Chinese timber companies commit to jointly develop the global green supply chain

A workshop and dialogue co-convened by ITTO in China in late June concluded with a call by twelve leading Chinese forest products enterprises—with a combined annual turnover of RMB 80 billion (about US$12 billion)—for the establishment of a global green supply chain (GGSC) initiative, to be facilitated by ITTO.
 
ITTO has a mandate to promote sustainable forest management (SFM) and the expansion and diversification of tropical timber trade from legal and sustainable sources. In collaboration with the Center for International Forest Products Trade of the National Forestry and Grassland Administration of China (CINFT/NFGA), ITTO organized the International Workshop on Global Green Supply Chain of Forest Products and Dialogue with Chinese Leading Forest Products Enterprises in Beijing, China, on 21–22 June 2018 with the aim of promoting interest in green supply chains in China’s vast timber sector.

The development of a global green supply chain would enhance the production, processing, distribution and consumption of legal and sustainable timber and forest products, including tropical timber, bringing benefits to all stakeholders, from forest owners in the tropics to end-consumers, and to the global environment.
 
The workshop was attended by more than 120 participants from the Chinese industry and government (the Ministry of Commerce; the National Forestry and Grassland Administration and the General Administration of Customs), as well as international speakers. Participants agreed that legal and sustainable “green” supply chains would yield multiple benefits for all stakeholders from the forests in tropical countries to the finished products in consumer markets. The development of green supply chains would help create a level playing field for promoting good business and close emerging supply gaps for tropical forest products while conserving biodiversity, mitigating climate change and ensuring environmental health. Enhanced legality and traceability would contribute to the transparency of the whole value chain, from forest production, to the processing, distribution and consumption of timber and other forest products.
 
The workshop, which was organized in four sessions, was followed by a dialogue with top representatives of some of China’s leading companies.[1] The workshop sessions addressed the following topics:
1) the global situation of, and trends in, the supply of tropical timber resources;
2) demands and challenges in global timber markets;
3) the role of, and perspectives on, building green supply chains in China; and
4) building successful green supply chains: concepts and international experiences.
 
The following key messages and conclusions emerged from the workshop:

• Ensuring a stable and reliable supply of wood raw materials from legal and sustainable sources is essential for the development of a thriving forest products industry.
• There are several interpretations of green supply chains but, from the standpoint of the private sector, the aim is to reduce costs and increase efficiency.
• Building green supply chains involves various levels of actions and commitments across a wide spectrum of stakeholders, who need to interact in a coordinated manner to ensure the sustainable and legal production of timber and forest products.
• Green supply chains need to be practical. They need to define a common concept of legality, an accepted set of documentation, and clear and common rules of the game, and they must be mutually recognized by tropical timber producers and consumers to promote win–win approaches.
• There is a need to build capacities among operators and stakeholders across supply chains through knowledge-sharing, technical expertise, the transfer of technology, and access to information and networking.
• Incentives, access to finance and fair taxation are vital for creating an enabling environment for green supply chains that fosters much-needed forest-sector investments —such as in forest management, forest restoration, and technological upgrades for timber processing— to promote further business.
• Most tropical timber-producing countries lack sufficient infrastructure and technology to establish green supply chains. Public–private partnerships —domestically and with consumer countries— are necessary for sharing the incremental costs and ensuring the viability of initiatives to create green supply chains.
• The influence of major purchasing powers in domestic and international markets could be a driver in promoting best practices for SFM and legal compliance in tropical timber-producing countries, while also increasing demand for legal and sustainable forest products among end-consumers, hence creating a virtuous cycle.
• It is imperative to raise consumer awareness of the benefits of using sustainably produced wood as the most environmentally friendly and renewable material compared to other materials.

The dialogue with leading Chinese forest products enterprises that followed the workshop focused on the vital role of SFM in establishing green supply chains and the benefits that green supply chains could bring to tropical timber producers, Chinese manufacturers of timber products—who are placed in the middle of timber supply chains—and consumer markets.
 
Key outcomes of the dialogue, in which twelve major companies from the Chinese private sector were represented, were a declaration to jointly establish a global green supply chain (GGSC) initiative to be facilitated by ITTO and the launching of a committee for its promotion. The main elements include:

• A clear acknowledgement of the vital role of forests in the survival of humankind and the shared responsibility in ensuring forest conservation for present and future generations.
• Recognition of the role of wood as an environmentally friendly material that locks up carbon and of the potential of the forest industry as a spearhead for sustainable, low-carbon development.
• An acknowledgement of the commitment of the international community to sustainably manage forests and the joint efforts required by governments, universities, research institutions and the private sector to achieve it.
• A call to the forest products industry, research institutions, governments and international organizations to jointly establish a GGSC. The aim of a GGSC would be to bridge the upstream, midstream and downstream sectors to ensure forest sustainability and the supply of more and better forest products to consumers, both in China and abroad, and thus contribute to sustainable development and the well-being of humankind.

The GGSC initiative which is being supported by the Chinese government (the Ministry of Commerce; the National Forestry and Grassland Administration and the General Administration of Customs) is to be implemented in a phased approach, encouraging best practices with a harmonized set of standards and creating a level playing field for all producers.

Download the call for a global green supply chain initiative for forest products
Download the presentations for session 1
Download the presentations for session 2
Download the presentations for session 3
Download the presentations for session 4
 
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