Rapid changes in economies, environmental conditions and social structures require that institutions are often called upon to transform themselves to meet new priorities and shifting demands. The forestry sector is increasingly swayed by the tides of change in national and regional affairs that accompany globalization. On the one hand, increasing wealth, lower poverty rates and greater access to information have, together with demands for social equity, stimulated moves to promote more participatory and devolved forms of governance. At the same time, however, dramatic deterioration in the extent and quality of forest resources in the region has led to criticism and questioning of the roles, objectives and institutional cultures of many traditional state forestry agencies. In addition, processes of economic, social and technological transformation have created political imperatives to enforce major changes in activities, responsibilities and the modus operandi of most forestry agencies in the Asia-Pacific region.
Generally, perceived weaknesses and failures of forestry institutions have meant that institutional re-inventions have been imposed on forestry agencies in the form of major restructurings, rather than allowing forestry agencies to evolve responses to change in more “organic” fashion. However, for several agencies – for example the USDA Forest Service – evolutionary approaches are a key feature of on-going re-invention. Important institutional weaknesses documented in Re-inventing forestry agencies include such factors as:
The Re-inventing forestry agencies initiative was organized with the intention of unravelling some of the trends and approaches to institutional restructuring in forestry in the Asia-Pacific region. The case studies describe various forces acting upon the region’s forestry institutions and the trajectories followed by individual countries in adjusting and adapting. The publication elaborates recent experiences in China, India, Malaysia (Sarawak and FRIM), Nepal, New Zealand, the Philippines, United States of America and Viet Nam. The initiative identifies key themes and forces at play in forestry and analyzes how countries have restructured their forestry institutions to respond to a fast changing landscape with rapidly evolving demands.
Worldwide economic, social and political integration, or “globalization,” is one of the defining characteristics of the twentieth and now the twenty-first century. Never before have so many states operated according to such similar sets of rules. The emergence of the World Trade Organization and regional trade blocks such as the European Union are phenomena that are re-defining state interactions and modes of governance. For countries where central planning and non-market-based economic systems have prevailed, especially in Asia, this has involved major re-orientation. The impacts on governments, how they are structured and operate, and the fundamental roles that they play have been – and currently are being – rewritten.
Forestry institutions have not been immune to the impacts of global trends in governance. These include: effects of globalization and economic liberalization; the privatization of government functions; increased importance of trade; multi-disciplinary and multi-stakeholder approaches; all combining with a need to remain relevant in an increasingly competitive environment. In light of globalization and increasing inter-connectedness of countries – through closer economic ties and increased information flows – there is consistency and universality in many of the trends taking place. There are strong similarities between, for example, experiences in New Zealand and Sarawak, and between Nepal, Philippines and Chhattisgarh. The more prominent themes resonate widely throughout the countries of Asia and the Pacific.
Privatization is a recurrent theme in discussions of forest management options, both globally and within Asia and the Pacific. However, it has been relatively rare that discussions have progressed to implementation. New Zealand was one of the pioneering countries in the world to embark upon large-scale privatization of its plantation forests. In the late-1980s, the New Zealand government decided that perceived conflicts between the multiple objectives pursued by the Forest Service were compromising organizational efficiency and resulting in economically suboptimal outcomes in forestry. A major restructuring of forest agencies was embarked upon. As a first step, the Forest Service was disbanded and new agencies were established to ensure production and commercial forestry functions would be kept separate from environmental and conservation forestry. Subsequently, between 1990 and 1996, the government sold more than 530 000 hectares of commercial forests to the private sector. The vast majority of New Zealand’s government-owned planted forest resources have been privatized, with the majority now in the hands of overseas interests.
In Sarawak, Malaysia, the formation of the Sarawak Forestry Corporation provides valuable insights into the processes of corporatization, even while it remains too early to assess the outcomes. International criticism over high rates of deforestation in the rainforests of Sarawak led to a mission by the International Tropical Timber Organization (ITTO) to assess how the forest resources of Sarawak could best be managed. The findings of this mission recommended a significant increase in Forest Department staffing, a move that the Government was reluctant to undertake with obvious implications for finance and overall bureaucracy size. A model was eventually proposed that vested operational forest management functions within a new corporate entity, whilst responsibilities for regulations and policy remained in the Forest Department. An innovative arrangement that established the Sarawak Forestry Corporation Sdn. Bhd., a “government-owned, private company”, enabled the state government to “cut through red tape” and enhance efficiency. The Sarawak model offers a unique example of an innovative institutional restructuring that is taking place in the sector as a result of pressures to improve performance within strict financial constraints.
New Zealand and Sarawak encapsulate a trend towards greater commercialization in forestry, which is embodied in the re-invention of the Forest Research Institute of Malaysia (FRIM). The transformation of FRIM into a new, statutory body was driven by a vision and need for the institution to generate innovations, rather than merely conduct research. Institutional restructuring enabled FRIM a far greater degree of independence to identify new research directions, and to pursue research excellence on its own terms. One of the most important innovations was much greater scope to react to the research demands of Malaysian industry, and to commercialize research findings. The importance of this restructuring is reflected in the scale and success of the Malaysian rubberwood industry, which is – to a significant part – attributable to the re-invention of FRIM.
Devolution is the transfer of powers from the central level to the regional or local levels and may involve transfer of powers to community groups or individuals. Devolution also re-allocates rights and responsibilities and re-distributes benefits and risks. The key argument for devolution, particularly as it relates to natural resources, is that it will lead to increased efficiency, equity and local-level inclusion by transferring decision-making powers towards those most directly affected. Devolution is regarded as an effective means of bringing about democratizing effects by empowering local people to control resources – and their own livelihoods.
The rising prominence of public participation in forest management has occurred for a number of reasons, including: opportunities for improved outcomes through local people’s inclusion; reaction against centralization and the isolation of decision-makers; the rise of advocacy movements supporting indigenous people, the rural poor and better environmental management; higher levels of education among the general public; and the growing influence of global trends. Public participation in forestry occurs in numerous forms: Joint Forest Management in India, community forestry agreements throughout the region; and in the case of more developed countries such as the United States, strong civil society dialogue on the use and management of forests.
In the case of the Philippines, devolution of power and the spread of participatory approaches grew out of resistance from indigenous groups to developments perceived as threatening traditional livelihoods. Such resistance ultimately led to the passing of the Indigenous Peoples Rights Act (IPRA). With control over ancestral lands being a flashpoint issue, the Department of the Environment and Natural Resources responded by creating the Indigenous Communities and Ancestral Domain (ICAD) Division within its Special Concerns Office. The various legal mechanisms that ensued culminated in increased rights and recognition of indigenous peoples, particularly with regard to management and de facto ownership of forestlands – effectively validating traditional indigenous forest use practices. While acceptance of direct public participation was not a painless transition in the case of the Philippines, it did allow greater involvement of civil society in forest resource management.
In Nepal, rampant forest degradation – attributed to ineffective management on the part of the government – prompted the eventual transfer of forest management responsibilities to local communities. While solutions to forest degradation were initially focused on technical aspects and centrally implemented, it became clear that important strategic elements were absent. Poverty reduction and income generation for surrounding communities gradually came to be viewed as keys for halting forest loss. Decentralization of rights and responsibilities to Community Forest User Groups, supported by the premise of equitable benefit sharing, became the cornerstone of Nepal’s forest policy.
Chhattisgarh is another case where very specific allowances were made for the involvement of local people. The new State’s forest policy envisaged that participatory Joint Forest Management (JFM) would form the basis of forest management in Chhattisgarh. However, recognition of “gaps” within the JFM approach, led to the design of several innovative institutional arrangements to enhance local people’s well-being and promote enhanced management of forest resources. Chhattisgarh developed new concepts of People’s Protected Areas and Public-Private Partnerships, along with innovative pilot projects and new benefit-sharing arrangements. Chhattisgarh is a living example of the need to re-invent broad concepts to adapt to specific local circumstances.
Devolution processes can be implemented in different ways and to different extents. Decentralisation is one such restructuring process – usually considered a less comprehensive form of devolution – in which decision-making powers or administrative resources are moved from central government agencies to provincial or local government levels.
In Viet Nam, the process of forestry sector decentralization and re-invention was wrapped up with – and driven by – the sweeping national reforms of Doi Moi. With transition to a market economy, the Vietnamese government faced significant challenges as forest agencies had been designed and trained to carry out a highly centralized management approach. In addition, the forest resource base had deteriorated significantly in the post-war national rebuilding period. The chosen approach of the Vietnamese Government in addressing these challenges was to adopt a policy of decentralization. Forestry functions, previously under the jurisdiction of national-level agencies, were decentralized to people’s committees (equivalent to municipal government-level). The lower levels of administration (provincial and district level) became responsible for forest protection and development and were made upwardly accountable. Underpinning these processes of decentralization in Viet Nam was a keen desire, as well as a necessity, for decision-making to more accurately reflect on-the-ground realities.
In China, massive changes in forestry have occurred during the past 50 years. During the period of the Cultural Revolution, the sector was dominated by institutional paralysis and widespread exploitation of forests. The 1980s saw recognition of an urgent need for “re-greening” the country, while also coping with huge economic changes associated with development of market–based systems. Reform of forest tenure and devolution of forest management responsibilities to households and collectives was also a major aspect of change. More recently, the focus has been on environmental rehabilitation, with downsizing of state-owned forestry enterprises and the development of large-scale programmes encouraging rural households to assume responsibility for tree-planting and forest management (such as “Grain for Green”).
A major objective of re-inventions in New Zealand, Sarawak, and at FRIM, was the rationalization of activities and assets to enhance the efficiency and international competitiveness of the forestry sector. This drive to improve the efficiency of government agencies has similarly been demonstrated in efforts to downsize and streamline ministries and departments. The trend has forced a fundamental rethinking of the roles being played by forestry institutions in the light of shrinking human and financial resources. The China case study depicts “across-the-board” downsizing of government agencies during three major State Council-drive restructurings, between 1982 and 1988. The aim was both to reduce the size of the administration and to curtail bureaucratic involvement in micro-level management, thereby inducing greater separation between macro- and field-level functions. The same trend of administrative downsizing has been played out in almost all countries of the region, though none has matched the scale of China’s reforms.
The case studies summarized above largely implemented “Big Bang” approaches to institutional restructuring. An alternative approach, as reflected in the institutional experiences of the USDA Forest Service, is gradual evolution in response to changing demands and challenges.
Following the Second World War, the USDA Forest Service had a well-demarcated role – supplying timber to a burgeoning economy. The Forest Service was seen as a provider of jobs and supporter of national economic progress. However, by the 1970s, concerns over the management of the nation’s forest resources had begun to percolate through society. Multi-functional forest management and forest protection – allied to new planning and participatory approaches – supplanted wood production as the key priority. The changed emphasis required the employment of new staff, with new skills appropriate to managing social, environmental and recreational functions. During the 1980s, forest management priorities veered towards greater protection of forest resources, and the instruments effecting the change were, in this case, legal – rather than political or economic – in origin. The flagship case of the Northern Spotted Owl, and other legal challenges, required the agency to bring on board new staff, versed in managing the issues for which the Forest Service had acquired responsibility. In recent times, the Forest Service has been grappling with new and revised roles such as forest rehabilitation and reduction of forest fire risk. However, the underlying experience for the USDA Forest Service has been more one of adaptation and adjustment, rather than complete re-invention.
Moves towards devolution, decentralization, increased participation and privatization are common responses to perceptions of ineffective forest management by state agencies. A trend toward the separation of regulatory and strategic roles – from operational functions – is clearly reflected in the New Zealand, Sarawak, Nepal and China studies. The main driver appears to be the demarcation of clear spheres of responsibility that remove conflicts of interest and allow agencies to focus on narrower sets of objectives. The major costs of this “simplification” include losses of potential synergies. For example, if an agency is tasked solely with managing forests for wood production – and its performance is reviewed only against this criteria – externalities relating to soil and water conservation, biodiversity conservation, production of non-wood forest products, etc. are likely to diminish in performance or be lost altogether. A similar argument applies to agencies tasked solely with forest management for conservation. Sound arguments can be made for retaining broad multiple-use frameworks, rather than embracing this compartmentalized approach. However, the merits of a structure that enables agencies to successfully achieve a narrow range of objectives, rather than fail across a broad range, should not be underestimated.
Consultation and participation promote involvement in processes of transformation, with broader shouldering of responsibilities, better information on which to orient changes, and (in theory) better decision-making. These factors were listed as being very important in Nepal, China and the Philippines and took different forms in each country. In Nepal, open discussions, negotiations and consensus-building led to decision-making being more closely linked to forest management through the devolution of rights and responsibilities to Forest User Groups. Policy monitoring and research were important in Viet Nam and China, stressing the importance of awareness of on-the-ground realities in determining the success of institutions.
The need to train staff to effectively carry out tasks associated with new institutional roles was cited in the studies from New Zealand, Sarawak, Nepal, Viet Nam and Philippines and variously referred to as “reorientation”, “development of new attitudes”, “retraining” and “initiation of changes in the mindsets of staff”. In the United States, new staff were employed to meet expanding needs, but the principle remained the same – institutional expertise must be harmonized with institutional objectives. Where forest management responsibilities are devolved to new groups, success is contingent on the space and opportunities created for these groups to learn and access necessary skills, information and knowledge.
A good model may fail due to weak implementation. Successful re-invention of forestry agencies requires not only appropriate reasons for initiation, but also the right ingredients to make the process a success. Visionary leadership, committed political support, and an ability to win followers and influence detractors were critical in effecting change in New Zealand, Sarawak and the United States.
Wider support for institutional change not only assists transforming forestry agencies to reach objectives, but may also serve as a bellwether for broader change across society. National and international networking provided support for change in the Forest Research Institute of Malaysia and in Nepal. In Viet Nam, strong support from international donors helped to ensure the establishment of the Ministry of Agriculture and Rural Development and its subsidiary Department. In the Philippines, collaboration with NGOs and civil society organizations – in addition to international assistance – supported the bureaus in the Department of Environment and Natural Resources in extending and devolving powers to the community level. Other key factors in successful reinventions include the existence of role models in the form of other re-invented agencies (FRIM), institutional independence (China) and adequate financial support (Malaysia, Philippines and USA), and the need to maintain momentum in the reform process (Nepal).
An obvious lesson is that there is no panacea for institutional restructuring and reform processes. Social, economic, physical and political factors are markedly different among countries of Asia and the Pacific, so that institutions must adapt themselves to very specific situations. In the modern world, change has often out-paced institutional capacities to adapt. While adopting a gradual reform process – avoiding the “Big Bang” – is attractive when relationships among organizational structures, functions and values are sound, in many cases the linkages have become sufficiently dysfunctional as to necessitate radical change.
To be successful and remain relevant, institutions need to ensure flexibility, strategic management capabilities, strong “sensory” capacities, and an institutional culture that responds to change. The overarching lesson is that unless an institutional structure is properly aligned with organizational values and principles, objectives and functions, organizations will struggle to effectively implement their mission.