Development and Testing of a New Forest Auctioning System
| Location | Georgia |
|---|---|
| Start | 2003 |
| Finish | 2005 |
| Client | Forest Sector Development Centre/ World Bank |
Summary
This project is one activity under the World Bank funded Forest Development Project. The project will develop a new timber and non-wood forest product auctioning system and prepare guidelines for sustainable utilisation of forest resources to increase revenue to the State and maintain transparency.
Problem
Following the collapse of the Soviet Union, Georgia has embarked on a process of introducing a market-based economy. Georgia has a massively under-utilised forestry sector. There is significant potential for government revenue generated through the sale of sustainably managed wood and non-wood forest products. Under current legislation there is some provision for auctioning of timber rights but only a limited number of auctions have been carried out, and these have been unsuccessful. Legal inconsistencies exist that do not support auctioning and effectively prevent optimal government and free market involvement.
Solution
Under this project LTS is:
- Reviewing the legal framework of the management and utilisation of forestry resources;
- Developing an objective and auditable model for the determination of reserve prices for auction sales;
- Identifying priority types of forest uses for auctioning and other market based forms of forest resource sales;
- Developing an objective and auditable model for auction sales in the State Forest Department;- Developing a draft New Forest Resource Auctioning Regulation;
- Producing a detailed protocol and operating procedures manual; and
- Testing and refining the new auctioning system.
Benefits
The Project will enable the Government of Georgia to increase its revenue through the selective auctioning and sustainable management of its forest resources. It will also provide a valuable tool to provide roadside fuelwood for poor communities and support the government's efforts to combat illegal logging.
