Content: Demand-side measures

Linking supply and demand-side measures

Many major agricultural commodities such as beef, soy, sugar and palm oil drive deforestation in tropical countries. There is a growing awareness that in order to reduce the pressure on forests from these commodities it is necessary to address both consumption and production. Many of the activities and lessons from the EU FLEGT Action Plan are relevant to the broader REDD+ and zero-deforestation commodity contexts.

Voluntary approaches were instrumental in creating markets for legal timber in Europe, and several other countries and regions followed this lead. Voluntary approaches include:

  • Private sector policies on responsible timber sourcing
  • Public sector policies on sustainable timber procurement 
  • Financial sector approaches on responsible forest and land-use investment 

Legislation to address consumption of illegal timber includes the EU Timber Regulation, which prohibits the placing of illegally harvested timber on the EU market.

These voluntary and regulatory examples from the FLEGT context provide useful lessons for discussions within the broader REDD+ and zero-deforestation commodity contexts on the advantages, and the very significant costs and challenges, of various policies and measures for controlling consumption of forest-risk commodities, and ultimately reducing deforestation. At the country level, lessons from FLEGT VPA experiences can assist efforts to define the enabling environment stakeholders need to put in place to make zero-deforestation production and related trade a reality.

Another valuable lesson is that efforts should also be made on the supply side to ensure commodity producers comply with demand-side requirements, including environmental, social and governance criteria. The EU FLEGT Action Plan uses the leverage of EU market access and trade to promote supply-side action and reforms on legal timber production in producing/exporting countries. The EU FLEGT Action Plan is based on the understanding that both demand and supply side measures are needed to achieve the transformation required to address major environmental and governance challenges, and that efforts are required throughout and beyond the whole value chain. Moreover, a trade focus brings a wider range of actors together than would otherwise have been involved in land-use decisions.

REDD+ processes directly interact with several land-use sectors in commodity producing countries, and provide opportunities to support the creation of an enabling environment stakeholders need to decouple agro-commodity production from deforestation in those countries.