Forest products

Prey Lang Wildlife Sanctuary. Photo by U.S. Embassy Phnom Penh on 09 June 2016. Licensed under CC BY-ND 2.0.

Cambodia had over 8 million hectares of forest resources in 2020, accounting for 44.7% of the country’s total land area. 1 The state owns the whole forest area, which means that the government can transfer forest land to local communities in the form of community forestry for forest resource management and traditional usage, or grants to private firms in the form of economic land concessions (ELCs), as well as grants to the citizens as the social land concessions (SLCs). The permanent forest estates consist of permanent forest reserves and private forests. The permanent forest consists of three categories such as production forests, protection forests, and conversion forestland. The production of the permanent forest should be maintained in a manner to allow for the sustainable production of forest products and by-products, including forest concessions, production of forests not under concession, forests rehabilitation, reserve forestland for reforestation or tree plantation, reserved forestland for forest regeneration, degraded forestland, and community forests under the agreement. Some private forest, comprising forest or tree plantation, is owned privately by a private company, individuals, and local households.2 The private forest shall be maintained by the owners with the interesting rights to manage, develop, harvest, use, sell, and distribute the products by themselves.3

Forest products

The state owns all forest products and by-products (timber products, non-timber forest products, and processed goods) found in and originating from the permanent forest reserve. When supply exceeds local needs, the items are selected for yearly domestic needs and exported.4 Based on production potential, the government could offer a forest concession to an investor or legal company, allowing them to manage and collect forest products and by-products. However, the government dissolved all concession businesses in 2002, restricted logging licenses in wild forests, and froze wood exports in 2006. Currently, harvesting forest products and by-products on state-owned land are only permitted in economic land concession (ELC), social land concession (SLC), infrastructure development, private land, and community forest.5

Cambodia’s production forest is 3.1 million hectares,6 The average annual net loss of forest areas (2010-2020) is 252,000 hectares per year, equivalent to 2.68%. The 3.1 million hectares of forest are designated for production.7

Cambodia produced around 813,000 m3 of Roundwood in 2020. Since the government stopped logging licenses in natural forests in 2002 and suspended timber exports in 2006, the country's wood production has been low. The country exported wood products such as plywood, veneered panel, and similar laminated wood to the following main destinations in 2019, including the United States 92.7%, China 5.7%, Vietnam 0.8%, Canada 0.3%, Chinese Taipei 0.1%, and Singapore 0.1%. The entire export value of primary wood products is around 190 million US dollars. In 2020, Cambodia exported around 13,410m3 of Roundwood. 8

Legal framework for forest harvesting

The forest harvesting of each individual, community, and company is required to have various legal documents based on the categories of land as the following:

  • Economic Land Concessions (ELCs): An economic land concession (ELC) is a long-term lease that allows a concessionaire to clear land to develop industrial-scale agriculture and can be granted for various activities, including large-scale plantations, raising animals, and building factories to process agricultural products. Private companies are given ELC contracts to develop forest lands for various use. Since 2014, ELCs for agro-industrial uses (including forest plantings) can be granted for a maximum of 50 years and areas no larger than 10,000 hectares. When legal and contractual conditions are not met, the government has the authority to revoke or annul ELC contracts.9
    • Economic Land Concession contract
    • Management plan
    • Land Register
    • Cadastral maps
    • Environmental and Social Impact Assessment
    • Forest Inventory Lists of timber species and volumes
    • Commercial registration
    • Permit to harvest forest products and by-products.10
  • Social Land Concessions (SLCs): the states allocated private property for residential use and/or family farming. SLCs can be converted to private land after five years of tenure on State Private Land, and forest plantings, if any, become private forest plantations.11 The Ministry of Land Management, Urban Planning, and Construction are responsible for submitting proposals to the government for land grants. If permitted, the land might be cleared by an auctioning company based on the Forestry Administration’s forest inventory results. A harvest permit, as well as transportation permission, would be necessary.12
  • Infrastructure development: State-owned land designated for development by private firms (e.g., hydro-power dams, national and provincial road areas). Harvest Permits are necessary to clear the land in preparation for construction.13
    • Memorandum of Understanding with Ministry of Mines and Energy
    • Feasibility Study
    • Approval by the Council for the Development of Cambodia
    • Water use license from the Ministry of Water Resource and meteorology
    • Environmental Impact Assessment
    • Build-operate-transfer (BOT) contracts
    • Permit to set harvest quota
    • Permit to harvest forest products & by-products.
  • Private land: Land that is privately owned and administered by private. The land must be registered, and a Registration Certificate is provided. Products from private forests or tree plantations do not require permits like a harvesting permit, a license permit, or a transport permit. A license is required for exporting or processing products from private forest or tree plantations, issued by the Ministry of Commerce and the Forestry Administration.
  • Community forest: Timber from community forestry areas may also be exported if acquired by Timber Export Companies. Local communities have customary user rights on forest products and by-products and can assist forest management through community forestry. The community also has the right to harvest forest products and by-products from its community forest for commercial purposes upon approval from the Ministry of Agriculture, Forestry, and Fisheries and a harvest permit issued by the Forestry Administration. The payment for premium and royalty is needed and jointly determined by the Ministry of Agriculture, Forestry, and Fisheries and the Ministry of Economy and Finance.14

Forest tax, fees, and royalties

Individuals and legal entities who harvest forest products and by-products from permanent forest estates for commercial reasons must pay royalties and premiums to the national budget through the Forestry Administration, according to the Law on Forestry, article 52. A security deposit to ensure payment of royalties and premiums is necessary to acquire a permit to harvest the goods, and the size of the deposit depends on the yearly harvest quota permit. On the other hand, products harvested from private and communal forests are exempt from royalties and premiums. Before exporting, the export and other duty taxes must be paid to the national budget.15

Related to Forest Products

References

  1. 1. Food and Agriculture Organization of the United Nations, “Global forest resources assessment 2020,” 2020, accessed on 03 June 2022.
  2. 2. Royal Government of Cambodia, “Law on Forestry,” 31 August 2002, accessed on 01 July 2022.
  3. 3. Ibid.
  4. 4. Royal Government of Cambodia, “Law on Forestry,” 31 August 2002, accessed on 10 June 2022.
  5. 5. Timber Trade Portal, “Legal framework for forest management and timber trade of Cambodia,” accessed on 10 June 2022.
  6. 6. Timber Trade Portal, “Forest resources and context of Cambodia,” accessed on 01 July 2022.
  7. 7. Food and Agriculture Organization of the United Nations, “Global forest resources assessment 2020,” 2020, accessed on 03 June 2022.
  8. 8. Timber Trade Portal, “Overview of timbers sector of Cambodia,” accessed on 01 July 2022.
  9. 9. Preferred by Nature, “Cambodia Timber Risk Profile,” 24 November 2022, accessed on 01 July 2022.
  10. 10. Timber Trade Portal, “Legal framework for forest management and timber trade of Cambodia,” accessed on 30 June 2022.
  11. 11. Preferred by Nature, “Cambodia Timber Risk Profile,” 24 November 2022, accessed on 01 July 2022.
  12. 12. Timber Trade Portal, “Legal framework for forest management and timber trade of Cambodia,” accessed on 30 June 2022.
  13. 13. Preferred by Nature, “Cambodia Timber Risk Profile,” 24 November 2022, accessed on 01 July 2022.
  14. 14. Timber Trade Portal, “Legal framework for forest management and timber trade of Cambodia,” accessed on 30 June 2022.
  15. 15. Royal Government of Cambodia, “Law on Forestry,” 31 August 2002, accessed on 01 July 2022.
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