Supporting Forest Based Technology as Small and Medium-Sized Enterprises (SMEs) and Entrepreneurs

1.     Importance of Small and Medium-Sized Enterprises (SMEs) and Entrepreneurs

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Small and medium-sized enterprises (SMEs) and entrepreneurs are crucial for tracing new paths to more sustainable and inclusive growth, thanks to their role in developing and diffusing innovation and providing employment. However, they can only fulfill this role if they obtain the finance necessary to start and grow their business.

Every country or some organizations like European Union or OECD[1] has some special program in order to support and enhance the small and medium-sized enterprises and entrepreneurs. Under the OECD, with the framework of “Centre for Entrepreneurship, SMEs and Local Development[2]” currently there is a special program for SMEs namely “LEED Programme (Local Economic and Employment Development[3])”

Supporting to SMEs is a special interest of  the European Union. For this reason there is a special program under “Enterprise and Industry” namely COSME.

COSME[4] is the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (SMEs) running from 2014 to 2020 with a planned budget of €2.3bn. COSME will support SMEs in the following area.

 

2.     Forest Based Sector

Forest based industry mainly based on SMEs is very important especially for local development.

2.1.          In the world;

  • Over 1.6 billion people’s livelihoods depend on forests[5].
  • Trade in forest products was estimated at $327 billion in 2004.
  • 30 percent of forests are used for production of wood and non-wood products.
  • Forests are home to 300 million people around the world. The annual value of wood removed from forests is estimated to be more than $100 billion.

More than 60 million people are employed by forest-based industries

  •  Where forests are sustainably managed and utilized, they can contribute significantly to alleviating poverty and creating forest-based enterprises and services.
  •  Forests play a critical role in ensuring a sustainable water supply and in the transition of society towards green economies. Wood energy, green infrastructure and buildings, and forests as carbon sinks represent opportunities for the forest sector.
  •  A number of “payment for ecosystem services” initiatives have shown the possibilities of valuing and paying for forest ecosystem services such as carbon sequestration, water-quality,
  • Tropical forests provide a vast array of medicinal plants used in healing and healthcare, worth an estimated $108 billion a year.
  •  More than a quarter of modern medicines originate from tropical forest plants.
  •  Forests curb transmission of infectious diseases. Undisturbed tropical forests can have a moderating effect on the spread of insect- and animal-borne disease
  •  40 percent of the world’s population lives in malaria infested regions. Heavily deforested areas can see a 300-fold increase in the risk of malaria infection compared to areas of intact forest.
  •  72 percent of emerging infectious diseases transmitted from animals to humans come from wildlife as opposed to domesticated animals. Deforested areas increase contact between wildlife and humans and affect pathogen transmission.
  • ·
  • The European Commission, the EU’s executive, adopted the “A new EU Forest Strategy[6]: for forests and the forest-based sector” at the date of 20.09.2013.
  • The Commission also issued a blueprint to further develop the EU’s significant forest-based industries, indicating activities that can be undertaken to help this sector fulfil its potential to substantially contribute to the  goal of smart, sustainable and inclusive growth by 2020.
  • The Blueprint describes the EU’s wood-processing and related industries and the challenges they face – including global competition, raw-material supplies; environmental, renewable energy and climate policy targets; educational needs, logistics and an ageing workforce – and describes how to address these challenges.
  • According to this blueprint EU forest-based industries (F-BI) form a significant part of manufacturing in Europe, having around 3.5 million jobs and nearly €500 billion worth of annual turnover. They are thus at the forefront of the Commission’s efforts to create growth and jobs, an important element of which is the re-industrialization of the European economy.
  • In this context, and with many of their products based on renewable and recyclable wood, the EU F-BI have good potential to contribute more widely to Europe’s 2020 and even 2050 goals, based on sustainable forest management. In particular, sustainable construction and furniture offer scope to improve the F-BI’s market share in more traditional products, whilst bio-based products, intelligent paper and packaging and new print applications could further harness high-tech potential, both in the EU and global markets.
  • Having set the scene of the EU’s forest-based industries (woodworking; furniture; pulp & paper; printing) through sectoral, economic and technological outlooks, the Blueprint then outlines their four sub-sectors in more detail. Their eleven sets of challenges are subsequently identified and discussed, along with activities to help address them; as follows:
  • Stimulating growth: F-BI need to improve production efficiency and the quality of their products and services, in order to grow markets both within and outside the EU. In parallel they need to develop bio-based products, take an active role in sustainable construction and improve customer information on furniture;
  • Resource and energy efficiency: responding to increased competition from both bio-energy and the bio-economy for wood raw material, the “cascade” principle should help the EU use its wood more effectively, by the F-BI and other wood-users. Similarly, energy efficiencies can help reduce F-BI production costs;
  • Raw materials: although EU forests are growing, they are also ageing and face ever more legal, ownership and other limitations to harvesting wood. Wood recycling lags behind that of paper. Much wood imported to the EU is taxed before export. Some EU saw-logs are exported. To better address these difficulties, wood is included in the European Innovation Partnership for Raw Materials. Intertwined with raw material supply and product delivery, better logistics are also vital to sectoral competitiveness;
  • Structural adaptation: most firms in the F-BI are small, medium (SMEs) or micro enterprises and thus need to co-operate both upstream and downstream in their value chains in order to achieve economies of scale;
  • Innovation and RTD: are vital activities for new products and processes, such as bio-refineries, and also to support other improvements along the F-BI’s four value chains. To this end, EU programmes such as Horizon 2020 and COSME can provide invaluable help, along with the Forest-based Sector Technology Platform;
  • Education, training & skills; ageing workforce: technological improvement often cannot be harnessed due to a lack of scope for re-training existing workforces. A shortage of young entrants means existing F-BI skills are not being passed on. Sectoral Social Dialogues and European Skills Alliances can help address these issues;
  • Coherence of EU legislation: F-BI are affected by various EU policies and related legislation. It is important to ensure coherence and consistency in order to provide a predictable environment for economic operators.
  • Implementation of EU climate policy: wood-based panels and paper are within the scope of the EU Emissions Trading System (ETS). Along with sawn wood, their stored carbon can now also be accounted under the Land use, Land-use Change and Forestry Emissions Agreement (LULUCF);
  • International competition, trade and co-operation: as high-cost but efficient producers of wood-based products, EU F-BI need to ensure they maintain international competitiveness and access to global markets. The EU’s trade agreements help improve market access and address abuses of World Trade Organization (WTO) rules through trade-defense instruments. Sectoral dialogues complement these efforts;
  • Information, communication & image: better information of all kinds and its flow within and between F-BI sub-sectors would help improve their functioning and hence efficiency and competitiveness. Better external information could improve their communication to other stakeholders and society in general and thus help improve their image, which is often rather negative.

2.2.          In the European Union

3.       Supporting Forestry Sector as a Part of Enterprise and Industry

There are several initiatives to support forest based industry as a part of “enterprise and industry” in the world, in the European level and in Turkey. If we give a special attention to the European Union, we can see that the sector divided into three sub items like; Wood, Paper, Printing[7].

Forest-based industries include the woodworking industriespulp and paper industries and the printing industries. They use as their main raw materials wood, paper or recovered paper and wood. They also include specialized sectors such as cork.

EU forest-based industries are competitive, boasting very good technical and commercial performance. The pulp and paper, woodworking and printing sectors are world leaders in many areas. However, the sector faces a number of challenges, including access to raw materialsclimate changeinnovation, trade and the provision of information on forest-based products. For woodworking and printing, the SME dimension is highly relevant. Many parts of these industries play an essential role in maintaining sustainable employment in rural areas.

In Turkey the forest based sector also very important. According to the “Turkish National Export Strategy for 2023” Turkey aims to have 500 billion US Dollars export annually. With the line of this general strategy “The Union of Exporters for Forest Products” prepared a special plan in order to have more than 16 billion exports in the year of 2023[8].

4.       The Aim of This Project Proposal

With this text, as CARFU, we are aiming to have financial support in order to prepare “The Country National Strategy for Supporting Forest Based Technology” in Balkan, Near East and African Countries.

The projects will have three components like;

  • Investigation-Research
  • Preparation
  • Implementation

We are planning to work together with national agencies, civil society organizations and international organizations.

 



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