Higher international standards or rent-seeking race to the bottom?: the impacts of forest product trade liberalisation on forest governance

The objective of this study is to assess the impacts of forest trade policies, especially trade liberalisation, on forest governance. This was based on a literature review and three country case studies – Brazil, Indonesia and Mexico. The emphasis is on national (public, private and community sector) forest governance in developing and transition economy countries, since this is where governance problems like illegal logging and corruption are most problematic. A brief review of trade policies found it difficult to establish an overall trend towards trade liberalisation. Reductions in tariffs have been counteracted by a range of nontrade measures – mainly trade restrictions by poorer countries, and subsidies by wealthier nations - to protect domestic forest industry. An analysis was carried out of various pro and anti-trade liberalisation positions towards likely forest governance impacts. It was found that the empirical basis for both (pro and anti-liberalisation) sets of arguments was weak, fundamentally because trade policies and pressures have weak, indirect and sometimes perverse impacts on forest governance. They are also difficult to identify due to the complexity of trade and governance interactions, and the greater importance of non-trade factors.