction of biodiversity, the serious destruction of the habitats of rare flora and fauna species, and the deterioration of natural calamities e.g. floods, mudslides, landslides, etc. The study on China’s green public procurement policy for tropical forest products can facilitate the development of an environment friendly market of tropical forest products, provide policy experience for researches on green public procurement for non-tropical forest products supported by other channels besides ITTO and reduce the illegal logging in non-tropical timber producing countries, so as to accelerate the sustainable management of non-tropical forests. 2.8 Social Aspects By establishing A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China and green public procurement policy, the project aims at eliminating the illegal logging of tropical forests and pushing forward the sustainable management of tropical forests to provide employment opportunities for community development, accelerate the community economic development, maintain the community eco-security, improve the livelihood and encourage the public’s involvement in the protection of the community’s tropical forest environment. The said guideline and policy implementation can effectively control trades related to illegal logging, avoid the blind competition among small-scale wood companies, reduce the potential conflicts and promote the harmonious social development. Meanwhile, the policies and provisions related to labor security of wood enterprises can help them obey the national labor protection policy and protect the labor’s rights and personal dignity. The formulation and implementation of such guidelines and policy can foster and enhance the public and the whole society’s awareness of ecological protection and green consumption and advance the development of an environment friendly and resource saving society. The use of the website and the newsletter will strengthen the information extension and knowledge exchange and make suppliers voluntarily prefer to purchasing green tropical forest products or services with legal sources or sustainability. It will also strengthen suppliers’ understanding of green public procurement and encourage them to promote the development, production and marketing of green tropical forest products. Moreover, it can increase the society’s awareness of green public procurement and attract other consumers to reinforce their ideas of green procurement and consumption, so as to advance the development of an environment friendly and resource saving society. 2.9 Risks The first potential risk is that green public procurement policy may reject legally harvested timber but without being certified. However, as long as the project can maintain the good communication and balance between purchasers and suppliers, a green procurement market and network can be gradually established with no threats to those non-certified tropical forest products but from legal sources. The second potential risk is that the additional cost resulted from related certification may weaken the competitiveness of certified timber. In order to avoid or alleviate such situation, it is of great importance to make efforts to minimize the costs for certification and increase suppliers’ awareness of green procurement and consumers’ awareness of green consumption of tropical forest products. The project intends to use the website to provide a communication platform for the closer cooperation between purchasers and suppliers, actively support suppliers to formulate and implement an economical and feasible green supply action plan and minimize the costs. Besides, the project also intends to propose suggestions on green procurement policy for the government and enterprises and formulate a guide to the green procurement of legitimate and sustainable tropical forest products. The third potential risk is the cognitive attitude and implementing will of government to the green public procurement for forest products. Currently, the completed policy on green public procurement for forest products had not been proposed and implemented by State Forestry Administration. The project will contribute to update related policy for State Forestry Administration through science research, trainings, workshops and policy suggestion. Furthermore, Suggestion on Environmental Label Product & Government Procurement and the first Government Procurement List for

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Environmental Label Product (including some forest products) jointly released by the State Environmental Protection Administration and the Ministry of Finance will advance China’s formulation and implementation process of green public procurement for forest products and minimize the will of government as potential risk. A wide range of involved organizations, regions and countries but limited time frame may cause some difficulties during the process of implementation. But the implementing agency has organized a professional and experienced research team and reached agreements with the State Forestry Administration, State Environmental Protection Administration, National Development and Reform Commission, China Timber Distribution Association and other related agencies, which will give the support to the project implementation. Meanwhile, the implementing agency intends to retain related consultants during the implementation to ensure the successful completion of the proposed project. 3. OUTPUT 3.1 Specific Objective 1 To develop a national Governmental strategy for the green public procurement of tropical forest products in China through the establishment of policy guidelines. Output 1.1: The survey report entitled Status Quo of Green Tropical Forest Products Production,

Consumption and Trade in China Output 1.2: The survey report entitled The World’s Green Procurement Policies and Practices for Tropical

Forest Products

Output 1.3: Formulation of A Guide to Green Procurement of Tropical Forest Products for Wood

Processing Enterprises in China Output 1.4: Formulation of The Proposal on China’s Green Public Procurement Policy for Tropical Forest

Products

3.2 Specific Objective 2 To create awareness among all parties involved in terms of resource management, products’ trade and consumption by analyzing and distributing relevant information, thus to promote the use of tropical forest products from legal sources and transparent trade. Output 2.1: Establishment of a platform for extension and communication of China Green Tropical Forest

Products Procurement Information 4. ACTIVITIES 4.1 Output 1.1 The survey report entitled Status Quo of Green Tropical Forest Products Production, Consumption and Trade in China Activity 1.1.1: Study and survey the current situation of China’s green production, consumption and trade of

tropical forest products, interview 10 wood enterprises of different types, collect existing related data and identify wood enterprises’ interests, procurement practices, demands and challenges in respect of green public procurement of tropical forest products;

Activity 1.1.2: Compile, translate and publish the survey report (in respective volumes of 400 in Chinese and English).

4.2 Output 1.2

The survey report entitled The World’s Green Procurement Policies and Practices for Tropical Forest Products

Activity 1.2.1: Collect data about the green procurement policies and practices for tropical forest products from major countries in the world; Compile, translate and publish the Study Report in respective volumes of 400 in Chinese and English.

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4.3 Output 1.3 Formulation of A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China Activity 1.3.1: Formulate A Guide to Green Procurement of Tropical Forest Products for Wood Processing

Enterprises in China integrating the results of Output 1.1 and 1.2; Activity 1.3.2: Convene a 2-day international technical workshop in Beijing of 60 participants including 30

sponsored Chinese and 4 sponsored overseas participants, to discuss the contents of the Guide and relevant topics;

Activity 1.3.3: Revise, translate and publish the Guide in respective volumes of 600 in Chinese and English.

4.4 Output 1.4 Formulation of The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products Activity 1.4.1: Convene a one-day symposium with 20 participants of Chinese officials, experts and

representatives from forestry enterprises, to discuss on the formulation of national strategies and policy for green public procurement of tropical forest products, on the basis of the Guide;

Activity 1.4.2: Formulate The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products and submit it to the government, to accelerate China’s development of the national strategies and policy for green public procurement of tropical forest products.

4.5 Output 2.1 Establishment of a platform for extension and communication of China Green Tropical Forest Products Procurement Information Activity 2.1.1: Establish the website of China Green Tropical Forest Products Procurement Information; Activity 2.1.2: Publish the newsletter of China Green Tropical Forest Products Procurement in respective

volumes of 300 in Chinese and English for each issue. Retain 12 persons. months special correspondents. Four issues per year.

Activity 2.1.3: Organize a 2-day training course for 20 persons to extend and communicate information about the green public procurement of tropical forest products in China. Instruct at least two or three wood enterprises to start procurement practices in line with the policy proposal and guidelines of green procurement.

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5. LOGICAL FRAMEWORK

PROJECT ELEMENTS INDICATORS MEANS OF VERIFICATION ASSUMPTIONS

DEVELOPMENT OBJECTIVE: Contribute to the sustainable use, sound trade and responsible consumption of the resources for timber forest products, stable construction of environment-friendly society and sustainable development of economy in P.R. China. This is envisaged by the development of national guidelines and international information exchange website for the procurement of “green” tropical forest products.

- A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China have been formulated; - A platform for extension and communication of Green Tropical Forest Products Procurement Information have been established; - Awareness of sustainable use of tropical and non-tropical timbers have been improved.

- Baseline analysis; - Users’ evaluations; - Review and evaluation by ITTO.

Chinese government, the public and enterprises have common wish to formulate, accept and implement the green tropical forest products procurement policy and guidelines.

SPECIFIC OBJECTIVES 1: To develop a national Governmental strategy for the green public procurement of tropical forest products in China through the establishment of policy guidelines.

- Green public procurement guidelines for tropical forest products was recognized; - Accelerated the development of national strategies and policy for green public procurement of tropical forest products in China.

- Users’ evaluations; - Review and evaluation by ITTO; - Submission of two study reports, a guide to green public procurement and a policy proposal.

- The professional expertise of

experts; - Support from Chinese

authorities, the public and enterprises.

SPECIFIC OBJECTIVES 2: To create awareness among all parties involved in terms of resource management, products’ trade and consumption by analyzing and distributing relevant information, thus to promote the use of tropical forest products from legal sources and transparent trade.

- An international website of

Green Tropical Forest Products Procurement Information was established;

- Four issues of newsletter of China Green Tropical Forest Products Procurement annually were published;

- Awareness of stakeholders. Was enhanced

- Baseline analysis; - Users’ evaluations; - Review and evaluation by ITTO.

- Internet resources and database available to access; - Active involvement of stakeholders, especially forest -product buyers and suppliers.

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OUTPUT 1.1 The survey report entitled Status Quo of Green Tropical Forest Products Production, Consumption and Trade in China

- Related literatures was

collected; - The data on green

production, consumption and trade of 10 Chinese wood enterprises have been collected and analyzed in a report.

Publication of the survey report entitled Status Quo of Green Tropical Forest Products Production, Consumption and Trade in China in Chinese and English

- Access to relevant literatures and database;

- - Wood enterprises are willing

to collaborate and provide true and realistic data.

OUTPUT 1.2 The survey report entitled The World’s Green Procurement Policies and Practices for Tropical Forest Products

- Relevant data from at least 6 foreign countries on green procurement policies and practices for tropical forest products have been collected and analyzed in a report; - International experts and resource persons came to China to provide information and expertise on green public procurement policies being implemented in other countries.

-Publication of the survey report entitled The World’s Green Procurement Policies and Practices for Tropical Forest Products in Chinese and English -Materials of information and expertise on green public procurement policies being implemented in other countries

- Data are accessible, countries with advancements in green procurement are willing to share their data;

- International experts and resource persons are familiar with information and expertise on green public procurement policies being implemented in other countries.

OUTPUT 1.3 Formulation of A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China

- A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China have been formulated; - One technical workshop with Chinese and overseas experts has been held; - A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China has been revised.

- A list of participants; - Proceedings are published - A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China in Chinese and English.

-Experts are capable of formulating A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China; -Relevant resource persons both national and international are willing to participate the workshop and share their knowledge and experiences.

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OUTPUT 1.4 Formulation of The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products

- One symposium of Chinese officials, experts and representatives from forestry enterprises has been held; - The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products have been formulated and put forward

- A list of participants; - Proceedings are published; - Report on The Proposal on

China’s Green Public Procurement Policy for Tropical Forest Products

- Chinese officials, experts and representatives from forestry enterprises are willing to participate the symposium and share their knowledge and experiences; - Experts have sufficient expertise and are capable of formulating such policy proposal.

OUTPUT 2.1 Establishment of a platform for extension and communication of China Green Tropical Forest Products Procurement Information

- Website of China Green Tropical Forest Products Public Procurement Information have been established; - Four issues of newsletter of China Green Tropical Forest Products Procurement annually have been published; - One training course for stakeholders has been held; -At least instructed two or three wood enterprises to start practices of green public procurement.

- A list of website users; - A list of newsletter readers; - Publication of the newsletter; - A list of participants to the training course and their organizations.

- Development of Internet technology and stability of the website; - Rich and reliable data and information extended by the website and the newsletter; - Stakeholders are willing to participate the training course; - Wood enterprises are interested in the green public procurement policy for tropical forest products and willing to start such practices.

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6. WORK PLAN

OUTPUTS RESPONSIBLE

PARTY

SCHEDULE (monthly)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Output 1.1 The survey report entitled Status Quo of Green Tropical Forest Products Production, Consumption and Trade in China

Activity 1.1.1: Study and survey the current situation of China’s green production, consumption and trade of tropical forest products, interview 10 wood enterprises of different types, collect existing related data and identify wood enterprises’ interests, procurement practices, demands and challenges in respect of green public procurement of tropical forest products

Project team members and related organizations

Activity 1.1.2: Compile, translate and publish the survey report (in respective volumes of 400 in Chinese and English)

Project team members, translators and publishing units

Output 1.2 The survey report entitled The World’s Green Procurement Policies and Practices for Tropical Forest Products

Activity 1.2.1: Collect data about the green procurement policies and practices for tropical forest products from major countries in the world; Compile, translate and publish the Study Report in respective volumes of 400 in Chinese and English

Project team members, international consultants and publishing units

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OUTPUTS RESPONSIBLE

PARTY

SCHEDULE (monthly)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Output 1.3 Formulation of A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China

Activity 1.3.1: Formulate A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China integrating the results of Output 1.1 and 1.2

Project team members, international consultants and related organizations

Activity 1.3.2: Convene a 2-day international technical workshop in Beijing of 60 participants including 30 sponsored Chinese and 4 sponsored overseas participants, to discuss the contents of the Guide and relevant topics

Project team members, related organizations and overseas experts

Activity 1.3.3: Revise, translate and publish the Guide in respective volumes of 600 in Chinese and English

Project team members, translators and publishing units

Output 1.4 Formulation of The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products

Activity 1.4.1: Convene a one-day symposium with 20 participants of Chinese officials, experts and representatives from forestry enterprises, to discuss on the formulation of national strategies and policy for green public procurement of tropical forest products, on the basis of the Guide


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OUTPUTS RESPONSIBLE

PARTY

SCHEDULE (monthly)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Activity 1.4.2: Formulate The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products and submit it to the government, to accelerate China’s development of the national strategies and policy for green public procurement of tropical forest products


Output 2.1 Establishment of a platform for extension and communication of China Green Tropical Forest Products Procurement Information

Activity 2.1.1: Establish the website of China Green Tropical Forest Products Procurement Information

Project team members and website designer

Activity 2.1.2: Publish the newsletter of China Green Tropical Forest Products Procurement in respective volumes of 300 in Chinese and English for each issue. Retain 12 persons. months special correspondents. Four issues per year.

Project team members, correspondents and publishing units

Activity 2.1.3: Organize a 2-day training course for 20 persons to extend and communicate information about the green public procurement of tropical forest products in China. Instruct at least two or three wood enterprises to start procurement practices in line with the policy proposal and guidelines of green procurement


Non Activity based expenses Project team members

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7. BUDGET

7.1 Worksheet of Budget Component

Output and Activities

Inputs Unit Cost

(US＄) Quarter,

Year Budget

Component

Total

Units and quantity ITTO China ITTO China


Activity 1.1.1: Study and survey the current situation of China’s green production, consumption and trade of tropical forest products, interview 10 wood enterprises of different types, collect existing related data and identify wood enterprises’ interests, procurement practices, demands and challenges in respect of green public procurement of tropical forest products

1 Full Time Staff 0 16 400 Q1-Q4,Y1 11 0 6,400

2 Daily Subsistence Allowance 60 0 50 31 3,000 0

3 Domestic Travel 20 0 300 33 6,000 0

4 Local Transport 60 0 50 33 3,000 0

5 Consumable Items 1 0 300 54 300 0

6 Miscellaneous 1 0 300 61 300 0

Total Activity 1.1.1 12,600 6,400

Activity 1.1.2: Compile, translate and publish the survey report (in respective volumes of 400 in Chinese and English)


2 Subcontract for Translation 1 0 3,000 21 3,000 0

3 Subcontract for Printing 800 0 15 22 12,000 0



Total Activity 1.1.2 15,400 2,000

Total Output 1.1 36,400

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Inputs Unit Cost

(US＄) Quarter,

Year Budget

Component

Total



Activity 1.2.1: Collect data about the green procurement policies and practices for tropical forest products from major countries in the world; Compile, translate and publish the Study Report in respective volumes of 400 in Chinese and English


2 International Consultant 2 0 10,000 12 20,000 0

3 International Travel 2 0 1,500 32 3,000 0


5 Domestic Travel 4 0 300 33 1,200 0

6 Local Transport 12 0 50 33 600 0


8 Subcontract for Printing 800 0 15 22 12,000 0


10 Miscellaneous 1 0 200 61 200 0

Total Activity 1.2.1 41,280 4,800



Activity 1.3.1: Formulate A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China integrating the results of Output 1.1 and 1.2

1 Full Time Staff 0 24 400 Q2,Y1-Q1,Y2 11 0 9,600

2 International Consultant 1.5 0 10,000 12 15,000 0



5 Domestic Travel 15 0 300 33 4,500 0

6 Local Transport 45 0 50 33 2,250 0



Total Activity 1.3.1 28,210 9,600

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Inputs Unit Cost

(US＄) Quarter,

Year Budget

Component

Total


Activity 1.3.2: Convene a 2-day international technical workshop in Beijing of 60 participants including 30 sponsored Chinese and 4 sponsored overseas participants, to discuss the contents of the Guide and relevant topics

1 Full Time Staff 0 3 400 Q1,Y2 11 0 1,200

2

International Train/Workshop Expert 1 0 10,000 13 10,000 0

3

National Train/Workshop Expert 2 0 1,200 14 2,400 0

4 Other Labour 30 0 50 15 1,500 0



7 Domestic Travel 30 0 300 33 9,000 0

8 Local Transport 60 0 50 33 3,000 0


10 Miscellaneous 1 0 200 61 200 0

Total Activity 1.3.2 36,380 1,200

Activity 1.3.3: Revise, translate and publish the Guide in respective volumes of 600 in Chinese and English



3 Subcontract for Printing 1,200 0 15 22 18,000 0



Total Activity 1.3.3 21,400 1,600


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Inputs Unit Cost

(US＄) Quarter,

Year Budget

Component

Total



Activity 1.4.1: Convene a one-day symposium with 20 participants of Chinese officials, experts and representatives from forestry enterprises, to discuss on the formulation of national strategies and policy for green public procurement of tropical forest products, on the basis of the Guide

1 Full Time Staff 0 2 400 Q3,Y2 11 0 800

2


3 Other Labour 15 0 50 15 750 0


5 Domestic Travel 20 0 300 33 6,000 0

6 Local Transport 20 0 50 33 1,000 0



Total Activity 1.4.1 12,750 800

Activity 1.4.2: Formulate The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products and submit it to the government, to accelerate China’s development of the national strategies and policy for green public procurement of tropical forest products



3 Domestic Travel 8 0 300 33 2,400 0

4 Local Transport 24 0 50 33 1,200 0



Total Activity 1.4.2 5,200 3,200


- 26 -


Inputs Unit Cost

(US＄) Quarter,

Year Budget

Component

Total



Activity 2.1.1: Establish the website of China Green Tropical Forest Products Procurement Information

1 Full Time Staff 0 16 400 Y1-Y2 11 0 6,400

2 Daily Subsistence Allowance 12 0 50 31 600 0

3 Domestic Travel 4 0 300 33 1,200 0

4 Local Transport 12 0 50 33 600 0

5 Website Design and Maintenance 1 0 25,000 43 25,000 0



Total Activity 2.1.1 27,800 6,400

Activity 2.1.2: Publish the newsletter of China Green Tropical Forest Products Procurement in respective volumes of 400 in Chinese and English for each issue. Retain 12 persons. months special correspondents. Four issues per year.

1 Full Time Staff 0 4 400 Y1-Y2 11 0 1,600

2 Correspondent 12 0 600 16 7,200 0


4 Domestic Travel 8 0 300 33 2,400 0

5 Local Transport 24 0 50 33 1,200 0

6 Subcontract for Translation 8 0 600 21 4,800 0

7 Subcontract for Printing 4,800 0 2 22 9,600 0

8 Dissemination 8 0 1,000 53 8,000 0


10 Miscellaneous 2 0 200 61 400 0

Total Activity 2.1.2 35,200 1,600

- 27 -


Inputs Unit Cost

(US＄) Quarter,

Year Budget

Component

Total


Activity 2.1.3: Organize a 2-day training course for 20 persons to extend and communicate information about the green public procurement of tropical forest products in China. Instruct at least two or three wood enterprises to start procurement practices in line with the policy proposal and guidelines of green procurement

1 Full Time Staff 0 4 400 Q4,Y2 11 0 1,600

2



4 Domestic Travel 30 0 300 33 9,000 0

5 Local Transport 80 0 50 33 4,000 0



Total Activity 2.1.3 21,400 1,600


Non Activity Based Expenses

1 Office Space 0 24 200 Y1-Y2 42 0 4,800

2 Office Supplies 2 0 500 52 1,000 0

3 Operational Vehicles 0 1 15,000 41 0 15,000

4 Fuel and Utilities 0 2 1,000 51 0 2,000

Total Non Activity Based Expenses 1,000 21,800

Total Budget by Activity 258,620 61,000

Executing Agency Management Cost（15% From Total Overall Project Budget） 47,943

ITTO Monitoring, Evaluation and Administration

81 Monitoring and Review Costs 10,000

82 Ex-post Evaluation Costs 6,000

83 Programme Support Cost (8% from Total) 21,970

Refund Budget 0 0

Total Budget 296,590 108,943

Grand Budget 405,533

- 27 -

7.2 Overall Project Budget by Activity


10. Project

Personnel 20.

Sub Contract 30.

Duty Travel 40.

Capital Items

50. Consumable

Items 60.

Miscellaneous Quarter,

Year Grand Total

ITTO China ITTO China ITTO China ITTO China ITTO China ITTO China ITTO China


Activity 1.1.1: Study and survey the current situation of China’s green production, consumption and trade of tropical forest products, interview 10 wood enterprises of different types, collect existing related data and identify wood enterprises’ interests, procurement practices, demands and challenges in respect of green public procurement of tropical forest products 0 6,400 0 0 12,000 0 0 0 300 0 300 0 Q1-Q4,Y1 12,600 6,400

Activity 1.1.2: Compile, translate and publish the survey report (in respective volumes of 400 in Chinese and English) 0 2,000 15,000 0 0 0 0 0 200 0 200 0 Q2-Q4,Y1 15,400 2,000



Activity 1.2.1: Collect data about the green procurement policies and practices for tropical forest products from major countries in the world; Compile, translate and publish the Study Report in respective volumes of 400 in Chinese and English 20,000 4,800 15,000 0 5,880 0 0 0 200 0 200 0 Q1-Q4,Y1 41,280 4,800



Activity 1.3.1: Formulate A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China integrating the results of Output 1.1 and 1.2 15,000 9,600 0 0 12,810 0 0 0 200 0 200 0 Q2,Y1-Q1,Y2 28,210 9,600

- 28 -

Activity 1.3.2: Convene a 2-day international technical workshop in Beijing of 60 participants including 30 sponsored Chinese and 4 sponsored overseas participants, to discuss the contents of the Guide and relevant topics 13,900 1,200 0 0 22,080 0 0 0 200 0 200 0 Q1,Y2 36,380 1,200

Activity 1.3.3: Revise, translate and publish the Guide in respective volumes of 600 in Chinese and English 0 1,600 21,000 0 0 0 0 0 200 0 200 Q2-Q4,Y2 21,400 1,600



Activity 1.4.1: Convene a one-day symposium with 20 participants of Chinese officials, experts and representatives from forestry enterprises, to discuss on the formulation of national strategies and policy for green public procurement of tropical forest products, on the basis of the Guide 4,350 800 0 0 8,000 0 0 0 200 0 200 0 Q3,Y2 12,750 800

Activity 1.4.2: Formulate The Proposal on China’s Green Public Procurement Policy for Tropical Forest Products and submit it to the government, to accelerate China’s development of the national strategies and policy for green public procurement of tropical forest products 0 3,200 0 0 4,800 0 0 0 200 0 200 0 Q3-Q4,Y2 5,200 3,200



Activity 2.1.1: Establish the website of China Green Tropical Forest Products Procurement Information 0 6,400 0 0 2,400 0 25,000 0 200 0 200 0 Y1-Y2 27,800 6,400

Activity 2.1.2: Publish the newsletter of China Green Tropical Forest Products Procurement in respective volumes of 300 in Chinese and English for each issue. Retain 12 persons. months special correspondents. Four issues per year. 7,200 1,600 14,400 0 4,800 0 0 0 8,400 0 400 0 Y1-Y2 35,200 1,600

- 29 -

Activity 2.1.3: Organize a 2-day training course for 20 persons to extend and communicate information about the green public procurement of tropical forest products in China. Instruct at least two or three wood enterprises to start procurement practices in line with the policy proposal and guidelines of green procurement 3,600 1,600 0 0 17,000 0 0 0 400 0 400 0 Q4,Y2 21,400 1,600


Total Non Activity Based Expenses 0 0 0 0 0 0 0 19,800 1,000 2,000 0 0 Y1-Y2 1,000 21,800

Total Budget by Activity 258,620 61,000

Executing Agency Management

Cost（15% From Total Overall

Project Budget） 0 47,943

ITTO Monitoring, Evaluation and Administration 37,970 0

Refund Budget 0 0

Total Budget 296,590 108,943

Grand Budget 405,533

- 30 -

7.3.1 Consolidated ITTO Budget

Budget Components ITTO

ITTO Annual Disbursement

YEAR 1 YEAR 2

10 Project Personnel

11 Full Time Staff 0 0 0

12 International Consultant 35,000 35,000 0

13 International Train/Workshop Expert 10,000 0 10,000

14 National Train/Workshop Expert 9,600 0 9,600

15 Other Labour 2,250 2,250

16 Correspondent 7,200 3,600 3,600

19 Component Total 64,050 38,600 25,450

20 Sub Contract

21 Subcontract for Translation 13,800 8,400 5,400

22 Subcontract for Printing 51,600 28,800 22,800

29 Component Total 65,400 37,200 28,200

30 Duty Travel

31 Daily Subsistence Allowance 19,220 7,275 11,945

32 International Travel 12,000 4,500 7,500

33 Transport Cost

33.1.Domestic Travel (Air) 41,700 12,375 29,325

33.2.Local Transport 16,850 6,188 10,662

39 Component Total 89,770 30,338 59,432

40 Capital Items

41 Operational Vehicles 0 0 0

42 Office Space 0 0 0

43 Website Design and Maintenance 25,000 17,500 7,500

49 Component Total 25,000 17,500 7,500

50 Consumable Items

51 Fuel and Utilities 0 0 0

52 Office Supplies 1,000 500 500

53 Dissemination 8,000 4,000 4,000

54 Other Consumable Items 2,700 1,150 1,550

59 Component Total 11,700 5,650 6,050

60 Miscellaneous

61 Other Miscellaneous 2,700 1,150 1,550

69 Component Total 2,700 1,150 1,550

70 Executing Agency Management Cost

79 Component Total 0 0 0

80 ITTO Monitoring, Evaluation and Administration


82 Ex-Post Evaluation Costs 6,000

83 Programme Support Cost（8% From Total） 21,970

89 Component Total 37,970

90 Refund Budget 0

100 Grand Total 296,590

- 31 -

7.3.2 Consolidated Chinese Government

Budget Components Chinese

Government

Chinese Government Annual Disbursement

YEAR 1 YEAR 2


11 Full Time Staff 39,200 24,400 14,800

12 International Consultant 0 0 0

13 International Train/Workshop Expert 0 0 0

14 National Train/Workshop Expert 0 0 0

15 Other Labour 0 0 0

16 Correspondent 0 0 0

19 Component Total 39,200 24,400 14,800

20 Sub Contract

21 Subcontract for Translation 0 0 0

22 Subcontract for Printing 0 0 0


30 Duty Travel

31 Daily Subsistence Allowance 0 0 0

32 International Travel 0 0 0

33 Transport Cost

33.1.Domestic Travel (Air) 0 0 0

33.2.Local Transport 0 0 0


40 Capital Items

41 Operational Vehicles 15,000 15,000 0

42 Office Space 4,800 2,400 2,400

43 Website Design and Maintenance 0 0 0

49 Component Total 19,800 17,400 2,400

50 Consumable Items

51 Fuel and Utilities 2,000 1,000 1,000

52 Office Supplies 0 0 0

53 Dissemination 0 0 0

54 Other Consumable Items 0 0 0

59 Component Total 2,000 1,000 1,000

60 Miscellaneous

61 Other Miscellaneous 0 0 0



79 Component Total 47,943 23,972 23,971


81 Monitoring and Review Costs 0

82 Ex-Post Evaluation Costs 0

83 Programme Support Cost（8% From Total） 0

89 Component Total 0

90 Refund Budget 0


- 32 -

7.3.3 Consolidated Total Budget

Budget Components TOTAL

TOTAL Annual Disbursement

YEAR 1 YEAR 2


11 Full Time Staff 39,200 24,400 14,800

12 International Consultant 35,000 35,000 0

13 International Train/Workshop Expert 10,000 0 10,000

14 National Train/Workshop Expert 9,600 0 9,600

15 Other Labour 2,250 0 2,250

16 Correspondent 7,200 3,600 3,600

19 Component Total 103,250 63,000 40,250

20 Sub Contract

21 Subcontract for Translation 13,800 8,400 5,400

22 Subcontract for Printing 51,600 28,800 22,800

29 Component Total 65,400 37,200 28,200

30 Duty Travel

31 Daily Subsistence Allowance 19,220 7,275 11,945

32 International Travel 12,000 4,500 7,500

33 Transport Cost

33.1.Domestic Travel (Air) 41,700 12,375 29,325

33.2.Local Transport 16,850 6,188 10,662

39 Component Total 89,770 30,338 59,432

40 Capital Items

41 Operational Vehicles 15,000 15,000 0

42 Office Space 4,800 2,400 2,400

43 Website Design and Maintenance 25,000 17,500 7,500

49 Component Total 44,800 34,900 9,900

50 Consumable Items

51 Fuel and Utilities 2,000 1,000 1,000

52 Office Supplies 1,000 500 500

53 Dissemination 8,000 4,000 4,000

54 Other Consumable Items 2,700 1,150 1,550

59 Component Total 13,700 6,650 7,050

60 Miscellaneous

61 Other Miscellaneous 2,700 1,150 1,550

69 Component Total 2,700 1,150 1,550


79 Component Total 47,943 23,972 23,971



82 Ex-Post Evaluation Costs 6,000

83 Programme Support Cost（8% From Total） 21,970

89 Component Total 37,970

90 Refund Budget 0


- 33 -

7.4.1 Yearly Project Budget by Source-ITTO

Annual Disbursement Budget Component

Total

YEAR

YEAR 1 YEAR 2

10. Project Personnel 64,050 38,600 25,450

20. Sub Contract 65,400 37,200 28,200

30. Duty Travel 89,770 30,338 59,432

40. Capital Items 25,000 17,500 7,500

50. Consumable Items 11,700 5,650 6,050

60. Miscellaneous 2,700 1,150 1,550

70. Executing Agency Management Cost 0 0 0

80. ITTO Monitoring, Evaluation and Administration

81.Monitoring and Review Costs 10,000

82.Ex-Post Evaluation Costs 6,000

83.Programme Support Cost（8% From Total） 21,970

90.Refund Budget 0

ITTO TOTAL 296,590

7.4.2 Yearly Project Budget by Source-China Government

Annual Disbursement Budget Component Total

YEAR

YEAR 1 YEAR 2

10. Project Personnel 39,200 24,400 14,800

20. Sub Contract 0 0 0

30. Duty Travel 0 0 0

40. Capital Items 19,800 17,400 2,400

50. Consumable Items 2,000 1,000 1,000

60. Miscellaneous 0 0 0

70. Executing Agency Management Cost 47,943 23,972 23,971

80. ITTO Monitoring, Evaluation and Administration

81.Monitoring and Review Costs 0

82.Ex-Post Evaluation Costs 0

83.Programme Support Cost（8% From Total） 0

90.Refund Budget 0

Chinese Government TOTAL 108,943

- 34 -

PART III. OPERATIONAL ARRANGEMENT 1. MANAGEMENT STRUCTURE The proposed project will be executed by Research Institute of Forestry Policy and Information (RIFPI) under the guidance of Ministry of Commerce of China, State Forestry administration of China and ITTO. RIFPI is an institution responsible for the research on policy, development planning and information in terms of nation forestry sector, and it is also the key institution working on international forestry research as well as the principal institution which provides the forest product information services and related consultation for some other institutions, companies and enterprises at home and abroad. For a long time, the domestic and world forest products industry development and the changes in the market have been one of focus research items that RIFPI is engaged in. The key project members have participated for many times in the formulation of national medium- and long-term forestry development planning (including forestry plan in "Eighth Five-Year ", "Ninth Five-Year", "Tenth Five-Year ", "11th Five-Year") and major forestry policies (including industrial policies, environmental policies, technology policies, etc.). In addition, they accomplished various missions in collaboration with ITTO, FAO and other international organizations. From 1992, they have successively undertaken the projects that include ITTO tropical forest market, trade and information, ecological services and sustainable management.

2. MONITORING, REPORTING AND EVALUATION 1. After the official launch of the project, the project team will report the work progress to ITTO

every half year and the final report will be submitted at the end of the project. 2. In the project execution process, the project team will accept the supervision and inspection.

The time will be jointly discussed and determined by the project team and ITTO Economical Information and Market Intelligence Committee.

3. Upon the project completion, the project team will accept the final review and evaluation conducted

by ITTO

3. FUTURE OPERATION AND MAINTENANCE Throughout the project execution, the Chinese government and the executive agency will provide indispensable supports and services and shoulder the cost to which the Chinese side committed. In the entire process of the project execution, all the project members will strictly follow the various agreements reached together with ITTO competent departments, and finish all outputs on schedule in accordance with the work plan presented in the project proposal. By implementing several ITTO projects, the effective scheme of reporting to governmental decision-makers has been preliminarily established. When the project comes to end, China Tropical Forest Product Information Consultation Center will continue to be responsible for the gathering, classification, sharing and consultation of tropical forest product information in China and for the daily jobs such as the updating, maintenance and operation of the website of China’s green public procurement for Tropical Forest Products. The Center has been authorized by Ministry of Commerce and State Forestry Administration to preside in the sorting-out and verification of the statistics data of tropical forest products in China.

- 35 -

PART IV. TROPICAL TIMBER FRAMEWORKS

1. COMPLIANCE WITH ITTA 1994 OBJECTIVES

The project is consistent with objectives (a), (c), (d), (e), (h), (k), (l) and (n) of Article 1 of Chapter 1 of the ITTA, 1994:

(a) To provide an effective framework for consultation, international cooperation and policy development among all members with regard to all aspects of the world timber economy;

(c) To contribute to the process of sustainable development; (d) To enhance the capacity of members to implement a strategy for achieving exports of tropical

timber and timber products from sustainably managed sources by the year 2000; (e) To promote the expansion and diversification of international trade in tropical timber from

sustainable sources by improving the structural conditions in international markets, by taking into account, on the one hand, a long term increase in consumption and continuity of supplies, and, on the other, prices which reflect the costs of sustainable forest management and which are remunerative and equitable for members, and the improvement of market access;

(h) To improve market intelligence with the view to ensuring greater transparency in the international timber market, including the gathering, compilation and dissemination of trade-related data, including the data related to species being traded;

(k) To improve marketing and distribution of tropical timber exports from sustainably managed sources;

(l) To encourage members to develop national policies aimed at sustainable utilization and conservation of timber producing forests and their genetic resources and aimed at maintaining the ecological balance in the region concerned, in the context of tropical timber trade.

(n) Encouraging information-sharing on the international timber market.

2. COMPLIANCE WITH ITTO YOKOHAMA ACTION PLAN 2002-2006 The project relates to Relation to ITTO Yokohama Action Plan 2002-2006

The project is conformant to Action 2, 3, 5 and 7 of Goal 1 and Action 1, 2, 3, 5 and 7 of Goal 2 formulated by Market Intelligence Committee in ITTO Yokohama Action Plan 2002-2006:

Goal 1: Improve transparency of the international timber market 2. Promote the collection and dissemination of accurate and timely trade and economic data

relevant to the global timber market, in cooperation with international organizations and other sources, with a view also to reducing duplication where possible;

3. Where feasible and in cooperation with relevant organizations, fill key data gaps through regular assessments and special studies, including the collection and analysis of information on forest law enforcement, sustainable timber harvesting, illegal trade, secondary products, substitution, plantation timber, and certified products;

5. Undertake a regular study of medium- and long-term outlook for tropical timber market; 7. Encourage members and assist them, where appropriate, to:

Develop and improve national data gathering, reporting and disseminating mechanisms;

Develop manpower skills through appropriate approaches, including the ITTO Fellowship Programme;

Cooperate with relevant organizations, including the private sector, NGOs and others in gathering data;

Provide relevant data, in a timely and complete manner, to ITTO;

Participate in Annual Market Discussions, including encouraging the participation of the trade and industry; and

Provide inputs to ITTO market outlook studies.

- 36 -

Goal 2: Promote tropical timber from sustainably managed forest 1. Promote public awareness of progress made in implementing sustainable forest management

and in the increasing availability of tropical timber form sustainably managed forest; 2. Provide a forum for discussion on non-discriminatory trade, subsidies for competing products,

shortcomings in enforcement of forest law and regulation, and other factors that may affect the marketability and access of tropical timber products.

3. Monitor progress being made regarding the comparability and equivalence of certification systems.

5. Examine the market and product requirements that may have to be met in order to develop exports of added-value products

7 Encourage members and assist them, where appropriate, to:

Develop awareness of progress made in implementing sustainable forest management and in the increased availability of tropical timber from sustainably managed sources;

Identify trade barriers, shortcomings in forest law enforcement, and other factors that may affect the access and marketability of tropical timber, and propose measures to overcome them;

Use LCA information and similar studies as tools to improve the competitiveness of tropical timber;

Develop awareness of market and end-use requirements for tropical timber;

Prepare and implement research and development projects covering marketing trials, marketing methods and opportunities, particularly for lesser-used species;

Develop and promote wider use of their tropical timber, both primary and added-value products; and

Establish and maintain economic and fiscal policies that are conducive to the competitiveness of the industry and trade in tropical timber from sustainably managed sources.

- 37 -

ANNEX 1. PROFILE OF THE EXECUTIVE AGENCY Research Institute of Forestry Policy and Information (RIFPI) of Chinese Academy of Forestry is one of principal institutions in terms of research and consultation of policy and information under State Forestry Administration of China, and it also acts as a platform where China can share information with international organizations, forestry authorities and forest product industry authorities worldwide and major producing and trade companies (enterprises). For may years, RIFPI has undertaken the various national research missions which include national forestry polices ( including forest product trade policy, industrial policies, environmental policies, technological polices, etc.), medium - and long-term development planning (including forest product supply-demand planning, ecological preservation planning, forest certification planning, technological planning, etc. ) and forest development strategy. Meanwhile, it has conducted extensive collaboration with international organizations (e.g., ITTO, FAO, WB, the EU, INBAR, etc.) and civilian organizations (e.g., NASDA, IDRC, GTZ, Ford Foundation, Forest Trend, etc.) to accomplish many an important project. There is 120 staff in RIFPI with a team of high-quality talents who are accomplished in or familiar with English, Japanese, French, German, etc., 40 of which are senior researchers. RIFPI is comprised of Research Division, Periodical Division, Internet work Division and a printing factory. Besides, the largest library of forestry in China and the website of National Forestry Information are also under RIFPI. The library is the national forestry scientific and technological literature center, which collects 400 thousand books and subscribes 1000 Chinese and foreign-language journals with 700 foreign-language journals.

- 38 -

ANNEX 2. CURRICULA VITAE OF KEY STAFF Li Zhiyong: Doctor, Senior Researcher and Director of Research Institute of Forestry Policy and Information of Chinese Academy of Forestry. His study field is forestry economics and he has a good level of English. He has participated for many times in the research on national forestry policies and development strategy and in the formulation of national medium- and long-term forestry development planning, and in recent years he has undertaken the researches on the “tenth five-year” forestry development planning, forest products supply-demand forecast, forestry industry policies, etc., which are

under State Forestry Administration. As the principal of ITTO project (PD 171/02（M）), he led the project

team fulfilling the research on tropical forest product market circulation and development trend. Meanwhile, he accomplished a series of international projects related to sustainable forest management in cooperation with international organizations (ITTO, FAO, EU, GTZ, etc.). He will take full charge of the organization and implementation of the proposed project as project coordinator and his responsibilities will focus on the research on green procurement policy. Wang Zhongming: Senior Researcher and Deputy Director of Research Institute of Forestry Policy and Information of Chinese Academy of Forestry. He has been principally engaged in the establishment of the websites of forestry information and the provision of related service. In recent years, and besides he has been responsible for the development and management of the websites of China Forestry Information, China Forestry Science and Technology, China Forestry Policy Information and China Industry Consultation. In the proposed project, he will take charge of the establishment, management and operation of the website of Green Tropical Forest Products Procurement as deputy project coordinator. He Youjun: Doctor, Assistant Research and Vice Director of Research Division under Research Institute of Forestry Policy and Information. His study field covers sustainable forest management, bio-diversity protection, forest product trade and forest policy. He has participated in various research studies on forest product trade, forestry strategy and forestry policy funded by the Ministry of Science and Technology of China and State Forestry Administration and also participated in a series of international cooperation projects with regard to sustainable forest management and forest product trade funded by international organizations such as FAO, EU, GTZ, etc. In this project, he will be responsible for the research on current status of the production, consumption and trade of tropical forest products in China and the preparation of world certified tropical forest products and enterprises list as deputy project coordinator. Xu Bin: Doctor, Associate Professor, Director of Research Division under Research Institute of Forestry Policy and Information, Executive Director of Forest Certification Research and Promotion Center under the

research institute，the member of FSC-China Working Group on Forest Certification and one of the main

technique experts both for national scheme and FSC China. His research is focused on Sustainable Forest Management, Forest Certification, forest products market and forest policy. He has led 20+ projects in cooperation with SFA, FAO, WWF, WB, IKEA, and IIED. In the proposed project, he will take charge of the comparative research on domestic and international green procurement policies and the compilation and preparation of the lists.

Chen Jiawen: Senior Engineer and Director of Foreign Economic Division of Department of Development, Planning and Finance under State Forestry Administration of China. He principally deals with the formulation of forest product import and export management policy and the research and development of such polices as international cooperation in forest product trade. In recent years, he is mainly responsible for Forest Law Enforcement and Governance Process, negotiations on trade section in the non-legally-binding international forest instrument adopted by the United Nations Forum on Forests, coordination of the work undertaken by State Forestry Administration in the matter of international illegal logging of timber, and research and formulation of such polices as Chinese enterprises investment in forestry activities. In this project he will be specifically responsible for the green procurement policy guidelines and policy enforcement.

Zhang Wei: Senior Engineer in Quota Licensing Bureau under Ministry of Commerce of China. His major experience is economics and trade. He has been engaged in the research and formulation of trade policy and measures, the management, monitoring and inspection of import and export policy enforcement agencies and coordination for trade compliance. In this project, he will be specifically responsible for comparative research on green procurement policies, multi -agency coordination, information services, etc.

- 39 -

ANNEX 3. TERMS OF REFERENCE FOR DOMESTIC AND INTERNATIONAL CONSULTANTS

Terms of Reference for Information Gathering of

Green Tropical Forest Product Procurement Policies Worldwide (Activity 1.2.1) 1. Objective The objective of the activity is to gather and analyze information and procurement practices concerning the implementation of green tropical forest product procurement policies across the world, and to compose the research report entitled The World’s Green Procurement Policies and Practices for Tropical Forest Products. Additionally, international experts and resource persons will come to China to provide information and expertise on green public procurement policies being implemented in other countries. 2. Output Based on the gathering and analysis of the said information, the survey report entitled The World’s Green Procurement Policies and Practices for Tropical Forest Products will be composed to provide references for China to study and develop green tropical forest products’ procurement policy. Additionally, international experts and resource persons will come to China to provide information and expertise on green public procurement policies being implemented in other countries. 3. Activities The following activities will be performed:

To gather information and existing documents regarding the implementation of green procurement policies in Germany, Denmark, France, Japan, UK, USA and Canada;

To use diagrams, tables and cases to analyze and evaluate the process that these countries implement their green procurement policy, as well as the effect of the policy on purchasers and processing enterprises utilizing legal and certified tropical timber;

To compose the survey report entitled The World’s Green Procurement Policies and Practices for Tropical Forest Products and summarize what China can learn for her formulation and enforcement of green tropical forest product procurement policy;

Additionally, international experts and resource persons will come to China to provide information and expertise on green public procurement policies being implemented in other countries.

4. Timeframe From the starting of the project to the end of the first year. 5. Qualification International consultants are supposed to be familiar with green procurement policies for tropical forest products carried out in major countries worldwide in this regard. 6. Man. month Activity 1.2.1: 2 man. month

- 40 -

Terms of Reference for Formulation of A Guide to Green Procurement of Tropical Forest Products for

Wood Processing Enterprises in China (Activity 1.3.1) and Information Gathering and Editing on World’s Certified Tropical Forest Products and Enterprises

1. Objective The list of certified tropical forest products and enterprises is one of the important components of A Guide to Green Procurement of Tropical Forest Products for Wood Processing Enterprises in China and it requires retaining international consultants to fulfill it. The objective of these activities is to contact major certification institutions in the world, collect the list of certified tropical forest products and enterprises, and meanwhile introduce various certification systems to the government and timber enterprises in China. 2. Output Compose analysis report on world’s certified tropical forest products and enterprises, and release relevant information on the website. 3. Activities The following activities will be performed by selected NGOs engaged in commercial consultation service:

To establish contact with major certification institutions in the world;

To introduce major certification systems to the government and timber enterprises in China;

To obtain the information on certified tropical forest products and enterprises via certification institutions;

To analyze the green procurement process of certified tropical forest products and enumerate certified tropical forest products list.

4. Timeframe From the fourth month to the tenth month of the first year of the project. 5. Qualification International consultants are supposed to be familiar with major forest certification institutions and certification systems in the world. 6. Person. month Activity 1.3.1: 1.5 man. month

- 41 -

ANNEX 4. THE 34th EXPERT PANEL RECOMMENDED

34th Experts' Recommended Revised Page 1. Modify development objective, eliminate the

possibility of making a difference to tropical timber

See part II, The Project, Point 1.1. Development Objective “Contribute to the sustainable use…tropical forest products”.

The main objective of the proposal is to contribute to the sustainable use, sound trade and responsible consumption of the resources for timber and non-timber forest products in P.R. China. This is envisaged by the development of national guidelines for the green public procurement of tropical forest products, the establishment of a platform to extend related information, the enhancement of stakeholders’ awareness of green public procurement, the promotion of China’s use of tropical and non-tropical timber from sustainable sources and the improvement of the forest law enforcement and execution in China. Meanwhile, the proposed project also intends to provide experience and reference for researches on the green public procurement policies for non-tropical timbers which is to be supported by other channels besides ITTO.

5

2. Redevelop specific objectives, making a clearer statement of whether the proposal refers to public procurement policy

See part II, The Project, Point 1.2. Specific Objectives “To develop a national Governmental strategy for the green public procurement....”, and

“To create awareness among all parties…to promote the use of tropical forest products from legal sources and transparent trade”

5

3. Modify problem tree and objective tree by the consolidation of cause boxes

See part II, The Project, Point 2.1. (Problems to Be Addressed) and point 2.2 (Intended Situation after Project Completion), Diagram 1 and Diagram 2

5-10

4. State in detail technical and scientific aspects, economic aspects, environmental aspects and social aspects

See part II, The Project, point 2.5，2.6，

2.7，2.8

11-13

5. make risk analysis and expound how to reduce risks in detail

See part II, The Project, point 2.9 Risks,” One of the potential risks is that green public procurement policy may reject legally harvested timber but without being certified…, to ensure the successful completion of the proposed project”.

13-14

- 42 -

6. Consolidate project activities See part II, The Project, point 4 Activities, consolidate the original 30 activities into 12 activities, which is more conformant to modified budget and revised development as well as specific objectives.

14-15

7. Modify the evaluation indicators in logical matrix.

See part II, The Project, point 5 Logical Framework.

Make a further amendment and refining of the evaluation indicators in the logic matrix according to adjusted outputs and activities, so the indicators will be more of operability and testability. Moreover, the experience of Germany and other countries in the respect are considered.

16-18

8. Examine the cost accounting in the budget component

See part II, The Project, point 7 Budget.

Table 7.1，7.2，7.3.3 and 7.4.1

— Total budget increased from

USD 386,869 to 409633,

— Subcontract reduced from

USD 128,500 to 65,400,

— Duty travel increased from

USD 75,000 to 102,730,

22-33

Note: those with black bold underlined style indicate revisions done in response to the recommendations of the 34th Expert Panel.

- 43 -

ANNEX 5. THE 35th EXPERT PANEL RECOMMENDED

35th Experts' Recommended Revised Page 1. Further refine the development objective and

delete the reference to non timber forest products.

See part II, The Project, Point 1.1. Development Objective “Contribute to the sustainable use tropical forest products”.

5

2. Delete activity 1.2.1 on study tours (it would be far more cost-effective and beneficial for the proponent to invite international experts and resource persons to China to provide information and expertise on green public procurement policies being implemented in other countries instead of conducting international travel and overseas study tours for the same purpose).

See Point 4.2 (Output 1.2), the original activity 1.2.1 had been deleted, and the original activity 1.2.2 become new activity 1.2.1;

In order to invite international experts and resource persons to China to provide information and expertise on green public procurement policies being implemented in other countries instead of conducting international travel and overseas study tours for the same purpose, we increase the activities and output with in Terms of Reference for Information Gathering of Green Tropical Forest Product Procurement Policies Worldwide (Activity 1.2.1, see ANNEX 3), and the man. month ranged from 1 to 2 man. month, but the new grand budget (405,533 US$) is lower than original budget (409,633 US$), See point 7.1 Worksheet of Budget Component;

See Logical framework (indicators, means of verification and assumptions related on output 1.2 had been modified).

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22-26,39

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3. Include the will of the government as a potential risk to be analyzed and mitigated.

See the last but one paragraph in Point 2.9 (Risks), the will of the government as a potential risk to be analyzed and mitigated

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Note: those with blue bold underlined style indicate revisions done in response to the recommendations of the 35th Expert Panel.

itto · timber. meanwhile, china is the world's most important wood-based forest product...

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