State forestry sector needs  reorganization – but now?

In light of public accusations in illegal activities, inefficiency and shortages in transparency a fundamental reform of the state forestry sector of Ukraine is a subject of forest policy during recent years. Having followed to a number of presidential and governmental decisions, Ministry of Ecology and Nature Resources (MENR) and State Forest Resource Agency (SFRA) has initiated the unification of state forest enterprises into the single State Enterprise “Forests of Ukraine”.

Referring to the Presidential Decree of 07.06.2021 №228/2021 “On some measures for the preservation and reproduction of forests”, the State Strategy of Forest Management of Ukraine until 2035, the Protocol of the meeting under the chairmanship of the Prime Minister of Ukraine Denis Shmyhal dated 04.02.2022 “On Forestry Reform” and on behalf of the commitment of National Security and Defense Council of 29.06.2022 №1594/14-05/2-22 regarding the minutes #5 Groups on the preservation and reproduction of forests of 28.06.2022, SFRA of Ukraine has prepared a draft resolution of Cabinet of Ministers, which envisages the formation of a State Unitary Commercial Enterprise “Forests of Ukraine” by reorganization (merger) of state-owned enterprises belonging to the sphere of management of the State Forest Resource Agency. The draft resolution was recently sent for approval to Ministry of Environment and Nature Protection. SFRA assumes that subsequent corporatization will allow to increase the efficiency of state forestry management.

In light of this, on July 7, 2022 a special session of Environmental Committee of the Verkhovna Rada was focused to the reform of state forestry management and the proposed merging of state forest enterprises. Mr. Volker Sasse, forest policy expert of SFI project, participated and expressed his view: “As our project advised earlier the main subject is not so much organizational restructuring, but further improving of transparency and mainly mechanisms of financing the various activities of state forest enterprises. Moreover, there are certain risk in centralizing state forest management into one single enterprise. Taking into account the current war situation, such a fundamental reform, should possibly be postponed and discussed with the public actors in this area more comprehensively and transparently. If requested, SFI Project is ready to provide comments to the draft resolution considering common European principles in financing and organization of state forestry management.”