Karl-Hermann Schmincke is Director of the FAO Forest Products Division.
Consideration of the challenges inherent in achieving the full potential of forest industries in sustainable development and the role of FAO.
In virtually every country in the world with significant forest resources, forest industries (both wood and non-wood) have played and continue to play a key role in overall socio-economic development. Large and small-scale enterprises that produce forest products for domestic consumption as well as for most countries. The annual value of fuelwood and wood-based forest products to the global economy is estimated to be more than US$400 000 million, or about 2 percent of gross domestic product. The real value of the forestry sector's contribution to the global economy has increased over the past few decades at an average annual rate of 2.5 percent. The production, harvesting, processing and trade of timber and other forest products, together with associated secondary industries, are significant sources of employment and income, especially in rural areas with limited alternatives. Wood is the most commonly used renewable raw material; for the many applications to which it lends itself there are no cost-effective alternatives that are also potentially environmentally benign. Forest industry converts the resource into economic and social values which are available to society at large, thus justifying forests as a land-use alternative that is in competition with others.
Yet the development of the forest industry has often been portrayed as a major destructive force rather than an essential element in the process of sustainable development. Concern over the destruction or degradation of forests, and the related loss of environmental benefits, biological diversity and physical and cultural habitats has led to calls for the reduction or even curtailment of forest industries.
Sustainable forest industry converts the resource base into economic and social values
However, a reduction in the forest industry and the benefits it provides would almost inevitably be paralleled by a decrease in the resources dedicated to forest conservation and management. This would also result in the slowing down of development, aggravating the poverty of forest-dependent communities and other vulnerable rural groups and forcing them into wasteful, unplanned depletion of forest resources in a struggle to improve their existence.
Forest industries worldwide, spurred by economic considerations, on the one hand, and increasing government and public pressure, on the other, have made large strides in adapting and improving their processing technologies, thus responding to market demands in terms of better-quality products and larger volumes, as well as in the conservation of natural resources, the protection of the environment and pollution abatement. Compared with other industrial sectors, forest industries have made significant progress towards being truly environment-friendly. Modern technology allows the primary energy needs of forest industries and their environmental impact to be small compared with other industries using non-renewable raw materials and producing competing products. A major part of industry residues are used as raw materials for other products or for energy generation.
Increasingly, the industry itself is adopting practices that regulate harvesting and transport in line with the sustainable management of the resource base, and in implementing initiatives to produce raw material from other than natural forests, through forestation of degraded land and the creation of plantation forests. These changes in the raw material supply are accompanied by parallel changes in processing technologies. Logs from plantation forests are smaller in diameter and develop lower-strength properties than those from natural forests. New processing technologies have been developed to utilize these small-diameter logs and produce new products with equal or better physical properties than those traditionally available on the market. A variety of composite wood-based products, such as oriented strand boards (OSB), medium density fibreboard (MDF) and laminated timber are often produced from plantation timber or from residues that were previously considered useless.
However, it would be unrealistic to portray forest industries as being without their share of inefficient practices and policies. Certainly there is room for improvement on a number of fronts. Forest industries, whether public or private, must substantially step up their commitment to appropriate technology and the sustainable management of forest resources; they must have a holistic, balanced perspective and, moreover, publicize this commitment.
This article considers the development of the forest industry since the Second World War, examines a number of the challenges that must be addressed and the current and future role of FAO in this regard and, overall, reaffirms the potential of the forest industry as a positive force for sustainable development.
Forest industrialization based on in-country processing is now under way in all developing countries with forest resources
FAO's ROLE IN THE DEVELOPMENT AND EVOLUTION OF FOREST INDUSTRIES
The establishment of FAO in 1945 coincided with the end of the Second World War which left behind countries with destroyed cities and villages, creating an enormous challenge to repair the damage and build new societies. Forests, their values and the benefits associated with them became a source of life and hope.
Forestry and the use of forest products have always been an inseparable part of FAO's work. Moreover, there has been a recognition of the interaction between and mutual dependency of agriculture and forestry. In fact, in the first issue of Unasylva, published in 1947, FAO Director-General Sir John Boyd Orr in his classic "One World - One Forest" noted:
"In the fields of forestry and forest products, the 48 nations working together through FAO are following a world policy with three main objectives - the conservation of all forests that perform useful social or protective functions; wise use of the world's forest soils for continuing an adequate production of raw materials; and new and better ways of processing and using forest products as a means of raising standards of living."
FAO's first involvement in the development of forest industries was to start providing reliable information on a global basis to support industry planning and operation. Over the years the collection, analysis and dissemination of statistical information have become more sophisticated and data have become more timely, accurate and appropriate for the planning and operation of forest industries [Ed. note: see article by Wardle].
Much of the success in collection, analysis and dissemination of forest industry information has been achieved thanks to strong support from the forest industry. FAO has established statutory and technical committees, such as the Advisory Committee of Experts on Pulp and Paper and the Committee on Wood-Based Panel Products, which have helped to maintain information contacts with the industry and have also served as a channel to get practical advice in formulating FAO's programmes for the development of forest industries.
Small-scale forest industries have been recognized as important for overall development
Following the postwar rebuilding, another major development with consequences to forestry started taking place; as a result of decolonization, newly independent nations with increased needs for economic and social development were born. Forests provided an initial source of capital which could be used to support the development of these countries. Forests also provided the basis for the process of industrialization to diversify economies. FAO's membership increased dramatically as did the demands for technical assistance in forest industry development.
It is noteworthy that, at that time, FAO represented virtually the only option in this field; most of the countries with major forest industries had not yet developed bilateral assistance programmes and often, for political reasons, the chain of assistance between the former colonial powers and their former territories had been broken.
At the initial stages of FAO's technical assistance to developing countries in the area of forest industries, the approach adopted was largely to transfer industrial technology from the north to the south. The postwar reconstruction of the industries in the north resulted in forest industry technology that was modern and designed for fairly large-scale operations to take advantage of economies of scale. This technology required relatively high capital investments and also a skilled labour force and management capability. A long-term capacity-building approach would have been appropriate but the developing countries, urgently needing to obtain capital to support the development of their economies, adopted the alternative of allocating their forests as concessions to foreign enterprises.
This resulted in a period of forest exploitation during which the resource was basically mined for the export of raw logs. Later it became apparent that this approach was inappropriate in the long term, with regard to both conservation of the resource base and economic benefit to the countries. Subsequently, forest industrialization with increasing emphasis on in-country added-value processing started in all tropical regions. Today, primary and often secondary processing of wood on different scales has become an important contributor to employment and income generation.
Moreover, support to small-scale industries in the forestry sector was recognized as an important parameter for development, particularly in the rural areas. One of FAO's activities in contributing to this development was to prepare portfolios of small-scale wood-based panel plants and sawmills to provide examples that could be followed in developing countries.
In the early 1970s, the world faced the first energy crisis which led to a better understanding of the limits posed by non-renewable resources to sustained economic and social development, and to the importance of wood fuels, especially in developing countries. At the same time, industrial pollution and the need for its abatement became an item on national and international agendas. Public attention, interest and concern began to focus on renewable natural resources, particularly the forests. Forests continued to be a source of life and hope but there was growing worldwide concern for their lasting existence.
In the late 1970s and early 1980s, deforestation and degradation of forests, especially tropical forests, became major international issues. Through the latter part of the 1980s and culminating in the Earth Summit in Rio de Janeiro in 1992, concern about the sustainability of forest resources of all kinds and in all regions reached unprecedented levels.
The challenges facing forest industry development worldwide, therefore, are to develop or improve practices that are environment-friendly on a sustainable basis and economically viable, in order to provide the goods and services needed. It is obvious that only an approach based on global partnership and the full involvement of all partners - governments, environmental and development non-governmental organizations, the private sector, as well as the people who live in or depend directly on forest resources - can result in the fullest possible contribution of forest industry to overall sustainable development.
An FAO brochure on sustainable forestry practices
CHALLENGES FOR THE FOREST INDUSTRY AND FAO's CONTRIBUTION
The overriding future challenge faced by the forest industry is to meet the increasing demand for forest products from a limited and often fragile resource base. During the 1980-1990 period the global industrial wood demand - excluding firewood and charcoal - rose from 0.8 billion m³ to 1.6 billion m³ and is projected to reach 2.7 billion m³ by 2010. In the industrialized countries, the projected increase in demand for the 1990-2010 period will be 53 percent (from 1 224 million to 1 875 million m³), whereas it will be 111 percent (from 378 million to 799 million m³) in the developing countries.
The long-term priority must therefore be progress towards sustainable utilization of forests for wood and non-wood forest products while maximizing the benefits to local populations and national economies and respecting the balance between conservation and development.
The emphasis for FAO is on a significant contribution to the development and application of efficient technologies for the sustainable use and valuation of forests and their products while increasing income and employment. Special focus will be given to ensuring that environmental impacts are taken fully into account. Moreover, FAO will continue to take advantage of its unique role as facilitator of a global partnership bringing together all parties concerned. This commitment was highlighted in the recent meetings with representatives of the private industry sector and non-governmental organizations as well as during the March 1995 meeting of the Advisory Committee of Experts on Pulp and Paper and the Committee on Forestry.
In terms of overall forest utilization, priority will be given to limiting negative physical and social impacts, while ensuring economic viability. A programme will be launched for the global and regional assessment of forest degradation and damage associated with harvesting and forest road construction. Criteria and procedures for carrying out site-specific environmental impact assessments associated with these operations in both natural and plantation forests will be developed and tested through case-studies.
Forest industries are characterized by a wide range of diversity in type, size, raw materials, products, management and market requirements. There is a constant need for improvement and adaptation to changing patterns to establish, maintain and increase efficiency, to remain economically competitive and to make the best use of the limited resources. Foresters, local people and industries will need to strengthen information exchange in order to design the best management and utilization strategies to meet the diverse needs of those involved while simultaneously maintaining the environmental integrity of the forest.
FAO will continue to provide assistance in the development of appropriate forest industries, with priority given to identification, preparation and evaluation of investment project proposals. Special attention will be given to aiding existing industries to improve their processing methods, and in promoting the more efficient utilization of available raw materials. Increased emphasis will be placed on strengthening organizational ties to the private sector. The creation of a forest industries committee, including the wood-based panel, sawmilling, pulp, paper and trade sectors, is envisaged in this regard. FAO will continue to build on its programme for small-scale forest-based enterprises.
Stanley L. Pringle
One of the most striking features in tropical forest utilization, that also exists in other regions, is the wastage of forests and wood. A recent FAO study revealed that frequently less than 50 percent of the wood in the main stems of tropical trees felled for harvest is fully utilized. By comparison, the amount used in industrial regions is more than 75 percent. If trees felled in tropical forests were utilized at the higher rate, the area of tropical forest harvested each year could be reduced by almost one-third with no decrease in the volume of timber brought to the market.
Within the area of forest harvesting, FAO's activities will focus on capacity building in efficient and environment-friendly harvesting technologies for industrial wood, with emphasis on medium- and small-scale industries in developing countries. FAO has recently developed a Model Code of Forest Harvesting Practice as a guideline for the improvement of comprehensive harvest planning, effective implementa-tion and control of harvesting operations, postharvest assessment, communication of results and the development of a competent and properly motivated workforce. Work will continue on the development of computer software for estimating costs and production rates in forest engineering, harvesting and transport operations.
Non-wood forest products
Non-wood forest products provide essential goods for direct consumption and local trade as well as providing raw materials to processing enterprises that produce internationally traded commodities. They can help to generate a considerable amount of employment and income to communities without endangering the environment. Notwithstanding these actual and potential benefits, only marginal attention was formerly paid to developing the potential of non-wood forest products.
FAO has initiated a multipronged strategy to develop this sector through the systematic classification of products and the dissemination of appropriate harvesting, processing and marketing techniques with the help of regional and interregional expert consultations, case-studies and publications [Ed. note: see summary of expert consultation]. These activities, carried out in close cooperation with other institutions, contribute significantly to sustainable forestry development and food security while maintaining environmental quality and biological diversity.
FAO has initiated a multipronged strategy to develop the non-wood forest products sector
Trade and marketing
FAO will support countries in developing market analyses, trade policies and institutional arrangements that encourage improved market transparency, are compatible with sustainable development and respect the environment, taking account of fair competition aspects. Unilateral bans and/or boycotts will continue to be strongly opposed by the Organization and open dialogue will be encouraged. Activities related to marketing will emphasize human resource development, strengthen marketing information and recognize and improve marketing practices and procedures covering wood and non-wood forest products, including value-added products. Environmental issues connected with trade and marketing will be given attention, with emphasis on timber certification and labelling and recycling.
Certification of wood products is a particularly important item within the overall subject of trade and marketing. Voluntary certification of wood from sustainably managed resources will allow producers and processors to measure their forest management practices against widely accepted standards and to demonstrate compliance with those standards. It will allow industry and trade to promote responsibility with regard to the environment and sustainability and give environment-conscious consumers confidence in the products they choose.
Many wood-producing countries have recognized the potential advantages of timber certification and have launched national certification schemes. FAO will work with interested countries, the private sector and independent organ-izations to ensure the application of internationally agreed systems on a transparent and independent basis to allow complete monitoring of the production and distribution chain.
FAO will also continue to work towards the development of local market information systems managed at the community level, and on other efforts to understand and support community-level markets and marketing skills.
Wood-based energy activities will continue to focus on improved wood energy systems and on the promotion of more efficient and less polluting wood energy conversion technologies and systems, and related policies and plans. Improved wood energy technologies will be documented and information will be widely disseminated.
Sustainable forest development can only be achieved if all parties concerned, governments and local people, industry and trade, international organizations and development banks cooperate closely. Given a rapidly changing world in which natural resources, including forests, are under heavy and varied pressure, the wise and sustainable use of forests can only be achieved by applying appropriate policies, techniques and skills. The continuous development and application of technologies, the education and training of people as some of the basic needs for the valuation of forests and their goods are prerequisites so that forests continue to be "essential to economic development and the maintenance of all forms of life", to quote from the preamble of the UNCED Statement of principles for a global consensus on the management, conservation and sustainable development of all types of forests.
The forest industry is undoubtedly an economic engine which is essential for enabling the forestry sector overall to claim its position among the other economic, social and environmental activities of nations. FAO stands ready to assist member countries in realizing the potential of sustainable forest industry.