Forest revenue transparency: Republic of Congo and the EU must do more
The 2016 report that the Republic of Congo just submitted to the Extractive Industries Transparency Initiative (EITI) raises NGO concerns over the country’s commitment to ensure full transparency of payments made by logging companies, an obligation under both the EITI and the Forest Law Enforcement, Governance and Trade (FLEGT) Voluntary Partnership Agreement (VPA) to halt exports in illegally sourced timber.
This is the country’s ninth published report, and the second to include the forest sector. The result is somewhat disappointing, however: out of 20 companies asked to disclose information about payments made to the forest authorities, only one (Industrie Forestière d'Ouesso, affiliate of German-Swiss group Danzer) did so. Major companies, such as Forest Stewardship Council (FSC)-certified Congolaise Industrielle des Bois, or Mokabi, affiliate of French group Rougier, failed to comply. Consequently, it remains impossible to reconcile financial flows from the forest sector, understand the sector’s real contribution to the economy (five per cent according to the report), assess whether total revenues should be higher, or determine how much local communities should receive.
For Christian Mounzéo, coordinator of Rencontre pour la Paix et les Droits de l’Homme (RPDH), one of Fern’s local partners in Congo, several factors are to blame: companies’ unwillingness to comply with their transparency obligations, a tradition of opacity in the forest sector, and the absence of government sanctions. EITI and VPA transparency commitments can help maximise natural resource revenues and fight corruption in Congo’s forest sector, but only if the government is willing and capable of undertaking necessary reforms.
As one of Congo’s top importers of timber, the EU has a responsibility to ensure that all exports to the EU are ‘clean’, and that logging companies accessing the EU market adhere to high standards of integrity and transparency. This would send an important signal that the EU is serious about strengthening the implementation of the EU timber regulation (EUTR), a key complementary measure to the VPA. Under the EUTR, competent authorities must check that all timber entering the EU is legal. As the Commission vows to step up EU action against tropical deforestation and forest degradation, it should remember that this goes hand in hand with halting the illegal timber trade through the FLEGT Action Plan.