Indonesia Takes Landmark Step on Timber Legality

UNCLAS JAKARTA 000951 SIPDIS DEPT FOR OES/ENRC, EAP/MTS USTR FOR DBROOKS USAID FOR ANE, EGAT AGRICULTURE FOR FOREST SERVICE TREASURY FOR KBERG BANGKOK FOR RDM/A E.O. 12958: N/A TAGS: SENV EAGR KGHG ECON PGOV ID SUBJECT: Indonesia Takes Landmark Step on Timber Legality ¶1. On Friday, May 29, Indonesia's Minister of Forestry M.S. Kaban signed a decree on a timber legality verification standard (Standar Verifikasi Legalitas Kayu, or SVLK). The SVLK is a landmark step because it significantly empowers officials to clamp down on illegal timber harvesting, transport and trade through simplified regulation and law enforcement. The legality standard will be crucial to U.S. efforts to enforce the amended Lacey Act, given that the Lacey Act defines legality according to the laws of the country of origin of timber products entering the U.S. market. ¶2. An informal multi-stakeholder process to develop this timber legality standard began in 2002. The process was formalized in 2006 under the Ministry of Forestry (MOF). The final draft SVLK was approved internally by MOF officials and presented to the Minister for his signature in late 2008. However, lingering concerns about the SVLK's potential impact on the timber industry delayed the Minister's final approval until last week. However, Post has not yet seen the final version, and cannot confirm the extent to which it reflects the stakeholder-agreed text. ¶3. The final impetus for signing the decree appears to have been the amended Lacey Act. Statements by MOF officials indicate they see the SVLK as a clear way for the Indonesian timber industry to assuage U.S. importers' concerns about timber legality. "The government has established a timber legality verification system (SVLK) in anticipation of the Lacey Act", said the Director General for Forest Production Development in Jakarta recently. U.S. Support for Developing the SVLK -------------- ¶4. From 2002 to today, The Nature Conservancy has played a key role in assisting the MOF and stakeholders to develop the national timber legality standard, with USAID support. In 2005, these efforts prompted the MOF to launch a formal stakeholder process led by the Indonesian Ecolabelling Institute (LEI) to develop management and operational procedures to implement the legality standard. Under the broader U.S. commitment to implement the 2006 Memorandum of Understanding on Combating Illegal Logging and Associated Trade, The Nature Conservancy, the U.S. Forest Service, World Resources Institute, and the Indonesian NGO Sekala assisted the MOF with working out final aspects of the new legality standard. The United Kingdom's Department for International Development also provided complementary support. Next Steps -------------- ¶5. The SVLK now goes to MOF's Legal Bureau for administrative processing prior to submission to the Ministry of Law. The Ministry of Law will then officially publish the decree in the state gazette. The subsequent challenge is to make the SVLK operational. The MOF will need continued assistance to train personnel and pilot the key processes and procedures within the Ministry and in the field that must be in place for effective implementation of the legality standard, with a strong emphasis on transparency and accountability, including the training of independent assessors. Neither Post nor NGOs that were active participants to the SVLK's development have seen the final version of the SVLK. Post will share the contents of the ministerial decree once it has obtained a copy. HUME