INTERNATIONAL TROPICAL TIMBER ORGANIZATION

TITLE

SERIAL NUMBER

COMMITTEE

SUBMITTED BY

ORIGINAL

SUMMARY

ITTO PROJECT PROPOSAL

ACCELERATING THE EXPANSION OF EFFICIENT AND COMPETITIVE DOWNSTREAM WOOD BASED INDUSTRIES IN MELANESIAN COUNTRIES

PD 465107 (I)

FOREST INDUSTRY

GOVERNMENT OF FIJI

ENGLISH

This is a regional project conceived by Fiji Islands, Papua New Guinea (PNG) and Vanuatu, the Melanesian ITTO member countries. The project will be implemented by the Land and Resources Division (LRD) of the Secretariat of the Pacific Community (SPC) which is headquartered in Suva, Fiji Islands. A project manager will be based in the LRD and activities at the country level will be undertaken by government assigned officers under the guidance of a project manager in the LRD.

The governments of Fiji Islands, PNG and Vanuatu have identified that the forestry and wood processing sectors can contribute more to national development. This project will address the constraints that are holding back growth in the wood processing industries. The main constraints that limit expansion of a more efficient and competitive wood processing sector include; the absence of appropriate government policies to support expanded manufacturing of, and trade in added value wood products; weaknesses in the industry in identifying and applying technological and production opportunities and a lack of appreciation of marketing opportunities.

The project will generate baseline information on the national wood processing sectors to provide the foundation for national wood processing policies to be developed and proposed for adoption. The project will create a cadre of technicians who, through close liaison with the public and private timber industries, will be able to identify and offer solutions to production and marketing constraints and assist companies with development and investment plans. Country level assistance to industry will be backed by technical and market information databases established at the regional level and by the expertise of the regional project manager and staff and also by the sourcing of occasional short term international/national experts if required.

Expansion of efficient and competitive wood processing industlies, in particular those manufacturing added value wood products can provide many social and economic benefits in the form of direct and indirect employment generation, skill development and foreign exchange savings from import substitution and hard currency earnings from exports. Timber industries can operate efficiently and competitively at wide varying scales of production. This characteristic offers the opportunity to help integrate rural landowners into the productive cash generating economy, a priority in Melanesian countries.

EXECUTING AGENCY

DURATION

APPROXIMATE STARTING DATE

PROPOSED BUDGET AND OTHER FUNDING SOURCES

LAND RESOURCE DIVISION, SECRETARIAT OF THE PACIFIC COMMUNITY, FIJI in collaboration with PNG FOREST SERVICE AND V ANUATU DEPARTMENT OF FORESTRY

36 MONTHS

UPON APPROVAL

Source

ITTO Fiji, PNG, Vanuatu & LRDISPC

TOTAL

Contribution in US$

1,118,283 155,000

1,273,283

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Table of Contents

PART I: CONTEXT 1. Origin 2. Sectoral Policies 3. Programmes and Operational Activities

PART 11: THE PROJECT 1 Project Objectives

1.1 Development Objective 1.2 Specific Objective(s)

2. Justification 2.1 Problems to be addressed 2.2 Intended situation after Project completion 2.3 Project strategy 2.4 Target beneficiaries 2.5 Technical and scientific aspects 2.6 Economic aspects 2.7 Environmental aspects 2.8 Social aspects 2.9 Risks

3. Outputs 3.1 Specific Objective 1

3.2 Specific Objective 2

4. Activities

5. Logical Framework Worksheets

6. Work Plan

7. Budget 1. Overall Project Budget by Activity 2. Yearly Project Budgets by Source

PART Ill: OPERATIONAL ARRANGEMENTS 1. Management Structure 2. Monitoring. Reporting and Evaluation 3. Future Operation and Maintenance

PART IV:TROPICAL TIMBER FRAMEWORK 1. Compliance with ITT A 1994 Objectives 2. Compliance with ITTO Action Plan

ANNEX(ES) A B

Profile of the Executing Agency Curricula Vitae of the Key Staff

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PART I: CONTEXT

The International Tropical Timber Council, (ITTC), at its Twenty-Ninth Session in 2003 approved and funded a pre-project PPD 58/02 Rev.2 'Improving the Utilization Efficiency in Wood Industries in the South Pacific Region' This project proposal is the output of the pre-project.

The pre-project, PPD 58/02 required an assessment of wood processing industries in the Melanesian ITTO member countries of Fiji Islands, Papua New Guinea (PNG) and Vanuatu. This assessment identified that greater investment in efficient and competitive wood based industries would result in a more significant contribution by the sector to social and economic development in the three countries. It also identified that there are areas of weaknesses in government policy development and in marketing and technological skills in industry that are common to the three countries.

A regional workshop hosted by the Lands and Resources Division (LRD) of the Secretariat of the Pacific Community (SPC, the pre-project implementing agency) brought together representatives from forestry administrations in Fiji, PNG and Vanuatu to discuss the pre-project results. This workshop identified priority areas for action and these are the basis of this project proposal. The workshop also recommended a regional approach to wood based industry development to facilitate the sharing of experiences and expertise within the region and to effect economies in the use of resources.

2. Sectoral Policies

2.1 Fiji Islands

The forestry sector is an important foreign revenue earner in Fiji Islands and one of the top five sectors. The country has an export diversification growth strategy and the government acknowledges that, to be successful, the strategy will involve putting more emphasis on downstream wood processing and releasing the capacity of the sector to manufacture for export.

Forest policy

The Fiji Islands forest policy was enacted in 1950 and the seven-point policy has not been revised since however, a draft replacement policy has been prepared. The main legislation governing forestry is the Forest Decree (1992). The main objective of the Forest Decree 1992 is to regulate the management and utilization of forest resources in a sustainable manner while facilitating the growth of the sector with full participation of resource owners. The regulations that guide forest development include; Forest Regulation 1990, Forest Sawmill Regulations 1968, Forest Guard Regulations 1955 and the Forest (Fire Prevention) Regulation 1972.

Other legislations that affects forest industry development include; Native Land Trust Act 1940; Land Conservation and Improvement Act 1953; Nature Reserves Act 1956; Native Land (Lease and Licenses) Regulations 1984; and Native Land (Forest) Regulation 1984.

Laws and regulations that create forest institutions include; Fiji Pine Commission Act 1976 Regulation 1987; and the Fiji Pine Decree 1990.There is also legislation establishing the Fiji Hardwood Corporation which is charged with management and utilization of the Government's hardwood plantation resources.

Downstream Industries

The government of Fiji Islands has articulated a policy for the manufacturing sector in general but has no specific policy for the down-stream wood processing sector. The legislation establishing

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the two state timber enterprises, Fiji Pine and Fiji Hardwoods does require these companies to move into manufacturing of added value products but little progress has been made.

2.2Papua New Guinea

Log exports dominate PNG's timber sector activities. The country's international trade policy aims to strengthen the multilateral trading system; the concept of open regionalism; the development of regional integration arrangements with the Melanesian Spearhead Group. PNG remains strongly supportive of non-reciprocal trading arrangements such as Sparteca and the Lome Convention which have assisted the country to establish export-oriented industries.

PNG also supports a trade policy based upon WTO-compatible regional integration arrangements with the Melanesian Spearhead Group and subsequently with other Forum Island countries. PNG recognizes the benefit of regional integration in terms of economies of scale and expansion of markets.

Forest Policy

Customary land ownership is guaranteed by the PNG constitution and is the key factor influencing the use of the forest as most of the land is held as communal or clan commons; there is also individual/private ownership of land. Landowner groups are legally entitled to be involved actively in decisions concerning the management of their forest land.

PNG's national forest policy was approved in 1991. The country has also adopted ITTO's C & I as a monitoring tool for SFM. The main objectives of the national forest policy are: (i) the management and protection of the nation's forest resources as a renewable natural asset; and (ii) the utilization of the nation's forest resources to achieve economic growth, employment, greater Papua New Guinean participation in industry, and increased viable onshore processing. Parallel to the development of this policy, the National Forests and Conservation Action Plan was prepared and officially approved in 1996. Three sub-policies linked to the national forest policy have been drafted: an eco-forestry policy; a reforestation policy; and a downstream-processing policy.

Downstream Industries

The forestry sector in PNG is dominated by log exports but this has not always been the case. The log export orientation did not begin in earnest until the early 1980's, prior to that forestry in PNG was a processing oriented sector.

In 2000/3 the PNGFA produced a discussion document "National Policy on Downstream Processing of Forest Products" which attracted much criticism, notably because it was drafted with little or no input from the sector stakeholders. The draft is still being debated and is a useful first step towards creating a more dynamic wood processing sector.

2.3Vanuatu

Vanuatu's economy is primarily agricultural with 80% of the population engaged in agricultural activities. Copra is by far the most important cash crop followed by beef, timber, cocoa and Kava root extract. The government has maintained Vanuatu's pre-independence status as a tax haven and international off-shore financial center and the earnings from this are significant.

Forest policy

The National Forest Policy (NFP) was developed through a consultative process in 1996 and 1997. It was endorsed by the Council of Ministers in 1998. The NFP guides the work of the Department of Forests and this provides a clear indication to investors and donors about how the

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forestry sector will be managed in the country. The NFP presents a positive vision for the management of the nations' forest resources. It is stated that "the Government will work co­operatively with the landowners and the forest industries to achieve sustainable forest management and thereby encourage revenue generation for ni-Vanuatu landowners, economic development for the wider community and conservation of the country's forest biodiversity".

The Forestry Act No. 26 (2001) is the major law relating to forests and forestry. It defines the administration, forestry sector planning, agreements, licenses, protection of the environment and reforestation activities. The Forestry Act contains Vanuatu Code of Logging Practice which applies to all commercial forestry operations. Since 1993 only exports of processed timber (currently mainly sawnwood) have been permitted.

While policies are in place to encourage manufacturing in all sectors and these allow for manufacturing industries to be exempted from import duties however, Vanuatu has no specific policy for the downstream wood processing sector.

3. Programmes and Operational Activities

Fiji Islands

The Forestry Department is responsible for the sustainable management of the natural forest only, not for the forest plantations, for which management responsibility has been transferred to statutory bodies.

Communal groups (mataqa/i) who depend on natural resources for their well being, own 90% of the unexploited forests and 85% of all Fijian forests, including planted forests; the remaining forests are privately or state-owned. The Native Land Trust Board (NL TB) deals with landowner resource management and administers all customary land with the consent of landowning units. Fiji's commitment to SFM is demonstrated by its adherence to the Forest Principles of the 1992 Earth Summit and membership of ITTO.

There are four governmental/quasi-governmental institutions responsible for or otherwise involved in forest management. These are: the NL TB, which deals with landowner resource management and administers all customary land with the consent of landowning units; the Forestry Department responsible for management of the natural forest as well as industry assistance, research, training, extension plantations and timber production statistics; Fiji Pine Limited, a government-owned company which is responsible for pine plantation establishment, management, utilization and marketing; and the Fiji Hardwood Corporation Limited, also a government-owned enterprise responsible for the management, harvesting and processing of hardwood plantations.

The issuance of logging licenses, monitoring of harvesting and enforcing the logging code of practice is implemented in the natural forest is a function of the Forestry Department.

The Forest Decree 1992 provides for a Forestry Board, broadly representative of other government bodies with interests in or affected by the conservation, utilisation and management of the forests, together with non-governmental interests such as the timber industry. The Board may set up ad hoc forestry committees as requested by the Minister to look into specific issues.

Collaboration with partners

The Department of Forestry has been collaborating with foreign partners including: a) GTZ support and assistance in sustainable forest management system and practice, and agro forestry and sustainable land use plans; b) AusAID support for nutritional aspects of plantation species; c)

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ACIARlCSIRO support for the biological control programme; and ITTO. Past and ongoing ITTO projects in Fiji are annexed.

ITTO Technical Mission to Fiji Islands

A 2004 technical mission from the International Tropical Timber Organization (ITTO) assessed and reported on the constraints that are preventing Fiji from adopting sustainable forest management. The report ('Achieving the ITTO Objective 2000 and Sustainable Forest Management in the Republic of the Fiji Islands)' was submitted to the International Tropical Timber Council by the Diagnostic Mission established pursuant to Decision 2 (XXIX) November 2004.

PNG

Customary land ownership is enshrined in the PNG constitution and is the key factor influencing the use of the forest. Some 97% of the land is held as communal or clan commons; there is also individual/private ownership of land. The country has also adopted ITTO's C & I as a monitoring tool for SFM. The PNG Forest Authority was created in 1991 by the Forestry Act as a statutory corporation. It comprises 19 provincial forest divisions and the Forest Industry Council and is responsible for the management of the forest sector throughout the country.

The Forest Authority comprises the National Forest Board and the National Forest Service and a number of regulatory and administrative responsibilities have been delegated to the provincial level. The National Forest Board operates through a system of specialist advisory committees and provincial forest management committees which are serviced by the NFS. The PNG Forest Research Institute is a specialized agency falling under the PNG Forest Authority.

The PNG Forest Industries Association (PNGFIA) is an incorporated national association representing and promoting the interests of the PNG forest industry. Monitoring and surveillance of the log trade is carried out under contract by Socieiete Generale de Survellance (SGS) of Switzerland. The Department of Environment and Conservation is responsible for the administration of protected areas and also has a monitoring role with respect to adherence to environmental regulations.

Collaboration with partners

Many donors have been providing support to the forestry sector development in the country including: the Japanese Government (JICA), IITO, the New Zealand Government, Australia (AusAID), bilateral NGOs from the USA (Mc. Arthur Foundation), World Bank, UNDP, GEF, and FAO. Past and ongoing ITTO projects in PNG are annexed. PNG is a signatory of several international agreements and conventions, including: a) International Tropical Timber Agreement; b) Convention on Biodiversity Conservation; and c) Convention on Framework of Climate Change. PNG is actively involved in several international initiatives dealing with forest and forestry, including partiCipating in the deliberations in various sessions of IPF/IFF, CITES and other international initiatives on forests and forestry.

Vanuatu

In Vanuatu forest lands are customarily owned. The land may be owned communally, usually by clans (extended family units), or individually.

The constitution states that "every person has the fundamental duty to ... safeguard the natural wealth, resources and environment in the interest of the present generation and of the future generations". This is echoed in the 1997 national forest policy, the principle goal of which is to

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ensure the sustainable management of Vanuatu's forests to achieve greater social and economic benefits for current and future generations.

The ITIO C&I have been adopted as a monitoring tool, and training has been provided.

The Ministry of Agriculture, Forestry and Fisheries is responsible for forestry. Within the ministry, the Vanuatu Department of Forests (VDF) is responsible for the management of natural forests through policy development, planning, protection, silvicultural principles and guidelines. It is also responsible for all reforestation, afforestation and management of small-scale (mobile) sawmill licensing.

Collaboration with partners

The VDF maintains a policy of open cooperation with NGOs and collaborates closely with some programmes. NGOs such as the Foundation of the People of South Pacifc support and assist in training and extension programmes. The Forestry Act provides a mechanism for wider and more consultative planning in forest management.

The MCC Compact

In early 2006 the Millennium Challenge Corporation (MCC) approved a five-year US$65.69 million aid package with Vanuatu. The Millennium Challenge Programme is expected to increase average income per capita by 15% within five years. The government of Vanuatu identified costly and unreliable transportation infrastructure as a major impediment to economic growth. Improvement of inter-island trade will facilitate wood based industry development. Past and ongoing ITIO projects in PNG are annexed.

Regional Forestry Activities

On-going LRD projects include Development of Sustainable Agriculture in the Pacific (DSAP), Plant Protection in the Pacific (PPP), Forests and Trees Programme and GTZ-funded Pacific German Regional Forestry Project on Community-based Natural Forest Management. The LRD is developing partnerships and meeting new challenges for the Pacific region through initiating new projects including the Pacific Regional Influenza Pandemic Preparedness Project (PRIPP), Pacific Ant Prevention Programme (PAPP), Centre for Pacific Crops and Trees, Pacific Agriculture and Forestry Policy Network (PAFPNet), Sustainable Land Management and Land Care Concept for the Pacific, Organic Agriculture and the Pacific Regional Crops Improvement Program. Also an EU-funded pilot project to support potential agriculture and forestry exporting enterprises will soon begin.

PART 11: THE PROJECT

1. Project Objectives

1.1 Development Objective

To accelerate economic and social development in the Melanesian ITIO member countries from expanded sustainable, efficient and competitive wood based industries.

1.2 Specific Objective

To accomplish the adoption by the Melanesian ITTO member countries of policies to support expansion of the manufacturing of, and trade in added value wood products.

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To establish a regional and national capacity to source and deliver information and advice on technological and market opportunities to the public and private wood processing industries so as to facilitate establishment of efficient and competitive downstream wood based industries.

2. Justification

This section is presented in two parts, the first provides a background on the present situation and issues in the wood based industries in Fiji Islands, PNG and Vanuatu, the second provides an analysis of the issues constraining the sector as determined by stakeholders brought together in a regional workshop convened as part of the implementation of project PPD 58/02 Rev.2 'Improving the Utilization Efficiency in Wood Industries in the South Pacific Region'.

2.1 Problems to be addressed

Fiji Islands

The forestry sector is a small but significant foreign revenue earner in Fiji Islands, however, the contribution of the sector to GDP, foreign exchange earnings and employment has remained stagnant over the past decade. The bulk of the export earnings come from the export of low value wood chips and more recently from mahogany sawnwood exports. Manufactured wood products, which are of medium to low quality, comprise mainly of furniture for the local market and curios for tourists for the local market. Most manufacturers are small family businesses, there are a few small companies producing to international standards.

The Fiji Islands Forestry sector is constrained by a sector wide lack of appreciation of the technological and market opportunities that exist. Currently, industry has nowhere in the country to turn for advice and assistance on appropriate manufacturing technologies or market intelligence. If the constraints to development of the sector are not addressed then the industry will fail to grow and it will fail in its promise of delivering opportunities for poor landowners to be integrated into the economy. It will also fail in generating much needed foreign exchange so badly needed given the present economic situation in the country.

The absence of a defined policy for the wood based manufacturing sector is one reason why government's aspirations have not been fulfilled. Investment in the sector is also constrained by an irregular flow of logs to processors because, in recent years, the Forestry Department has moved from issuing long term harvesting licenses for the natural forest to licenses for only one year. Investment is also constrained because the private sector millers cannot readily obtain plantation logs from the state enterprises. The private timber sector has failed to get these issues resolved mainly because there are no functioning timber associations to articulate a common view and work with government to resolve issues.

PNG

The forestry sector in PNG is dominated by log exports and the sector contributes about US$350 mil. annually to the economy, representing 30% of GDP. There are forest regulations to force investment in processing plant by concessionaires. Before logging concessions are granted it is a requirement that proposals be submitted for investment in wood processing facilities within the concession areas. This approach has not proven successful as most concessionaires, once being granted the concession, either ignore or delay investment in processing capacity and concentrate on their primary business, log exports.

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The 2003 version of draft "National Policy on Downstream Processing of Forest Products" identifies the following constraints which impede progress in domestic processing in PNG: lack of resource security, lack of appropriate investment incentives for processing, lack of conducive government policies, high transport costs within PNG and high freight rates to overseas markets, high logging costs, diverse species mix, landowner disputes and poor physical infrastructure development.

Added to these constraints is the weakness of private sector players to recognize and act upon marketing opportunities and the low level of technical experience in the sector which manifests itself in inappropriate technologies being applied. The PNGFIA is very active and is able to present an industry perspective to government. However, the preoccupation of the PNGFIA is with issues facing log exporters and not those faced by the manufacturing industries.

PNG is rich in forest resources and a policy on downstream processing is a prerequisite to attracting investment in the sector to create employment and to maximize export earnings. Wood based industries will only contribute to the government aims when investment flows into appropriate manufacturing capacity to suit market requirements.

Vanuatu

The wood based industry in Vanuatu is small. There are just two permanently sited sawmills in the country. The largest mill is foreign owned and produces a range of products for the Japanese market. The second mill is a permanently sited circular mill producing mainly for the local market. The country has adequate forest resources to support small scale manufacturing, but what is lacking is the means for potential investors to obtain guidance on market opportunities and the appropriate processing equipment to match market requirements.

There few statistics on wood based industry production and output to provide a basis for planning in the sector. Downstream industries are mainly small, fledgling operations producing joinery and furniture for the local market. Exports of manufactured wood products are insignificant but imports of wood products are growing and there are opportunities for import substitution if the processing techniques, product design and quality of local products can be improved.

Regional Assessment of Issues

Government and private sector stakeholders from Fiji Islands, PNG and Vanuatu were brought together in a workshop to address a regional approach to issues constraining the contribution of the wood processing industries to national economies.

The following areas were identified as the common constraints which could, cost effectively, be addressed regionally: absence or poorly formulated national policies for development of the downstream wood processing sector; absence of and/or unreliable sector statistical data systems to support planning and policy monitoring; absence of locally available advice on technological problem identification and problem solving or on market intelligence; poorly developed training capacity unsuited to current technologies; absence of, or unapplied national grading and treatment standards undermining competitiveness of local wood products vis-a vis imports, uncertainty over the social and financial desirability and viability of mobile sawmill operation under different conditions.

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PROBLEM TREE

Insufficient and locally unavailable knowledge on technological options

Contribution of Wood based industries to social and economic development well below that expected

Slow flow of investment into upgraded or new manufacturing capacity

r Poorly developed or absence of specific policy for the downstream wood orocessina sector

2.2 Intended situation after project completion

Irregular flow of market intelligence and weak experience in its interpretation

At the development objective level a sustainable mechanism for providing support for the expansion of the wood processing sector will be in place, the range of wood products manufactured in the participating countries will have been expanded and the range of products exported will be widened. On completion of the project investment in processing capacity will be expanded and foreign exchange earnings from the export of wood products will increase annually.

At the specific objective level on successful completion of the project there will be significant improvements in investment in downstream processing in the sector and improvement in the support available to the manufacturers.

On successful completion of the project there will be regional experience in the processes involved in developing national policies for the wood based manufacturing sector, there will be draft policies that have been reviewed by stakeholders and these national policy statements will have been proposed for adoption by government agencies in Fiji Islands, PNG and Vanuatu. These policies will provide the platform for action to promote increased further processing to meet national objectives in employment generation and from expanded trade in added value products.

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Most importantly the policies will encourage private investment in manufacturing and thus provide opportunities for export diversification

Weaknesses in the statistical data on the timber and wood processing sectors in the region have been highlighted as a constraint to effective planning and monitoring of the sector. On completion of the project there will be trained personnel familiar with appropriate statistical software packages, there will be functioning systems for the collection and compilation of data on the sector and there will be user-friendly databases to facilitate the planning and management of the sector. In addition there will be regular publication of forestry and industry statistical digests. Successful completion of this element will improve the capacity of the countries in meeting their international obligations in reporting on the sector.

It has been identified that the wood processing sectors in participating countries lack technical and managerial skills, they fail to identify market opportunities and they fail in the choice and management of available processing technologies. This weakness will be addressed by providing direct advice backed by a regional source of on-line information on available technologies suited to local conditions and access to on-line market intelligence upon which companies can develop marketing and investment plans.

In further recognition of the weaknesses in utilizing available information for investment planning or problem solving in existing industries, the project will establish a cadre of industrial liaison personnel in the participating countries. National government officer/officers will be capable of assisting industry in trouble shooting, planning and in investment decision making, matching technologies appropriate to the raw material and with market opportunities. The national officers will be back-stopped by the regional information and technical support facility from which they can access technological and market information and, when necessary, technical and/or marketing specialists.

This project will not be funding training but it will address the issue of how national training institutions can deliver what is required for a modern wood based manufacturing sector. This will be achieved through working with the management of the national training institutes and devising appropriate ways in which industry representatives can be involved in curriculum development and the design of training courses. National training institutes will, at project completion have devised a means to actively involve the wood processing sector in its decision making process on the deSign and implementation of training.

In all participating countries imported wood products are making inroads into the local market and are successfully competing with locally manufactured products to the detriment of domestic industries. Price competition is fierce but consumers are also making decisions based on quality and assurances of that quality. The absence of viable and accepted lumber grading rules and wood treatment standards for sawnwood in the domestic markets in the region is a main reason why imported timber is successful. On completion of this project national sawnwood and treatment standards will have been reviewed with stakeholders and refined and monitoring systems will be in place to ensure locally manufactured products conform to the agreed standards so as to improve the competitiveness of locally manufactured products. This work may pave the way for the development of regional standards on grading, preservation and other aspects of wood processing.

The concept of timber production by forest communities from their own forests for their own building needs using small scale mobile sawmills employing simple technology has been advocated for more than 15 years in Melanesia. Mobile sawmills are common in most countries in the region. However, experiences with mobile sawmilling and whether they can deliver social and financial benefits has been mixed.

On the successful completion of this project a definitive report on the social, economic and financial viability of mobile sawmills operating under various conditions in the region will have

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been prepared and the results will have been assessed at a regional level to facilitate national policy discussion on the place of mobile sawmills in the sector.

2.3 Project Strategy

Wood based industries present many special features which can play a significant role in promoting social and economic growth and stability but, in the Melanesian countries, the sector is not meeting the expectations of forest landowners or governments. Ways must be found to release the capacity of the sector to expand and move into higher added value manufacturing to capture all the economic multiplier benefits derived from a strong domestic manufacturing base.

The strategy in this project is to release the potential in the wood based industry sector through the establishment of a sustainable mechanism to provide the 'tools' required for investments in manufacturing to be made with confidence. This is directly relates to IITO's goal of efficient utilization of forest resources and the development of downstream wood processing.

In order that the existing experience in the participating countries of technological support and market information collection, delivery and interpretation is used optimally, a regional approach will be adopted. There are two advantages in this, existing experiences in the different countries can be shared and cost savings can be effected as duplication of effort can be avoided.

Regional programmes and activities are common in the Pacific island countries and the Forest and Trees Program of the SPC LRD plays a leading role in regional forestry and timber industry programmes. Forestry and timber industry stakeholders in the countries participating in this project have jOintly agreed that the SPC LRD should take the lead in implementing and coordinating this project.

It is proposed that SPC LRD be the hub providing technical and market information and the training and capacity building for national 'industrial liaison' personnel who will spearhead the communication and development support services to the wood based industries. The strategy has an additional element as it is anticipated that there will be instances when neither SPC LRD nor the national personnel have the required specialist knowledge on certain issues. In this case the project strategy is for SPC to have available a fund to finance short term specialist services required to move investment in downstream processing forward.

There are at least two alternatives to the strategy proposed, the first would be for the countries to independently develop and fund their own industry support programmes, the second would be to allow the industry to try and develop on its own.

If countries were to each develop their own industry support mechanism then there would be a duplication of effort and a failure by the countries to take full advantage of the experience that already exists in the region. With the issues holding back the expansion of the wood based industries being common in the participating countries this would be an inefficient use of resources.

In time, if left completely to their own devises, investment by industry would slowly find its way into the wood based industry sector as sector players expanded their knowledge of available technologies and market opportunities. Along the way, unaided, some industries would flourish and others would fail but the process of expanding the sector would be slow.

Both the alternative routes would be more costly, take more time and experience greater risks than the strategy proposed.

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2.4 Target beneficiaries

The ultimate beneficiaries of this project will be the people in the participating countries and there will be benefits flowing to sector stakeholders. In the Melanesian countries policies are in place to secure greater participation of the indigenous population in industry, trade and commerce and the forestry sector has always been lauded as one of the most promising in this regard. Currently, landowners, whose forest resources are utilized industrially, rarely have an opportunity to participate in the commercialization of their resources and remain rent takers only.

The approach to this by Governments in the region has been to introduce various policies and schemes for landowners. Mobile sawmilling was seen as offering rural dwellers with opportunities to become involved in commercial activities but here the results have been mixed and disappointing.

Both primary and secondary wood based industry development offers opportunities for landowner participation and there are success stories in the region, the most notable being the involvement of landowners in Fiji in commercialization of plantation resources. Downstream industries can operate profitably at various scales of output and an expansion of this sector would provide additional opportunities for involvement of the rural work force and for landowner investment taking advantage of the various government initiatives in the region to help landowners establish businesses.

The public and private timber enterprises in the partiCipating countries would be the beneficiaries of this project. Technical and market information flows to the players in the sector would be increased significantly and practical in-factory advice and assistance in problem solving and formulating investment plans would be provided. It is the increase in investment in manufacturing plant that will generate the flow of social and economic benefits to the country. Industrialist would benefit directly also, from opportunities for industrial expansion, market diversification and improved competitiveness.

Benefits would also flow to those at the regional and national level implementing the project in terms of skill development and experience which will be invaluable for the region as a whole.

2.5 Technical and scientific aspects

While this project involves providing technical advice and support to wood based industries it will not be expected to generate any new technologies or be directly responsible for scientific study. The project may, on the other hand, utilise project funds for short-term specialist technical input if the project personnel lack a particular skill.

Project staff have a background in either wood based industry technology and/or tropical wood product marketing. The additional technical skills applied by the project staff will be those related to information technology (database development and management as well as communication skills).

2.6 Economic aspects

FAO data suggests that the gross value added by the forest sector amounted to around US$350 billion globally in 2000, or about 1.2 percent of the gross domestic product. In Fiji Islands, PNG and Vanuatu the contribution of the forestry sector exceeds the global average and ranges from 3-5 percent in the smaller islands to as much as 30 percent in PNG. Despite the above average figures forestry and the wood processing industries in the Pacific islands have the potential to contribute more.

Producing primary forest products alone contributes fewer economic benefits than manufacturing wood products and improved benefits will derive from increasing the capacity of players in the

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forestry sector to move up the value chain, taking advantage of the market opportunities and technological developments.

Unfortunately, the share of gross value added by the forestry sectors in the Pacific island countries remains very low even though there are adequate forest resources and this stems from limited success in developing an efficient wood processing sector.

The objective of this project is to remove the technological and marketing constraints and release the investment potential in the wood processing sector. This will lead to modernization and upgrading of existing manufacturing enterprises it will also lead to the establishment of new ventures.

The flow-on effects of such an expansion will be seen in the creation of employment opportunities, an increase in production of a wider range of products and expanded sales to the local and international market. It is conservatively estimated that over the duration of the project the following targets can be achieved: Fiji, investment in new or upgraded manufacturing capacity exceeds US$2.0 mil, 100 new jobs created, export sales of added value products increase by 15%, PNG, investment in new or upgraded manufacturing capacity exceeds US$4.0 mil, 200 new jobs created, export sales of added value products increase by 10%, Vanuatu, investment in new or upgraded manufacturing capacity exceeds US$1.0 mil., 50 new jobs are created, export sales increase by 10%. In addition to these direct measurable parameters, government will see an increase in tax revenues and a significant increase in foreign exchange earnings.

The importance of timely market intelligence and the need to adopt new or upgraded technologies to ensure the wood based industry sector stays competitive require continuous assessment. The role of government agencies in supporting and guiding the development of wood based industries can be significant as witnessed by the success of the timber industries in SE Asian countries and in Malaysia in particular.

This project will create a capacity in the three participating countries of Fiji Islands, PNG and Vanuatu as well as within the Secretariat of the Pacific Community that can be cost effectively sustained when the project is concluded. On completion of the project the concept of industrial technology transfer and market information delivery will be firmly established in SPC and the national implementing agencies, staff will be experienced, networks will have been established and liaison processes with industry will be ongoing. Most importantly, with the clearly measurable targets that have been achieved, recognition of the pivotal role that government can play in guiding the sector to deliver social and economic benefits will be established

2.7 Environmental aspects

The major internally induced environmental problems in the Pacific island countries are land degradation. In broad terms, land degradation is associated with agricultural intensification and deforestation. Other land uses contribute to environmental problems such as biodiversity loss, fresh water quality and availability. In Fiji Islands, for example, one of the main problems is soil degradation, which occurs from widespread and indiscriminate burning, particularly, but not exclusively in the sugar cane growing areas.

Deforestation in the Pacific island countries is another area of concern. With some 80 per cent of the population living in the rural areas, their forest resources supplies most of their basic needs. The forest also represents the main asset rural populations can commercialise for significant income generation and this has often led to over harvesting for short-term gain.

Pacific island countries face several disadvantages arising from their small size. These disadvantages include a narrow range of exportable resources and low levels of domestic processing, which leads to risky dependence on international trade and hence vulnerability to

15

global developments. Other disadvantages include population density, which increases the pressure on already limited resources and frequent over-exploitation of natural resources. The small islands also have high degrees of endemism and levels of biodiversity, but the relatively small numbers of the various species impose high risks of extinction and create a need for protection. Due to the small size, isolation and fragility of island ecosystems, biodiversity in these countries is among the most threatened in the world today.

Economic viability and the social and environmental sustainability of forestry and wood processing industries is a pre-requisite for the successful implementation of sustainable forest management practices. Increased production of added value products and an expansion of the manufacturing base does not necessarily equate with higher levels of harvesting of the natural forest. Downstream industries offer the opportunity for increased production and trade from current sustainable harvest levels. It is envisaged that the successful implementation of this project will be achieved from a redistribution of current sustainable harvest levels to downstream production.

In Fiji the resources for the downstream industries will be plantation forests and the natural forest resource, at current sustainable harvest levels. In PNG the resources for the development of downstream industries will be a portion of the harvest that was destined for export in log form and plantations. Expansion of downstream processing will be achieved with no significant change in harvest levels.

In Vanuatu, as pointed out in the ITTO 'Status of Tropical Forest Management 2005'. In the absence of long-term management plans and post-harvest care, production forests in Vanuatu cannot be considered to be managed sustainably However, ITTO assessed that, "encouragingly, though, the current annual industrial log harvest of about 30,000 cu.m is well below the estimated sustainable yield of 68,000 cu.m. An expansion of downstream processing will involve harvesting of logs from islands where there are ample resources and from the rapidly maturing plantations ...

Assessment of the status of forest management and of the areas of sustainably managed forests in Fiji Islands, PNG and Vanuatu was recently reported by ITTO in its document, Status of Tropical Forest Management 2005, to which the reader is referred.

2.8 Social aspects

Many of the benefits provided by forests and the industries which they support go beyond national income estimates and immediate markets the social benefits from a viable forestry sector can be significant for the rural populations and community landowners. The forestry sector holds a promise of improved quality of life for rural communities and landowners but that promise is yet to be fully realised.

In the rural areas of the countries participating in this project there are very limited opportunities for formal paid employment. While most rural people have cash incomes from small-scale agriculture, the informal economy, or remittances from employed family members living in town, these amounts are usually small and irregular. Direct financial payments to local resource owners are therefore a major inducement through which they accept commercial exploitation of forest resources

Life expectancy at birth in the participating member countries is shown below. Life expectancy in the region ranges from a low of 57.0 years for PNG to 69.0 years for Fiji Islands. The second column shows figures for gross primary school enrolment ratios in percentages. They range from 114 for Vanuatu to 85 for PNG. The third column of Table presents figures for per capita Gross National Product (GNP). These range from US$ 700 for PNG to US$ 1,820 for Fiji Islands.

The last two columns show the Human Development Index (HDI) and the global HDI rank for the three countries. Of the three countries included in the UNDP HDI, Fiji Islands has the highest

16

rank of 81st, followed by Vanuatu with a rank of 128. PNG has the lowest rank of 132. In terms of socioeconomic indicators such as primary school enrolment ratio and per capita GNP, countries/territories such as Cook Islands, FSM, Tonga, and Tuvalu outperform the western Melanesian countries of Fiji Islands, PNG and Vanuatu.

Socio-economic indicators

Life ; Primary i GNP Human HDI : expectancy , school • ! Development' rankb !

------------------------'----atblrth ---renrOlmeritT---------iin-dex(HDI)bT---------; ___ ••• _. ______ • ____ • ___ •• _. ____ •• 0 ___ • ________ ~---_~ ___ • _________ , _____ ._. __ •• _. ___ ._._.~._-_ ••• _____ •• __ • __ >_ ..•.. ____ . __ ._ .• ____ • __ ..•.

, , , ,

~------.-.--.-----.--.. ------.. --·----riyearsj"2001a-lratio-r/;)a---rius$j-2ifOOa

--- --- - ---_._--- ____ L ______ ____________ _ _ ____________________ L __ . ______ ... _

Fiji 69 -----_._.--_._-------- --- -.--.----~---------------

Vanuatu ' 66 ; ---;f14-'1,150 1,820 112 0.754

---_ ..... _-_._.-- ---- .'-- -- ------ -----'

0.568

81

128 . __________ __________ A ___ .. _. _________ . ________ .. _. _______ , ____ _ ._. __ . ___ ., ___ . _________ ..... _ .'. _____________ . __ ._,

Papua new Guinea 56' 85 ' 700 0.548

a Average of male and female life expectancy taken from ADS (2003). b Average of male and female gross primary school enrolment ratio taken from UNDP 2003

132

Even though, as indicated earlier, the majority of the region's population lives in the rural areas, the rate of urbanization is increasing. The latest statistics indicate high urban population growth rates of 7.3 per cent for Vanuatu, 4.1 per cent for PNG and 2.6 percent for Fiji Islands. At this rate of urbanization, it is estimated that the urban population will double in about ten years in Vanuatu and in around 27 years in Fiji Islands and PNG.

Per capita incomes in some Pacific island countries tend to be higher than that of the developing countries as a group, which means that they sometimes cannot get access to concessionary finance. However, closer examination of these economies shows that in many cases, current incomes are often facilitated by migrant remittances, preferential market access for some major exports and assistance from the international community, sources which are neither endogenous nor secure.

Furthermore, those incomes have generally been unstable over time as a result of natural and man-made disasters, as well as difficulties in the international market for particular commodities. In addition, economic recession in developed economies has been seen to reduce export earnings in small island developing states dramatically, sometimes by as much as 20 to 30 per cent of GDP in a single year.

Vanuatu is classified as a Least Developed Country (LDC) economy along with PNG whose economic performance has recently been re-assessed a LDC. At the Millennium Summit held in September 2000, the Member States of the United Nations adopted the Millennium Declaration and committed themselves to a series of goals and targets to be reached by 2015. Progress toward attainment of these Millennium Development Goals (MDGs), however, has varied greatly among countries of Asia and the Pacific, especially by the Least Developed Countries (LDCs) of the region.

Today there are 14 LDCs in Asia and the Pacific and two are ITIO member countries participating in this project. The social and economic situation in the LDCs in the region varies widely. While some countries have made significant progress, both in social and economic terms, and stand at the threshold of graduation from the list, others have continued to stagnate for more than two decades. In most of these countries, overall progress toward the achievement of the MDGs has been imbalanced, with success in some areas marred by failure in others.

17

The eighth MOG, accordingly, called for a global partnership for development, whereby developed countries would provide tariff- and quota-free access for exports from the LOCs, implement the enhanced programmes of debt relief for the heavily indebted poor countries and cancel all official bilateral debts; and grant more generous development assistance to LOCs committed to poverty reduction. In 2006 Vanuatu successfully negotiated a MOG package as mentioned above.

At the project level the impact of landowner issues will impact the project, some impacts will be positive and some negative. Whether these issues arise because of the dispersed nature of land and forest ownership by communities and clans or issues related to equitable returns to the landowners or because of the un-fulfilled aspirations of landowners to participate in the commercialization of forest resources, there will be an impact. In terms of international market acceptance of domestically manufactured wood products, the sustainability of the resource base will be a matter of concern.

There are a number of factors that will limit the ability of countries in the region to assure the raw materials for the wood based industries come from sustainably managed forests. Land ownership issues in the Pacific islands, with the land and forest resources being communally, owned frequently poses difficulties in the formulation and execution of development strategies for forestry and, by extrapolation, the wood processing industries.

The issue of land ownership and its impact on progress in the forestry sectors in Fiji Islands, PNG and Vanuatu is analysed in the ITTO report "Status of Tropical Forest Management' and the reader is directed to this report for further elaboration of the matter.

2.9 Risks

Potential risks that may effect the successful implementation of the project include:

Difficulties in securing the cooperation and participation of the wood processing industries. The successful achievement of the objective of an expanded capacity for downstream manufacturing depends on the willingness of industry to share detailed company statistics upon which the project can build development proposals on their behalf. In particular, the private sector is always wary of revealing company data. This risk can only be overcome by the government liaison staff having credibility and integrity. Much will depend on achieving some early successes with cooperative industries so as to establish a 'track-record'.

National project staff reassigned away from project. The national project staff are experienced and professional officers who will be progressively gaining experience and training and progressively building working relationships with sector stakeholders. The loss of this experience because an officer was transferred would delay progress towards full achievement of the objectives. The regional project manager will have the responsibility of keeping the project profile high on the agenda of the heads of the organizations implementing national activities for the project.

Failed agreement of stakeholders on draft national downstream policy. The building of consensus amongst stakeholders will be demanding on the project but the risk of failure here can be minimized particularly as there are many examples in tropical timber producing countries where clearly defined policies backed by technical and marketing support have been successful. The risk of failure in this aspect can be minimized through the wise use of examples from other countries.

National governments fail to address the flow of log resources and security of log supply to industry.

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The issue of irregular log flows to primary processing mills will impact downstream processors who also need a regular uninterrupted flow of wood raw materials. This is an issue in all three Melanesian countries partiCipating in the project and it is likely that the issue will be addressed at different speed in the individual countries. It is likely that the pace of improvement will be slow and variable in the different countries. However, up until the present, there has been investment in the wood based industries despite the log flow constraint and even if log flows did not improve the industry would still progress because of the project activities but at a slower pace.

3 Outputs

3.1 Specific Objective 1

Output 13 Completed baseline studies as prerequisite to downstream wood processing policy development

Output 14 Accomplished revision/drafting of national policies for the downstream processing sector and implementation strategies

Output 15 Completed high level regional conference on development and implementation of policies for downstream wood industries in the Pacific island countries managed by regional centre

3.2 Specific Objective 2

Output 1 Installed operational capacity in regional centre to support regional wood industry development

Output 2 Installed operational capacity in national agencies in participating countries to support national downstream wood industry development

Output 3 Completed database of appropriate technological information and database of market intelligence developed and maintained by regional centre

Output 4 Completed network of industry and marketing specialists to assist industry developed and maintained by regional centre

Output 5 Completed network of wood industry machinery and materials suppliers willing to participate in technology demonstration and training courses in region developed and maintained by regional centre

Output 6 Completed regional training workshops for national project personnel managed by regional centre on:

Output 7 Effective and cooperative working relationship accomplished between project manager and forestry officials and policy makers in the participating countries

Output 8

Output 9

Output 10

Technology and market information delivery to industry

Pre-feasibility studies planned and prepared jointly with industry

Market research studies planned with but financed by industry

Output 11 Mill and manufacturing plant evaluation and development proposals prepared jointly with industry

19

Output 12 Evaluated training needs for various sub-sectors

Output 16 Restructured national forestry statistical data collection, compilation and dissemination

Output 17 Assessed social and economic impact of mobile sawmill operations under different conditions

Output 18 Completed regional conference on the viability of mobile sawmill operations under different conditions held and report published

Output 19 Transfer of experience accomplished through active participation of regional project manager with national project staff in in-country industry development studies/activities

Output 20 Adopted national domestic lumber grading rules and wood preservation standards and implementation plan

4.0 Activities

Output 1 Installed operational capacity in regional centre to support regional wood industry development

Activities • Recruit project manager • Recruit technical officer • Arrange for secretarial support • Arrange for office accommodation • Arrange office equipment purchase and installation (tel, fax, computer, internet

connection etc) • Arrange US dollar bank account for project funds • Arrange internal auditing system

Output 2 Installed operational capacity in national agencies in partiCipating countries to support national downstream wood industry development

Activities • Arrange assignment of national project staff by government agency • Arrange national secretarial support • Arrange purchase, tax and insurance for project vehicle/s • Arrange for office accommodation • Arrange office equipment purchase and installation (tel, fax, computer, internet

connection etc) • Arrange US dollar bank account for project funds • Arrange internal auditing system

Output 3 Completed database of appropriate technological information and database of market intelligence developed and maintained by regional centre

Activities • Design database to be compatible with partiCipating country capacity • Source and compile technical and market information • Input and regularly update data • Secure the database and promote industry access

20

Output 4 Completed network of industry and marketing specialists to assist industry developed and maintained by regional centre

Activities • Secure data on experience and skills of various specialists/consultants appropriate for

the various sub-sectors in the wood processing sector • Maintain updated profiles of specialists/consultants • Recruit specialists/consultants as and when required for specific assignments in support

of national and regional demands

Output 5 Completed network of wood industry machinery and materials suppliers willing to participate in technology demonstration and training courses in region developed and maintained by regional centre

Activities • Compile details of wood industry machinery suppliers and material suppliers willing to

participate in technology demonstration and training courses • Promote the utilization of wood industry machinery and material suppliers as resource

persons to the national and regional training institutions

Output 6 Completed regional training workshops for national project personnel managed by regional centre on:

• communication and liaison with the wood processing sub-sectors • guidance to industry on preparation of market analysis studies • pre-feasibility study preparation

Activities • Prepare workshop programme • Identify resource persons • Host and manage workshop • Report on workshop

Output 7 Effective and cooperative working relationship accomplished between project manager and forestry officials and policy makers in the participating countries

Activities, regional centre • Participation in regional forestry and timber industry events in the participating countries

and in the region • Holding of regular dialogue with host national agencies and stakeholders in the

participating countries to discuss progress and emerging issues that effect the project implementation

Output 8 Technology and market information delivery to industry

National project staff experienced in communication with industry editing and delivering technological information and market intelligence in form and style appreciated by industry users.

Activities • Preparing profiles of industries in the sector • Building rapport with industrialists, landowners, public sector agencies and other

stakeholders • Identifying opportunities for increased production, improved efficiency and market

diversification at the company level

21

• Identifying production and/or management problems not appreciated by companies and offering solutions

• Accessing the regional centre for technical options and market information, editing raw technical and market information

• Distributing edited reports to industry • Securing regional center funding for specialist/consultant input as a last resort

Output 9 Pre-feasibility studies planned and prepared jOintly with industry

Activities • Identifying production opportunities with individual company • Quantifying market opportunities and deciding optimum scale of production • Identifying appropriate technology and obtaining costs estimates for machinery and all

other inputs • Drafting and reviewing pre-feasibility report jOintly with company

Output10 Market research studies planned with but financed by industry

Activities • Identify market opportunities with individual company • Compile market data from regional database • Select target market options for further closer study • Prepare study terms of reference • Call for services and review consultant proposals • Assist company with review consultant contract and work schedule • Assist company with analysis of consultant report

Output 11 Mill and manufacturing plant evaluation and development proposals prepared jointly with industry

Activities • Through regular visits and discussion with company executives and managers, identify

technological, management or marketing problems • Prepare and present to company short proposal on options to address problem • Secure appropriate inputs to address problems • Evaluate impact of inputs on resolving the problem

Output 12 Evaluated training needs for various sub-sectors

Activities • Survey industry sub-sectors to determine perceived and assessed needs for various

skills • Report on compatibility or otherwise of needs of industry and available training courses • Review results with national training institutions and industry • Establish mechanism for jOint industry/training institute curriculum development

consultation

Output 13 Completed baseline studies as prerequisite to downstream wood processing policy development

Activities • Survey status of industry by sub-sector • Collect and transmit to regional centre all information on national initiatives on

downstream processing policy development

22

• Prepare recommendations for regional center on scope of work to be completed

Output 14 Accomplished revision/drafting of national policies for the downstream processing sector and implementation strategies

Activities, regional centre Assess policy initiatives in project countries

• Review recommendations of national project staff on scope of work to be completed • Drafting consultant terms of reference • Recruiting consultant • Arrange consultant schedule in consultation with national project staff • Participate in national workshop/dialogue on consultant recommendations • Distribute draft policy recommendation and implementation strategy to participating

countries • Distribute final policy and implementation plan to participating countries • Participate in national workshop/dialogue on adoption of the downstream processing

policy and implementation strategy

Activities, national project staff • Complete baseline sector study as prerequisite for downstream policy development • Collect published and available downstream policy drafts/reports and working documents

transmitted to regional project manager • Arrange and host national dialogue on downstream policy development during mission by

consultant • Participate as project counterpart to consultant during national study • Arrange consultant programme during national study and provide log istica I support • Arrange national workshop/dialogue to assess and provide comments on consultant draft

policy and implementation strategy • Arrange national workshop/dialogue to recommend adoption of final policy and

implementation strategy to government

Output 15 Completed high level regional conference on development and implementation of policies for downstream wood industries in the Pacific island countries managed by regional centre

Activities regional centre • Prepare conference programme • Identify resource persons • Host and manage conference • Report on conference

Output 16 Restructured national forestry statistical data collection, compilation and dissemination

Activities regional centre • Prepare scope of study and terms of reference for consultant in consultation with

participating countries • Recruit consultant • Arrange three country schedule • Participate in nation workshop to review consultant report • Distribute the draft report • Distribute the final report • Promote consultant recommendations and implementation plan

23

Activities, national project staff

• Propose scope of study and terms of reference to regional centre • Propose consultant work programme, provide logistical support and participate in the field

data collection • Arrange national workshop to review consultant recommendations • Promote consultant recommendations and implementation plan

Output 17 Assessed social and economic impact of mobile sawmill operations under different conditions

Activities regional centre • Prepare scope of study and terms of reference for consultant in consultation with

participating countries • Recruit consultant • Arrange three country schedule • Participate in nation workshop to review consultant report • Distribute the draft report • Distribute the final report • Promote consultant recommendations and implementation plan

Activities, national project staff

• Propose scope of study and terms of reference to regional centre • Propose consultant work programme, provide logistical support and participate in the field

data collection • Arrange national workshop to review consultant recommendations • Promote consultant recommendations and implementation plan at national level

Output 18 Completed regional conference on the viability of mobile sawmill operations under different conditions held and report published

Activities, regional centre • Prepare conference programme • Identify resource persons • Host and manage conference • Publish and distribute conference proceedings

Activities, national project staff • Prepare report on national status of consultant report • Participate in regional workshop

Output 19 Transfer of experience accomplished through active participation of regional project manager with national project staff in in-country industry development studies/activities

Activities, regional centre • Identification of suitable studies/activities offering training opportunity • Active field participation jointly with national project staff • Assessment of skill development and performance of national project staff

Activities national project staff • Industry studies conducted jOintly with project manager • Report on self assessed skills enhancement and areas needing strengthening

24

Output 20 Adopted national domestic lumber grading rules and wood preservation standards and implementation plan

Activities regional centre • Prepare scope of study and terms of reference in consultation with participating countries • Recruit consultant • Arrange three country schedule • Attend national workshop on national lumber grading rules and wood preservation

standards and implementation plans

Activities, national project staff • Implement a national workshops to review consultant proposals • Prepare workshop programme, identify and invite speakers and participants • Arrange venue and facilities • Arrange workshop reporting and print and distribute workshop report • Promote national adoption of recommended rules and standards and implementation

plans

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5 Logical Framework

Project Elements Development Objective To accelerate economic and social development in the Melanesian ITTO member countries from sustainable, efficient and competitive wood based industries. Specific Objective 1 To accomplish the adoption by the Melanesian ITTO member countries of policies to support the expansion of manufacturing of, and trade in added value wood products.

Specific Objective 2

Indicators

Higher GDP contribution from sector Additional jobs created Higher employment in sector Exports diversified Higher investment in sector

Downstream policy and implementation plan accepted by forestry administrations and recommended to government for adoption

To establish a regional and Experienced staff recruited by national capacity to source and regional implementing agency, deliver information and advice on SPC. technological and market Appropriate staff assigned in Fiji, opportunities to the public and PNG and Vanuatu. private wood processing industries Training to national project staff so as to facilitate establishment of successful. efficient and competitive Regional centre has adequate downstream wood based data on technologies and markets industries. Public and private enterprises

utilise services of project for productivity improvement

Outputs

1.1 nstalled operational capacity in regional centre to support regional wood industry development

2. Installed operational capacity in national agencies in

participating countries to support national downstream wood industry development

Staff recruited and assigned Equipment purchased, commissioned and internet links with national project offices established Banking arrangements made National staff in Fiji, PNG and Vanuatu assigned to project Vehicles and equipment purchased and commissioned. Internet link with regional center

established

Means of Verification

Government statistic Forestry statistics Central Bank statistics List of wood products exported Statistics on investment from investment boards

Reports of dialogue with stakeholders Policy and implementation strategy drafted, reviewed with stakeholders. Forestry administration acceptance of proposal and deliver to ~overnment

TOR of project manager TORs of national project staff Technology and market info. Database operational and accessible. Number of enterprises using services of project. Records Domestic and export sales data in forestry statistic Records of processing efficiency

jinput/output) in forestry statistics

Staff recruitment TOR and contracts Agreement with host agency SPC on office accommodation and support services Bank account details TOR of national project staff Agreements between national host agencies on office space and logistical and secretarial support. Working internet links

Important assumptions

Melanesian governments maintain emphasis on expanding manufacturing base. Improved flow of log raw materials to industry achieved

Melanesian governments maintain emphasis on developing the forestry sector. Agreement on content of policy and implementation with stakeholders

Suitably experienced project manager can be sourced in the region. National governments willing to assign staff to project Public and private sector enterprises recognize and appreciate quality of service delivered

SPC agreement to host and provide logistical and secretarial support

National governments maintain support for project objectives and agree to host project and assign staff

26

3. Completed database of Database of wood processing Internet accessible computerized Adequate skills are available to appropriate technological technologies established. databases in regional centre. source assess and update the information and database Database of market information Number of databases users from databases. of market intelligence developed established. national project staff and industry.

and maintained by regional centre Staff continuously sourcing and Public and private sector updating databases and servicing enterprises have experience in information needs of national internet accessing databases ~oject staff

4. Completed network of industry Database of suitable consultants Number of consultants and Consultants and specialists willing and marketing specialists to assist and specialists by area of specialists in the database to register and provide details of industry developed and expertise and regional experience. experience. maintained CVs acquired along with lists of Consultants and specialists signal by regional centre publications. willingness to undertake

aSSignment in participating countries

5.Completed network of wood Database of wood machinery and Number of entries in database Machinery and material suppliers industry machinery and materials materials suppliers willing to Number of technology see commercial benefit in suppliers willing to participate in participate in demonstrations of demonstrations held participating in the project. technology demonstration and technology and in training Number of training courses held training courses in region courses. with input from machinery and developed and maintained by materials suppliers regional centre

6.Completed regional training Programme content and Dates of workshops and list of Active participation by national workshops for national project resources persons identified attendees. project staff. personnel managed by regional Training and participation List of resource persons centre on: evaluated by trainees and trainers Content of training meets needs of

trainees and complements existing skills

7. Effective and cooperative Regular and productive dialogues Number of contacts each way Officials and stakeholders working relationship accomplished between project manager and between project manager and perceive 'ownership' of the project between officials in participating countries officials and wish to actively participate project manager and forestry Suggestions and advise secured Issues discussed and help steer the project officials and policy makers in the from officials Records of action/follow-up to participating countries dialogue

8. National project staff Project staff able to build rapport Range and reliability of statistical experienced in communication with industry stakeholders to data provided by company Public and private enterprises are with industry edit and delivering facilitate open sharing of company Number of reports/surveys assured of confidentiality of technological information and experiences delivered by project to industry information and data delivered to market intelligence National project staff able to project

deliver technical and marketing information easily understood by

27

industrialists

9. Pre-feasibility studies planned Opportunities for production Number of pre-feasibility reports Industry able, independently or and prepared jointly with industry expansion/diversification identified requested with project staff, to identify

jointly by project staff and industry Number of pre-feasibility reports opportunities. Technological and market completed Project staff can source information combined to produce appropriate and adequate data pre-feasibility reports from regional center to complete

pre-feasibility reports

10.Market research studies Industry commissions market Number of requests for assistance No negative issues impact planned with but financed by analYSis as part of their from industry industry perception of investment industry development planning. Number of studies completed climate

Project staff assists industry in preparing scope of study, identifying and contracting consultants and in interpreting consultant report.

11.MiII and manufacturing plant Requested or unsolicited mill Number of requests for assistance Industry able to identify production evaluation and development evaluations completed by project from industry and management constraints proposals staff to identify production, Number of studies completed prepared jointly with industry technological or management Project staff able to identify

constraints to efficient production production and management Reports prepared for companies constraints on opportunities to remedy problems and production constraints

i

12. Evaluated training needs for Individual sub-sectors surveyed to Number of companies surveyed Industry can articulate short and various sub-sectors determine industry perception of Report prepared and dispatched medium term skills and training

short and medium term to regional centre needs requirements worker skills and Number of training institutions Training institutions are open to training surveyed the idea that industry demands National and regional training Report dispatched to regional drive training programmes and institutions assessed and centre training curriculum development curriculum compared to industry needs for skills

13.Completed baseline studies as Detailed survey of industrial Report written and dispatched to Industry appreciates need for prerequisite to downstream wood capacity, technologies employed, regional centre for onwards policy and provides accurate data processing policy development inputs and outputs completed transmission to consultant to national project staff

14.National policies on the Stakeholders at the national level Published policy and Constructive participation by

28

downstream processing sector cooperate with the project implementation plan for the stakeholders with implementation consultant to define draft policy downstream wood processing Policy reflects aspirations of strategies promoted to and implementation plan industry stakeholders

government by the forestry Policy and implementation plan Governments have the resources administrations accepted by national forestry to commit to policy implementation

administration and promoted for adoption by government

15 .Completed high level regional Policy makers convene to share Conference programme Policies and implementation plans conference on development and experiences of development, distributed promoted to government by implementation of policies for implementation and successes Invitations made to policy makers national forest authorities adopted downstream wood industries in and failures of downstream policy and stakeholders and implemented by government the Pacific island countries and implementation plan List of national participants and

speakers Conference proceedings

16. Restructured national forestry Scope of study prepared and Written scope of study Forest administrations can secure statistical data collection, consultant terms of reference Consultant TOR the resources to implement compilation written Consultant work schedule proposed statistical data systems and dissemination procedures Consultant recruited and Written draft proposals

stakeholders consulted and work National review report plan concluded Formal adoption by forest Proposals prepared for administration restructuring of national forestry/wood industry statistics collection, processing storage, retrieval and accessibility Proposal reviewed and adopted by national forest authorities

17 Assessed social and economic Scope of study prepared and Written scope of work and No risks apply impact of mobile sawmill consultant terms of reference consultant TOR operations written Written work plan under different conditions Consultant recruited, stakeholders Draft report submitted to regional

consulted and work plan centre concluded Final report submitted to regional Draft report reviewed at national centre level Final report prepared

18.Completed regional conference Regional conference convened by Conference programme and Depends on progress in adoption on the viability of mobile sawmill project speaker list and implementation of national operations under different High level participation of national List of attendees downstream processing policy and conditions policy markers and stakeholders Published conference proceedings implementation strategy held and report published

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19.Transfer of skills and Project manager and national Number of joint missions No risks apply experience accomplished through project staff jointly undertake Written assessment of training by active participation of regional industry development national project staff project manager with national assignments, technology Written evaluation of training by project staff on in-country evaluations, efficiency studies, project manager studies/activities market analysis and company

trouble shooting exercises

20.National domestic lumber Scope of study defined and Written scope of study and TOR Government agency responsible grading rules and wood consultant TOR drafted Consultant contract can secure resources to preservation standards Field assessments and Consultant work plan implement proposal and implementation plan accepted stakeholder consultations Draft report Wood processing enterprises see by completed Final report commercial advantage in adopted Forestry administrations Proposals drafted and reviewed at Formal adoption nationally grading rules and treatment

national level standards Final proposals written Proposals adopted and published

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6 Work Plan

31

32

33

--I I I i Yri1 I I I I I I I I I I Yrl2 I I I I I I I I I Yrl3 I I I I I

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36

14.Accomplished revision/drafting of national ~licies -for the downstream processing sector and im~lementation strategies

Activities, re~1 centre Assess policy initiatives in I2ro~ct cOlmtries 1--

~ Review recommendations of national project staff on scope of work I Drafting consuItant terms of reference Recruit!rJg consultant

~ - - f-- 1-1 - - - --Arrange consultant schedule with nationaIproject staff -ParIicipate in national workshop on consuItant recommendations • l1li DistrIbute draft policy recommendation to parIicipating countries Distribute fmal policy and implementation pian National workshop on the downstream processing JlQlicy III

Activities, national pro~ct staff

.. trr?J Bseline sector s~ for downstream JlQlicy development Collect publish downstream policy drafts/reports National dialogue on downstream JlQlicy development ---f--

~. Participate as counterpart to consultant during national stu~ ---r Logistics for consuItant during national studY National workshop/dialogue to assess consultant draft JlQlicy National workshop/dialo@!e to recommend adol2tion of fmal policy

-- I- ---I---15 High level regional conference on Downstream Policy

Activities regional centre +- --~

--Prepare conference programme

I-- -

~ ~ resource ~rsons L Host and manage conference

I-I--Report on conference - -

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36

16. National filresfr)' statistical data systems ________ ,-I-- -- -t- ---I

Activities regional centre I I - I-- I I I--- - --~e scope of stu~ and terms of reference for consultant -J-- f-- ---~--t - -Flf ---- - - ,--

Recruit consultant .... _'_IW Arrange three country schedule , g- -

ParIicipate in nation workshop to review consultant reJlQrt _ • -Distribute the draft report I -1-- -Distribute the fmal report

-c--- +--{ I ~ ~I --I-Promote consultant recommendations and iml2lementation ~

I I -H I I--

, H - d-'=1-HJ11-= i- -- 1-----

Activities, national project staff I

~ - I--~se sco~ of study and terms ofreferenc~l centr~ _____ ~~;~ - --t-- -~---Consultant work I2rogrllmme, lo~tical support and fieldwork 1f~ri-LLL ~~tl ---~rrange national workshoJl to r~view consuItant recommendations _ 1---1-- ---

]--± i-Promote consultant recommendations and imJllementation l2ian

34

-----I I I Yrl1 I I I I I I I I I I Yrl2 I I I I I I I Yrl3 I I I I I

1 2 3 4 516 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 I 27 28 29 30 31 32 33 34 35 36'

17 Assessed social and economic impact of mobile sawmill !

Activities regi<>nal centre

Prepare scope of study and tenns of reference for consultant ! III -

El Recruit consu1tant I -Arrange three country schedule Participate in nation workshop to review consultant report I III Distnbute the draft report I

Distnbute the fmal report

Promote consultant recommendations and imlllementation Illan I

Activities, national project staff

I Propose scope of study and terms of reference to regional centre I III Consu1tant work programme and lo~ticaVfIeld support i

~ge national worksholl to review consu1tant recommendations

Promote consultant recommendations at national level :-f-- r--

- 1---~gional conference on the viabili!r of mobile sawmill operations -

Activities, regi<>nal centre r I I I

Prepare conference programme I

~ Identify resource ~rsons I 1- -Host and manage conference I I Publish and distribute conference proceedings i

i

! f---Activities, national project staff I

1-- -_ .. I-- -

Prepare report on national status of consultant report I -~ -- - r---- i

Participate in regional worksholl

35

I I I Yrl1 I I I I I I I I Yrl2 I I I I I I I I Yrl3 I I I I I I 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36

19.Transfer experience: regional manager to national staff

Activities, regional centre

~ ~ Identification of studies/activities offering training 0

Active field participation jointly with national Ero~ct staff Assessment of skill developmenlperformance of project staff III

Activities national project staff

~ ~ Industry studies conducted Ein!\y with Eroject manager la Report self assessed skills development areas for strengthening

20.National domestic grading rules and wood (!reservation standards

Activities reg!Qnal centre

I

~ Prepare scope and TOR in consultation with participating countries i -Recruit consultant

----,

Arrange three country schedule I Attend workshops on grading rules and Ereservation standards III

-- i----Activities, national project staff i

~I-~ ~ sco~ of study and terms of reference to reg!Qnal centre Consultant work programme and logisticaVfleld support I Implement a national workshops to review consultant proposals l+t-Promote national adoption of recommended rules and standards I i

36

7 Budget 7.1 Fine tuned budget

Outputs and Activities Inputs Unit Quarter Budget Total Units and Quality Number Cost Year Componen Amount

I.Instal operational capacity in regional centre

Activities Recruit project manager US$/man month 36 7,000 Yr1,Q1 10.11 252,000 Recruit technical officer US$/man month 36 3,000 Yr1,Q1 10.11 108,000 Arrange for secretarial support (honorarium) US$/man month 36 200 Yr1,Q1 10.13 7,200 Rent office accommodation US$/month 36 500.0 Yr1,Q1 60.61 18,000 Arrange office equipment purchase and installation

3 desktop computers with printers US$litem 3 2,500 Yr1,Q1 40.44 7,500 Internet connection/usage fees (3 computers 3 years) US$lyear 9 1,200 Yr1,Q1 50.53 10,800

Arrange US dollar bank account for project funds 0 o Yr1,Q1 0 Arrange internal auditing sy stem 0 o Yr1,Q1 0

Sub total 403,500 2. Establish capaci~ in national al!:encies in participatinl!: countries to sUPIJOrt national downstream wood industry development

Activities Arrange assignment of national Eroject staff US$/man month honorarium 144 500 Yr1,Q1 10.11 72,000 Arrange national secretarial support US$/man month honorarium 144 200 Yr1,Q1 10.13 28,800 Arrange_purchase, tax and insurance for project vehicle/s Yr1,Q1 4-wheel drive vehicle (1 for Fiji, 2 for PNG, 1 for Vanuatu) US$/Wlhicle 4 18,000 Yr1,Q1 40.43 72,000 Road tax US$lyear (4 Wlhicle for 3 years) 12 500 Yr1,Q1 60.61 6,000 Insurance US$lyear (4 Wlhicles for 3 years 12 1,000 Yr1,Q1 60.61 12,000 Rent office acconnnodation (1 in Fiii, 2 in PNG, 1 in Vanuatu} US$/month 48 500 Yr1,Q1 60.61 24,000 Arrange office equipment purchase and installation Yr1,Q1

Desktop computer and printer US$litem 4 2,500 Yr1,Q1 40.44 10,000 Internet connection/usage fees (4 computers 3 years) US$lyear 12 1,200 Yr1,Q1 50.53 14,400

Arrange US dollar bank account for Eroject funds 0 o Yr1,Q1 0 -

Arrange internal auditing system US$/day 0 0lYr1,Q1 0 Sub total i 239,200

3. Database of technological information and market information I , Activities I

Design database compatible with participating country capacity 0 o Yr1 Q1-Q2 0 Source and compile technical and matket infonnation 0 o Yr1Q2 - Yr3Q4 0 Input and regularly update data 0 o Yr1Q2 - Yr3Q4 0 Secure the database and promote industry access 0 o Yr1Q2 - Yr3Q4

Purchase ofsoftware US$/package 3 1,000 Yr1Q2 50.54 3,000 Annual interent connection fees US$/year 3 1,200 Yr1Q1,Yr2Q1,Yr3Q1 50.53 3,600 -- ,

Sub total I 6,600 . - ---~------ -_.

37

lA . .. I- 1--1 ctlvrtles details of machinery andrnat(lria~lI»pliers willing to participate

Telephone fax communicationlUS$lyear 3 2,000 IYr1Q2 - Yr3Q4 50.53 6,000 Promote machinery and material suppliers as trainers to institutions

Telephone fax communicationlUS$lyear 3 2,000 IYr2Q1 -Yr3 Q4 50.53 6,000 Sub total 12,000

I I .:..::.:.==--------------------------f----------:----------~~----+-- ---j----- I-------l

o 0 IYr1Q2, Yr2Q2, Yr3Q2 I o Identify resource persons 0 -t. 0 IYr1Q2, yr2Q2, Yr3Q2 Host and manage workshop

o

Venue rent US$/el.ent 3 500 Yr1Q2, yr2Q2, Yr3Q2 60.61 1,500 Food and refreshment and incidentals US$/el.ent 3 500 Yr1 Q2, yr2Q2, Yr3Q2 60.61 1,500

I Report on workshop Printing and distribution of documents US$/copy 30 ~ Yr1Q3, Yr2Q3, Yr3Q3 50.54 =+~I

.sub total I +--r==--- 3900

7.Flftttiw ..... i .. ' ... ·~ .. e "-Ii',h,d """'on l- - 1-_ -~- I ~ectmanagerandforestryofficiaIs I _______ __1__ _ __ ._____ I j ~ies, regional centre

Participation in regional forestry and timber industry events F ___ _ 1--~ I---- Trave,16joumeysin3yearsPNGandVanuatu(airfare)IUS$/trip . --t 6 1,000 Yr1Q2,Yr1Q4,Yr2Q2,Yr2Q4,Yr3Q2,Yr3

130.32 ~_ 6,000

DSA !US$/day I ._24 150 Yr1Q2,Yr1Q4,Yr2Q2,Yr2Q4,Yr3Q2,Yr3

1

30.31 3,600 Dialogue with host national agencies ~~ discuss emerging issues -l L ____ I C . _ Travel, 6 trips in 3 years (airfare~'US$/trip . ______ L 6 I 1,000 Yr1Q2,Yr1Q4,Yr2Q2,Yr2Q4,Yr3Q2,Yr330.32 6,0001

DSA US$/day I 241 150 Yr1Q2,Yr1Q4,Yr2Q2,Yr2Q4,Yr3Q2,yd30.31 3,600 '-______________ . ___ ._. ____ . ___ . __ -- _ Subtotal, --T~ __ L ~-=--=-.l __ 19,?00

38

Outputs and Activities Inputs Unit Quarter Budget Total

Units and Quality Number Cost Y@lr Campal\@nt Am8unt 8. TechnolQgy and market information delivery

Activities

Preparing profiles of industries in the sector (annually in 3 countries) and Yr1Q2, Yr2Q2,Yr3Q2 Building rapport with stakeholders and Yr1 Q2 - Yr3Q4 Identifying opportunities for mill improvement/expansion and Yr1Q2 - Yr3Q4

Identifying production and/or management problems Yr1Q2 - Yr3Q4 Road transport costs (4 project staff over 3 years) Fuel at US$30/week 60 30 Yr1Q2 - Yr3Q4 50.53 1,800

DSA US$/manday 48 80 Yr1Q2 - Yr3Q4 30.31 3,840 Accessing the regional centre for technicaVmarket infonnation 0 Yr1Q2 - Yr3Q4 0 Distributing edited reports to industry 0 Yr1 Q2 - Yr3Q4 0 Securing regional center funding for specialist/consultant input Yr1Q2 - Yr3Q4

Sub total 5,640 9. Pre-feasibility studies danned and prepared jointly mth industry --

Activities Identifying production opportunities with individual company and quantifying market opportunities and optinrumscale of production

Road transport costs (4 project staff over 3 years) Fuel at US$30/week 60 30 Yr1Q2 - Yr3Q4 50.53 1,800 Occassional olA9might DSA (4 project staff 3 years) US$/day 75 80 Yr1 Q2 - Yr3Q4 30.31 6,000

Identifying appropriate technology and obtaining costs estimates 0 0 Yr1 Q2 - Yr3Q4 0 Drafting and reviewing pre-feasibility report jointly with company Yr1Q2 - Yr3Q4

Road transport costs (4 project staff over 3 years) Fuel at US$30/week 10 30 Yr1Q2 - Yr3Q4 50.53 300 Occassional olA9rnight DSA (4 project staff 3 years) US$/day 20 80 Yr1 Q2 - Yr3Q4 30.31 1,600

Sub total 9,700

IO.Market research s tudies ~anned mth but financed !!y indus try

Activities Identify market opportunities with individual company Yr1Q2 - Yr3Q4

Road transport costs (4 project staff over 3 years) Fuel at US$30/week 20 30 Yr1Q2 - Yr3Q4 50.53 600 Occassional olA9rnight DSA (4 project staff 3 years) US$/day 20 80 Yr1Q2 - Yr3Q4 30.31 -~

Prepare study terms of reference =l 0 0 Yr1 Q2 - Yr3Q4 ---~ Compile market data from regional database 0 0 Yr1Q2 - Yr3Q4

--

I 0 -

Select target market options for further closer study -i 0 0 Yr1Q2 - Yr3Q4 0 -

Call for services and review consultant proposals I 0 0 Yr1Q2 - Yr3Q4 0 Assist cOlllEany to review consultant contract and work schedule

-,------0 0 Yr1 Q2 - Yr3Q4 ! - -- 0

Assist company with analysis of consultant re~ort j ------ -----

Road transport costs (4 project staff over 3 years) I Fuel at US$30/week 20 30 Yr1 Q2 - Yr3Q4 50.53 600

--- Occassional olA9rnight DSA (4 project staff 3 years~t US$/day 20 80 Yr1Q2 - Yr3Q4 30.31 ---(600 ----- --

_____ _ Sub total I --"-. 44qQ

39

Outputs and Activities Inputs Unit Quarter Budget Total Units and Quality Number Cost Year Component Amount I

1l.MiIl and manufacturing plant evaluation and development pro~sals preparedjointlymth industry I

I

Activities VIsit and discuss with company executives to identifY technological, 0 0 0

management or marketing problems Yr1Q2 - Yr3Q4

Road transport costs (4 project staff over 3 years) Fuel at US$30/week 20 30 Yr1Q2 - Yr3Q4 50.53 600 Occassional o~might DSA (4 project staff 3 years) US$/day 45 80 Yr1Q2 - Yr3Q4 30.31 3,600j

Purchase of tapes, measuring devices, and other equipment US$/year 3 500 Yr1Q2 - Yr3Q4 60.61 1,500j

Prepare company proposals on problem solving 0 0 Yr1Q2 - Yr3Q4 01

Secure appropriate inputs to address problems 0 0 Yr1Q2 - Yr3Q4 °i Evaluate impact of inputs on resolving the problem

Road transport costs (4 project staff over 3 years) Fuel at US$30/week 10 30 Yr1Q2 - Yr3Q4 50.53 3001 Occassional o~might DSA (4 project staff 3 years) US$/day 20 80 Yr1 Q2 - Yr3Q4 30.31 1 ,600~

Sub total ~ 7600

12. EwIuated training needs for various sub-sectors I I

I

Activities Survey industry sub-sectors to detennine skill needed

Road transport costs (4 project staff over 3 years) Fuel at US$30/week 16 30 Yr1Q4 50.53 480 Occassional o~might DSA (4 project staff 3 years) US$/day -- 20 80 Yr1Q4 30.31 1,600,

Report on industry needs and available training courses 0 0 Yr1Q4 -Yr2Q1 61 Review results with national training institutions and industry 0 0 Yr2Q1 0

~tablishjoint industry/training institute curriculum development I I 0 0 Yr2Q2 and Yr3Q2 I 01

Sub total Wl 2080

F-----J 13.Baseline studies for downstream processing policy development I I

Activities -------

I [ i -Survey status of industry by sub-sector Yearly in Fij~ PNG Vanuatu Yr1Q4 I ;

Road transport costs (4 project staff over 3 years) Fuel at US$30/week 36 30 Yr1Q4 -

150.53 1,0801 Occassional o~rnight DSA (4 project staff 3 years) US$/day 60 80 Yr1 Q4 !30.31 4,8001

--""1---- ----r-OJ Collect/transmit data on national downstream proces sing policy *= YMQ4-YrlQ1

I ---==f Prepare reconnnendations for regional center on scope of work _________ .Q_ J> Yr1 Q1 -- 01

SUbtotalE I 5,8801 - I - ____ .

_. i ---I __ J I ---

40

i ________________ =~QutP~~~~~-_J\~~!i~~:~~_~:-~-____ ~=-___II1~~~---- ____ L____ _ I -UnitTQuarter-]Sudget -TTotal .. I _ _ i Units and Quality i Numberl -Cost -I Vear- i ComponeniTAmou-nt!

b~~~:~~~:~~~~==~}L~/~~~~:~~:>r~~~j>0l~,_;~~--:~u~~~$=-=~;F;~: i Reviewreconnnendations of national project staffon scope of work : ! I iVr2Q1--:--------- ------;---------01 1----;------.----------------------------.----.-.- .. ------- -------------.-.-.. ----.- - !. -- ---- .---.---.--.---- - ... -.---.--- -,--. ------- r-·- --. -- ---.. -------. .. ----·1-·----- .------ .. - -.-.. -1- - --. -----·-i I Draftmg consultant tenns of reference i i, iVr2Q1 ! i 01 I------------.--~.--.--... --.. -.. --.------.-----.. -.-.-----.---------.-.------~ --.. ----..( ... - -. -.. ---------... -- .. ------- ----------·-~-----·--·----i- .----- _______ .J.. __ .. __ .__________ - - J ) -. ~ I Recruiting cons ultant : I i i -- - ----r------- --- --- -r---- ----I 1 _______________________________________________________________________ ~ ______________________ M _____ L.________ _. - .. J ____ ... I .\

1 Consultantfee ;US$/man month i 2 --I--f6;66o- iVr2Q1-Q2 -----------nOTEf-------r--20;oOQi ,------ ----------------- --- - - --- ------ ------ --- --------- - .------------- ----- -----r ______ L_ --------1----------- .. -- _ .. ____ . __ . __ ._. ___ . _______ ._._._~. __ . ______ J i ConsultantDSA :US$/manday i 60 ! 150 Vr2Q1-Q2 i30.31! 9,0001 1------------- ----- - -- ---- --- - - -- ----- ------ - -- --------------- -- -------- - -- -- --- -- ---- --~ --- --- L_ ----~--- - - I ' Consultanttravel :US$/trip ! 1 I 3,000 iVr2Q1-Q2 - - - -- ---- ----- - - --l30.32 -- - T----3,OOO 1--··--------------··-----------------------------·----.---------------,------------.. ----.-----.-.-. ___ ,. _______ ._J_ .----.--.---, ____ .. _._ .---- -- -- - - ----- -- - - -~ - - --.- -I Arrange consultant schedule with national project staff : I I f I I ! [------------------------------.---.------------------.-.-------.-----------.-----------~.-----.-.-----.--.----.-.----------... - -.-.------ - -- ---- -- - -- - ------- ---- I l'~icip_ate i!l. national workshop on consultal!t rec9nnnendations i I:! !: -----.J

L _____ ~~~:=~_Ak~I~======~=~=[~~~==---~- -- --lj~~---~-~~OI i DSA iUS$/day i 12 I 150 IVr1Q4 ·---i3o.3f----r-----s661 , __________ . ___ . _________________ . _____ •. _______________ .. __ . ___ . ______ . ___ .. _. ____________ ._._ ... __ . _____ ._. ______ ._" __________ , ________ ._._ . ' .. . J j ! Distribute draft policy reconnnendation to participating countries! : i·-·· 1 - ....... -- --------r---- -----r--------, , __ . _____ . ________ . _______________ ._ .. ________ . ___ .... --.-----.---.--.-------.-------.---- .-.- .-.--- -.- -.---- .. --.- -- _ --.-- ----- .- .. --.-.--- --.---.- ----.. -- _ ---- _-.J_ -----.--- _ .. . .. I I Printing and distnbution i US$/report 50 ; 25 I Vr2Q3- ---:50-:-5lf--- -T1;2561 L ___ ~ __ • ____ . _______ • __ • ______ . _________ •... _._ .. __ . __ ... ____ ."_ ... _ .. ___ . __ .• ___ .• _"_", _____________ . _________ ~ __ ..•. _ .. " " ________ . ___ ..• __ .__ . ____ . ___ " __ _ 1_ .. _ ... __ •.. _. ______________ , __ .• F, •

i Distribute final policy and implementation plan i :! i :-------- ---1 ~--------•• ---- _______ . ____ . _____ . ___________ ... _. ____ •. _. ______________________ ._~-------.---------- . _____ . ________ .. ______ . __ . __ . _________ .. __ .. ____ . ____ . . .. _I •

i Printing and distnbution i US$/report I 50 ~ 25 I Vr2Q3-- -- -rSD.54- .- --[---'1~250i

Li\ttenL~~lO!1_~_~~r~h_op;~!l_~-~~~!~!l11!~~c~;;-~ip~i~~=_---=-===:=~-T:-_=~~ _ _=~~-_~=_-~~-~-~~~_===t=-_:-::-J~~::~==_J:y_~~~~:=:-_ .. .------ r----:=::- =-!- ·-------1 I . .. ,. Akfare(PNGandVanuatu) ;US$/trip . . . 1.3 i 1,000 IVr2Q3 .. --------T30:32 ..... 1---3~606:

r==-=:-=:-===:~=====-=-:=-=------~=~-=-:=::===:-:=---====~=_P~A=[9:~$~-~¥~=_=~=:=-~= __ :: =-==--=I:-:E-~-~i-- --1~_-:-J,!~~3_------- ------~~_~]~6~~--:::=:I~=E80~1 I Activities, national project staff : i! i i! ! (===~=-==---=-=====~=~~=~~-~-~~:~=-=::===-~~-~:~~~-=:=~-~--=~~=--'-~~-~::~:--:~-~-:-. -----~=-~C----- ..1-_--- . -:~--=-:r-~-- .....J-:~:-~=-:_ .. -_~:::! __ = -:~::-~= I i Baselme sector study for downstream polIcy development ' : ,Yr1 Q2 ..' ... OJ 1-=:-= _~_~=~_=_~:~~=:~::===~-=-=-=_=~_-=-=:==_~~Ii!~ip-o~£()i~i~'p.!()ji<:~stafif -:_~~_a.~l.I_S~~O/week _ : ____ ~~_~- _~Q:::JY~_92:- .. :.. . ........ _ _ .... . . --:J5§§}:. .. .J--_~~Qj i__ ______ _ __ Occ.assl<>.nalovemlghtDSA(4proJectstafi)iU~$/day i 16 ! 80 lVr1Q2 130.31 1,280;

1=-~~~~;:~~~~:~;j~~~~~li~~~~;~~:-~--rlig~~ilotli~~=-~::::~:----r--- .- ... -- ... ·-1_ -:i -:: l~~%f-'----- i -- -:-gl I-P;op~~~-scope ofst~dy-;;ndt~~ ;;-f~f~~~~~~-to-~~gio~-ai~e~re------ ; .. :-. !Vr1Q4 l 1.------- -.-------- .. --------.-------------- --.----- ---. --.--.-.--.-.. ----.--------.---------- . - . --- .... - -------! Participate as counterpart to consultant during national study and ! i Vr2Q1-Q2

[ __ ~'sit~f;;-~-~~~.!Iii-a~t:ii~g~~iilm!~[~!~~i=~=_~:=_==:=: -. ----------:--:[--:--=--=-==--=- ··--1 !-:-=-:--. I ... .... Road transport costs (4 project staft)i Fuel at US$30/week . 8 i 30 iVr2Q1-Q2

t--_~~iO~~~~kS~:p(d~~g~e:ii3ises~:c~nitft~ti~~()p~~tg}ll-~SA!~p-~:je~(~~;!l)J,lJS$/~~y:_- - .... -- - 16.·.: L:8~ .:_:!"r2Q1-02 1___________ __ye!ll!e~...n.!_:U~_$~~llt ~.. i 500i~1.94_ i Food and refreshment and incidentals i US$/ewnt 3 500 i Vr1 Q4 ,-_ .. _--_._._ .. _.-_.-----_. __ ._._--- - --_._----- ---_._-_.. -_._. __ .- -----_._. ----

I Report on workshop 1----------- Printu{g ~d<liStrib-ution of documents ! US$/copy 1-- -- ---.-- .. ----- -.. ---- --...-.- - -.-- ------.-.--- .. -.- -. --. ----.-i National workshop/dialogue to reconnnend adoption offinal policy , r---' -_.- ~----.--~----------- .. -----.. --------. . .. _ .... -.-.. ---- ---------------- .. - --_ ..

Venue rent ! US$/ewnt Food and refreshment andiIi~identais . :US$le\enf

_~I'0lt ()11 :,\,or\(sho_p J>rinting_ an.d distributi0!1_()K.do~ll~nts }U~~/£0I>¥

Sub total

3 3

50

25

500 500

25

[Vr2Q2

1

TVQQ3 !Vr2Q3

1\'12-94 ...

160.61 [66:61

. ;50.54 ~ ;60.61 i60.61

--; -

.5-0.54

·2401 i 1,380i

-- - - -- --- ----'--1

1,5001 1;5001 - .. ----{

i,2S();

1,500: ·1-,5001

i , 1,250i

-J'- 55020i

41

Outputs and Activities ---r-~~

Inputs Unit Quarter Budget Total

I Units and Quality Number Cost Year Component Amount 15 High IewI regional conference on Downstream Policy

Activities regional centre Prepare conference progrannne 0 0 Yr3Q1 0 Identify resource persons 0 0 Yr3Q1 0 Host and manage conference 0 0 Yr3Q1 0 Speaker Travel (5 spekers) US$/speaker 5 500 Yr3Q1 30.32 2,500 SpeakerDSA (5x3 days) US$/day 15 150 Yr3Q1 30.31 2,250

Travel invitation to high level officials (2 ea. Fij~ PNG; Vanuatu) US$/person 4 1,000 Yr3Q1 30.32 4,000 DSA for high level officials US$/manday 18 200 Yr3Q1 30.31 3,600

Venue rent US$/el.ent 1 1000 Yr3Q1 60.61 1,000 Report on conference

Publish and distribute conference report US$/report 100 25 Yr3Q1 50.54 2,500 Sub total 15850

16. National forestry statistical data systems

Activities regional centre

Prepare scope of study and terms of reference for consultant Yr2Q1 0 Recruit consultant

Consultant fee US$/man month 2 10,000 Yr2Q2 10.16 20,000 Consultant DSA US$/manday 60 150 Yr2Q2 30.31 9,000

ConSUltant tral.el US$ltrip 1 3,000 Yr2Q2 30.32 3,000 Arrange three country schedule 0 0 Yr2Q2 0 Participate in nation workshops (3) to review consultant report Airfare (2 international flights) US$/trip 3 1,000 Yr2Q3 30.32 3,000 DSA US$/day 12 150 Yr2Q3 30.31 1,800 Distribute the draft report

Printing and distribution of documents US$/copy 50 25 Yr2Q4 50.54 1,250 Distribute the final report

Printing and distribution of documents US$/copy 50 25 Yr2Q4 50.54 1,250 Promote consultant recommendations and implementation plan I 0 0 Yr3Q1- Yr3Q4 0

t r Activities, national project staff I

I I

-.

-Propose scope of study and terms of reference to regional centre 0 0 Yr2Q1 0 Accommpany consultant, give logistical support

-Road transport costs (4 project stafl) Fuel at US$30/week 6 30 Yr2Q1 50.53 180

Occassional overnight DSA (4 project stafl) US$/day 16 80 Yr2Q1 30.31 1,280 Arrange national workshop to review consultant recommendations I I

Venue rent US$/el.ent . 1-~3-j 500 Yr2Q3 160.61 1,500 Food and refreshment and incidentals US$/el.ent + 3 1 500 IYr2Q3

160

.61 L 1,500

Promote consultant recommendations and implementation plan I =t±0 IY02Q39-YOO4 1--0

Sub total I .L~- _± -I l- 43760 I

42

---Outputs and Activities Inputs Unit Quarter Budget Total

Units and Quality Number Cost Year Component Amount 17 Assessed social and economic impact of mobile samnill

Activities regional centre

Prepare scope of stud v and tenns of reference for consultant Yr2Q3 Recruit consultant Yr3 Q1

Consultant fee US$/man month 2 10,000 Yr3 Q1 10.16 20,000 Consultant DSA US$/manday 60 150 Yr3 Q1 30.31 9,000

Consultant travel US$/trip 1 3,000 Yr3 Q1 30.32 3,000 Arrange three count!)' schedule Yr3 Q1 Participate in nation wOIkshops (3) to review consultant report Airfare (2 international flights 2 US$/trip 3 1,000 Yr3 Q2 30.32 3,000 DSA US$/day 12 150 Yr3 Q2 30.31 1,800 Distribute the dmft report

Printing and distribution of docummts US$/copy 50 25 Yr3Q2 50.54 1,250 Distribute the final report

Printing and distnbution of docum::nts US$/copy 50 25 Yr2Q4 50.54 1,250 PrOlmte consultant recommendations and implem::ntation plan 0 0 Yr3 Q3 - Q4

Activities, national project staff

Propose scope of stud v and tenns of reference to regional centre 0 0 Yr2Q32 0 Acconnnpany consultant, give logistical support

Road tmnsport costs (4 project staff) Fuel at US$30/week 6 30 Yr3 Q1 50.53 180 Occassional overnight DSA (4 project staff) US$/day 16 80 Yr3 Q1 30.31 1,280

Arrange national wOIkshop to review consultant recommendations Venue rent US$/event 3 500 Yr3 Q2 60.61 1,500

Food and refreshm::nt and incidentals US$/event 3 500 Yr3 Q2 60.61 1,500 PrOlmte consultant recommendations and implem::ntation plan 0 0 Yr3 Q3 - Q4 0

Sub total 43,760

1S.Regional conference on the viability of mobile samnill operations

Activities, regional centre

Prepare conference progmmme 0 0 Yr3 Q4 0 IdentifY resource persons Yr3 Q4 Host and manage conference in one earticieating count!)' Yr3 Q4 Speaker Tmvel (5 speakers) US$/speaker 5 1,000 Yr3 Q4 30.32 5,000

~£eaker DSA {5x3 days) US$/day 15 150 Yr3 Q4 30.31 2,250

-- Tmvel invitation to high level officials (2 ea. Fiji, PNG, Vanuatu) US$/person 4 1,000 Yr3 Q4 30.32 4,000 DSA for high level officials US$/manday 18 150 Yr3 Q4 30.31 2,700

Reeort on conference Yr3 Q4 Publish and distribute conference report US$/report 100 25 Yr3 Q4 60.61 2,500

I

, Activities, national project staff

o -- 0 ivr3 Q4 ______ -___ =+ ___ 0 Prepare report on national status of consultant reeort Participate in regional works hoe -

Travel (~ intemationalllights) US$/trip 3 J 1,000 IYr3 Q4 - 30.32 ~ 3,000 ._--DSA (4 persons 4 nights) US$/manday 16

Sub total + ~~O fr3 Q4 ____________ -=1~~~~ :1:~~ 43

Outputs and Activities Inputs Unit Quarter Budget Total Units and Quality Number Cost Year Component: Amount

19.Transfer experience: regional manager to national staff

Activities, regional centre

Identification of stud iesl activities offering training~ortunity 0 0 Yr1 Q2,Yr2 Q2,Yr3 Q2 0 Active field participation jointly with national project staff and Yr1 Q2,Yr2 Q2,Yr3 Q2 0 Assessment ofskill developmen/perfonnance ofproject staff Yr1 Q2,Yr2 Q2,Yr3 Q2 0 Travel (3 counties once per year) 3 1,000 Yr1 Q2,Yr2 Q2,Yr3 Q2 30.32 3,000 DSA (14 days per country per year) 42 150 Yr1 Q2,Yr2 Q2,Yr3 Q2 30.31 6,300

Activities national ~ject staff

Industry studies conducted jointly with project manager Road transport costs (4 project staft) Fuel at US$30/week 6 30 Yr1 Q2,Yr2 Q2,Yr3 Q2 50.53 180

Occassional overnight DSA (4 project staft) US$/day 9 80 Yr1 Q2,Yr2 Q2,Yr3 Q2 30.31 720

Report self assessed skills development areas for strengthening 0 0 Yr1 Q2,Yr2 Q2,Yr3 Q2 0 Sub total 10200

20.National domestic eradine rules and wood preservation standards

Activities regional centre

Prepare scope and TOR in consultation with l2articjeating countries 0 0 Yr2Q4 0 Recruit consultant I 0 0 Yr3 Q1 0 I

Consultant fee US$/man month 2 10,000 Yr3 Q1 10.16 20,000 Consultant DSA US$/manday 60 150 Yr3 Q1 30.31 9,000

Consultant trawl US$/trip 1 3,000 Yr3 Q1 30.32 3,000

Arrange three country schedule I 0 0 Yr3Q1 0 Attend workshops on grading rules and 12reservation standards Airfare (2 international flights) US$/trip 2 1,000 Yr3 Q1 30.32 2,000 DSA US$/day 12 150 Yr3 Q1 30.31 1,800 Promote consultant recommendations and implementation plan Yr3Q2 -Q12 --I

I I

Activities, national project staff

Propose scope of study and tenns of reference to regional centre 0 0 Yr2Q4 0 I --

Consultant work programmeand logistical/field support Yr3 Q1 0 Road transport costs (412roject staft) Fuel at US$30/week 3 30 Yr3 Q1 50.53 90

Occassional overnight DSA {4 Eroject staft) US$/day 12 80 Yr3 Q1 30.31 960

- -+ j Arrange national workshol2 to review consultant recommendations Y"Q1 ~I 0 Venue rent US$/ewnt g-: Food and refreshment and incidentals US$/ewnt

500 Yr3 Q1 --------:- 60.6(J= 1506-500 Yr3 Q1 60.61 1-""1500"

Promote consultant recommendations and implementation plan Yr3Q2 - Q12 - _ i __ 1 --= E~~mote national adol2tion of recommended rules and standards .. I

Subtotal j _ yr3Q2 - Q12 . I

L __ I 1 i I 39850

44

7.2 Overall project budget by activity 10 Project 50 Consumable Quarter

1-__________________________ +P:....e::.:rso=:.::nn:.::e::.:14=:.:.::..:=..:=-t...:..:..:::.:...:~_+ Items Year

I.Instal operational capacity in regional centre

Activities Recruit project manager 252000 Q1 - Q12 Recruit technical officer 108000 Q1 - Q12 Arrange for secretarial support (honorarium) 7200 Q1 - Q12 Rent office accommodation 18000iQ1 - Q12 Arrange office equipment purchase and installation

3 desktop computers with printers 7500 Q1 Internet connection/usage fees (3 computers 3 years) 10800 Q1

Arrange US dollar bank account for project funds Q1 Arrange internal auditing sy stem Q1

Sub Total 367200 7500 10800 18000

Gran<!=1 Total

403500

2. Fstaliish capacity in national agencies in participatingc..:c'-=o-=un:::.tr=ie""s ______ -t ____ -t ____ -t--___ -t--_____ I-____ --+----+---------J-----J to support national domIS tream oood industry development

Activities

A~ge asslgll1ll(:nt ofnational Jl!Qject staff 72,000 Q1 A~~ation~~cretarial support 28,800 Q1 Arrange purchase, tax and insurance for project vehicle/s

4-wheel drive vehicle (I forFij~ 2 forPNG, I forVanuatu) 720001 IQ1 Road tax 6000 Q1 Insurance 12000iQ1

R<mtoffi,,,,,=_'oilin (Hn FiP. 2 mPNG, 'm _,to) I I I I 24000 Q1 ~ t==-:e office equipment purchase and installation I _I

Desktop computer and printer i 10000 Q1 Internet connection/usage fees (4 computers 3 years) t 14400 Q1 I

Arrange US dollar bank account for project funds I I Q1 i Arrang~intemal auditing system I Q1

~20001 14400 __ 3. Database of technological information and market information I _L- I t

I I ---L _____ -C _ 1 __ 1

1 Activities i

Sub Total 100800 42000 239200

Design database compatible with participating country capacity _______ Q2 -1-__ Source and compile technical and market information Q2 T-- I

!!!.put and regularly update data __ __ I __ Q2 -Q12 I ~ Secure the database and promote industry access ! ___ . ______ , -----4--- I . ~

rurchaseofsoftware _____ [ --.-l---~-----~~ Q2 i I Ann""m_,oooo,,",,n"" [. ,---1-------1 _ 3600 Q1,Q5,Q9 [

Sub Total. I ~ ____ L__ 66~~ ____ ---,-_ 6600

45

Output and Activities 110 Project 20 Sub 30 Duty 40 Capital 50 Consumable 60 Mise- Quarter Gran-a--Personnel Contracts Travel Items Items costs Year Total

4. Netmlrk ofindustry and marketing specialists to assist industry dewloped and maintained by reg,..:.io:::n=a::.1 ::::ce:.:n:::tr:..::e'--_______ +-____ +-___ + ___ -+-___ -+ _______ -l-_~ __________ +-__ --1

Activities 02 - 012 Obtain data on experience and skills of consultants _____ -+0,:-2=----=-0'-,1.".2 ____ 1~ __ __l

Maintain updated profiles of specialists/consultants 02 - 012 Recruit specialists/consultants as required 40000 Undetennined

Consultant fee 7200 Undetennined Consultant DSA 12000 Undetennined

Consultant travel 40000 19200 59200 Sub Total

5.Netmlrk ofindustrr machinery and materials sUIPiers "iIling'--_______ + _____ -+ ____ +-___ l-___ + ______ -+-___ +-______ -1-__ ---l to plrticiplte in technol~ demonstration and trainine: courses

Activities 02 -012 -----i~~~=-----~--~

Compile details of machinery and material suppliers willing to participate 6000 02 -012 Telephone fax communication 02 -012

Promote machinery and material suppliers as trainers to institutions 6000 05 - 012 Telephone fax communication 12000 12000

Sub Total I I

6.Regional training workshops for national project pe=rs:::o:::n=ne:.:I _________ -i _______ +-______ -l ___ --1. ______ f-______ +----I---------f------j

Activities Q2,06,010 Prepare workshop programme 02,06,010 IdentifY resource persons __ 02,06,010 Host and manage workshop 1500 02,06,010 Venue rent ~ 1500 02,06,010

Food and refreshment and incidentals I --I----------------~~~~~~=~~~~~===--i ~port on workshop 900 02,06,010

Printing and distnbution ofdocuments ___ 900 3000 3900

Sub Total

-----r-7.lllIectiw working relationship accomplished bemeen ------- I -------- --project manager and forestry officials i I

__________ ~I-- i -----"A-c-'ti-vi:-:ti-es-,-re-g-:io-n-al,-c-e-nt-re----------·~ I I 02,04,06,08,010,011

""'<;p.tion mreg""rufure,,,,, md t""~m""'""",~" ~ =::J 60001--- t------ 02,04,06,08,010,011 Trave,16joumeys in 3 years PNGand Vanuatu (air fare) i 3600~ ----- . 02,04,06,08,010,011

I--~~gue with host national agencies t_o discuss emerg~~_~~_: ____ ~d ____ -_ --1-- 6000 ~ - J-~. ----- 02,04,06,08,010,d12 --__ __ Travel, 6 trips inlYears (alr~ _____________ -+ 36001_ _ _____________ 02,04,06,08,010,912 __

I-- - --- DSA ___ 19200, _____ 1 --~---- --- 1--~ '-_________________________________ Sub Totali __ _______ I r _____ ~_I ______ ~ . .JI ___ -l

46

Output and Activities 10 Project 20 Sub 30 Duty 40 Capital 50 Consumable 60 Mise Quarter Grand Personnel Contracts Travel Items Items costs Year Total

8. Technolog~ and market information deliver~ communication with industry edit and delivering technological information and market intelligence

Activities

Preparing profiles of industries in the sector (annually in 3 countries) and Q2 - 012 Building rapport with stakeholders and Q2 - 012 Identnying opportunities for mill improvement/expansion and Q2 - Q12 Identnying Eroduction and/or management problem<; Q2 - Q12

Road transport costs (4 project staff over 3 years) 1800 02 -012 DSA 3840 02 -Q12

Accessing the regional centre for technicaVmarket information Distnbuting edited reports to industry Securing regional center funding for specialist/consultant input

Sub Total 3840 1800 5640 9. Pre-feasibility studies Jianned and prepared jointly mth industry

I Activities

Identnying production opportunities with individual company and Q2 - Q12 Quantnying market opportunities and optimum scale of production 02 - 012

Road transport costs (4 project staff over 3 years) 1800 Q2 - Q12 Occassional o\emight DSA (4 project staff 3 years) 6000 02 - 012

-Identny~ aPP!Qpriate technolog~ and obtaining costs estimates Q2 - 012 Drafting and reviewing pre-feasibility report jointly with company I 02 - 012

Road transport costs (4 project staff over 3 years) 300 02 - 012 Occassional o\emight DSA (4 project staff 3 years) 1600 02 - 012

Sub Total 7600 2100 9700

lO.Market research studies Jianned mth but financed I'l' industry

--Activities t------r Identny market opportunities with individual company I 02 - 012

Road transport costs (4 project staff over 3 years) 600 02 - 012 Occassional o\emight DSA (4 project staff 3 years) 1600 -F= 02 - 012

I -02 - 012 J Prepare study terms of reference -

Compile market data from regional database ~ ___ i= __ ~_ 02 - 012 L_ I -- --.-

Select target market options for further closer study 02 - 012 -L--i ------Call for services and review consultant proposals -i : I

02 - 012 --_. ±---{ Assist company to review consultant contract and work schedule 02 - 012 ----1 Assist co~ with analysis of consultant report I 02 - 012 Road transport costs (4 project staff over 3 years)

I 16001 600 02 -012 ~.~ Occassional o\emight DSA (4 project staff 3 years) 02 - 012

1---- E 32001

-- -------1206 ------ --Sub Total

1--- ,---- ~-----t I I

'---- ! __ 1. J

47

Output and Activities 10 Project 20 Sub 30 Duty 40 Capital 50 Consumable 60 Mise Quarter Grand Personnel Contracts Travel Items Items costs Year Total

1l.MiIl and manufacturing dant ewluation and dewlopDlent IX"oposals IX"eparedjointly mth industry

Activities VISit and discuss with company executives

to identifY technological, management or marketing problems Q2 - Q12 Road transport costs (4 p~ect staff over 3 years) 600 Q2 - Q12 Occassional overnight DSA (4 project staff3 years) 3600 Q2 - Q12

Purchase of tapes, measuring devices, and other equipment 1500 Q2 - Q12

Prepare company .e!o~osa1s on ~roblem solving Q2 - Q12 Secure appropriate inputs to address problems Q2 - Q12 Evaluate impact of inputs on resolving the problem Q2 -Q12

Road transport costs (4 project staff over 3 years) 300 Q2 - Q12 Occassional o\emight DSA (4 project staff 3 years) 1600 Q2 - Q12

Sub Total ---1 5200 900 1500 7600

12. Evaluated training needs for wrious sub-sectors

Activities Survey industry sub-sectors to detennine skill needed I Q3-Q4

Road transport costs (4 project staff over 3 years) 480 Q3-Q4 Occassional o\emight DSA (4 project staff 3 years) 1600 Q3-Q4

Report on industry needs and available training courses Q4-Q5

Review results with national training institutions and industry I Q5

Establish joint industry/training institute curriculum develo~ment Q6 and Q10 -I Sub Total 1600 480 2080

13.Baseline studies for downstream IX"ocessing policy development

Activities Survey- status of industry by sub-sector Yearl~ in Fij~ PNG Vanuatu Q4

Road transport costs (4 project staff over 3 years) 1080 Q4 Occassional o\emight DSA (4 project staff 3 years) 4800 Q4

Collect/transmit data on national downstream processing policy _ I Q4-Q5

Prepare reconnnendations for regional center on sco~e of work I I 3=- Q5

[58BO Sub Total

I I 4800 - 10~Q~

I I I ~ I I

48

Output a nd Activities 10 Project 20 Sub 30 Duty 40 Capital 50 Consumable 60 Mise Quarter Personnel Contracts Travel Items Items costs Year

14.Accomplished revisionldraftine: of national policies for the downs tream proces sing sector and implementation s trate!!ies

Activities, regional centre Q5 Assess policy initiatives in project countries Q5

Review recommendations of national project staff on scope of work Q5 Drafting consultant terms of reference Q6 Recruiting consultant Q6

Consultant fee 20000 Q6 Consultant DSA 9000 Q6

Consultant travel 3000 Q6 Arrange consultant schedule with national project staff Q6 Participate in national workshop on consultant recommendations Q6

Air fare (pNGand Vanuatu) 3000 Q6 DSA 960 Q6

Distribute draft Qolicy recommendation to participating countries Q7 Printing and distribution 1250 Q7

Distribute final policy and implementation Qlan Q7 Printing and distribution 1250 Q7

Attend national workshops on the downstream processing Qolicy Q4 Air fare (pNG and Vanuatu) 3000 Q4

DSA 1800 Q4 Activities, national project staff

Baseline sector study for downstream policy development Q3 Road transport costs (4 project staff) 360 Q3

Occassional overnight DSA (4 project staff) 1280 Q3 Collect publish downstream policy drafts/reports Q3

-National dialogue on downstream policy development Q4 Participate as counterpart to consultant during national study and Q6 Logistics for consultant during national study Q6

Road transport costs (4 project staff) 240 Q6 Occassional overnight DSA (4 project staff) 1380 Q6

National workshop/dialogue to assess consultant draft policy I Venue rent 1500 Q6

Food and refreshment and incidentals 1500 Q6 Report on workshop

Printing and distribution of documents ! 1250 Q6 I National workshop/dialogue to recommend adoption offinal policy i

Venue rent I -

1500 Q7 --

Food and refreshment and incidentals I 1500 Q& -

I Report on works hOE Printing and distribution of docume~ 2O!E_T3420L_l----- 1250 Q8

5600 6000 --

~-SubTotal I ---

-.-~- -----

49

,------- Output and Activities 10 Project 20 Sub 30 Duty 140 Capital 50 Consumable 60 Mise Quarter Grand Personnel Contracts Travel Items Items costs Year Total

~gh lewl reldonal conference on Downstream Policy !

Activities regional centre Prepare conference programme Q9 IdentifY resource persons Q9 Host and manage conference Q9 Speaker Travel (5 speakers) 2500 Q9 SpeakerDSA (5x3 days) 2250 Q9

Travel invitation to high level officials (2 ea. Fii~ PNG, Vanuatu) 4000 Q9 DSA for high level officials 3600 09

Venue rent 1000 Q9 Report on conference 2500 09 Publish and distnbute conference report 09

Sub Total 12350 2500 1000 15850

16. National forestry statistical data systems

Activities reg""io:.;:n:.:a1::..::.:ce:.::n:.::tf:.::e _____________________ + ______ +-___ -+_---+----+---------..f.""-----I---------~L----

Prepare scope of study and tenns of reference for consultant 05 Recruit consultant Q5

Consultant fee 20000 05 Consultant DSA 9000 Q5

Consultant tral.el 3000 Arrange three country schedule 05 Participate in nation workshops (3) to review consultant report Q7

Airfare (2 international flights) 3000 07

~-~-~~-------------------------~D=S=A~~-- 1800 Q7 Distnbute the draft report ----+--'---------+,-------,

f--_______________ .::..Prin:.::"=:;t=ing and distnbution of documents i 1250 08

Distnbute the final report -------l-----l-I _____ j _________ ~=+---__+=-=---------I-------.........j Printing and distnbution of documents I 1250 09

Promote consultant recommendations and implementation plan I - ~ ___ _

Activities, national project staff --

Propose scope of study and tenns of reference to regional centre __ _ ______ +0~5_--"--_-+-_-_--l Accommpanyconsultant, give logistical support 07

__ Road transport costs (4 project staff) __________________ ! ______ , _ 180 07 I f-------- Occassional overnight DSA (4 project staff) 1280[ 07 I

Arrange national workshop to review consultant recommendations I 07 I ____ _______ Venue rent I ---~-=-f----"--I 1500 07

Food and refreshment and inCiden~als ---f.-.---- I 1500 07 ~mote consultant recommendations and implementation ~ _______ ---=r=-------1 09 -012 1--________________________ " _____ -=-S-U=b-_li-O-~J=_20~00 I 18080

L -1-- 2680

1 3000~--------- 43~ 6-8

Output and Activities 10 Project 120 Sub 130 Duty 40 Capital 150 Consumable 160 Mise IQuarter Grand Personnel IContracts 1 Trave I Items Iltems Icosts IYear Total

17 Assessed social and economic impact of mobile sawmill

Activities regional centre

Prepare scope of study and tenns of reference for consultant Q9

Recruit consultant Q9

Consuhant fee 20000 Q9 -Q10

Consultant DSA 9000 Q9 - Q10 Consultant tra-.el 3000 Q9-Q10

Arrange_thret) country schedule Q9

Parti~ate in nation workshops (3) to review consultant report Q10 Airfare (3 international flights) 3000 Q10

DSA 1800 Q10

Distribute the draft report Q11

Printing and distribution of documents 1250 Q11

Distribute the final report Q11 Printing and distribution of documents 1250 Q11

Promote consultant recommendations and implementation plan Q11-Q12

Activities, national project staff

Propose scope of study and tenns of reference to regional centre I Q9 Accommpany consultant, give logistical support +- I Q9 -Q1 0

Road transport costs (4 project staff) Q9 -Q1 0 Occassional overnight DSA (4 project staff)1 1801 I Q9 -Q 10

Arrange national \VOIk:s~Op to review consultant recommendations 12801 IQ10 Venue rent 1500lQ10

Food and refreshment and incidentals 1500lQ10

Promote consultant recommendations and implementation plan Q11 - Q12 Sub Total 20000 18080 2680 3000 43760

IS.Regional conference on the viabili!Y-.::.of:cm=obi""I:.;::e.::.s=-aWIBl=::::·II:..:o"'pe""r:.:a"'ti""on"'s'---_____ + __ ---)----+----\-----+------+----)---------+----1

Activities, regional centre

-+ I I , I

Q11 Prepare conference progrannne Q11 Identify resource persons Q11 Host and manage conference

Speaker Travel (5 speakers) 5000 Q11

Speaker DSA (5x3 days) 2250 Q11

Travel invitation to higllJevel officials (2 ea. Fij~ PNG, Vanuatu) 4000 Q11

27001 J 1---

Q11 DSA for high level officials Q12 Report on conference

51

Output and Activities 10 Project 20 Sub 130 Duty 40 Capital 150 Consumable 60 Mise Quarter Grand Personnel Contracts I Travel Items I Items costs Year Total

19.Transfer experience: re~ional mana~er to national staff

Activities, regional centre

Identification of studies/activities offering training opportunity Q2,Q6,Q10 Active field participation jointly with national project staff and Q2,Q6,Q10 Assessment of skill developmen/perfonnance ofproiect staff Q2,Q6,Q10

Travel ( 3 counties once pt:D'ear) 3000 3000IQ2,Q6,Q10 DSA (14 days per country per year) 6300 6300IQ2,Q6,Q10

Activities national project staff

Jndus~ry studies conducted jointly with project manager 102,06,010

Roadtransportcosts(4projectstaft) 1 1 1 1801 18002,06,010 Occassional overnight DSA (4 project staft) 720 720 02, 06,Q1 0

Report self assessed skills development areas for streng111e~iI!g Q2,Q6,010 Sub Total 10020 180 10200 10200

120.National domestic grading rules and mJOd preservation standards --I

Activities regional centre

Prepare scope and TOR in cOllsIlItat!OI!~,\'Vit~~artic~iI!g countries 08 Recruit consultant 08

Consultant fee 20000 08 Consultant DSA 1 9000 08

Consultant tra\el 3000 08

~ 08 Q9

2000 09

Arrange three country schedule Attend workshops on grading rules and preservation standards

Airfare (2 international flights) DSA I 1800 09

1----, ------j

I Activities, national project staff r-- L Propose scope of study and tenns of reference to regional centre I 3

1

1 J____ I _ 08

Consultantworkprogrannneand logisticallfield support ~ ~ ~=$_ 09 +--_ Road transport costs (4 ~ject staft) 90 09 l---l

_ Occassional overnight DSA (4 project staft) ____ I ____ 960 -=____ 09 -l~---==J

Arrange national workshop to review consultant recommendations ---r-- I.~ ________ ~' 09 ~~ Venue rent _~_ r 1500 09 t - Food and refreshment and incidentats '--=-=-L ---T-- , -=-=== ----15oc)ag-- ---r-

Promote consultant recommendations and implementation plan I _______ 09 - 012 !

.~=-f--~or __ j-=-~676J___ -+===- 94.~ __ ~£ ---I-~~ ",z.

7.3 Yearly project budgets by source

Total Year 1 Year 2 Year 3 Budget Components 10. Project personnel 559,200 153400 202,900 202,900 20. Sub-contracts 0 0 0 0 30. Duty tra\el 182,800 32650 63950 86200 40. Capital items 89,500 89500 0

1690~1 50. Consumable items 40,790 9090 14800 60. Miscellaneous 17,600 4500 6100

1

7000

1 Subtotal 1 889,890

80. ITIO Monitor., Evaluat. and I

Administ. Costs 81. Monitoring and Review 20,000 Costs (effecti\e estimation) --82. Evaluation Costs (effecti\e 7,500 1

estimation) Subtotal 2 917,390 -

83. Programme Support Costs 50,450 (5.5% of subtotal 2) 90. Refund of Pre-Project Costs 150,443

I I ITTOTOTAL 1,118,283 I

Yearly Project Budget By Source - LRD/SPC and National Governments I Total Year 1 Year 2 Year 3

I 10. Project personnel 28,800 9,600 9,600 9,600 20. Sub-contracts 0 0 0 0 30. Duty tra\el 0 0 0 0 40. Capital items 0 0 0 0 50. Consumable items 25,200 8,400 8,400 8,400 60. Miscellaneous 75,500 22,500 28,000 25,000 70. Executing Agency Management Costs

I (2.5% of total of O\erall Budget by Activity) 25,500 8,500 8,500 8,500 EXECUTING AGENCY/HOST GOVT. I

I TOTAL I 155,000 49,000 54,500 51,5QQj

53

Consolidated Yearly Project Budget

Budget Component Total Yr1 Yr2 Yr3 10 Project Personnel L

11. National Experts 115,000 115,000 115,000 12. National Consultants 36000 36000 36000 13. Other labour 7,500 7,500 7,500 14. Fellowships and

I Training 15. International Experts 4500 14000 14000 16. International Consultants 40000 40000

19. Component Total 588,000 163,000 212,500 212,50() 20 Sub-contracts

21. Sub-contract (with A) 22. Sub-contract (with B)

29. Component Total 0 0 0 I 0 30 Duty Travel

31. Daily Subsistence Allowance 18,650 41,450 42350 32. International Travel 14000 22500 43750 33. Transport Costs

86100 ~ 39. Component Total 182,700 32650 63950 40 capital Items

141. Premises 42. Land 43. Vehicles 72000

1-----

--44. Capital Equipment 17500 ----

49. Component Total 89,500 89500 ---

50 Consumable Items 51. Raw materials 52. Spares 53. Fuel and Utilities 13500 15600 16400 54. Office Supplies 3990 7600 8900

59. Component Total 65,990 17490 23200 25300 60 Miscellaneous

61. Sundry 22600 29600 27500 62. Auditing 2500 2500 2500 63. Contingencies 2000 2000 2000

69. Component Total 93,200 27100 34100 32000 70 Executing Agency

Management Cost 2.5% of Overall Project Budget 8500 8500 8500

I 79. Component Total 25500 8500 8500 8500 SUBTOTAL 1,044,890

80 ITTO Monitoring, Evaluation and Adm Inlstratlon

81. Monitoring and Relliew Costs 20,000 82. Evaluation Costs 7500 83. Programme Support Costs 50,450

89. Component Total 77,950 90 Refund of Pre-Project Costs

150,443 100 GRAND TOTAL 1,273,283

54

PART Ill. OPERATIONAL ARRANGEMENTS

1. Management Structure

There will be four agencies involved in implementing various elements of this regional project. The Lands and Resources Division (LRD) of the Secretariat of the Pacific Community (SPC, Fiji) will be the lead agency in implementing this project. National level implementation of activities will be the responsibility of the following: Fiji, Forestry Department; Papua New Guinea, PNG Forest Service; Vanuatu, Forestry Department.

The work to be implemented by the various institutions is as follows:

Work to be carried out

1. Exclusively by regional project center at SPC LRD Fiji Islands

Output1 Recruit project manager Recruit technical officer Arrange for secretarial support Arrange for office accommodation Arrange office equipment purchase and installation (tel, fax, computer, internet connection etc) Arrange US dollar bank account for project funds Arrange internal auditing system

Output 2 Arrange assignment of national project staff by government agency Arrange national secretarial support Arrange purchase, tax and insurance for project vehicle/s Arrange for office accommodation Arrange office equipment purchase and installation (tel, fax, computer, internet connection etc) Arrange US dollar bank account for project funds Arrange internal auditing system

Output 3 Design database to be compatible with participating country capacity Source and compile technical and market information Input and regularly update data Secure the database and promote industry access

Output 4 Secure data on experience and skills of various specialists/consultants appropriate for the various sub-sectors in the wood processing sector Maintain updated profiles of specialists/consultants Recruit specialists/consultants as and when required for specific assignments in support of national and regional demands

Output 5 Compile details of wood industry machinery suppliers and material suppliers willing to participate in technology demonstration and training courses Promote the utilization of wood industry machinery and material suppliers as resource persons to the national and regional training institutions

Output 6

Prepare workshop programme

55

Identify resource persons Host and manage workshop Report on workshop

Output 7 Participation in regional forestry and timber industry events in the participating countries and in the region Holding of regular dialogue with host national agencies and stakeholders in the participating countries to discuss progress and emerging issues that effect the project implementation

Also

Output 15 Prepare conference programme Identify resource persons Host and manage conference Report on conference

2. Exclusively by national project staff in Fiji Islands. PNG and Vanuatu

Output 8 Technology and market information delivery to industry Preparing profiles of industries in the sector Building rapport with industrialists, landowners, public sector agencies and other stakeholders Identifying opportunities for increased production, improved efficiency and market diversification at the company level Identifying production and/or management problems not appreciated by companies and offering solutions Accessing the regional centre for technical options and market information editing raw technical and market information Distributing edited reports to industry Securing regional center funding for specialist/consultant input as a last resort

Output 9 Identifying production opportunities with individual company Quantifying market opportunities and deciding optimum scale of production Identifying appropriate technology and obtaining costs estimates for machinery and all other inputs Drafting and reviewing pre-feasibility report jointly with company

Output 10 Identify market opportunities with individual company Compile market data from regional database Select target market options for further closer study Prepare study terms of reference Call for services and review consultant proposals Assist company with review consultant contract and work schedule Assist company with analysis of consultant report

Output 11 Through regular visits and discussion with company executives and managers, identify technological, management or marketing problems Prepare and present to company short proposal on options to address problem Secure appropriate inputs to address problems Evaluate impact of inputs on resolving the problem

Output 12

56

Survey industry sub-sectors to determine perceived and assessed needs for various skills Report on compatibility or otherwise of needs of industry and available training courses Review results with national training institutions and industry Establish mechanism for joint industry/training institute curriculum development consultation

Output 13 Survey status of industry by sub-sector Collect and transmit to regional centre all information on national initiatives on downstream processing policy development Prepare recommendations for regional center on scope of work to be completed

Also

3. Jointly by regional and national project staff in Fiji Islands. PNG and Vanuatu

Output 14 regional centre Review recommendations of national project staff on scope of work to be completed Drafting consultant terms of reference Recruiting consultant Arrange consultant schedule in consultation with national project staff Participate in national workshop/dialogue on consultant recommendations Distribute draft policy recommendation and implementation strategy to participating countries Distribute final policy and implementation plan to participating countries Participate in national workshop/dialogue on adoption of the downstream processing policy and implementation strategy

national project staff Complete baseline sector study as prerequisite for downstream policy development Collect published and available downstream policy drafts/reports and working documents transmitted to regional project manager Arrange and host national dialogue on downstream policy development during mission by consultant Participate as project counterpart to consultant during national study Arrange consultant programme during national study and provide logistical support Arrange national workshop/dialogue to assess and provide comments on consultant draft policy and implementation strategy Arrange national workshop/dialogue to recommend adoption of final policy and implementation strategy to government

Output 16 regional centre Prepare scope of study and terms of reference for consultant in consultation with participating countries Recruit consultant Arrange three country schedules Participate in nation workshop to review consultant report Distribute the draft report Distribute the final report Promote consultant recommendations and implementation plan

national project staff Propose scope of study and terms of reference to regional centre Propose consultant work programme, provide logistical support and participate in the field data collection

57

Arrange national workshop to review consultant recommendations Promote consultant recommendations and implementation plan

Output 17 regional centre Prepare scope of study and terms of reference for consultant in consultation with participating countries Recruit consultant Arrange three country schedules Participate in nation workshop to review consultant report Distribute the draft report Distribute the final report Promote consultant recommendations and implementation plan

national project staff Propose scope of study and terms of reference to regional centre Propose consultant work programme, provide logistical support and participate in the field data collection Arrange national workshop to review consultant recommendations Promote consultant recommendations and implementation plan at national level

Output 18 regional centre Prepare conference programme Identify resource persons Host and manage conference Publish and distribute conference proceedings

national project staff Prepare report on national status of consultant report Participate in regional workshop

Output 19 regional centre Identification of suitable studies/activities offering training opportunity Active field participation jointly with national project staff Assessment of skill development and performance of national project staff

national project staff Industry studies conducted jointly with project manager Report on self assessed skills enhancement and areas needing strengthening

Output 20

regional centre Prepare scope of study and terms of reference in consultation with participating countries Recruit consultant Arrange three country schedules Attend national workshop on national lumber grading rules and wood preservation standards and implementation plans

national project staff Implement national workshops to review consultant proposals Prepare workshop programme, identify and invite speakers and participants Arrange venue and facilities Arrange workshop reporting and print and distribute workshop report

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Promote national adoption of recommended rules and standards and implementation plans

Management

A project manager will be based at the SPC LRD, Fiji Islands, the institution hosting the regional project facility. The project manager will be responsible for management, implementation of regional activities and those activities to be undertaken jOintly by the regional center and the national project staff and reporting on the project with inputs being provided by national project staff.

The regional project manager will administer and manage the disbursement of funds and supervise procurement of equipment and materials by national project staff. The project manager will support and assist the national project staff in the timely conduct and implementation of national activities.

National project staff will be assigned in Fiji Islands, PNG and Vanuatu and will be from the following national forest authorities: Fiji Islands Department of Forestry, PNG Forest Service and Vanuatu Department of Forests. National project managers will be responsible for management, implementation of national activities and those activities to be undertaken jointly with the regional center. The national project managers will be responsible for reporting on the national project activities and progress. The national project managers will be responsible for managing project funds dispersed by the regional project manager and for the procurement of equipment and materials in cooperation with the regional project manager.

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Management structure

Regional

Project

Manager

~----------------

Fiji National Project

Manager

--------- ... I Oversight and I Administrative I Support I Forest and Trees I Programme I I SPC/LRD I ~--------- ..

PNG National Project

Managers (two

persons)

~----------------

Vanuatu National Project

Manager ------

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2. Monitoring. Reporting and Evaluation

Project Progress Reports

Progress reports will be provided at 6 monthly intervals and the timing of delivery of the reports shall be at least 4 weeks before the date of any monitoring visit and 2 months before the ITTC convenes. A precise schedule for the delivery of progress reports will be provided when the implementing agency indicates it is ready to begin the project.

Project Technical Reports

Project technical reports will be provided when achievement milestones have been achieved. The first technical report will be provided within 6 months of start-up.

Monitoring, Review and Steering Committee's Visits

On the basis of the work plan, monitoring visits and steering committee meetings will be held to the following schedule:

Yr 102 Yr2 02 Yr302

Project Completion Report

This will be submitted within three months of Project completion.

Evaluation

While it is not anticipated that a mid-term evaluation would yield significantly new inputs than provided by the Project Steering Committee an ex-post evaluation would potentially yield useful lessons on the implementation of regional projects in the Pacific island ITTO member countries.

3. Future Operation and Maintenance

This project, on its successful completion, will have demonstrated that significant expansion of investment in the wood processing sector leads to greater social and economic benefits at a national level. The project will have demonstrated the effectiveness of national capacity, backed by regional support, to address the main constraints to expansion of downstream processing. It will have also demonstrated that cost effective reassignment of national forestry administration personnel to the task of assisting industry pays dividends in terms of expansion of activity in the sector.

Because of the benefits derived, and because these benefits can flow from re-assignment of existing personnel it is anticipated that national governments will adopt the strategy applied by the project and establish permanent industry support capacity funded from the existing budget allocations to the forestry administrations.

At the regional level, the LRD has a clear mandate to support forestry and added value manufacturing in the region and the demonstrated successes of this project in delivering sustained expansion of forestry and timber industry activity will cause the LRD to secure funds for the continuation of its regional back-stopping for national capacity building in the region.

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PART IV. THE TROPICAL TIMBER FRAMEWORK

1. Compliance with ITTA 1994 Objectives

The goal of this regional project is to accelerate economic and social development in the Melanesian ITTO member countries from sustainable, efficient and competitive wood based industries,

Of the fourteen objectives set out in Article 1 of the ITT A 1994 the goals of this project are consistent with articles c, h, I and k of the ITTA.

In relation to Article c, this project will directly impact job creation, enhanced employment opportunities for landowners and increased foreign exchange earnings. At the regional level this project will provide a means for the wood processing industries in the region to access market information and as such the project will contribute to the achievement of Article h of the ITTA 1994.

The governments of Fiji Islands, PNG and Vanuatu are determined to expand the manufacturing sectors in their respective countries and downstream wood processing industries utilizing both natural and plantation forests have the potential to contribute to the social and economic development of the respective countries. All three countries have determined that there are considerable multiplier effects to be derived from wood based added value production. This project aims to provide the 'tools' for an expansion of downstream wood processing and as such the goals of the project are consistent with Article I of the ITTA 1994.

A key function of this project is the delivery and interpretation of market information to facilitate both public and private enterprises to improve their marketing and distribution of tropical timber which is consistent with Article k of the ITTA 1994.

2. Compliance with ITTO Action Plan

This project will make a contribution to several elements of the ITTO Yokohama Action Plan 2002-2006 and is consistent with the key strategy therein described of taking an integrated approach to development of the forestry/wood based industry sector. In particular this project intends to balance the inputs of sustainable forest resources, efficient and competitive processing and the marketing of added value products

The goals of this project are consistent with Goal 1 and Goal 2 set out in relation to the Organizations aims for the wood based industry sector in member countries.

This project aims to promote increased added value processing of tropical timber from sustainable sources and improve industry's efficiency and competitiveness. The achievement of the project objectives will be achieved through the transfer of technology and the delivery of market intelligence in a form that can be commercialized by the timber industries. Assistance will be provided to public and private enterprises to plan production expansion and work will be concluded to establish a sound policy framework for the development for the timber industries in Fiji Islands, PNG and Vanuatu

Main features of executing agency

The Land and Resources Division (LRD) will implement this project. LRD is the newest division of SPC and brings together two previously separate programmes: agriculture and forestry. LRD's goal is derived from SPC's corporate vision:

To improve food security, increase trade and assist the Pacific Community to be more prosperous and healthy and manage their agricultural and forest resources in a sustainable way.

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I n its Strategic Plan 2005-2008, LRD is committed to work in collaboration with its stakeholders -lDacific Island countries and territories (PICTs), donor partners, and national, regional and international agricultural organisations - to achieve its two objectives: i) sustainable management of integrated forest and agricultural systems i j) improved biosecurity and trade facilitation.

LRD places particular emphasis on an integrated and participatory approach to the development of sustainable agriculture and forestry. The division's assistance has become more targeted to provide effective solutions to meet the different needs of PICTs. To be more effective in delivering its services, LRD is increasingly adopting a decentralised approach to extension, coordinated at the country level by staff within national agricultural systems. LRD will be innovative in identifying donor partners and moving towards multi-project and multi-donor support of its work. LRD will continue to strengthen PICTs' capacity in plant protection, crop improvement, animal health and production, and sustainable forestry management and development. At the same time, LRD will develop capacity in new initiatives such as policy analysis and advice and support for agricultural science, technology and innovations. \/IJithin the limits of available resources, LRD will deal with current and emerging challenges facing member countries and territories in the agriculture and forestry sectors.

For example, PICTs' need for developing appropriate downstream agro-processing industries rather than concentrating on the export of fresh produce will be addressed. This need makes the presence within LRD of a strong agricultural marketing advice capacity. There are land use issues in PICTs that affect agricultural development and natural resource management, and LRD will work to help PICTs strengthen their capacity in addressing these issues.

I n the area of forestry, emphasis will be on strengthening PICTs' capacity to implement sustainable forest management and develop appropriate policies, strategies and legislation.

LRD will continue to work to strengthen its partnerships with other regional and international organisations, including ITTO, FAO, PIFS, ACIAR, GTZ, USP, ADAP and SPREP, and to avoid duplication and add value to the efforts of each agency. AusAID, NZAID, French AID and EU are LRD's traditional donor partners and have contributed significantly to the development of agriculture and forestry in the region.

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ANNEX A - PROFILE OF THE EXECUTING AGENCIES (4)

This regional project will be executed by the SPC LRD. National activities will be implemented by: Fiji Islands Forestry Department, PNG Forest Service and the Vanuatu Forestry Department.

Land and Resources Division of SPC

Mission

The Land and Resources Division (LRD) is the newest division of SPC and brings together two previously separate programmes: agriculture and forestry. LRD's goal is derived from SPC's corporate vision:

"to improve food security, increase trade and assist the Pacific Community to be more prosperous and healthy and manage their agricultural and forest resources in a sustainable way."

In its Strategic Plan 2005-2008, LRD is committed to work in collaboration with its stakeholders - Pacific Island countries and territories (PICTs), donor partners, and national, regional and international agricultural organisations - to achieve its two objectives:

i) sustainable management of integrated forest and agricultural systems

ii) improved biosecurity and trade facilitation.

LRD places particular emphasis on an integrated and participatory approach to the development of sustainable agriculture and forestry. The division's assistance has become more targeted to provide effective solutions to meet the different needs of PICTs, and to be more effective in delivering its services.

LRD will continue to strengthen PICTs' capacity in plant protection, crop improvement, animal health and production, and sustainable forestry management and development. At the same time, LRD will develop capacity in new initiatives such as policy analysis and advice and support for agricultural science, technology and innovations.

Within the limits of available resources, LRD will deal with current and emerging challenges facing member countries and territories in the agriculture and forestry sectors. For example, PICTs' need for developing appropriate downstream processing industries rather than concentrating on the export of commodities. This need justifies the presence within LRD of a strong technical and marketing advice capacity.

In the area of forestry, emphasis will be on strengthening PICTs' capacity to implement sustainable forest management and develop appropriate policies, strategies and legislation.

LRD will continue to work to strengthen its partnerships with other regional and international organisations, including ITIO, FAO, PIFS, ACIAR, GTZ, USP, ADAP and SPREP, and to avoid duplication and add value to the efforts of each agency. AusAID, NZAID, French AID and EU are LRD's traditional donor partners and have contributed significantly to the development of agriculture and forestry in the region.

64

The Infrastructure of the Executing Agency

SPC LRD

The SPC LRD Regional Forestry Programme has two main components; the Forests and Trees Programme, funded by AusAID and the Pacific-German Regional Forestry Project funded by the German Government through GTZ. Expertise available in the two components for the support of forestry work in the Pacific include forestry, wood science, forest genetic resources, land use and participatory land use planning and forest management. In addition, the forestry experts' participation in the LRD thematic groups (see LRD Structure) ensure access to other relevant expertise that strengthen the forestry programme's capacity to provide support to the countries.

Facilities available include training and meeting rooms, and laboratories for plant health and for genetic resources conservation and propagation, including tissue culture facilities.

Budget SPC LRD

The total budget in US dollars for the Forests and Trees Programme of the Regional Forestry Programme for the years 2004-2006 is as shown below. This indicates a substantial rise in the funding, which also include the funding from close to FJD400,000 to FJD1.2m. The Pacific German Regional Forestry Project has a separate budget which is also more than FJD1.0m per annum.

2004 2005 2006

Personnel 158000 158000 300000

Duty Travel 30000 30000 80000

Capital Items 10000 10000 40000

Activities* 200000 200000 800000

Total 398,000 398,000 1220000

* including sub-contract

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List of personnel in the Regional Forestry Programme include:

1. 2. 3. 4.

Post-graduates -Graduates -Technicians -Administrative -

4 3 2 3

Fiji Islands Forestry Department

Mission: To advocate the sustainable development of the forest resources in support of a growing and equitable economic and social development of our people.

The Forestry Department is part of the Ministry of Agriculture, Fisheries, and Forests, and is supported by six service divisions Le. Silviculture Research, Timber Utilisation Research, Management Services, Training Centre, Environment and Mechanical Services Divisions.

Some projects implemented in the last three years included the landowners awareness training on SFM, study into the forest revenue system, revision of the forest policy, revision of the code of logging practice, establishment of a timber industry training centre, ITIO mission, formulation of the rural land use policy and the formulation of national forest certification standards.

Main donor agencies include FAO, GTZ and ITIO. Significant support was also provided by the Secretariat of the Pacific Community through its Land Resources Division.

Projects and pre-projects submitted for ITTO funding support included:

• Landowner education and training for sustainable forest management - funded

• Assessment of forest industry training needs (pre-project - funded)

• Export intelligence system - funded

The Fiji Forestry Department has its main headquarters in Suva where there are meeting rooms, a library and GIS equipment. There are divisional offices in Lautoka, Nausori and Labasa which also have meeting and training rooms.

There are two specialist Divisions; the Silviculture Research and Timber Utilisation Divisions. Both of these have laboratories and also meeting/training rooms. In addition the Utilisation Division also has sawmilling, timber treatment, timber drying and timber machining facilities for training purposes.

The Forestry Department has a forestry training centre, consisting of a logging school, forestry technician training, and a timber industry training centre. In addition, the Department also has separate mechanical services and information technology units.

2004 2005 2006

Personnel 3,268,000 3,268,000 3,268,000

Duty Travel 103,000 103,000 103,000

Capital Items 2,232,000 2,232,000 2,232,000

Activities* 1,285,000 1,285,000 1,285,000

Total 6,785,000 6,785,000 6,785,000

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* including sub-contract

Forestry Department list of personnel:

1. Post-graduates - 2 2. Graduates - 9 3. Technicians - 60 4. Administrative - 40

PNG Forest Service

Mission

The mission of the PNGFA is to implement the national forest policy the basis of which is the fourth Goal of the Papua New Guinea Constitution which sets the foundation for PNG's Forest Policy. This states: "for Papua New Guinea's Natural Resources and Environment to beconseroed and used for the benefit of all, and to be replenished for the benefit of future generations".

The PNG Forest Authority was created in 1991 under the provisions of the Forestry Act. It succeeded the former Department of Forests, the 19 provincial forest divisions and the Forest Industry Council and was established as a statutory corporation with regulatory and administrative responsibility for the management of the forest sector throughout the country.

The Forest Authority comprises the National Forest Board (NFB) and the National Forest Service (NFS), and a number of regulatory and administrative responsibilities have been delegated to the provincial level.

The Board operates through a system of specialist advisory committees and provincial forest management committees which are serviced by the NFS. A 'landowner company' (LOC) concept was developed as part of the national forest policy in order to increase national participation in forestry. LOCs, as licence holders, contract foreign companies to conduct logging.

Fields of Expertise

The PNGFA fields of expertise include: Sustainable forest management, plantation management, Forest biology, Forest industry, Policy development, Planning and research, Human resource development and training, Extension and outreach Investment analysis and finance and Public relations.

PNG Staff and Organisation

The PNGFA has a total staff of over 600, including around 400 with diplomas or university degrees.

Core Functions Management Degree Holders 42 Project Monitoring Diploma Holders 117 Plantation Management Diploma Holders 230 Forest Planning and Inventory Diploma Holders 8 Research Degree Holders 32 Support functions Management Degree and Higher Diploma 12 Administrative Services College Certificates 122 Finance Degrees, Diplomas and Certificates 28 Vacancies 40 Total 456

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The FA is organized as shown below

Collaboration with partners

Several donors have been providing support to the forestry sector development in the country including: the Japanese Government (JICA), ITIO, the New Zealand Government, Australia (AusAid), bilateral NGOs from the USA (Mc. Arthur Foundation), WB, UNDP, GEF, and FAO. Recent activities include:

Human Resources Development (Forestry) Project. This is a major project funded by AusAid. The main emphasis of the project is human resource development in the forestry sector including forestry training and institution building. Also involved in the project are: the University of Technology, Bulolo Forestry College and Timber Industry Training College.

Log Export Monitoring and Surveillance. The project is undertaken by a Swiss company, Societe de Generale Surveillance (SGS), and is funded largely by the European Union The main emphasis

68

of this project is to ensure that proper accountability and value for logs being exported are accurately documented for government tax purposed.

Growth and Yield Studies. The Growth and Yield Studies is a research project that is funded by the Japanese Government, and is administered by the Japanese International Cooperation Agency (JICA). This project has been in operation since 1993 and the JICA team of researchers operates out of the Forest Research Institute in Lae. A major seminar is scheduled for November 1998 for the project to present it's findings. It is anticipated that the finds will have major policy implication to cuttings cycles, species and diameter limits.

East New Britain Balsa Project. This project is funded by International Tropical Timber Organization (IITO). The objective of the project is to expand the Balsa wood industry after the volcano in Rabaul. Balsa is a fast growing tree and is harvested after 4-5 years and is considered an alternative income base in rural community development

Timber Product Marketing Study. A study to evaluate the marketing strategies for Papua New Guinea Timber products being funded by the International Tropical Timber Organization. The study commenced in 19% and is expected to be completed in March 1998. The purpose of the study is to assess the market, possibility of a voluntary marketing organisation and market intelligence and viability of processing of timber in Papua New Guinea.

Forest Inventory Mapping (FIM). Funded by AusAid, this project is the continuation of an earlier project - the Rapid Resource Appraisal (RRA) project - which started in 1995. At the completion of the RRA Project, the Forest Authority sought an extension to update forest resource information through scanning and digitizing of the resource maps. This project is on going and the output will assist the NFS to determine the volumes of forest resources available, especially in new forest potential areas

International conventions

Papua New Guinea is Signatory to a number of international organizations which deal with forest and environment issues. These include:

a) International Tropical Timber Agreement (ITTA) which gives the mandate for the International Tropical Timber Organization (IITO) to perform its functions.

b) Inter-governmental Panel on Forests (IPF) under the United Nations Commission of Sustainable Development This is an ad hoc Panel dealing with the sustainable management of all types. There is no legally binding instrument associated with the IPF as yet, but Papua New Guinea is an active participant through the National Forest Service.

c) Convention on Biological Diversity (CBD). The Department of Environment and Conservation deals with this Convention. However since issues of biodiversity are interrelated with forest issues the National Forest Service closely observes the deliberations and decisions of the Convention.

d) Melanesian Spearhead Group. There is a scope for Papua New Guinea to assist the Melanesian Spearhead Group States in Logging Codes of Practice, log export monitoring and surveillance and training of personnel.

e) South Pacific Forum. The Papua New Guinea Forest Authority, representing Papua New Guinea is a key player on deliberations on forestry issues.

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Budget

The Annual budget of the PNG Forest Authority over the past 3 years has been in excess of US$8.5 million

Vanuatu Department of Forestry

Mission The principal goal of the forest sector and thus the Mission of the Department of Forests are to ensure the sustainable management of Vanuatu's forests to achieve greater social and economic benefits for current and future generations. This is set out in more detail in the National Forest Policy prepared in 1997 and endorsed by the Council of Ministers in 1998.

The Vanuatu Forestry Department is a government organization under the Ministry of Agriculture headed by the Director of Forest. Its main role is to develop the forestry sector by developing policies, legislation and monitor the implementation of these policies and legislation. Its responsibility also covers the regulation of the private sector namely the industry and the resources owners in the forest industry as well as assisting them in developing the industry.

70

", . . '" er

FOREST DIVISION ORGANISATION CHART

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The Vanuatu Department of Forests does not have any training facilities nor laboratories. It only has nursery facilities.

Vanuatu DF List of personnel:

1. Post-graduate - 2 2. Graduates - 3 3. Technicians - 20+ 4. Administrative - 10

72

ANNEX B - CURRICULA VITAE OF THE KEY STAFF AND TERMS OF REFERENCE

SPC LRD

Name: Sairusi Bulai

Date and place of birth: 09.03.55, Suva, Fiji Islands

Field and institution of graduation: Wood Science, University College of North Wales, Bangor

Relevant work experience: Employed by SPC as its Forestry Adviser with the main role of managing the Forests and Trees Programme in providing the necessary technical advise and support on forestry to its 22 member countries of the Pacific.

Before joining SPC, was the Deputy Conservator of Forests (Operations) for the Forestry Department of Fiji Islands Ministry of Fisheries and Forests.

Fiji Forestry Department

Name: Samuela Lagataki

Date and place of birth: 1.5.65

Field and institution of graduation: Forestry, Australian National University (ANU), Australia.

Relevant work experience: Currently employed as the Acting Deputy Conservator of Forests (Operations). Substantive position is the Principal Forestry Officer looking after the Management Services Division.

PNG Forest Service

Name: Brown Kiki

Date and place of birth: 1.12.55, PNG

Field and institution of graduation: Forestry, University of Technology, PNG

Relevant work experience: Joined PNG Forest Authority in 1979 and has performed various management functions before appointed to his present position. He is currently performing the functions of General Manager of the PNG Forest Authority, looking after the activities of the forest service part of the Authority.

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Vanuatu Department of Forestry

Name: Livo Mele

Date and place of birth: 29.11.69, Vanuatu

Field and institution of graduation: Environmental Science, University of the South Pacific (USP), Fiji Islands

Post-graduate: Business Administration, University of the South Pacific

Relevant work experience: Currently Director, Vanuatu Department of Forests.

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TERMS OF REFERENCE

PROJECT MANAGER

ITIO Project: Accelerating the expansion of efficient and competitive downstream wood based industries in Melanesian countries

Background

This is a regional project conceived by Fiji Islands, Papua New Guinea (PNG) and Vanuatu, the Melanesian ITIO member countries. The project will be implemented by the Land and Resources Division (LRD) of the Secretariat of the Pacific Community (SPC) which is headquartered in Suva, Fiji. The project manager will be based in the LRD and activities at the country level will be undertaken in cooperation with government assigned officers.

The governments of Fiji, PNG and Vanuatu have identified that the forestry and wood processing sectors can contribute more to national development. This project will address the constraints that are holding back growth in the wood processing industries. The main constraints that limit expansion of a more efficient and competitive wood processing sector include; the absence of appropriate government policies to support expanded manufacturing of, and trade in added value wood products; weaknesses in the industry in identifying and applying technological and production opportunities and a lack of appreciation of marketing opportunities.

The Project Manager will oversee the generation of baseline information on the national wood processing sectors to provide the foundation for national wood processing policies to be developed and proposed for adoption.

The Project Manager will be responsible for developing the skills of a cadre of technicians who, through close liaison with the public and private timber industries, will be able to identify and offer solutions to production and marketing constraints and assist companies with development and investment plans.

Country level assistance to industry will be backed up by technical and market information databases established under the guidance of the Project Manager and also by the sourcing of occasional short term international/national experts if required.

Expansion of efficient and competitive wood processing industries, in particular those manufacturing added value wood products can provide many social and economic benefits in the form of direct and indirect employment generation, skill development and foreign exchange savings from import substitution and hard currency earnings from exports. Timber industries can operate efficiently and competitively at wide varying scales of production. This characteristic offers the opportunity to help integrate rural landowners into the productive cash generating economy, a priority in Melanesian countries.

The principal focus of this regional project is on forest industry development, in particular on increasing investment in downstream wood processing. Decisions on investment will require identification of manufacturing and marketing opportunities and, therefore the project also has a strong tropical timber market information transparency feature.

Duration and emoluments

The contract for the Project Manager will be for a period of 3 years or for as long as ITTO funding for the project is available. Salary and benefits will be negotiable but will not be below the level of I within the SPC management structure.

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Experience

The Project Manager should:

• have a degree in wood industries processing technology or forestry with minimum 15 years working experience in the forestry, timber industry and or timber industry association sector. Employment experience with regional or international agency would be an advantage. A significant time should have been spent on tropical timber market promotion and technology transfer to industry

• have an up-to-date appreciation of the issues and trends in the tropical timber markets and of wood processing technologies appropriate for the Pacific countries

• have good and verifiable communication skills

• be willing to travel extensively in the Pacific region

• be fluent in spoken and written English (a publication list should be provided)

• be skilled in technical report writing

• be imaginative and forward thinking and be able to work alone

• have Experience in dealing with senior government and business leaders

• be computer literate

Applications are invited from suitably qualified and experienced men and women from ITTO member countries. Preference will be given to experienced and qualified applicants who are nationals of SPC member countries.

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TERMS OF REFERENCE

PROJECT TECHNICAL OFFICER

ITTO Project: Accelerating the expansion of efficient and competitive downstream wood based industries in Melanesian countries

Background

This is a regional project conceived by Fiji Islands, Papua New Guinea (PNG) and Vanuatu, the Melanesian ITTO member countries. The project will be implemented by the Land and Resources Division (LRD) of the Secretariat of the Pacific Community (SPC) which is headquartered in Suva, Fiji. The Technical Officer will be based in the LRD and activities at the country level will be undertaken in cooperation with government assigned officers.

The governments of Fiji, PNG and Vanuatu have identified that the forestry and wood processing sectors can contribute more to national development. This project will address the constraints that are holding back growth in the wood processing industries. The main constraints that limit expansion of a more efficient and competitive wood processing sector include; the absence of appropriate government policies to support expanded manufacturing of, and trade in added value wood products; weaknesses in the industry in identifying and applying technological and production opportunities and a lack of appreciation of marketing opportunities.

The Technical Officer will provide technical and administrative support to the Project Manager in the generation of baseline information on the national wood processing sectors to provide the foundation for national wood processing policies to be developed and proposed for adoption.

The Technical Manager will be responsible for developing and maintaining the technical and market information databases and for providing timely technical and market information to the regional officers in Fiji, PNG and Vanuatu in the execution of their duties.

Expansion of efficient and competitive wood processing industries, in particular those manufacturing added value wood products can provide many social and economic benefits in the form of direct and indirect employment generation, skill development and foreign exchange savings from import substitution and hard currency earnings from exports. Timber industries can operate efficiently and competitively at wide varying scales of production. This characteristic offers the opportunity to help integrate rural landowners into the productive cash generating economy, a priority in Melanesian countries.

The principal focus of this regional project is on forest industry development, in particular on increasing investment in downstream wood processing. Decisions on investment will require identification of manufacturing and marketing opportunities and, therefore the project also has a strong tropical timber market information transparency feature.

Duration and emoluments

The contract for the Project Technical Officer will be for a period of 3 years or for as long as ITTO funding for the project is available. Salary and benefits will be negotiable but will not be below the level H within the SPC management structure.

Experience

The Technical Officer should:

• have a degree in wood industries processing technology or forestry with minimum 5 years working experience in the forestry, timber industry and or timber industry association

77

sector. Employment experience with regional or international agency would be an advantage.

• have an up-to-date appreciation of the issues and trends in the tropical timber markets and of wood processing technologies appropriate for the Pacific countries

• be familiar with database technologies and have experience of managing information databases

• have good communication skills

• be fluent in spoken and written English

• be capable of working alone in support of colleagues who are operating in the countries participating in the project and be conscientious in meeting targets and deadlines

Applications are invited from suitably qualified and experienced men and women from ITTO member countries. Preference will be given to experienced and qualified applicants who are nationals of SPC member countries.

78