Through dialogue and transparency IUCN, WWF and FSC improved the Ukrainian forestry sector reform

Since the revolution in February 2014, Ukraine has been going through a phase of political and social turmoil. Riding on the wave of change in the country, groups of citizens came together and called for reforms to root out the rampant corruption of the political system. Part of this reform focused on natural resource management where several proposals were put forward to improve forest governance and make it more effective and transparent.

In December 2014, the newly-elected Parliament proposed a package of radical reforms that were intended to eradicate corruption in the forestry sector. However, in the context of the work implemented in the FLEG II Program, IUCN, WWF, and the Forest Stewardship Council (FSC) representatives in Ukraine pointed out that the implementation of these measures had the potential to severely damage the sector.

“The reform package was developed in a very chaotic period of time, right after the revolution” said Roman Volosyanchuk, FLEG II Country Program Coordinator for IUCN in Ukraine, “The new incoming parliamentary members wanted to take prompt actions against corruption, but they did not carefully weigh the negative consequences of the changes suggested”.

The draft legislation consisted of three measures - banning timber exports from Ukraine, allowing the privatization of forest areas, and discontinuing the issuance of new timber harvesting licences. According to IUCN, WWF, and FSC, the reform could lead to the collapse of the forestry sector and could actually exacerbate deteriorating socio-economic conditions of Ukrainian rural communities.

The ban on timber exports would constitute a flagrant violation of the Free Trade Agreement between Ukraine and the European Union and of World Trade Organization regulations, going in the opposite direction of open economy and democracy. In addition, it would lead to a sharp drop in timber prices internally, temporarily benefitting the timber processing industry but threatening the collapse of the forestry sector. Enterprises would lose a significant part of their profits, which would result in layoffs, tax insolvency, and service quality deterioration.

“The negative impacts of the reform would exert a particularly detrimental effect on rural communities whose economy is more directly dependent on a productive forest sector” affirmed Pavlo Kravets, FSC National Representative in Ukraine, “Among the most vulnerable individuals are women working in forest nurseries, who would be the first to lose their employment. We also need to consider that economic difficulties could encourage illegal activities such as uncontrolled timber harvesting”.

In order to raise awareness on the shortcomings of the reform, IUCN, WWF, and FSC combined forces and wrote a joint document called the ‘Open Letter’, which was presented at a Parliamentary hearing and distributed to the public. The document expressed criticism based on solid analysis and put forward concrete proposals to improve the timber trade system.

When the Open Letter was released, some environmental groups had a negative perception of IUCN, WWF, and FSC’s position, as they thought that the three signatory NGOs were trying to defend the interests of foresters and of the timber industry abroad. To clarify their reasons, the three organizations engaged in a direct dialogue with these groups and invited them to a roundtable to address their concerns.

“This meeting, held in March 2015, was a real success!” said Dmytro Karabchuk, FLEG II Activity Coordinator for WWF in Ukraine, “We had a very open exchange of ideas and a constructive debate which resulted in a unified position. Together with our partners, we prepared a petition in support of the Open Letter, which received around 800 signatures”.

The voice of the signatory organizations and citizens did not remain unheard. In April 2015, the measure to privatize forest areas and that to stop providing timber harvesting licences were removed from the reform package. On the contrary, the ban on timber export was adopted with small changes by the Parliament and came into force in November 2015. However, on March 22, 2016, a new draft law aiming to cancel the ban and establish transparent timber trade rules was registered at the Parliament Secretariat.

“We are following the development of the situation very carefully” said Mr. Volosyanchuk, “We stay at policy-makers’ disposal to provide expert guidance and improve forest governance in Ukraine”.

“We are very proud of what our team has obtained so far” said Richard Aishton, FLEG II Program Coordinator for IUCN, “This success is the result of a working method that characterizes our FLEG II Program and can be summarized in two words: dialogue & transparency. FLEG II Country Program Coordinators have established a dense network of professional relations with both public and private stakeholders through open and constructive dialogue. Their positions reflect high-quality, quantifiable analysis and are discussed in an open and transparent manner. This approach makes our experts trustworthy partners who are able to tangibly influence the governance of forest resources in the FLEG countries”.