COVID 19: Forest Industries Appeal for Help to Access EU Market via VPA-Flegt Processes

The COVID-19 pandemic has affected public wellness enormously and continues to create unparalleled disruptions to economies and labor markets, including workers and enterprises in the forest sector. In Ghana, the COVID-19 pandemic has presented immense immediate and medium-term impacts on forest-related supply chains.

The combination of stagnating production, reduced demand, shortages of raw materials, lack of working capital, freight rate increases, and, in some cases, labor shortages, has forced many operations to halt their activities, some permanently.

The sector that has contributed about 200 million euros annually to Ghana`s export income and an estimated 120 million euros of cash flow from the domestic market, providing employment opportunities to an estimated 300 thousand Ghanaians and whose companies through their social and corporate responsibilities have invested heavily in bridging the infrastructure gap in their areas of operations by construction and development of schools, hospitals, road networks, and investment into rural projects that sustain the livelihood of forest fringe communities and contributing to rural poverty reduction, now needs serious help and attention.

Among the viable remedies would be issuance of the European Union (EU) Forest Law Enforcement Governance and Trade (FLEGT) license through the implementation of a Voluntary Partnership Agreement (VPA) has been pursued since 2007 by Ghana and the European Union.

The progress made so far has brought about improved transparency in forest governance with Civil Society Organizations (CSOs) playing an astounding role in facilitating the process. It has also improved both human and technical capacity and brought more focus on sustainable forest management. Others include firm accountability, bureaucratic efficiencies, institutional collaboration, stakeholder participation, and other aspects of good forest governance. It is expected that when FLEGT becomes fully operational, FLEGT licensed timber will automatically meet the requirements of the EU Timber Regulation.

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It will, therefore, be exempt from any due diligence assessment process, saving time and money. This should increase EU importer confidence in Ghana’s timber products and make them more attractive than equivalent products without FLEGT licenses.

The overwhelming anticipation has been that the VPA process would have been concluded in 2020, thirteen years since when discussion, negotiation, and reaching of agreement ensued. The final stages of the implementation borders on ratification by Parliament for the conversion of old timber leases to the Timber Utilization Contract (TUC) as stipulated by law (Timber Resources Management and Legality Licensing Regulations, 2017- LI 2254) and finalization of Forest Management Plans (FMPs). The Forest Companies have done their part to submit applications for the conversion of existing Forest Leases and Permits into TUCs to the Forestry Commission (FC) for their assessments and evaluations. Successful applications have been documented and submitted to the Ministry of Land and Natural Resources (MLNR) for approval and onward transmission to Parliament for ratification.

The contribution of the forest sector to economic growth cannot be underestimated. Ghana stands to benefit enormously when FLEGT becomes fully operational through an increase in the flow and share of Government revenues by blocking access to export and domestic markets for illegal operators who do not pay appropriate taxes and fees.

The urgency of completing the VPA-FLEGT process therefore cannot be overemphasized enough. The thoughts of the current Parliament missing the ratification of the TUCs will be a devastating blow to the forest sector and several stakeholders that have been committed to over a decade of efforts to get it realized this year.

In the likely scenario that the present Parliament is unable to get the TUCs ratified and a new Parliament initiated next year, the ratification process could be characterized by massive uncertainties as attention will be shifted to building the structure for the next Parliament and attending to urgent government agendas.

This level of unpredictability could drag the completion process at the detriment of the forest sector. The forest sector has been strangled by the ongoing health and economic crisis but perhaps VPA-FLEGT can bring some relief to forest companies.

The EU remains a huge market for timber companies and can increase the stream of revenues into the country. After thirteen years of implementation, Ghana must strive to see the VPA-FLEGT through. The Private Sector, CSOs, FC have all played critical roles and continue to be instrumental in completing the EU VPA-FLEGT process. Hopefully, the approved TUCs will be delivered expeditiously to Parliament even if in batches for ratification to be complied with so that the grueling VPA-FLEGT process can be brought to deserved finality.