Rethinking forest concessions Improving the allocation of state-owned forests for better economic, social and environmental outcomes FORESTRY WORKING PAPER 4 Rethinking forest concessions Improving the allocation of state-owned forests for better economic, social and environmental outcomes FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS Rome, 2018 iii Contents Acronyms and abbreviations .................................................................................... vi Executive summary .................................................................................................. vii 1 Introduction ................................................................................................... 1 Objective................................................................................................................... 2 Concession systems .................................................................................................. 2 Forest tenure and forest rights ..................................................................................... 5 Concessions and responsibilities ................................................................................... 5 Concessions and their benefits ..................................................................................... 6 Concessions and sustainable forest management....................................................... 6 Poor forest management .............................................................................................. 7 Are expectations of concessions realistic? ................................................................... 8 Institutional settings and concessions .......................................................................... 8 2 Concessions around the world: successes, failures and lessons learned .............................................................................................11 Concessions in Latin America, Southeast Asia and West and Central Africa........11 Where are the concessions? ........................................................................................... 12 What are the benefits of concessions? .......................................................................... 14 Concessions as a means of protecting forests ............................................................. 17 Public forest concessions in other regions ............................................................. 18 Why are some concession systems more successful than others? ........................ 19 Small concessions versus large concessions ...................................................................20 Are community-held concessions more successful? .....................................................22 How can forest certification help? .......................................................................... 23 Intact forest landscapes ..................................................................................................26 What have tropical forest concessions achieved? .................................................. 27 3 Why is tropical forestry so difficult?.......................................................... 29 The diversity dilemma ............................................................................................ 29 Forest management planning ................................................................................. 30 Tropical forest silviculture ....................................................................................... 31 Economics of tropical forest management ............................................................ 32 The role of markets .................................................................................................. 35 iv Why have governments failed to keep value in-country? ................................... 37 Poor industrial performance .................................................................................. 38 Tropical forestry and self-regulation ..................................................................... 39 Illegality and corruption ......................................................................................... 40 Causes of illegality .......................................................................................................... 41 Impacts of illegality .........................................................................................................42 Impacts of corruption .....................................................................................................43 4 The future of concessions ........................................................................... 45 Scenarios for the future of tropical forest management ...................................... 45 Improved forest management ....................................................................................... 46 Improved governance .....................................................................................................46 Improved forest business ............................................................................................... 47 Forest investment ............................................................................................................48 What is wrong with the concession model? ......................................................... 49 Rights-based approaches ....................................................................................... 49 Worker rights, treatment of workers, and health and safety .............................. 51 The role of certification ........................................................................................... 52 Forest management ........................................................................................................52 Forest markets .................................................................................................................53 Auditing and transparency .............................................................................................53 “Concessions 2.0”: recommendations for an improved concession system ......... 54 Revised governance ........................................................................................................54 Facilitating forest business .............................................................................................55 Improved forest management .......................................................................................55 Involving local stakeholders ...........................................................................................56 Bibliography ..................................................................................................... 59 v Figures 1 Extent of intact forest landscapes in 2013 ................................................... 26 2 Number of native forest tree species, by country ........................................ 29 3 Major trade flows of tropical sawnwood, 2011 ............................................ 35 4 Volume of tropical timber for export and for legal and illegal consumption in local markets, various countries ....................... 37 Tables 1 Summary of forest areas and concession areas included in the three study regions ................................................................................ 1 2 Dimensions on which forest resource rights can be allocated, indicating broadly how commonly this occurs for each criterion in the case of concessions ................................................................................. 4 3 Forest revenues, by region ............................................................................. 12 4 Area of natural forests and concessions, by country, in the three studied regions ........................................................................... 13 5 Volume of logs harvested, and value of export sales, in selected countries ....................................................................................... 14 6 Areas and beneficiaries of Maya Biosphere Reserve concessions, by concession type .......................................................................................... 15 7 Typical social benefits associated with forest concessions ........................... 16 8 Corrective action requests requiring improved management in tropical forests certified by the Forest Stewardship Council ................... 24 9 Costs of logs in countries of origin and selling prices of boards in Europe for a range of hardwood species .................................................. 33 10 Quantities of timber required for a range of products ................................ 36 11 Scenarios for tropical forest management .................................................... 45 vi Acronyms and abbreviations CAD Canada dollar(s) CAR corrective action request CIFOR Center for International Forestry Research CIRAD Centre de Coopération Internationale en Recherche Agronomique pour le Développement CSR corporate social responsibility FAO Food and Agriculture Organization of the United Nations FAS free alongside FPIC free, prior and informed consent FRA Global Forest Resources Assessment FSC Forest Stewardship Council GBP United Kingdom pound ha hectare(s) IFL intact forest landscape ILCF investing in locally controlled forestry ITTO International Tropical Timber Organization km kilometre(s) kW kilowatt(s) m metre(s) NGO non-governmental organization NTFP non-timber forest