Is Indonesia jeopardizing it’s FLEGT license?

Indonesia is risking its FLEGT (Forest Law Enforcement, Governance and Trade) - license and missing the opportunity to become the first country in the world to achieve full implementation of its timber legality system as the Indonesian Trade Ministry insists on relaxing certification for timber products. Earlier Indonesia had agreed to fully implement its its timber legality system (SVLK) by the end of 2015, a deadline laid down by the EU for the country to meet if it wanted free access for its timber products into the EU market. This deadline was stipulated in the Voluntary Partnership Agreement (VPA) which was ratified by Indonesia in 2014.

“We already have the SVLK. There’s only one small step left to make, but we missed it. This has put us at risk of not becoming the champion of timber legality certification in the world,” Indonesia’s chief negotiator of FLEGT VPA, Agus Sarsito, said during a discussion on the future of the agreement held by the National Development Planning Board. Indonesia experienced a setback to its timber certification when Trade Minister Thomas Lembong issued Regulation No. 89/2015 in August last year, allowing for the export of 15 downstream timber products, including furniture, without SVLK certification. “The EU has told me that it is ready to implement the FLEGT VPA only if the ministerial regulation is revoked or annulled,” Agus said.

Since Indonesia missed the deadline, the EU has given a new deadline of April 1 this year. EU Ambassador to Indonesia Vincent Guerend promised that the EU would fully implement the agreement by the new deadline. The FLEGT implementation, he said, would benefit Indonesia, which currently has a 40 percent market share in the EU tropical timber market. However, he said that timber products must have the required V-legal documents attached, as regulated by SVLK.
As V-legal documents would be considered equal to a FLEGT license, Indonesian timber would automatically pass the due-diligence examination that is usually required before products enter the EU market. The Trade Ministry’s trade security director, Okan Norwan, questioned the EU’s readiness, saying that it was not serious in implementing the FLEGT. “They only check [timber products entering the EU] randomly. Because it’s random, illegal timber products from other countries can also enter the market. This is a disincentive for us,” he said. “There are also six EU countries that haven’t been able to implement [the FLEGT] yet. Those which have been able to do so also can’t do it optimally,” he added.
Okan also criticized the EU for allegedly trying to force Indonesia to fully implement the SVLK, saying that it was up to business players to decide whether they wanted to implement the SVLK or not as not all countries required Indonesia to implement the SVLK. With such sentiments from the ministry, Indonesia is at a crossroads on whether to proceed with the full implementation of SVLK, according to Agus.
“We don’t have any certainty on when our agreement with the EU goes live. Do we want the FLEGT VPA to be implemented? Or do we want to give up because we can’t revoke the regulation? If we can’t, then we could just stop the negotiation process [with the EU] because what’s the use? This is the worst case and we will be ridiculed by the international scene because we have ratified the agreement through a presidential regulation,” he said.

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