A recent regulation by Indonesia’s Ministry of Trade relaxing export requirements for timber products has drawn criticism from environmental groups, which said it would restimulate illegal logging and in turn damage the environment.

Issued late month, the ministry’s regulation on exports of forestry products scrapped the requirement for Indonesian timber companies to secure V-legal documents that certify the wood comes from legal sources before exporting their products.

V-legal licensing had represented an important tool of the timber legality verification system (SVLK) managed by the Ministry of Environment and Forestry, which has helped improve Indonesia’s reputation in the global sustainable timber trade.

Indonesian Independent Forest Monitoring Network activist Muhamad Kosar said the scrapping of the V-legal licence was a setback for forest protection since it was supposed to be the final check in timber exports.

Introduced in 2013, V-legal licensing had increased the traceability of exported Indonesian timber under the SVLK scheme, which aims to curb illegal logging and increase forest sustainability.

Kosar said the absence of V-legal documents would now potentially create a loophole for illegal loggers to market their products.

“This new policy also proves that forest protection by the government is still partial. The trade ministry and the environment and forestry ministry have different approaches in this case,” Kosar said on Thursday.

Hurt reputation

Abu Meridian of the NGO Kaoem Telapak said it could potentially hurt Indonesia’s reputation as one of the few countries that have a globally recognised verification system of timber products.

Indonesia’s SVLK system, which was first launched in 2009, has culminated in the Voluntary Partnership Agreement (VPA) with the EU, which was ratified in 2013.

The VPA stipulates that Indonesia must ensure that only verified legal timber and timber products are imported to the EU, in line with the EU Forest Law Enforcement, Governance and Trade (FLEGT) scheme.

“This trade ministerial regulation potentially harms Indonesia’s agreement with the EU. The V-legal documents were not only demanded by the EU but also the United States, Japan and Australia as well,” Abu said.

The country’s timber exports rose to $12.3 billion in 2018 from $6 billion in 2013 following the adoption of V-legal licensing, environment and forestry ministry data shows.

Most of the export destination countries recognise the SVLK scheme and require timber products to have V-legal documents.

Data from FLEGT Independent Market Monitor 2020 shows that the US is the largest importer of Indonesian wooden furniture, having imported $670 million worth last year. The EU came second at $320 million, followed by Japan at $130 million, South Korea at $30 million, Australia at $40 million and Malaysia at $10 million.

Indonesia only exported as much as $150 million to countries that require no timber verification.

China, the world’s biggest timber importer, imported $20 million worth of timber products from Indonesia last year. China does not recognise the Indonesian SLVK system, but in December China updated its forestry law after 20 years, banning imports from illegal logging.

The environmentalist groups, in an open letter to President Joko “Jokowi’’ Widodo, urged him to revoke or at least revise the trade ministerial regulation. They had also lobbied officials at the Presidential Office to help them convince Jokowi, but have received no response to date.

“We need strong public support to push the President to act,” Kosar said, adding that they were considering filing a judicial review with the Supreme Court against the new regulation.

Association of Indonesian Forest Concessionaires executive director Purwadi Soeprianto warned that the SVLK easing might potentially reduce Indonesia’s timber export value caused by a lack of market trust.

“With the adoption of the SVLK system, the value of Indonesia’s timber products has been increasing in the last five years – meaning that it has a positive impact [on the industry],” he said.

The trade ministry’s director for agricultural and forestry products export Sulistyawati was quick to defend the controversial regulation, saying it only regulated the export requirements for timber and would not affect the whole SVLK system.

“It [the SVLK system] provides mechanisms for companies wanting to export timber to ensure the legality of their products [that are produced in Indonesia],” Sulistyawati said, adding that the new policy was only made to cut red tape in timber product exports.