This media backgrounder provides journalists with information on the Guyana-EU Voluntary Partnership Agreement, which aims to address illegal logging, improve forest governance and promote trade in legal timber products. The backgrounder explains the aims of the VPA, progress to date and next steps.
The Guyana-EU Voluntary Partnership Agreement
- Illegal logging causes social problems, environmental degradation and a loss of economic opportunities
- In December 2012, Guyana and the EU began negotiating a Voluntary Partnership Agreement (VPA) to promote trade in legal timber products and improve forest governance
- Under a VPA Guyana would develop a timber legality assurance system so it can issue FLEGT licences to verified legal timber products
- Once Guyana begins FLEGT licensing, the products covered by the VPA will only be exported to the EU accompanied by FLEGT licences attesting to their legality
- Products not covered by the VPA will remain subject to the exercise of due diligence by EU importers in the context of the EU Timber Regulation
- FLEGT-licensed timber products from Guyana will be able to enter the EU market without undergoing the due diligence checks required by the EU Timber Regulation
- Legal and governance reforms identified by stakeholders through the VPA process are already underway
- There is broad stakeholder support for the aim of achieving a credible VPA. The Guyanese government, the private sector and indigenous peoples are looking for ways to ensure decisions related to a VPA are taken in a participatory way.
Guyana’s forest sector
Forests cover 87% of Guyana and make an important contribution to the economy, providing jobs and livelihoods. The government own 86% of the forests, while indigenous peoples own 14% of the land. In 2014, the annual deforestation rate was estimated to be 0.065%. Most deforestation is attributed to mining for gold and bauxite, which represents 60% of Guyana’s exports. Mining accounted for 87% of deforestation in 2014.
The timber trade between Guyana and the EU accounts for up to 5-8% of Guyana’s timber industry. Most exports of timber from Guyana to the EU are destined for the UK.
What is a VPA?
A Voluntary Partnership Agreement (VPA) is a legally binding trade agreement between the EU and a timber-exporting country outside the EU. A VPA aims to ensure that all timber and timber products destined for the EU market from a partner country comply with the laws of that country.
In addition to promoting trade in legal timber, VPAs address the causes of illegality by improving forest governance and law enforcement. A major strength of VPAs is that they look beyond trade to consider development and environmental issues.
Stakeholders in government, the private sector and civil society develop VPAs through a participatory process. While a VPA cannot address every issue in a country, due to its participatory nature, it allows different stakeholders to raise issues related to the forest sector that they want to see addressed.
VPAs are a key component of the EU Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan of 2003. Guyana is one of nine tropical countries that are negotiating VPAs with the EU. Six more countries have ratified VPAs and are implementing the agreements.
Key elements of a VPA
Key elements of a VPA are described in its main text and annexes. In countries where VPAs have already been signed, these include:
- A timber legality assurance system to verify that timber products are legal and can be issued with FLEGT licences
- Commitments to legal reforms, public disclosure of information and other improvements to forest governance
- A framework for overseeing, monitoring and evaluating implementation of the VPA and its economic, social and environmental impacts.
How a VPA promotes legal timber trade
A VPA partner country that has implemented a timber legality assurance system and other VPA commitments can issue verified legal timber products with FLEGT licences. The advantage of this is that FLEGT-licensed products automatically meet the requirements of the EU Timber Regulation (EUTR), which prohibits EU operators from placing illegally harvested timber and timber products on the EU market.
The EUTR entered into force in 2013. It requires EU operators to perform due diligence checks to ensure the timber products they place on the EU market are legal. FLEGT-licensed timber meets the due diligence requirements under the EUTR.
A VPA partner country can only issue FLEGT licences through a timber legality assurance system that the EU and the partner country have agreed on, developed and tested. Before a country can begin FLEGT licensing, the EU and the partner country must confirm that the country’s timber legality assurance system works as described in the VPA. Confirmation by the two parties means that the system is robust and will issue FLEGT licences only to legal timber products.
While FLEGT licensing is an important goal, it is not the end point of a VPA process. Governance reforms, legislative and policy reforms, impact monitoring, improvements to the timber legality assurance system and other activities continue.
Through progress on VPAs, the EU Timber Regulation and dialogues with other important timber markets, including China, the EU and the VPA partner countries are contributing to a growing global movement to address trade in illegal timber and timber products. The United States and Australia also prohibit the placing of illegal timber on their markets. The process to achieve FLEGT licences may therefore help VPA partner countries such as Guyana meet the legality requirements of markets beyond the EU.
The Guyana-EU VPA
Guyana and the EU are negotiating the terms of the VPA through a cooperative process: both parties share the goal of fostering good forest governance and addressing illegality.
The VPA negotiations began in December 2012. They involve the private sector, government ministries and agencies, and indigenous peoples. Through wide participation, the process aims to foster significant national ownership, stakeholder engagement and a broad consensus that will promote effective VPA implementation.
Following the conclusion of negotiations, Guyana and EU will sign and ratify the VPA and its commitments will become legally binding. A Guyana-EU joint body will oversee the implementation of the VPA and respond to concerns as they arise. VPA implementation can therefore improve as it proceeds.
In order to issue FLEGT licences as required by the VPA, Guyana will build on existing national initiatives to develop a robust timber legality assurance. Guyana will begin issuing FLEGT licences only when the timber legality assurance system has been successfully tested, and when Guyana and the EU are satisfied that it functions as described in the VPA.
VPAs signed to-date have also included commitments to improve transparency, accountability, legislative clarity and other aspects of governance.
Guyana’s efforts to tackle illegal logging
Guyana has made considerable efforts to address illegal logging and manage its forests sustainably. In 2000, Guyana introduced a log tracking system to verify the origin of forest products and control harvesting in state forests.
In 2009, the government launched a Low Carbon Development Strategy that promotes economic development while combating climate change by avoiding deforestation.
1953: Forest Act introduced to administer Guyana’s forests
1998: Guyana Forestry Commission introduces a Code of Practice for Timber Harvesting based on the UN Food and Agricultural Organisation (FAO) Model Code of Forest Practice
2000: Guyana Forestry Commission introduces a log tracking system
2002: Code of Practice for Timber Harvesting revised
2008: Parliament passes the New Draft Forest Act (Forest Bill 2007)
2009: Forest Act enacted
2012: Guyana and EU hold the first VPA negotiation session
2013: Guyana and the EU hold the second round of VPA negotiations
2013: Guyana holds additional stakeholder negotiation session
2015: Guyana and the EU hold the third round of VPA negotiations
2016: Guyana and the EU hold the fourth round of VPA negotiations
Guyana’s timber legality assurance system
Under the VPA, Guyana will commit to develop a system for assuring the legality of its timber. As in all VPAs, the timber legality assurance system must have the following five components:
- Legality definition: The legality definition states the aspects of a VPA partner country’s law for which the timber legality assurance system evaluates compliance with, for purposes of FLEGT licensing.
- Supply chain controls: Supply chain controls ensures that timber products verified as legal remain legal throughout all processes associated with the supply chain. Supply chain controls also prevent verified legal products being tainted by unverified products entering the supply chain.
- Verification of compliance: Verification of compliance involves checks that all the requirements of the VPA legality definition and supply chain controls have been met to ensure that timber products are legal.
- FLEGT licensing: A FLEGT licensing authority issues FLEGT licences to consignments of timber products that the verification mechanism has confirmed are legally compliant. FLEGT licensing cannot begin until a joint evaluation of the timber legality assurance system by Guyana and the EU confirms that the system works as described in the VPA (see Next steps).
- Independent audit: The independent audit regularly checks that all aspects of the legality assurance system work properly. An annex to the VPA provides terms of reference for the auditor.
How the Guyana-EU VPA improves forest governance
The VPA process has already had an impact as result of multistakeholder negotiations (see Guyana-EU VPA process).
Greater participation in decision-making
Stakeholder participation in the VPA process in Guyana improved in 2015 and 2016. The VPA process is becoming a vehicle for addressing the needs of different stakeholders including people who have never before had a voice in decision-making.
Encouraging dialogue between indigenous villagers and the Guyana Forestry Commission
Initially Guyana VPA negotiations were controversial. Some believed negotiations were helping build the capacity of all stakeholders. Others thought that the process was not inclusive, was rushed and did not tackle key issues of concern to local indigenous peoples’ organisations.
Since 2014, the UK and Norway have funded a FLEGT-facilitation support office. These support a genuine, inclusive and participatory process that allows for meaningful and independent inputs.
In addition, the EU provided support for the Amerindian Indigenous Peoples Association (APA) to improve awareness and build capacity for community engagement in the VPA process.
During consultations on the legality definition, some stakeholders expressed concerns about land issues. The Guyanese government indicated that it would be better to address such concerns through other appropriate forums. The National Technical Working Group (NTWG) agreed to consolidate the concerns on land issues raised throughout the VPA consultation process and communicate them to the appropriate government actors.
Enhanced capacity to address illegal logging
The VPA process is strengthening the capacity of government, the private sector and indigenous peoples to work together to address illegality in Guyana’s forest sector. The UK Department for International Development, the Government of Norway, the EU FAO FLEGT Project and the EU have all supported activities to ensure a fully inclusive VPA process.
VPAs include an annex that lists the information the government of the timber-exporting country commits to making publicly available. Guyana is drafting such an annex in consultation with stakeholders. Guyana’s Forestry Commission website publishes information on the VPA process, draft VPA annexes for comments, and reports on negotiation sessions and stakeholder meetings.
Legal reforms and improved legal clarity
The VPA process in Guyana provides opportunities to clarify what is legal and to identify overlaps, gaps and contradictions in the legal framework.
Conclude negotiations, then sign and ratify the VPA
Guyana and the EU are making good progress in negotiations. Stakeholders in Guyana, including the government, private sector and indigenous peoples, have reiterated their commitment to see the VPA signed, ratified and fully implemented if key issues can be resolved.
Implement the VPA
The EU and Guyana will establish a joint implementation committee, called joint monitoring and review committee in Guyana, to oversee implementation of the agreement. Implementation involves work to develop the timber legality assurance system described in the VPA so Guyana can issue verified legal timber products with FLEGT licences. Other activities may include legal reforms and capacity building. Multistakeholder participation continues in the implementation phase.
Trade in FLEGT-licensed timber
When a joint EU-Guyana evaluation concludes that the Guyanese timber legality assurance system is fully operational as described in the VPA, the joint monitoring and review committee can propose that Guyana begins to issue FLEGT licences. Once a decision is made to commence FLEGT licensing, the parties will follow their respective internal processes, including legislative measures, such as amending the FLEGT Regulation on the EU side.
Once FLEGT licensing begins, a valid FLEGT licence must accompany all exports to the EU of Guyanese timber-based products listed in Annex I of the VPA. EU customs officials will deny entry to any products covered by the VPA that arrive without a valid FLEGT licence. Products outside the scope of the VPA will remain subject to the normal due diligence requirements of the EU Timber Regulation.
Independent market monitoring
The European Commission has appointed the International Tropical Timber Organization (ITTO) as the independent market monitor for all VPA countries. The independent market monitor will assess the trade in timber products between Guyana and the EU, and the impacts of FLEGT licensing on this trade.