Effective Policy, Law and Regulations for Sustainable Development and Marketing of Non-wood Forest Products.doc

tcp lao 3002 a marketing system development for non wood forest products effectiveeffectiveeffective policy policy policy lawlawlaw andandand regulationsregulationsregulations forforfor sustainablesustainablesustainable developmentdevelopmentdevelopment andandand marketingmarketingmarketing ofofof non woodnon woodnon wood forestforestforest productsproductsproducts report on the second consultancy mission by c chandrasekharan international expert in forest policy and legislation food and agriculture organisation of the united nations vientiane october 2005 i i table of contents abbreviations and acronymsviii statistical profile of lao pdrxii executive summaryxiv 1 introduction 1 the project 1 scope of a marketing system 2 the consultancy on forest policy and legislation 2 tor for the consultancy 2 concepts linked to marketing system for nwfps 3 markets 4 marketing 5 marketing factors 6 marketing stages 6 market players and channels 6 role of middlemen 7 marketing channels 7 marketing of non wood forest products 8 market information 9 market infrastructure 9 institutional support 9 trade 10 impact of globalization 10 competitiveness 10 sustainability and sustainable development 11 sustainable forest management 12 production and productivity 13 products 13 produces 14 product classification 14 productivity 14 value addition 14 rent and rent capture 15 policy and policy instruments 15 policy 15 policy instruments 16 rules 18 regulations 19 supplimentary instructions 20 other important legal instruments 20 governance 21 ii 2 forestry situation in lao pdr 22 the country profile 22 macro economic situation 23 important economic sectors 24 agriculture 24 forestry 25 industry 25 tourism 25 the financial sector 25 income and trade balance 26 political division and decentralization 26 forestry situation 28 extent and condition of forest resource 28 forest types 28 forest plantations 28 plantations for future 29 dynamics of forest resource change 30 deforestation 30 forest degradation 31 forest management 31 management objectives 32 management activities 32 stabilisation of shifting cultivation 32 crop production 33 village forest management 33 community forestry 34 forest production 34 management plans and planning 35 forest resource utilization 36 forest production 36 forest based processing and value addition 37 forest products trade 39 protection and conservation 40 protected area management 40 institutions and instruments 42 sectoral objectives 42 legal framework for forestry sector 43 the forestry law of 1996 44 implementing rules and regulations 46 weaknesses in the legal framework 47 public forest administration 49 plans and programmes 51 forest revenue 53 support services 53 human resource development 53 forestry research 54 iii eorestry extension 55 marketing support 58 lao national chamber of commerce and industry 58 co ordination of forestry activities 59 sectoral constraints 59 benefits not backed by investments 61 international assistance projects 62 forestry situation in the project area 63 luang prabang province 63 xien ngeun district 64 long leuad village 64 3 non wood forest products in lao pdr 66 global situation 66 need for a clear definition 68 product boundary 68 source boundary 68 nwfps and agro forestry 69 need for an appropriate classification 69 role of domestication 70 complexity of technology 71 harvesting 71 post harvest treatments 72 value added processing 73 markets and marketing 74 nwfps of lao pdr 75 goals of the nwfp sub sector 76 production and trade 78 processing 80 trade in nwfps 81 the quotas 83 nwfp resource management 87 management technology 88 investment 89 external assistance projects 90 constraints for nwfp development 90 future of nwfps in lao pdr 92 nwfps under forestry strategy 2020 93 situation and role of nwfps in project sites 94 a system for nwfp development and marketing 95 4 policy and instituional arrangements for nwfps 97 situation in lao pdr 97 need for a formal policy 97 strategic objectives for nwfps 98 hierarchy of legal instruments 98 iv situation of legal frame work for nwfps 98 tyranny of quotas 100 customary use rights 102 organizational system 102 weaknesses of pfa 104 inadequacy of research efforts 104 lack of extension facilities 105 trade and investment 105 innovative cases of nwfp development in lao pdr 106 lao farmers products and batieng product 106 self help groups 107 independent authority to manage the plantation sector 107 analysis of nwfp situation in selected countries 107 bangladesh 109 homestead forests 109 importance of non wood forest products 109 constraints for nwfp development 110 role of ngos 111 india 113 the forest policy 113 joint forest management 113 ntfps in india 114 constraints for development of nwfps 115 institutional models 115 amul model 115 madhya pradesh state minor forest produce trade and development co operative federation 118 the girijan co operative corporation of andhra pradesh state 120 the tribal co operative marketing development federation of india ltd 120 co operatives of different kinds 121 the agro forestry federation of maharashtra state 121 self help groups 121 commodity boards 122 forest development corporations 122 public private partnerships 123 company farmer partnerships 124 other cases 125 public limited company 126 e choupal initiative 126 others individual efforts 126 indonesia 127 policy guidelines 127 important non wood forest products 128 institutional models 129 nwfp concessions 129 nwfp activities of perum perhutani 129 v production of kayuputih oil 130 silk production 130 bee keeping 130 production of gum rosin and turpentine 130 nucleus rattan furniture factory 131 manufacture of traditional medicines 131 republic of korea 132 village forestry associations under saemaul undung 132 malaysia 133 policy aspects 134 important non wood forest products 135 nepal 135 some policy aspects 135 important non wood forest products 135 the herbs production and processing company 137 papua new guinea 137 some policy aspects 138 important non wood forest products 139 philippines 139 some policy aspects 140 community based forest management 140 important non wood forest products 142 self help groups 142 vietnam 142 policy changes 143 important non wood forest products 145 some project models 146 snv north central vietnam income and employment generation project 146 extension and training support for forestry and agriculture in the uplands 147 other experiences 148 the shea project of uganda 148 integrated agro forestry in china 148 the lessons 148 resource related 149 production related 150 processing related 151 market related 151 related to socio economics 152 environment related 154 science and technology related 154 information related 155 policy realted 155 related to plans and programmes 156 related to institutions 157 to round up 159 an indicative framework for a policy on nwfps in lao pdr 159 vi components of policy framework 159 organisations for policy implementation 161 governance agencies 161 development enterprise agencies 161 innovative arrangements 162 the enterprise concept 163 a federated co operative enterprise system for nwfps 163 development of a formal policy 166 5 recommendations and conclusions 169 recommendations 169 conclusions 171 bibliograpy 172 vii appendices 1terms of reference international expert in forest policy and legislation 178 2list of some of the better known species in lao pdr providing non wood forest products 180 3extract of section 2 5 ntfp management from the report on legal framework of forestry sector for forestry strategy 2020 in lao pdr by todd sigaty 2003 182 4an annotated outline for a national policy for non wood forest products for lao pdr 186 list of tables table 1land allocation for different uses in lao pdr 1995 200224 table 2production and consumption of wood products 200337 table 3wood products trade 200339 table 4nwfp exports 1995 96 to 2004 200582 table 5some details of nwfp quota in lao pdr for 2004 200584 list of figures figure 1organizational chart of the ministry of agriculture and forestry52 figure 2organisational structure of the national agriculture and forestry research institute 55 figure 3the organization structure of the national agriculture and forestry extension service 57 figure 4linkages involved in quota administration85 figure 5diagrammatic illustration of a system for nwfp development and marketing 96 figure 6amul model replication117 figure 7graphical representation of organisational re structuring for nwfp forestry development 168 list of boxes box 1grameen bank of bangladesh112 viii abbreviations and acronyms adbasian development bank ansabasia network for sustainable agriculture and bio resources apbagriculture promotion bank aseanassociation of south east asian nations bflbasic forestry law of indonesia bracbanglades rural advancement committee btcbelgian technical cooperation c details provided differ considerably since none of the sources consulted had comprehensive information covering all aspects it was necessary to use information provided by different sources in the report depending on the context for purposes of illustration and to indicate rough orders of magnitude no attempt could be made to reconcile the differences in statistical information for want of time such reconciling was also not essential for purposes of this consultancy the sources have been listed under bibliography xiv executive summary defined as goods of biological origin other than wood as well as services derived from forests and allied land uses nwfps cover a wide range food fodder fibre fertilizer flosses organic construction materials non wood lingo cellulosic products natural dyes tannin gums resins latex and other exudates waxes essential oils spices edible oils medicinal extracts phyto chemicals aroma chemicals decorative articles cocoons cage birds culinary herbs horns bones pelts plumes hide and skin as well as services such as eco tourism and environemtnal conservation the emphasis of this report however is on material goods there are certain characteristics which set the nwfps apart from wood products as a broad group nwfps exhibit a high degree of heterogeneity in their source production systems and utilization it is multi dimentsional i e social economic environmental cultural and ethical in scope these produces are derived from a variety of sources plants palms grasses herbs shrubs trees animals insects birds reptiles large animals and microorganisms different parts of a plant or animal often provide different products simultaneously and or at different times also similar products can be obtained from different sources nwfps are used at subsistence local use and commercial levels nwfps exhibit considerable variation in their use some of them are consumed immediately on harvest e g fruits fodder wild meat or after primary processing e g edible nuts bamboo products some others go through a series of downstream processing or refinements to meet the market specifications and standards adding value to the product all along the way these produces vary in their habitat and management requirements under natural conditions nwfps can be managed along with wood in an intergrated manner thus increasing overall productivity nwfps can be sustainably harvested without causing damage to the eco system and they are therefore environmentally friendly unlike wood nwfps can be harvested continuously or more frequently many nwfps are available from timber species harvesting of wood and non wood products in such cases is not mutually exclusive and needs to be carried out with great care being capable of providing all the basic needs of local communities these represent a complete resource base xv some 80 of the population in the developing world depend on nwfps for their primary health and nutritional need as raw materials nwfps support village level artisanry craft activity and processing enterprises such as those of rattan and bamboo furniture essential oils resins and pharmaceuticals some nwfps are internationally traded and used in flood flavourings perfumes medicines and confectionary a large number of nwfp appear as ingredients of varying proportion in a large number of items of our everyday use such as medicines perfumes sun tan lotions nail polish mouth wash hair conditioners cosmetic products detergents shaving creams tooth pastes stress relievers cheese chewing gum soft drinks peanut butter breakfast cereals golf balls paints corrosion inhibitors insecticides fungicides and a host of others with extensive deforestation and forest degradation resulting from various causes and the government owned forests being kept out of bounds and reserved for conservation purposes in several countries the natural sources of nwfps have shrunken and growing of domesticated and genetically improved nwfps in private farm lands is becoming more common because of their special attributes and environmental friendliness sustainability of forestry in the future will depend more and more on nwfps however very little attention has been given to nwfps so far in spite of their importance and potentials this in one way or another is related to the characteristics of the produces nwfps as a group are extremely heterogeneous requiring a mix of different skills technology and research support in their management resources of these produces are often dispersed and vary considerably in their concentration knowledge on nwfps to a significant extent is local empirical and often linked to local culture this makes information gathering or exchange more difficult overlapping of their uses and sources adds to the complexity of managing and utilizing the nwpfs causing added difficulty for their development nwfps have however re emerged in many countries from relative obscurity and their development has gained some momentum due to increasing awareness about their importance the new market preference for natural products concern about the conservation of forests and their bio diversity realization that many nwfps give more income for forest owners compared to income from timber species and their potential as sources of new food and medicines it has therefore become necessary especially in respect of commercially important nwfps to have a marketing orientation rather than simple production orientation simple production orientation have the effect of creating increased supply thus reducing price and profitability a successful marketing orientation for nwfps on the other hand should increase demand and value thus allowing more of the products to enter the market without reducing the overall price of the concerned commodities an enhancing aspect of the market orientation is value addition through down stream processing xvi generally however establishment of sophisticated down stream value added processing in most developing countries is constrained by lack of capital technology and skills market and research support thus in most developing country situations harvested produces reach the market local or foreign either after some intermediate processing in the form of cleaning and grading or after primary or early stage processing the success of nwfps in the market would depend on certain imperatives productivity and sustainable production appropriate cultural practices waste free harvesting value added processing and consistency in product quality commercialization of nwfps is more than a strategy for poverty alleviation it is a strategy for growth market as an institution is expected to ensure economic efficiency providing necessary means to maximize the value of products and to distribute the benefits equitably among the participants national economy and income are influenced by the market a market is considered as fair and moving towards perfection if its functioning is characterized by full knowledge and free competition and not vitiated by monopolistic oligopolistic tendencies marketing of nwfps is one of the most challenging undertaking because of their number versatility dissimilarities end use variations and resource richness markets range from simple local level village fairs to most sophisticated industrial and niche markets in numerous end use sectors some of the attributes of nwfp production such as small size product diversity seasonal production labour intensive technology and accessibility to low income group of the community have both advantages and disadvantages while these are advantageous on the production side some of them are disadvantageous on the marketing side to circumvent the disadvantages market oriented production of nwfps can be taken up as co operative ventures globalisation of commerce further supported by green consumerism has opened up new opportunities for nwfps the response form the producers collectors to market demand for nwfps will be influenced by how the returns from it compare with other income generating activities the capability of the producers and the availability of primary inputs access to credit facilities and markets will influence the type of activities species and technology adopted a rational and effective policy on nwfps supported by adequate instruments i e laws rules and regulations and organizational support for enforcement of policy objectives and implementation of policy measures is vital in this connection policies represent the principles that govern actions directed towards given ends a forest policy has been defined as principles regarding the use of a nation s forests which it is felt will contribute to the achievement of some of the national objectives on the same basis a nwfp policy can be defined as principles regarding the use of a nation s nwfp resources which it is felt will contribute to the achievement of some of the national objectives in spite of the new favourable trend however the nwfp sub sector has not attracted sufficient and in some cases any policy attention as a re