PEFC: Connecting Smallholders and the Private Sector Unleashes the Real Potential of Forestry in Asia

“The world needs more wood.  And in the crowded landscapes of Asia, this wood won’t be coming from conventional large-scale plantations, but from millions of dispersed smallholders,” remarked Stephen Midgley during the opening session of PEFC’s event at the Asia Pacific Forestry Week (APFW) at the end of February.

PEFC’s event explored the interface between large-scale private sector and smallholders in the Asia region. The event featured perspectives from a range of companies: community engagement models from Burapha in Laos, APP in Vietnam, April Group in Indonesia, and SCG in Thailand.

The case studies from Vietnam and Thailand illustrated how large-scale industries can be built upon a dispersed, smallholder resource base. In Laos and Indonesia, the case studies showed longer-term company programmes engaging smallholders into company business models.

“Institutional investors want to invest in forests and I estimate that US$5 trillion is currently looking for a home. But so far, little of that is being invested in Asia, and why not?” questioned Dennis Nielsen, DANA Investment. “Supporting smallholders to come together in establishing institutional structures and pitching innovative opportunities to investors, could be one way to close this gap and start channeling some of the much needed investment into productive forestry in Asia.”

Emerging from the case studies and intense exchange amongst participants was a strong conclusion that both companies and smallholders can ‘get rich together’ by getting the model right and delivering to the growing global markets for forest products.

“Managing and adequately sharing risk is a critical issue at the interface of private sector and smallholder models, but to get it right will unleash the real potential of forestry in Asia. It’s an extremely efficient way to improve rural livelihoods and the environment,” concluded Richard Laity, PEFC International.