The study analyses how illegal timber imports impact the economic viability of the timber and forestry industries in Germany. On the basis of expert interviews and statistics, the study shows that the substantial long-term economic damage can result from reputation problems, price dumping and the unsustainable use of the industry’s resource base. The paper concludes with policy recommendations.

It is widely known that illegal logging has multiple negative impacts on the socio-economic and natural environment in forested countries. With instruments such as the FLEGT process, the EU tries to ensure that no illegal timber enters the European market. Comparable efforts are undertaken at the international level through the Convention on Biodiversity, the UN Framework Convention on Climate Change and the G8 Dialogue on Illegal Logging.

In contrast, the economic damages that illegal timber imports can cause in importer countries such as Germany have thus far received little attention. Although quantification of economic damages is extremely challenging at this point in time, the study shows that illegal timber imports pose an increasing risk to the industry. For example, reputation scandals and loss of consumer confidence are poised to further increase if illegal imports cannot be halted.

Lack of reliable data has proven to be a crucial problem when conducting this research. One of the key recommendations therefore is the introduction of a compulsory identification of timber origin to increase transparency for all market participants.

The study is now available for download.