The Risk Assessment of China\'s Timber Import Based on SWI Index

Wang Yanbin,Cheng Baodong,Li Tingting,Yu Sang Chang

doi:10.19026/ajfst.6.182

Abstract

Derived by the demand of domestic economy and forest products export, timber import shows the features of high concentration and strong dependence. Thus the risk of China's timber import significantly increases. Based on SWI Index, we construct the short-term and long-term timber risk index from resource risk, country risk, market risk, transportation risk etc. Using this index, we make a more comprehensive risk assessment and find out the trend and factors of risk. The results of index construction and estimation indicate that China's timber import generally shows the trend from high risk to low risk. Besides, it also points out that the majority of new timber- importing countries are those developing countries with high country risk and high resources risk. These factors may cause considerable potential risks. Finally, the study gives policy recommendations for reducing the risk of timber import.

Highlights

Timber import is an effective way to deal with the contradiction of supply and demand of timber as well as the problem caused by insufficient timber resources in China
Since the timber import sole structure of origin and excessive dependence of the timber-importing-countries are the main factors directly affect timber import, once these risks occur, it will directly lead to supply disruptions, affecting the supply of the security situation and the stable development of the domestic economy and other industries will be seriously affected, that is why we regard these risks as direct risks
The domestic supply cannot meet domestic demand, the demand for timber import increases about 44% comparing to the year of 2001. This part was provided by traditional timber exporting countries and countries with high consumption of forest resources and relatively high country risk, resulting in an actual increase in long-term timber import risk RTML

Summary

Introduction

Since the timber import sole structure of origin and excessive dependence of the timber-importing-countries are the main factors directly affect timber import, once these risks occur, it will directly lead to supply disruptions, affecting the supply of the security situation and the stable development of the domestic economy and other industries will be seriously affected, that is why we regard these risks as direct risks. The structure of China's timber import risk index: According to definition of short-term risk and long term-risk, short term timber import risk factors mainly consist of the concentration risk, political risk, transportation routes risk and market risk.

Results

Conclusion