Abstract
Over the past few decades, transnational and supranational market-based forest governance systems have been developed to address the complex problems associated with deforestation, by improving the legality and sustainability of timber traded in global markets. This is catalysed by the increasing global production and consumption of timber products and increasing sensitivity of interest groups to how timber products are produced. A broad range of actors is involved in global production networks. This paper discusses how hierarchies and networks of power across the timber production network are encountered and negotiated. More specifically, it investigates the power constellations of wood furniture actors in Indonesia, nested within global production networks: who holds the power, how power is gained and maintained, and who wins and loses over time. Using the case of the timber legality assurance system in the context of the European Union Forest Law Enforcement Governance and Trade (FLEGT) initiative, we demonstrate that legality verification in Indonesia is both entrenching pre-existing inequitable power relations while producing new modes of elite capture. Legality verification requires new knowledge and additional costs that are sometimes beyond the capacity of certain (particularly smaller) furniture manufacturers operators. This has driven a new practice of renting out FLEGT licenses by larger producers/manufacturers to smaller ones in the country. Although the practice implies potential risks (e.g. fines), large companies in Indonesia manage risk by drawing from pre-existing patronage relations. They also appear to find the risk worthwhile, as it produces financial gain but moreover, a new form of control over the market. Meanwhile, small operators and artisanal producers that still aspire to global markets face disproportionate challenges to engage in legality and are becoming more vulnerable as a result of new legality measures.
Highlights
New policies and market-based mechanisms in the global timber market have emerged to promote the responsible and wise use of forest resources (Tacconi, 2012)
While differential powers among actors would exist without Forest Law Enforcement Governance and Trade (FLEGT) we suggest that there are several ways in which these imbalances are exacerbated due to the FLEGT Voluntary Partnership Agreements (VPAs)
This reinforces the argument that FLEGT VPAs are yet another forestry sector intervention that, problematically, relies on market-based mechanisms to resolve problems in large part created by those same mechanisms (Rutt et al, forthcoming)
Summary
New policies and market-based mechanisms in the global timber market have emerged to promote the responsible and wise use of forest resources (Tacconi, 2012). These stand in contrast to the dominance, until recently, of more regulatory approaches to forest management and timber product manufacturing and trading (such as log export bans) in producer countries. Every VPA entails an assurance system that can verify timber legality If such a system fully comes into place, compliant exporters can merit the award of a 'FLEGT license', which will be granted through a national licensing authority established in the producer country. Operators in the EU, exporters to the EU, and producers under VPAs are obliged to ensure that they trade only legal timber and wood products with the EU
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