P l a t f o r m N e w s

Issue 3 – July 2004 – Quarterly newsletter of the EC Forest Platform
The EC Forest Platform is a FERN initiative that links peoples in the South and the European Community on aid and forest issues

The aim of Platform News is to inform you about current and upcoming issues on aid and forests in the European Community and to link the individuals and organisations interested in monitoring EC policies and projects. To allow this, we will endeavour to keep articles direct and simple, with a special emphasis placed on providing information that facilitates the understanding of how aid- and forest-related decisions are taken in the European Union.

In order to make this newsletter as useful as possible, please send me any information that you would like to publicise to other Platform members. This may be information about projects, documents or position papers, or just responses to news you see here. This process of debate and information sharing will provide the opportunity for Platform members to influence the European Union and the way its aid programme affects forests and forest peoples around the world. Where relevant, your information and experiences – whether critical or supportive – will be presented to the officials and decision-makers of the European institutions.

Do not hesitate to send me any comments or ideas to improve this newsletter, and please feel free to forward Platform News to interested friends and colleagues. We hope you will take advantage of this opportunity to make Platform News an open forum for debate and information exchange on EC aid and forest issues.

Iola Leal Riesco
EC Forest Platform co-ordinator
iola@fern.org
www.fern.org/pages/aid/platform.htm

P l a t f o r m Debates

Our Cameroonian and Indonesian EC aid Platforms have now been established. They send a clear signal to the European Commission and its Cameroonian and Indonesian delegations, that forest NGOs and Indigenous Peoples Organisations (IPOs) will closely monitor EC aid and EC forest projects. The focal points, Centre pour l’Environnement et le Développement (CED) and Telapak, have organised training seminars on EC aid with local NGOs and IPOs, and are already providing information to EC Platform members and to the Commission. This includes information on particular EC forest projects and on the development of policy-making both in Brussels and in the relevant local EC delegations and Governments.

For information about our national Platform activities and documents, or to actively join the Platform, please contact our NGO focal points Emmanuel Kam Yogo (ekamyogo@africa-environment.org), CED, Cameroon, and Mardi Minangsari (mardi_minangsari@telapak.org), Telapak, Indonesia.

EU Regulation
The Regulation to control imports of illegally sourced timber from specific countries in the South into the EU is now in its final stages of preparation and could still be completed before the end of the summer (see also Platform News issue 2). The Regulation will deal with aspects of border control and will form the legal basis for the licensing scheme and partnership agreements envisaged in the EU FLEGT Action Plan, but it will not touch upon the more political issues such as definitions of legality or the framework for partnership agreements.

The hot issue is what will be the legal basis for this Regulation. Today, while the Commission has stated that this Regulation’s legal basis should be article 133 (commercial policy) of the EU Treaty, the European Parliament, together with some member states, has put forward the case for it to be article 175 (environment). This may seem like nothing more than a numbers game, but this discussion is actually of great significance: article 133 will not allow the Parliament to amend the Regulation, instead giving full power to the Commission for its finalisation and implementation. And amending the Regulation – as it is currently envisaged by the Commission – may be essential given the recent findings of impact studies on the proposed licensing scheme. These studies (see below) have revealed that the scheme as it stands is unlikely to have much – if indeed any – positive impact on the ground.

There also remain doubts as to whether agreements between the EU and wood exporting countries can help to encourage more socially just forest laws in those countries. NGOs have stated on several occasions that only a Regulation enabling customs authorities in the EU to take action against all illegal timber imports would make any sense – a position even supported by the Dutch Timber Trade Federation, which has recently signed a joint statement with Dutch NGOs asking for such legislation.

Licensing scheme
As the Commission reaches the final stages of presenting its Regulation to control the imports of illegally sourced timber, various organisations have started to look at the potential impacts and workings of a licensing scheme that would accompany such a Regulation. Indufor Oy – contracted by the Commission – (draft report available from info@fern.org), the Royal Institute for International Affairs (final report will be available at: www.illegal-logging.info) and FERN have all presented reports on the impact and/or workings of a licensing scheme, which would allow imports of only ‘legal’ timber from partner countries. And although the Terms of Reference for the three studies differ significantly, one clear conclusion from all three is that the impact of banning illegal timber from partner countries could prove negligible if restricted only to logs and sawn wood. To expand the licensing scheme to include all product groups – including paper and pulp – would therefore be essential. The FERN study concludes, however, that without additional complementary measures any licensing scheme would probably not be able to contribute much in relation to controlling illegal logging.

Definitions of legality
No doubt one of the trickiest aspects of legality is the definition of what is 'legal', as well as how to ensure that products that are in some way inappropriate – even though they may strictly speaking be legal - do not become 'acceptable' under new definitions.

A first attempt to define ‘legality’ has now been concluded in Indonesia. The resulting definition is based on seven principles, 18 criteria and numerous sub-criteria as well as a detailed guidance note. It will be field tested in Indonesia some time this summer. If positive, the outcome of these tests will be critical in steering similar processes in other countries. If negative, a lot more thinking will need to be done to ensure that trade activities focused on legality can genuinely contribute to the well-being of the world’s forest and its forest peoples.

RELATED LINKS
EU FLEGT Action Plan:
The Action Plan (May 2003): http://europa.eu.int/comm/development/body/theme/forest/initiative/docs/Doc1-FLEGT_en.pdf#zoom=100
FERN’s analysis of the Action Plan and recommendations to the Council (Jul 2003): http://www.fern.org/pubs/briefs/illegallog2.pdf and http://www.fern.org/pubs/ngostats/AP_reccs.htm
Joint NGO recommendations: http://www.fern.org/pubs/ngostats/NGOFLEGT.htm
Council Conclusions (Oct 2003): http://europa.eu.int/comm/development/body/theme/forest/initiative/docs/Doc2-council_proceedings_0310.pdf#zoom=100
Joint NGO statement on the Council’s Conclusions (Oct 2003): http://www.fern.org/pubs/media/FLEGTpr.pdf
European Parliament motion (Jan 2004): http://europa.eu.int/comm/development/body/theme/forest/initiative/docs/Doc7-EP_motion.pdf#zoom=100
Joint NGO media statement on the Parliament’s motion (Jan 2004): http://eu.greenpeace.org/downloads/forests/PRonEPResFLEGT.pdf
Commission’s series of briefing sheets on the FLEGT Action Plan. (April 2004): http://europa.eu.int/comm/development/body/theme/forest/initiative/briefing_sheets_en.htm
NGO positions:
Facing Reality: how to halt the import of illegal timber in the EU. FERN, WWF and Greenpeace (April 2004): http://www.fern.org/pubs/reports/facing_reality.pdf
Definitions of legality:
A Legality Standard for Timber Products from Indonesia (May 2004): http://www.illegal-logging.info/papers/Z%20Introduction%20and%20Principles.htm#Principles

N e w p o l i c i e s from the EU

In November 2003, MEPs voted for amendments to the Commission Proposal for a revised Regulation governing aid to Asia and Latin America (ALA). The amendments approved during this first reading of the co-decision procedure [1] include several FERN demands such as environment benchmark spending (10%), integration of environmental concerns into country programming and specific natural resource and poverty related activities.

Parliamentarians have also voted for the regulation to be split into two: one for Asia and one for Latin America, giving political recognition to the different characteristics of the regions. While poverty eradication is now the primary objective of the Regulation, a strong push by Spanish and Portuguese MEPs has led to the reduction of EC aid to Asia (by 247 million Euro) to the benefit of Latin America. The decision is difficult to defend given that poverty levels are worse in Asia, and that, per capita, Latin America will receive three times the amount of annual EC aid compared to Asia.

It seems that both the Commission and the Council are dissatisfied with the split regulation, the budgetary changes, and the numerous amendments. Although a Council position was expected by September 2004, there are rumours that the Commission may use its legal right to withdraw the Regulation. Would this mean starting the process from scratch?

[1] Legislation following this procedure has to be considered both by the European Parliament - the only democratically elected institution of the EU - and the Council, the EU's legislative arm.

RELATED LINKS
Proposed new ALA regulation (July 2002): http://europa.eu.int/eur-lex/en/com/pdf/2002/com2002_0340en01.pdf
Current ALA regulation (Feb 1992): http://europa.eu.int/eur-lex/en/lif/reg/en_register_11702030.html
Joint NGOs comments (Feb 2003): http://www.fern.org/pubs/ngostats/ala.pdf

Last February, the European Commission adopted a Communication outlining its proposals for the EU’s budget plan for the period 2007-2013 (the ‘financial perspectives’). The financial perspectives define the maximum allocation of EU funds for the major categories (see below), including development and co-operation assistance.

Finalising the financial perspectives involves the following steps: the European Parliament and Council must agree on the proposed guidelines before the end of 2004. In early 2005, the Commission will develop a second, more detailed Communication, which will include proposed amounts for each of the categories listed in the financial perspectives. EU member states are expected to reach a political agreement by June 2005. After the maximum allocations are set, any increase in need for development co-operation must be addressed by making savings in other areas of external actions.

Sustainable development, natural resources conservation and EU external policy are three of the five long-term EU priorities of financing cited in the proposal (the others being: Citizenship, freedom, security and justice; and Administration). To fulfil these priorities, the Commission is asking to maintain the current ceiling of EU member state contribution of 1.24% of Gross National Income (GNI). The reality is that there is little appetite for this significant expansion of the European Union budget among member states, especially among the EU’s biggest net contributors – Austria, France, Germany, the Netherlands, Sweden and the UK - who in December 2003 called for a downsizing of their maximum expenditure level to 1.0% of Europe’s GNI.

The debate, which promises to give rise to a major power struggle between some of the member states and the Commission, is of special importance as it will define where and how the money is spent.

In a parallel development, the Commission is expected to present a draft Regulation, in July 2004, on economic co-operation and development. This Regulation, which is said to improve management of EC Aid, would replace all thematic and geographic budget lines which are currently administered by the Commission, including the Environment and Tropical Forest, NGO Co-financing and Human Rights budget lines.

FERN welcomes the debate on the rationalisation of the budget lines, if it will lead to improve the effectiveness of their impact. However, there are concerns that the Commission will use this momentum to drop most or all budget lines, which could mean less funding for environmental, human rights and tropical forest projects. The EC Platform will closely monitor these developments, highlight the need for transparency and coherence among the different EC Policies (Environment, Development, External Relations, etc) and keep a critical eye on the proposed new ‘structures’ of the different instruments (thematic and geographic budget lines) and the driving forces behind this restructuring in the name of making EC aid more effective.

RELATED LINKS
Financial perspectives: http://europa.eu.int/scadplus/leg/en/lvb/l34012.htm
Commission Communication ‘Building our common Future: Policy challenges and Budgetary means of the Enlarged Union 2007-2013’ (Feb 2004): http://europa.eu.int/eur-lex/en/com/cnc/2004/com2004_0101en02.pdf
CONCORD ’s Information and Lobbying Toolkit on Financial Perspectives (March 2004): http://www.concordeurope.org/

In October 2003, the European Commission presented a Communication proposing to fully integrate EU cooperation with ACP (Africa, Caribbean and Pacific) countries in the EU budget. Several attempts were made in the past (since 1973) to open the controversial issue of placing funding for the ACP countries under Parliamentary scrutiny. In every case, some EU member states opposed this.

The European Development Fund (EDF), set up in 1958, is the main instrument for Community aid for development co-operation in the ACP countries. Today, the EDF is funded by the member states, covered by its own financial rules and managed by a specific committee. EDF budgetisation means that the EDF would enter into the annual Community Budget and would be part of the new financial perspectives 2007-2013 (see above). As part of the financial perspectives, EDF budgetisation will not take place before 2007, and if no agreement is reached to include the EDF into the financial perspectives by 2005, the EDF will remain outside of Parliamentary control until at least 2014, when the next financial perspective period will start. The Commission hopes the changes will be made before the new EU budget period begins in 2007, but it is expected to find opposition at least from the UK and new member states, who are exempt from contributing to the EDF but not to the EU’s budget.

The implications of including the EDF in the financial perspectives on the management of aid to the ACP are still unclear. Many NGOs, who agree in principle on the need for Parliamentary oversight of the EDF, are worried that accepting this proposal might translate into less aid for the poorest countries. This may arise from the possibility, under new budgetary rules, of shifting unspent aid to other areas. Currently, 7-9 billion Euro of aid to ACP countries - over half of the current fun -, is estimated to be unspent. According to political priorities this could be spent on non ACP areas or targeted priorities. Such impact could worsen the situation on forest peoples, forests and the environment in general, that are already suffering from the lack of environmental mainstreaming of Commission Policies (see FERN report ‘Forest at the Edge’ at: www.fern.org).

Irrespective of the various concerns that arise from the current proposal for budgetisation of the EDF, the fundamental question arises: Is it possible for the EU to have a credible EC development policy if the biggest chunk of its aid funding remains outside Parliamentary scrutiny?

RELATED LINKS
Commission Communication‘Towards the full integration of cooperation with ACP countries in the EU budget’ (Oct 2003): http://europa.eu.int/eur-lex/en/com/cnc/2003/com2003_0590en01.pdf

In March 2004, the European Commission organised a public consultation on its draft Guidelines for Support to Land Policy Design and Land Reform Processes in Developing Countries. The guidelines aim to establish a common framework for the EU to support, through EC and member states’ bilateral co-operation programmes, the design of land policy reform processes in developing countries. The comments received from the consultation are being considered and will be reflected in the final version of the EU Task Force Guidelines, which are expected to come out before August 2004.

RELATED LINKS
Draft available from Land Coalition at: http://webapps.ifad.org/euforum/consultation_on_the_draft_land_policy_guidelines_of_the_eu

N e w s f r o m around the World

In February 2004, over 100 environment, development and human rights groups in the Democratic Republic of Congo (DRC) called on the World Bank to halt plans to finance a massive expansion of the logging industry in the country. The planned development would apparently "zone" the entire Congolese rainforest, second only to the Amazon basin in size and diversity, to sell off for commercial logging and other activities.

Leaked World Bank documents reveal that the Bank is aiming to "create a favourable climate for industrial logging" in DRC and envisages a 60-fold increase in the country's timber production. Congolese groups say that these plans will surely have "major repercussions for the rights and livelihoods of millions of Congolese citizens, with serious and irreversible impacts" on the forest environment.

Congolese NGOs' concerns have been "sidelined in a process which is deciding, at this very moment and without our contribution, the fate of our country's ecological heritage and the future of its people." This zoning and selling of logging rights without consultation, or any provision to ensure their future, threatens millions of impoverished forest peoples.

NGOs are now calling on the World Bank to be true to its rhetoric on participation, to its own environmental and social safeguards and to international law, to ensure that forests and forest peoples' rights in DRC are protected.

RELATED LINKS
NGO statement: http://www.fern.org/pubs/ngostats/DRC_appeal.htm
Rainforest Foundation Briefing Paper: http://www.fern.org/pubs/briefs/DRC_RF.pdf

In May 2004, Greenpeace declared the European Commission’s headquarters in Brussels a 'Forest Crime Scene' after undercover investigations showed that wood used in their renovation originates from companies known for trading in timber from Indonesia's threatened rainforests.

The Commission has stated that "any timber used in the refurbishment of Commission-owned buildings must be sourced from environmentally sustainable managed forests". Despite this, illegally-logged wood has been used in the Berlaymont building. No similar commitment, for projects such as the Economic and Social Committee (ECOSOC) building, has yet been made.

Forest products in the ECOSOC building include wood from the companies RSK, IKMM and Mujur, all of whom trade timber from the last rainforests of Kalimantan and Sumatra. It also includes timber from AFR, a company known to have obtained timber from a protected tiger reserve in Indonesia. Plywood in the Berlaymont building has been identified as originating from AFR, Korindo and Mujur. Korindo has been found by the Indonesian government to be trading in illegal timber.

Is it now hoped that the EU Environmental Ministers take this issue forward.

RELATED LINKS
Details on the action available on: http://www.greenpeace.org/international_en/news/details?item_id=473901
For a full press briefing, see: http://eu.greenpeace.org/downloads/forests/PressBriefingOnEUBuildingProjectForestCrime-Eng.pdf

On 2 June 2004, more than 30 Indonesian and European NGOs circulated an open letter, "No support for the planned pulp mill of United Fiber System in Indonesia ”. The letter calls for plans to develop a United Fiber System pulp mill in South Kalimantan to be shelved.

The planned pulp mill, a project of Union Fiber Systems Ltd (UFS), claims it will avoid problems of deforestation by using timber from established plantations in the nearby areas. However, there is strong evidence that the company does not have enough plantations to supply the planned mill. The new pulp mill would worsen the existing overcapacity of Indonesia's huge pulp industry, and would exacerbate related national and local problems. Concerns about the environmental and social impacts of the new pulp mill are increased by the fact that the Environmental Impacts Assessment report of the project has not yet been made publicly available.

While a dding another pulp mill project will almost certainly increase deforestation caused by an already unsustainable pulp industry in South Kalimantan, the industry has a further problem: logging and pulp companies in Indonesia are also marred by corruption. Many cases of stealing of the state forest have already been documented, while land conflicts and the clearing of rainforest to establish pulp plantations abound. Before plans progress to build yet another pulp mill a truly sustainable supply of timber to feed the mill must be ensured. Without such a guarantee, more land conflicts with local populations and more forest destruction seem certain. Indeed, rather than planning new developments, existing land conflicts must be resolved and planning for any new pulp mills must include free, prior informed consent from local communities. And as long as no credible guarantees can be obtained that ensure the sustainability of this project, the Finnish forestry industry, forest machinery producers, forest consultants and financers of the projects must abstain from taking part in the project.

RELATED LINKS
The Open letter of the NGOs is available at: http://www.fern.org/pubs/ngostats/UFS%20letter%20Jun04.pdf
United Fiber System: www.ufs.com.sg

The National Indicative Programme (NIP) 2005-2006 for Indonesia, adopted by the European Commission in April 2004, has been developed on the basis of the mid-term review of the 2002-2006 Country Strategy Paper (CSP) which took place in 2003.

Although “preservation and sustainable management of natural resources” is one of two assistance priorities within the Indonesian CSP, the NIP for 2005-2006 does not include this priority. The Commission’s reason: 100 million Euro have been spent in the natural resources/forestry sector since 1996 and there will be several programmes ongoing in 2005-2006 funded from the 2002-2004 NIP. In addition to this, and due to the situation in Indonesia where enforcement in the forestry sector is weak, the Commission foresees a need to evaluate the impact of the projects already undertaken and to propose a change in the current approach.

An evaluation of past spending and projects in the coming months will help to determine the Commission’s new approach to preservation and sustainable management of natural resources in Indonesia. It is possible that the Commission could decide to limit activities related to the preservation and sustainable management of natural resources in Indonesia to the FLEGT process (see Platform News issue 2). If this is the case, it will be essential to avoid focusing those FLEGT activities solely on the forestry sector, and rather to ensure that landrights and the underlying causes for illegal logging are also addressed. Without such a comprehensive approach, the Commission’s new approach may simply re-enforce unjust laws whilst doing little to address the forest crisis in Indonesia.

The EC Forest Platform Indonesia is actively monitoring the EC review mission and the ongoing EC forest projects. The discussions on the next CSP 2007-2011 will start in early 2005, as it will need to be ready by early 2006.

RELATED LINKS
The NIP will be made public soon on the Commission’s site: http://europa.eu.int/comm/external_relations/indonesia/intro/index.htm

R e s o u r c e s

A Practical Guide to Campaigning at the EU Level : the EU's impact on forests. FERN, TRN (June 2004). An essential tool for anyone working to influence the EU on forest issues, the Guide provides an overview of the EU, its institutions, details of how EU processes work, practical tips on influencing those processes and pointers on where to get hold of critical information. Available from: info@fern.org (for a hard copy) or from: http://www.fern.org/pubs/reports/EU-guide.pdf

Cotonou Agreement : A user's guide for non-state actors. ECDPM (Nov 2003). Produced by the European Centre for Development Policy Management and the ACP Secretariat, this guide covers various issues of interest to NGOs and evaluates the consultation process undertaken with a wide range of stakeholders from the six ACP regions and the European Commission. Available at: http://www.ecdpm.org/nsaguide

Implementors or Actors? Reviewing civil society's role in European Community development assistance in Kenya, Senegal, Bolivia and India. BOND (2004). This analysis focuses on the degree and quality of civil society participation in drawing up the Country Strategy Papers (CSPs) in four countries. CSPs determine how EC aid is allocated in the recipient country. Available at http://www.bond.org.uk/pubs/eu/impactor.pdf

In July 2002 FERN launched the EC (European Community) Forest Platform. The Platform’s aim is to ensure that EC development co-operation (10% of the world Official Development Assistance) has a positive impact on forests and forest peoples. Its main goals are to:

• give a voice to NGOs and forest peoples who want to present their issues to the European Community;
• debate the impacts of EC aid policies and projects on forests and forest peoples;
• provide EC policy makers with ‘on the ground’ information on forests and forest peoples;
• encourage greater co-operation and dialogue between EU based NGOs and Southern NGOs, community-based organizations and indigenous peoples organizations.

Platform activities should contribute to a better implementation of commitments made by the European Commission in regard to development co-operation, environmental integration and recognition of civil society as an active partner. Exchanges between European-based ENGOs and Southern NGOs should contribute to raise awareness among Northern ENGOs about development-related problems faced by people in the South.