Overseas Development Institute

Thursday 7 March 2002

Meeting Summary:

Rethinking "good governance" (1)

Breathing life into "good governance" – what does experience with natural resources tell us about the role of donors?

Speaker: Hilary Benn,

Parliamentary Under-Secretary of State for International Development, Department for International Development

Chair: Baroness Margaret Jay

Organised by the ODI Forest Policy and Environment Group

1) Baroness Margaret Jay introduced the meeting, highlighting how good governance had come to be a leading theme for donors. She saw this new ODI series as an opportunity to re-examine how effectively bilaterals had tackled the complexity of the problem.

    2) Hilary Benn, saw forests as one example of a number of natural resources (including fisheries and bushmeat) that were under increasing pressure from competing demands and interests. He explained that his interest in the forest sector as an entry point on good governance arose out of the East Asian Forest Law Enforcement Conference (September 2001) – which high-lighted the complexities surrounding the role of the state, conflict and corruption, participation and political power, and democratic accountability.

3) Mr Benn thought it striking how many issues in governance are played out in practice in forestry. Many countries have undergone processes to reduce public sector involvement in forest management in favour of private sector involvement and greater community-based management and ownership, and often in the face of resistance from powerful elites. He also highlighted how just over half the world’s tropical forests were areas of military conflict, often sustained by the revenues forests generate. The sector is plagued by corruption, lack of transparency and widespread illegality amounting losses of $10 – 15 billion in public revenue per year (more that global development assistance to the health and education sectors combined).

4) However Mr Benn also said that serious attempts are being made to reduce corruption and conflict arising out of forests, e.g. the Cambodian Forest Crime and Reporting Project. Related extra-sectoral measures include reform of the judiciary and security sector. He went on to stress that forests have the potential to significantly contribute to rural development, and that significant resources should therefore be committed to the social protection of 1.6 billion people. Indeed forest policies increasingly derive their legitimacy from the extent to which they underpin Poverty Reduction Strategy objectives.

Audio
Hilary Benn's speech
(in Windows Media Player and RealPlayer)

You'll need Windows Media Player to listen to these clips. You can download the correct version here

1) Introduction (4min 36)

2) What's going on in the forestry sector? (3min 42)

3) Reducing corruption in the forestry sector (4min 35)

4) Participatory Forestry Management Approaches (4min 50)

5) Investor and consumer roles (4min)

6) Conclusion (1min 40)

You'll need RealPlayer to listen to these clips. You can download the free version here

1) Introduction (4min 36)

2) What's going on in the forestry sector? (3min 42)

3) Reducing corruption in the forestry sector (4min 35)

4) Participatory Forestry Management Approaches (4min 50)

5) Investor and consumer roles (4min)

6) Conclusion (1min 40)
5) Mr Benn emphasised the importance of tenurial rights for local people to protect forests from encroachment, reduce opportunities for bribery and corruption, and strengthen economic and political independence. He pointed to the level and variety of experimentation in participatory forest management over the last 20 years - some less successful than others – and which offer lessons for other areas of development practice. He also pointed to increasing public participation in the formulation of national forest policies and the challenges of strengthening ownership. He illustrated DfiD’s work in Indonesia where forestry is being used to strengthen democratic processes, and to open up opportunities for reform in areas such as debt restructuring and legal and illegal trans-boundary trade.

6) Hilary Benn went on to discuss investor and consumer demand as powerful means of influencing reform in forest governance, including market based instruments, certification and audit processes.

7) Finally Mr Benn discussed what development agencies should do to help overcome poor governance and to realise more the potential of forests to contribute to poverty reduction. He highlighted four areas for action:

  1. Support the reform of legal, policy and institutional frameworks, including support for community forest management, public sector reform, regulation of the private sector, fiscal and financial management, as well as international efforts to combat illegal logging and trade.

  2. Linkages with a wider understanding of rural livelihoods, national poverty reduction objectives, as well as a coherent donor agency approach to governance issues.

  3. Concerted action at local, national and international levels. This includes action by donor agencies to strengthen forest law enforcement by promoting reforms in both producer and consumer countries.

  4. Building local institutional capacity to improve equity and defend interests in the face of claims from other powerful forces, which is not at odds with the drive by development agencies for rapid delivery and short-term impacts.

    8) Mr Benn concluded that it seems odd that forests are, on the one hand, places of beauty and serenity, and on the other, sources of disagreement and conflict. He thought that forests allow us to gain a better understanding of governance, and offers insights into other areas of development practice precisely because we expect so many different and seemingly irreconcilable things from forests.

  1. Key points from the discussion:

  1. On illegal logging and trade, independent log monitoring was highlighted as an important means of identifying offenders and of enabling appropriate action. But one participant argued that, although independent monitoring of the timber trade in Cameroon and Cambodia had generated valuable information, monitors faced serious limitations in the extent to which they could use such information to secure reforms. Another member of the audience thought that independent monitors had failed to gain ground-level consensus and ownership amongst local communities, who would otherwise be a crucial source of support.

  2. Another participant argued that governments were not currently accepting full responsibility for the trade in commodities such as diamonds, and that they should put strong pressure on their corporations for greater accountability.

  3. Jane Thornback, UK Tropical Forest Forum, brought attention to a document on Whitehall timber procurement by ERM. The document, which looks at options for sustainable sourcing of legal timber by the Government, will be posted on the Tropical Forest Forum website and a consultation meeting will be held on Monday 25 March.

  4. The challenge of distinguishing legal from illegal log imports was also highlighted –systems to certify legality are one solution but it also required enabling legislation in importing countries to allows customs to take action. Indeed the only enabling legislation at present related to CITES. But another participant argued that rigorous controls on imports risked blocking markets from responsible producers, who would then be forced to export to less regulated markets such as China. In addition, the cost of certification for local producers can be prohibitive – up to £5000 in one example from Zimbabwe.

  5. Mr Benn responded by arguing that full timber certification was not necessary, and could be a phased process, initially just consisting of a certificate of legality. On independent monitoring, he highlighted how this had enabled the Indonesian government to begin seizing shipments of illegal timber and thought this a significant step forward.

  6. On the role of donors in promoting good governance, one participant highlighted the tension between "good governance" and "self governance". He wondered to what extent conditionality inevitably arose and what problems this then presented.

  7. It was also suggested that experience from forestry showed that governance reform is not just about devolving management rights and power to local communities; if anything, it demonstrates that communities cannot ‘go it alone’ and that the common assumption local ownership ‘delivers the goods’ should be challenged.

  8. One member of the audience highlighted experience with land reform, and what this meant for donor’s commitment to governance. He noted how land reform had fallen in and out of favour with donors over time, with a strong resurgence of interest in Namibia and South Africa in the early 1990s but a subsequent decline given conflicts in Zimbabwe. Pro-poor land reform projects are now being abandoned. Another participant argued how donors involved with land reform in Mozambique had pursued governance in terms of economic reform and had, in fact, undermined democratic processes in the process.

  9. One further participant stressed that governance is not just about governments. It is also about strengthening NGOs and civil society movements, in particular where governments prove reluctant to reform. A DfID representative responded that a new environmental governance programme had just been initiated in Kenya working with civil society groups.

  10. There was one comment on energy sector reform and the impacts this was having on fuelwood consumption. Fossil fuels provide an important means of reducing both forest degradation as well as deaths from indoor pollution due to fuel-wood consumption – the 3rd biggest killer of adult women. However energy sector reforms, by raising the prices of fuels such as kerosene were forcing poor people back into relying on wood-fuel.

  11. On multinational environmental processes, there were two questions relating to WSSD and what this might achieve for forests and civil society (specifically women’s) empowerment. One member of the audience commented that little had been achieved at Rio on forests and that there was little reason why significantly more should be achieved at WSSD. Such processes are incremental and there should not be high expectations.

  12. Hilary Benn responded on a number of fronts. He agreed that it would be wrong to have excessive expectations of WSSD, and said that the summit was only a marker in an ongoing process that provided an opportunity to take stock. The real test would be whether WSSD created sufficient momentum to change things for the better.

  13. On the issue of "good" versus "self" governance, Mr Benn thought self-governance was clearly the priority but that this did raise tensions between donors and goverments. Donors face a dilemma and therefore have to spend their money in a variety of ways, ranging from budgetary support to way the Government is currently having to engage with Zimbabwe. Looking at the governance problems in that country over the last 20 years raises questions over the efficacy of conditionality. Ultimately, economic development and trade do more to lift people out of poverty. He also agreed with the point that governance reform did not means leaving it all to one group (i.e. local communities). However he stressed that such groups should not be left out.

  14. Mr Benn concluded by applauding the cross-party consensus in Westminster on development issues and hoped that currentexperiences and lessons learned would be carried forward into subsequent governments.

  15. Baroness Jay concluded the meeting by thanking Hilary Benn. She remarked that forest governance was a global issue and that while technical solutions offered some solutions, it ultimately came down to building consensus at the local level.

Diana Evans, 6th February 2002