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Forest resources are at the heart of the EU’s bioeconomy strategy. How can they be used sustainably?

In its push for climate-neutrality set out in its Green Deal, the EU bets high on thbioeconomy, with its potential to deliver decarbonization by switching to bio-based renewable materials and circular design systems. A recent online event highlighted the latest debate on the issue. 

Francis X. Johnson, Ekaterina Bessonova / Published on 23 March 2021
Sawmill in Lithuania

Aerial view of a sawmill in Lithuania. Photo: Ernesta Vala / Unsplash.

The use of forest resources for energy, bioplastics, construction, textiles and biomedical products, as well as the creation of jobs around these innovative green industries, will be central to bioeconomic transition. But how much can be extracted from forests for the bioeconomy without undermining biodiversity and carbon sequestration? And how can the bioeconomy become an integral part of the EU Green Deal, benefiting both people and nature?

In light of the upcoming revised EU Forest Strategy, the news organization Politico with support from the Confederation of European Paper Industries (CEPI), convened an online event to discuss the role of bioeconomy in the EU Green Deal. The focus was on forests, which have particular significance within the bloc in terms of managing future trade-offs between climate stabilization, sustainable production and ecosystem health.

The event showcased perspectives from the European Commission, the European Parliament, the Finnish forest-industry giant UPM, and FERN – an EU non-profit dedicated to protecting forests and the rights of people who depend on them.

At the event, Virginijus Sinkevičius, the EU Commissioner for Environment, Oceans and Fisheries, underscored that an EU bioeconomy aims to operate within sustainable ecological limits and consistent with climate and biodiversity goals. The Commissioner highlighted that the EU Bioeconomy Monitoring System dashboard, launched last year, provides a harmonized set of indicators and will be used to evaluate synergies and trade-offs during the implementation of the action plan of the EU Bioeconomy Strategy.

The EU Green Deal policy package spans nine policy areas, including several that are complementary to the Bioeconomy Strategy, namely the Circular Economy Action Plan, Biodiversity Plan, the already mentioned Forestry Strategy and the Farm to Fork Strategy. Interestingly, the Farm to Fork strategy does not include major reforms to the Common Agricultural Policy (CAP), even though re-working agricultural subsidies could help to realize the Green Deal and the EU Bioeconomy Strategy.

All in all, we are looking at a complex web of policies, which are difficult to integrate and harmonize, which can spark confusion and pushback. For instance, Hannah Mowat (from FERN) questioned the sustainability benefits of using forest resources for energy production, as there are no guarantees that only waste and residues will be used.

However, Joanna Drake (of the European Commission) noted that the EU’s Renewable Energy Directive includes the principle of cascading in woody biomass use, such that bioenergy applications prioritize the use of residues and minimize the direct use of virgin materials or whole trees.

So, although policy guidance is in place, it can be lost in the complexity of so many frameworks. In principle, the cross-cutting perspective of bioeconomy brings many different threads and elements together, including agriculture, forestry, marine and freshwater resources, energy, and many other areas of industry and business. Therefore, the EU Bioeconomy Strategy could, if done right, help unite and integrate different policies in the EU Green Deal package.

Jussi Pesonen (from UPM) pointed out that all EU countries manage their forests differently, but that it does not mean that the Forestry Strategy should take the average as a standard. “I hope the Strategy will employ the best practices and become a bioeconomy enabler,” he said. Jori Ringman (from CEPI) also expressed that the forest industry is ready for higher sustainability standards.

Despite a positive outlook from the industry, Hannah Mowat remained critical: “Our forests are losing the capacity to absorb carbon; they are already harvested too intensely, and their biodiversity is falling.” She called for a better balance between nature protection and production incentives.

Trade-offs between conservation of natural resources and their use for economic development pose a classic dilemma. However, with sound management, innovation, increased efficiency and reduced demand, a balance can be struck so that increased reliance on forest resources is achievable within ecological and climate limits.

Indeed, we will need improved and expanded applications for sustainable use of forest resources alongside the many other options which, when taken together, would put us on a path for climate stabilization and resilience. Sustainable bioeconomy can include conservation goals through the creation of institutions that value ecosystems and carbon alongside job creation and livelihoods.

The bioeconomic development trajectory offers a way forward where nature and economy aren’t in conflict. For sure, it is a constant balancing act, and requires careful management and governance with broad and inclusive stakeholder participation. According to the representatives of the EU Commission at the event, the Bioeconomy Monitoring Dashboard was made to enable decision making that strikes this balance.

Establishing mechanisms for stakeholder buy-in and collaboration on the ground is the next step in implementing the Bioeconomy Strategy to avoid conflicts and find common ground. At SEI we have been working with stakeholders in different parts of the world and developed a method for stakeholder engagement, which allows different groups to construct bioeconomy pathways together, tailoring to – and including – local needs and interests.

Finally, it was surprising to see that the job creation aspect of the bioeconomy was not rated highly in the participant poll organized by Politico during the event, neither did it take much space in the discussion. However, the social benefits of the bioeconomy and its potential to create green jobs should not be underestimated.

Not only can bioeconomic initiatives bring rewarding skilled jobs to rural areas, but these are also the jobs we will be in great need of when fossil industries reduce their operations and let staff go. In other words, bioeconomy is a crucial element of a just transition, and this aspect should be front and centre.

The EU Green Deal package already includes the Just Transition Mechanism, which fits well with the emerging opportunities from innovative and sustainable bioeconomy pathways in the EU and globally. Hopefully, these connections and opportunities will be taken the advantage of during the implementation.

Written by

Francis X. Johnson
Francis X. Johnson

Senior Research Fellow

SEI Asia

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