Naujienos
2004 - 11 - 11
* Private forestry in the enlarged EU - challenges and opportunities
Private forestry in the EU has, particularly in rural areas, considerable potentials to contribute to overall sustainable development of the region.
After the enlargement of the EU on the 1st of May this year, the forest area of the community amounts to 162 million ha representing approximately 35 % of the EU territory. Forestry and forest-based industries form one of the most important economic sector within the EU representing 9 % of the manufacturing industries. They employ about 3,5 million people and create an annual production value of EUR 400 billion.
Family Forestry must be seen as a one form of private entrepreneurship in the new EU member countries. A basic condition for private entrepreneurial activity and investments is clear and secure land ownership. The still on-going restitution and privatisation process needs to be completed to allow the forest owners manage and develop their forest assets. The legal framework for forestry operations should be established to promote active management of forests for both wood production and maintenance of other forest values.
In the new member states the former overall dominance of the state administration in forest management has changed with the emerging of new stakeholders and new form of property. Due to restitution process and privatisation the number of private forest holdings increased by 25 % and the number of forest owners by three million. In most of the countries, the average holding size would not exceed 5 ha. The situation is characterised by variation in knowledge and understanding of, expectations from, and interest in forest management. One of the biggest challenges to be faced is the high share of not-operational private forests without any management activities, lack of capacity and organisation of the private forestry.
The framework conditions for operation of private forestry need urgent improvement, including direct support in capacity building of private and community forest owners, their associations and interest organisations. The capacity building should address multipurpose forest management, but necessarily also access to timber markets and awareness of market-chain position as well as participation in policy-making and enhanced co-operation between private forest owner associations and state forest services/authorities.
Market Development
The impact of the EU enlargement on forestry is significant both in the old as well as the new member states. The EU forest resources increased remarkably; the total forest area grew by some 20 % and the volume of the growing stock by 25 %. Accordingly, the enlargement created a larger common market area for round-wood and wood-based industries with new possibilities to trade and investments.
Since the beginning of 1990s sawnwood production in the new Member Countries has grown considerably, particularly in the Baltic Countries and Central European countries. In deed, in several countries the sawmilling industry constitutes already a significant export industry especially within EU markets. Woodpulp and paper production in the new member countries is still rather small and these countries are still net importers of paper. The average paper consumption is only one third of the consumption in the former EU.
After the enlargement, the EU became self-sufficient in sawnwood. If there is no rapid increase in internal EU wood consumption and no external markets are opened, there could even be a shift in especially sawnwood production from the western European countries to the new member countries. Actually already now, the formal EU based forest industry companies have started to invest sawmilling and wood-based panel industry in the Baltic Countries and Central European countries.
However, in the short term no major changes are expected in the pulp and paper markets. The corporate sector will evaluate also the Central and Eastern European investment opportunity in the global context. But never the less, also on the pulp and paper industry side the new member countries are an attractive potential location for investment by forest industry companies based in the old EU. The fact that the consumption of paper and wood products per capita in the new
EU countries is less than half of the consumption level in the former EU will be a
major factor attracting investments in Central and Eastern Europe.
Timber markets in the Central and Eastern European countries are also undergoing change as a consequence of privatisation. The new private forest owners have little experience of the timber trade. And in addition, access to market information is limited. Like private forestry infrastructure in general, the laws governing the timber trade, provision of market information and advice for forest owners on the timber trade are being developed in the new member countries.
With privatisation, the new member countries will able to secure effective operation and competitiveness of the timber markets by increasing access to market information. Effectively functioning timber markets are crucial for ensuring competitive conditions in round wood markets throughout EU.
Family Forestry and Sustainable Development
In spite of the small size of a forest property in Europe, the primary objective of most private forest owners is financial security and income. Thus, the economic sustainability is the basis for family forestry. Without financial profit from the forest, the family forest owners would hardly be interested in forest operations. Only financially profitable forestry allows forest owners to invest in reforestation, nature management and protection and social values. In this context, there is no real difference between private and public forest ownership; a stumpage price is required in any case.
However, forest is not only about money, but forest owners have a deep respect for their forests and multiple values they produce. The contribution of forests and forestry to the sustainable development of modern societies are manifold. Besides the production of the renewable resource timber forest owners deliver a number of products and services to the wider society that are not yet marketable. There needs to be political recognition that a further increase for the production of these non-marketable products and services has a direct impact on the economic viability and thus sustainability of the individual family forest holding with knock-on effects for the economic and social welfare in rural communities. An integral part of enhancement of production of these services is the creation of demand-driven markets and valuation of these multiple services.
The EU Forest Policy
Forest sector and private forestry can mean significant development opportunities for the EU, but only if the EU is able to recognise this opportunity and take the challenge to create enabling environment for forest sector operation. This requires that forestry and forest-based sector is recognised as a self-standing sector instead of being submitted to fragmented and non co-ordinated policies and objectives of other sectors. The current evaluation and further development of the EU forestry strategy should even more focus on holistic approach and secure an enabling environment, improve competitiveness and emphasise dynamic and entrepreneurial approach in forestry.
The various EU policies should respect subsidiarity principle, which means that the member states are responsible for implementing their own national forest policies. There is an urgency to return to a genuine sustainable development approach within which the ecological pillar cannot receive higher attention than the economic and social pillars. In order to get the full benefit out of the forest sector, forest owners experiences and commitments among other stakeholders , their participation in the drawing up and implementation of forest sector policies and development strategies has to secured.
The EU forest policy should ensure clear and secure land tenure rights as well as recognise forest owners right to manage and use their forest according their own values and needs within the framework of sustainable forestry. The forest related decision-making within the community must respect the forest ownership structure in Europe and give adequate emphasis to private ownership. The jungle of regulations and guidelines surrounding it should not create barriers to private entrepreneurship and activity which creates added value also to society. The emphasis must be on the development of viability and competitiveness of forestry.
To summarise, I want to emphasise that private forestry should be seen as a one form of private entrepreneurship and should be based on free market economy. This calls for clarification of ownership status, capacity building and completion of the privatisation process without delay.
Financially feasible and cost effective forest management and sustainable roundwood prise as well as well functioned timber market are the key elements to promoting SFM in the whole Europe - also in the new EU member countries.
Private forestry can mean significant development opportunities for the EU. But however, the community must respect the forest ownership structure and forest owners' rights to use their forests.
After the enlargement of the EU on the 1st of May this year, the forest area of the community amounts to 162 million ha representing approximately 35 % of the EU territory. Forestry and forest-based industries form one of the most important economic sector within the EU representing 9 % of the manufacturing industries. They employ about 3,5 million people and create an annual production value of EUR 400 billion.
Family Forestry must be seen as a one form of private entrepreneurship in the new EU member countries. A basic condition for private entrepreneurial activity and investments is clear and secure land ownership. The still on-going restitution and privatisation process needs to be completed to allow the forest owners manage and develop their forest assets. The legal framework for forestry operations should be established to promote active management of forests for both wood production and maintenance of other forest values.
In the new member states the former overall dominance of the state administration in forest management has changed with the emerging of new stakeholders and new form of property. Due to restitution process and privatisation the number of private forest holdings increased by 25 % and the number of forest owners by three million. In most of the countries, the average holding size would not exceed 5 ha. The situation is characterised by variation in knowledge and understanding of, expectations from, and interest in forest management. One of the biggest challenges to be faced is the high share of not-operational private forests without any management activities, lack of capacity and organisation of the private forestry.
The framework conditions for operation of private forestry need urgent improvement, including direct support in capacity building of private and community forest owners, their associations and interest organisations. The capacity building should address multipurpose forest management, but necessarily also access to timber markets and awareness of market-chain position as well as participation in policy-making and enhanced co-operation between private forest owner associations and state forest services/authorities.
Market Development
The impact of the EU enlargement on forestry is significant both in the old as well as the new member states. The EU forest resources increased remarkably; the total forest area grew by some 20 % and the volume of the growing stock by 25 %. Accordingly, the enlargement created a larger common market area for round-wood and wood-based industries with new possibilities to trade and investments.
Since the beginning of 1990s sawnwood production in the new Member Countries has grown considerably, particularly in the Baltic Countries and Central European countries. In deed, in several countries the sawmilling industry constitutes already a significant export industry especially within EU markets. Woodpulp and paper production in the new member countries is still rather small and these countries are still net importers of paper. The average paper consumption is only one third of the consumption in the former EU.
After the enlargement, the EU became self-sufficient in sawnwood. If there is no rapid increase in internal EU wood consumption and no external markets are opened, there could even be a shift in especially sawnwood production from the western European countries to the new member countries. Actually already now, the formal EU based forest industry companies have started to invest sawmilling and wood-based panel industry in the Baltic Countries and Central European countries.
However, in the short term no major changes are expected in the pulp and paper markets. The corporate sector will evaluate also the Central and Eastern European investment opportunity in the global context. But never the less, also on the pulp and paper industry side the new member countries are an attractive potential location for investment by forest industry companies based in the old EU. The fact that the consumption of paper and wood products per capita in the new
EU countries is less than half of the consumption level in the former EU will be a
major factor attracting investments in Central and Eastern Europe.
Timber markets in the Central and Eastern European countries are also undergoing change as a consequence of privatisation. The new private forest owners have little experience of the timber trade. And in addition, access to market information is limited. Like private forestry infrastructure in general, the laws governing the timber trade, provision of market information and advice for forest owners on the timber trade are being developed in the new member countries.
With privatisation, the new member countries will able to secure effective operation and competitiveness of the timber markets by increasing access to market information. Effectively functioning timber markets are crucial for ensuring competitive conditions in round wood markets throughout EU.
Family Forestry and Sustainable Development
In spite of the small size of a forest property in Europe, the primary objective of most private forest owners is financial security and income. Thus, the economic sustainability is the basis for family forestry. Without financial profit from the forest, the family forest owners would hardly be interested in forest operations. Only financially profitable forestry allows forest owners to invest in reforestation, nature management and protection and social values. In this context, there is no real difference between private and public forest ownership; a stumpage price is required in any case.
However, forest is not only about money, but forest owners have a deep respect for their forests and multiple values they produce. The contribution of forests and forestry to the sustainable development of modern societies are manifold. Besides the production of the renewable resource timber forest owners deliver a number of products and services to the wider society that are not yet marketable. There needs to be political recognition that a further increase for the production of these non-marketable products and services has a direct impact on the economic viability and thus sustainability of the individual family forest holding with knock-on effects for the economic and social welfare in rural communities. An integral part of enhancement of production of these services is the creation of demand-driven markets and valuation of these multiple services.
The EU Forest Policy
Forest sector and private forestry can mean significant development opportunities for the EU, but only if the EU is able to recognise this opportunity and take the challenge to create enabling environment for forest sector operation. This requires that forestry and forest-based sector is recognised as a self-standing sector instead of being submitted to fragmented and non co-ordinated policies and objectives of other sectors. The current evaluation and further development of the EU forestry strategy should even more focus on holistic approach and secure an enabling environment, improve competitiveness and emphasise dynamic and entrepreneurial approach in forestry.
The various EU policies should respect subsidiarity principle, which means that the member states are responsible for implementing their own national forest policies. There is an urgency to return to a genuine sustainable development approach within which the ecological pillar cannot receive higher attention than the economic and social pillars. In order to get the full benefit out of the forest sector, forest owners experiences and commitments among other stakeholders , their participation in the drawing up and implementation of forest sector policies and development strategies has to secured.
The EU forest policy should ensure clear and secure land tenure rights as well as recognise forest owners right to manage and use their forest according their own values and needs within the framework of sustainable forestry. The forest related decision-making within the community must respect the forest ownership structure in Europe and give adequate emphasis to private ownership. The jungle of regulations and guidelines surrounding it should not create barriers to private entrepreneurship and activity which creates added value also to society. The emphasis must be on the development of viability and competitiveness of forestry.
To summarise, I want to emphasise that private forestry should be seen as a one form of private entrepreneurship and should be based on free market economy. This calls for clarification of ownership status, capacity building and completion of the privatisation process without delay.
Financially feasible and cost effective forest management and sustainable roundwood prise as well as well functioned timber market are the key elements to promoting SFM in the whole Europe - also in the new EU member countries.
Private forestry can mean significant development opportunities for the EU. But however, the community must respect the forest ownership structure and forest owners' rights to use their forests.
