INTERNATIONAL TROPICAL TIMBER ORGANIZATIONITTO
PROJECT DOCUMENT
TITLE:STRENGTHENING TECHNICAL AND BUSINESS MANAGEMENT IN THE
TIMBER FOREST INDUSTRY OF PERUSERIAL NUMBER:

PD 912/20 Rev.3 (I)COMMITTEE:FOREST INDUSTRYSUBMITTED BY:

GOVERNMENT OF PERUORIGINAL LANGUAGE:SPANISHSUMMARY

The project will contribute to the sustainable development of the country's timber industry, promoting
formal, efficient and competitive market-oriented forest enterprises, taking advantage of business
opportunities articulated with value chains, and marketing products based on the use of timber fromlegal sources in managed forests in the Amazon Region of Peru for the benefit of Peruvian society
and, in particular, the men and women that depend on the forest for their livelihoods (generalobjective). This will be attained through the achievement of the project’s specific objective – "tostrengthen the technical and business management of the forest industry that relies on timber
species from the Peruvian Amazon Region". Project beneficiaries include the micro, small andmedium enterprises (MSMEs) of the timber industry marketing their products in national and/or
export markets, as well as entrepreneurs and technical and administrative personnel (including both
men and women) involved in the production and/or management of these enterprises.
Project outputs will include the following: timber industries will interact with forest producers; forest
enterprises will be articulated with national and international markets for timber products; there will
be an efficient management of productive business organizations and the organization of timber
producers will be strengthened. Project impacts will include an improvement in the quality of life of
the Amazon population; enterprises will be producing and marketing timber products from safe
sources; the country’s balance of trade for timber products will be restored; exports of timber
products from the Amazon region will increase; forest production will be articulated with value chains;
new forest species will be introduced into the market; income and capitalization levels will improve;new business opportunities will be opened to enterprises; and 400 beneficiaries -including both men
and women- will be trained, among others. The project will be implemented in two phases. Each
phase will last 15 months. The first phase will begin in the first quarter of 2024 with a total
budget of US$ 291,439, comprising an ITTO contribution of US$ 166,847, to be provided by
the Government of Japan, and a contribution of US$ 124,592 from the National Forestry
Chamber (CNF).
EXECUTING AGENCY:

NATIONAL FORESTRY CHAMBER (CNF)

DURATION:

30 MONTHS

BUDGET AND PROPOSEDFUNDING SOURCES:

Source
ITTO
CNF
TOTAL

Contribution in
US$
Total
372,553
287,428
659,981Phase 1
166,847
124,592
291,439

Phase 2
205,706
162,836
368,542

Table of contents
PROJECT BRIEF ..................................................................................................................................................ii
ACRONYMS AND ABBREVIATIONS ..................................................................................................................v
MAP OF PROJECT AREA...................................................................................................................................vi
PART 1. PROJECT CONTEXT ............................................................................................................................1

1.1 Origin ................................................................................................................................................ 1
1.2 Relevance ......................................................................................................................................... 1
1.2.1 Conformity with ITTO’s objectives and priorities ....................................................................... 1
1.2.2 Relevance to submitting country’s policies ............................................................................... 2
1.3 Target area ....................................................................................................................................... 3
1.3.1 Geographic location .................................................................................................................. 3
1.3.2 Economic, environmental, cultural and social aspects ............................................................. 4
1.4 Expected outcomes at project completion ........................................................................................ 5
PART 2. PROJECT RATIONALE AND OBJECTIVES .......................................................................................6
2.1 Rationale ........................................................................................................................................... 6
2.1.1 Institutional set-up and organizational issues ........................................................................... 6
2.1.2 Stakeholder analysis ................................................................................................................. 8
2.1.3 Problem analysis ..................................................................................................................... 13
2.1.4 Logical Framework Matrix ....................................................................................................... 16
2.2 Objectives ............................................................................................................................... 19
2.2.1 Development objective and impact indicators ........................................................................ 20
2.2.2 Specific objective and outcome indicators .............................................................................. 20
PART 3. DESCRIPTION OF PROJECT INTERVENTIONS ..............................................................................21
3.1 Outputs and Activities ..................................................................................................................... 21
3.1.1 Outputs .................................................................................................................................... 21
3.1.2 Activities .................................................................................................................................. 22
3.2 Implementation approaches and methods ..................................................................................... 24
3.3 Work Plan ....................................................................................................................................... 26
3.4 Budget............................................................................................................................................. 27
3.4.1 Master budget schedule .......................................................................................................... 27
3.4.2 Consolidated budget by component (US$) ............................................................................. 39
3.4.3 ITTO budget by component (US$) .......................................................................................... 41
3.4.4 Executing agency budget by component ................................................................................ 42
3.5 Assumptions, risks and sustainability ............................................................................................. 43
3.5.1 Assumptions and risks ............................................................................................................ 43
3.5.2 Sustainability ........................................................................................................................... 43
PART 4. IMPLEMENTATION ARRANGEMENTS .............................................................................................44
4.1 Organization structure and stakeholder involvement mechanisms ................................................44
4.1.1 Executing agency and partners .............................................................................................. 44
4.1.2 Project management team ...................................................................................................... 44
4.1.3 Project Steering Committee .................................................................................................... 44
4.1.4 Stakeholder involvement mechanisms ................................................................................... 44
4.2 Reporting, review, monitoring and evaluation ................................................................................ 46
4.3 Dissemination and mainstreaming of project learning .................................................................... 47
4.3.1
Dissemination of project results .............................................................................................. 47
4.3.2 Mainstreaming of project learning ........................................................................................... 47
ANNEX 1. Profile of the executing agency ......................................................................................................48
ANNEX 2. Tasks and responsibilities of key experts provided by CNF .......................................................50
ANNEX 3. Terms of reference of personnel funded by ITTO .........................................................................51
ANNEX 4. Micro, small and medium forest industry enterprises in Peru –2019 .........................................56
ANNEX 5. Recommendations of ITTO Expert Panel.......................................................................................57
ANNEX 6. Financing provided for project PD 912/20 Rev. 2 (I) .....................................................................59
ANNEX 7. Submission of the modifications to PD 912/20 Rev. 2 (I) .............................................................60-i-

PROJECT BRIEF
Peru has large areas of natural forests, with the second largest Amazon forest area in South America which
covers a total of 69,020,330 hectares, and these forests are characterized by high diversity of forest species
and by high volumes of potentially harvestable species whose timber can be processed and marketed.
However, processing companies only use a few species and operate with serious weaknesses as they havenot developed sufficient capacity in the industrial forest sector. This is the case with forest MSMEs (micro andsmall enterprises), which together account for 99.8% of national forest enterprises (2019). In this context, thekey problem identified is the weak technical and business management of the timber industry that relies onnative species from the Peruvian Amazon Region. Identified causes to be addressed include the limited
interaction between timber industries and forest producers, including forest concessions and native
communities; forest enterprises are not appropriately linked to national and international timber productmarkets; poor production organization of timber processing enterprises; and poor organization of timberindustry producers. This causes a series of negative effects in the forest production system, for enterprises
and especially for the population that depends on forest resources for its livelihood and development. These
include a high degree of informality and illegality in the trade of timber products, accelerated negative growthof the country's timber product trade balance, reduced participation in timber product value chains, loss ofmarket share to alternative products and exotic timber species, and limited access to markets for processedand semi-processed products. Furthermore, there are many business opportunities that are not identified andthat are therefore missed and there is low productivity and competitiveness in the timber production sector
with high production costs and low levels of capitalization in timber enterprises. In general terms, this problem
is hindering the development of the forest economy in the country and contributing to the low quality of life of
the communities that depend on forest resources for their livelihoods.
In order to address this problem, the following development objective is proposed: “Contribute to thesustainable development of the country's timber industry, promoting formal, efficient and competitive marketoriented forest enterprises, taking advantage of business opportunities articulated with value chains, andmarketing products based on the use of timber from legal sources in managed forests in the Amazon Regionof Peru for the benefit of Peruvian society and, in particular, the men and women that depend on the forest for
their livelihoods”. The achievement of this objective will be measured through the following indicators:
•
•
•
•
•
•
•

40 enterprises are producing and marketing processed or semi-processed timber products sourced fromlegally managed forests
Timber product trade balance improved 10% annually
10% annual increase in exports of timber products sourced from Amazon forests
Amazon forest production articulated with 4 timber value chains
5 new or lesser-known forest species from the Amazon Region are introduced into the market
40 timber enterprises increase their income and capitalization levels
160 families improve their quality of life.

The project specific objective is to “strengthen the technical and business management of the forest industry
that relies on timber species from the Peruvian Amazon Region”. The achievement of this objective will bereflected in the following indicators:
•
•
•
•
•
•

40 timber enterprises improve their competitiveness40 timber processing enterprises use chain of custody, timber traceability and/or logbooks in theirproduction and/or marketing processes
20 timber enterprises use due diligence mechanisms for the acquisition of legally sourced timber
40 people, inc. 30% women, are trained in the marketing of timber products
20 new forest business opportunities are disseminated and taken advantage of with project support
400 people, inc. 30% women, strengthen their technical capacities in business management of the forest
industry.

The primary project beneficiaries will be micro, small and medium enterprises (MSMEs) in the timber
processing industry that market their products for the national and/or export markets, as well as entrepreneurs
and technical and administrative personnel, including both men and women, who participate in the production
and/or management of these enterprises. Micro enterprises have small-scale infrastructure and limited
machinery for wood working and finishing, in addition to poor knowledge of timber markets and poorly qualified
personnel; however, they are interested in improving their technical, production and management capacities.
Small enterprises usually have resawing, wood working and finishing infrastructure but have little knowledgeof timber markets, obsolete machinery and poorly qualified personnel; their main interest is to improve their
supply of timber products according to market requirements. Medium enterprises usually have wood sawing,-ii-

resawing, working, finishing and drying infrastructure, but little knowledge of timber markets and they process
a limited number of species and have poorly qualified personnel and obsolete machinery. However, they areinterested in improving their production capacity and are willing to improve their processing and to apply
business strategies, as well as improving their market knowledge. Outcomes and outputs expected to beachieved upon project completion include the following:
Output 1:

Timber industries are interacting with forest producers

1 study on the potential of managed forests in Madre de Dios and Ucayali
7 training workshops on forest potential in managed forests
140 people trained on the potential of managed forests, inc. 30% women
4 awareness-raising events on forest conservation and sustainable forest management for timber
processing industries• 40 timber processing enterprises are interrelated with other timber companies in Lima, Madre de Dios andUcayali• 160 technical assistance provided to enterprises in forest certification, chain of custody, timber traceability
and operational logbooks

•
•
•
•

Output 2.

Forest enterprises are linked to national and international markets for timber products• 1 due diligence mechanism on the acquisition of legal timber identified, promoted and implemented• 8 training workshops on the use of due diligence mechanisms for the acquisition of timber of legal origin
and record of stakeholders along the timber value chain• 80 representatives of timber processing companies -inc. 30% women- trained in the application of due
diligence mechanisms• 4 electronic newsletters on prices of timber products and forest production services published• 200 technical assistance services on industrial innovation in timber processing to forest industry managers• 6 market-oriented business plans for timber products developed• 54 technical assistance services provided for the implementation of business plans
Output 3.

The production organization of timber processing companies is efficiently managed• 6 proposals for technological development submitted and promoted to timber companies• 6 workshops on technology and timber production organized• 120 technicians from timber processing companies trained in wood technologies and production processes,
at least 25% women• 6 workshops on business management and production aimed at business leaders• 1 fact-sheet booklet on technological properties and uses of timber species from Peruvian Amazon forests
produced and disseminated by the first half of the second year of the project• 3 dissemination events on the use of tropical timber
Output 4.
•
•
•
•
•
•
•
•
•

The organization of producers in the timber industry has been strengthened

2 forest governance dialogue spaces strengthened
30 forest stakeholders supported to enable their participation in extra-regional dialogue spaces,
30% women
2 fact-sheet booklets on forest regulations produced and disseminated
2 events on forest regulations
80 people trained on forest regulations, 30% women
4 awareness events on the importance of participating in production organizations
40 representatives of timber processing companies sensitized on the importance of participating in
production organizations, 30% women
2 enterprise associations strengthened
5 enterprises have access to financial services

The project will be implemented in cooperation with stakeholders and beneficiaries who are directly or indirectly
involved in improving existing forest production systems, especially in timber processing activities, so as toensure that companies are managed more efficiently and that better use is made of timber from forest species
found in the managed forests of the Amazon region. The project will use a participatory approach (including
both men and women) to achieve its proposed objective, as it will promote participation in the implementationof activities through a shared vision aimed at raising the level of competitiveness of producers and promoting-iii-

the use of mechanisms that will guarantee the legality of timber activities and the sustainable use of forest
resources in the region. The implementation of the project will focus on optimizing the production processesof companies through a market approach and through training and strengthening business strategies that meetthe needs of stakeholders. The project’s intervention strategies are aimed at making information available onforest management plans and species used by the processing industry; strengthening capacities for theefficient management of the production organization of forest enterprises; developing business management
plans geared to timber product markets; strengthening organizations in the forest production sector; and using
a gender equity approach in the implementation of all actions.
There are associations of forest producers in the project’s area of influence that are highly involved andcommitted to working for the sustainable development of the processing industry that uses timber species frommanaged forests. Project objectives and activities are aimed at improving the technical and managerial
efficiency of timber processors that are indeed using native timber species, as this will not only contribute toimproving the quality of life of Amazon communities but will also to contribute to the development of the
Amazon region in general. Thus, project sustainability will be ensured by having highly sensitized
entrepreneurs who will ensure the ongoing sustainability of project outputs. The methodology for knowledgetransfer will be continued by the National Forestry Chamber – CNF by supporting project beneficiaries in thepractical implementation of the knowledge acquired through training, workshops and technical assistanceprovided to timber industry sector stakeholders, especially through their associations.
The main assumptions for the achievement of the development objective include ongoing compliance withlaws and agreements on the implementation of management plans and the origin of timber from legal sources;
stakeholders maintain their interest and support the implementation of the project; and willingness of forest
entrepreneurs to continue promoting positive change to achieve the sustainable development of the industry
by incorporating new forest species in their production processes. The most important risk would be that users
of forest resources do not show willingness to comply with forest legislation, show indifference to demonstratethat the forest products they process and market come from legal sources and are not interested in working
with new forest species. The countermeasures that the project would take would be to carry out awarenesscampaigns to change attitudes and to work with users who abide by the current forest legislation, show interestin applying traceability mechanisms and are willing to process new forest species.
The assumptions for the achievement of the specific objective are that timber industry enterprises maintaintheir openness, are willing to share information and actively participate in project activities. A risk to beconsidered is that part of the private forest business sector could be reluctant to provide and share information.
If this situation were to arise, other sources such as forest authorities would be used
Assumptions related to project outputs include their willingness to improve productivity; willingness of
producers and industrialists to share information and interact; maintaining their interest in training and in theuse the project outputs; active participation of entrepreneurs in their organizations and in dialogue spaces;
while in relation to forest authorities, the assumption is an ongoing interest in promoting mechanisms toguarantee the legality of timber. The most important risks are that entrepreneurs show little interest in improving
their productivity and receiving training and are indifferent to the outcomes of project activities; and that forest
authorities do not to continue promoting the use of mechanisms to guarantee the legality of timber. To mitigate
these potential risks, the project would implement awareness raising campaigns addressed to timber
processors, working with proactive entrepreneurs and promoting voluntary mechanisms from the private sector
to guarantee the legal origin of timber products.
The overall project budget is US$ 659,981, comprising a contribution of US$ 287,428 from the executing
agency (equivalent to 44% of the total budget) and an ITTO contribution of US$ 372,553 (equivalent to 56%of the total budget). Out of the ITTO budget, 54% (or US$ 199,800) is allocated to personnel costs, while
capital items account for 1% or US$3,300.

The project will be implemented in two phases. Each phase will last 15 months. The firstphase will begin in the first quarter of 2024 with a total budget of US$ 291,439, comprising an
ITTO contribution of US$ 166,847 (57.2%), to be provided by the Government of Japan, and acontribution of US$ 124,592 (42.8%) from the National Forestry Chamber (CNF). The total
budget for the implementation of the second phase is US$ 368,542, comprising a contributionof US$ 205,706 (55.8%) from ITTO and US$ 162,836 (44.2%) from the CNF.

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ACRONYMS AND ABBREVIATIONS
ADEX
AEMRU
AGRORURAL
AIDER
AMDU
APROFUBCRPCAPECOCITEMadera
CNF
Conafor-PERÚ
DAM
EAP
GDP
GORE´s
GVA
INEI
INIA
ITTO
M&SMEsMEF
MINAGRIMINCETUR
MINEDU
MINEM
MINSA
MSEs
MVCS
NGO
OSINFORPRODUCE
PROMPERÚSERFOR
SMEs
SUNAT
TU
UNALM
YPO

Asociación de Exportadores (Exporters Association)
Asociación de Extractores Madereros y Reforestadores de la Región de Ucayali (Timber
Logging and Reforestation Association of the Ucayali Region)
Programa de Desarrollo Productivo Agrario Rural (Programme for Rural Agrarian
Production Development)
Asociación para la Investigación y el Desarrollo Integral (Association for Integrated
Research and Development)
Asociación de Madereros del Departamento de Ucayali (Timber Producers Association of
the Department of Ucayali)
Asociación de Productores Forestales de Ucayali (Forest Producers Association of
Ucayali)
Banco Central de Reserva del Perú (Central Reserve Bank of Peru)
Cámara Peruana de la Construcción (Peruvian Construction Chamber)Centro de Innovación Tecnológica de la Madera (Center for Wood Technology
Innovation)
Cámara Nacional Forestal (National Forestry Chamber)
Confederación Nacional Forestal del Perú (National Forest Confederation of Peru)
Declaración Aduanera de Mercancías (Customs Declaration of Goods)
Economically active population
Gross domestic productGobiernos regionales (Regional governments)
Gross value added
Instituto Nacional de Estadística e Informática (National Institute of Statistics andInformation Technology)
Instituto Nacional de Innovación Agraria (National Institute for Agrarian Innovation)
International Tropical Timber Organization
Micro, small and medium enterprises
Ministerio de Economía y Finanzas (Ministry of Economy and Finance)
Ministerio de Agricultura y Riego (Ministry of Agriculture and Irrigation)
Ministerio de Comercio Exterior y Turismo (Ministry of Foreign Trade and Tourism)
Ministerio de Educación (Ministry of Education)
Ministerio de Energía y Minas (Ministry of Energy and Mining)
Ministerio de Salud (Ministry of Health)Micro and small enterprises
Ministerio de Vivienda, Construcción y Saneamiento (Ministry of Housing, Construction andSanitation)
Non-governmental organization
Organismo de Supervisión de Recursos Forestales Maderables (Timber Forest
Resources Supervisory Agency)
Ministerio de la Producción (Ministry of Production)
Comisión de promoción del Perú para la exportación y el turismo (Export and Tourism
Promotion Commission of Peru)
Servicio Nacional Forestal y de Fauna Silvestre (National Forest and Wildlife Service)
Small and medium enterprises
Superintendencia Nacional de Administración Tributaria (National Tax Administration
Department)
Taxable unit
Universidad Nacional Agraria La Molina (National Agrarian University of La Molina)
Yearly plan of operation-v-

MAP OF PROJECT AREA

-vi-

PART 1. PROJECT CONTEXT
1.1

OriginThis project proposal draws on the various projects implemented by the CNF in cooperation with national
forestry authorities (INRENA, National General Forest and Wildlife Directorate and SERFOR) and with thetechnical and financial support of ITTO, as follows:
•

•

•

•

1990 – 1993: PD 37/88 Rev.3 (I) “Industrial utilization of new forest species in Peru”. This project
developed technical fact-sheets for 23 species, describing different aspects of the species from theidentification of trees in the forest to the end uses of harvested timber, including major timber processing
features.
2004 – 2006: PD 23/00 Rev. 4 (F) “Promotion and Transfer of Knowledge on Sustainable Forest
Management Models to Timber Producers”. Among other actions, training was developed and provided
through 12 forest education modules mainly aimed at forest concessionaires that were just starting to
implement forest management plans required by the newly enforced legislation of the time; one of themodules focused on forest product marketing and markets.
2007 – 2010: PD 421/06 Rev. 2 (F) “Strengthening of the production chain for timber from forest
concessions and other forests under management”. This project developed business plans using aparticipatory approach with participating entrepreneurs, with a view to improving their understanding of
how to conduct more articulated businesses based on their knowledge of market requirements and thegreat production potential of managed forests (forestry potential), especially lesser-known species, aswell as the significance of producing an increasing number of higher value-added products. It wasunderstood that the harvesting of timber from officially managed forests is a business mechanism topromote timber exports, but it requires support for small and medium producers to expand the export
supply of Peruvian timber to international markets, which would benefit the communities involved inforestry activities. During the implementation of the project, it was observed that entrepreneurs, directors,
executives and other decision-making personnel of participating companies had serious deficiencies inmanagerial aspects that needed to be addressed for better business management.
2012 – 2016: As a result of its previous experiences, CNF developed and implemented two projects –PD 540/09 Rev. 2 (I) “Support to improve the productivity of the Peruvian timber industry for the productionof higher value-added products” and PD 621/11 Rev.3 (M) "Traceability of timber produced by forest
concessions and native communities in Madre de Dios and Ucayali".

Based on the experience of its technical and managerial team, particularly from the projects already
implemented, CNF has identified that forest producers, mainly comprising forest concessionaires and native
communities, as well as timber processors, have limited technical and managerial capacity to manage theircompanies efficiently, using very little timber volume in relation to the forestry potential of Amazon forests, andthat even though a larger number of timber species have already entered the market, the harvesting of species
and timber yield levels continue to be low in relation to existing potential.
Against this background and considering the mega trends of market globalization, the growing preference for
ecological products, more demanding and environmentally concerned consumers, and fast technologicaldevelopments, all forest production activities must demonstrate the legal origin of forest products under theForest and Wildlife Law in order to contribute to sustainable forest harvesting and improved forest businesses
for the strengthening of forest producers and the timber industry. Thus, CNF’s technical team, in cooperation
with forest sector stakeholders, proposed to develop this project to strengthen technical and business
management in the forest industry based on timber harvested from the Peruvian Amazon Region.
1.2
1.2.1

Relevance
Conformity with ITTO’s objectives and priorities

This project proposal is consistent with the overall objective of ITTO (as set out in Article 1 of the ITTA 2006)
i.e. to promote the expansion and diversification of international trade and to promote the sustainable
management of tropical timber producing forests, as described below:•

The proposed project will promote strategies for achieving exports of timber products from sustainably
managed sources (Objective d).

-1-

•
•
•
•
•
•

Furthermore, the project will promote improved understanding of the conditions in international markets
as well as consumer preferences (Objective e).
Market intelligence will be improved by providing data on prices and marketed species (Objective h).
The project will encourage better organized processing so as to foster better use of raw materials andthus promote efficient industrialization, thereby increasing employment opportunities and export earnings(Objectives i).
The project will improve marketing and distribution of timber exports from sustainably managed sources
as well as legal trade (Objective k).
The project will encourage information sharing for a better understanding of voluntary mechanisms suchas certification of managed forests (Objective o).
The project will strengthen capacities to improve forest law enforcement and governance and willcontribute to the reduction of illegal logging and related timber trade (Objective n).

Moreover, this project is consistent with the priorities established in the ITTO Action Plan 2008-2011. The main
aspects considered in the proposal are as follows:•••

Assisting forest industry enterprises to develop their organizational, leadership, management andmarketing skills by increasing forest sector production. ITTO is also constantly working on strategies toincrease efficiency in the processing and marketing activities of forest enterprises, thereby generating
incentives and funding for sustainable forest management (Strategic priority 2).
Promoting the use of a wide range of tropical timber species from forests under sustainable management.
The sustainability of forest biodiversity depends on the ability to improve the use of species through thesustainable management generated by products and services (Strategic priority 3).
Assisting enterprises to develop capacities to enhance trade in forest goods and services from sustainably
managed forests (Strategic priority 6).

1.2.2

Relevance to submitting country’s policies

The project complies with the principles and objectives of the National Forest Policy, approved in 2013, relating
to the following guidelines for each policy area:•

Policy area 1: Institutional framework and governance. In accordance with guidelines “2g. Strengtheningof capacities of public and private stakeholders, in order to facilitate their informed, proactive participation
in forest management" and "2h. Implementation of a multi-user, interconnected, efficient, accessible anduser-friendly national information system to enable the collection, systematization, management anddissemination of information on the forest sector", the project will generate useful and available
information to be shared with various users in both the public and private sectors.

•

Policy area 2: Sustainability. In accordance with guideline "1a. Promoting the diversified and integrated
use of the national forest resource base", the project will promote the harvesting of a larger number offorest species and the diversification of both timber and non-timber forest products and benefits as well
as forest environmental services with marketing potential. According to guideline "1e. Promoting trade inforest products under legal and sustainable harvesting, marketing and traceability systems", the projectwill promote the marketing of forest products of legal origin from sustainable sources.

•

Policy area 3: Competitiveness. According to guideline "f. Development of a forest value chain that favours
the integrity of all processes and stakeholders in the business sector", project actions will strengthen thevalue chain of timber and non-timber products, providing updated market and marketing information alongeach of the links of the value chain.

•

Policy area 5: Knowledge, science and technology. In accordance with guideline "1a. Capacity buildingin public and private institutions related to the forest sector so as to promote the competitiveness of
production activities and high value-added processing”, the project will carry out events to build thecapacities of various stakeholders involved in forest activities in both the production and commercial
sectors, as well as public servants. The project is also consistent with guideline "2d. Analysis of markets,
production chains and demand requirements for new or lesser-known species with potential forsustainable harvesting" as it will implement market surveys with an analytical focus on the supply anddemand of forest products and services along the value chain, considering the forestry potential of lesserknown species.

The following project-related activities are provided for under the Forest and Wildlife Law – Act No. 29763(Art. 131):

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•
•

Diversified and integrated harvesting of forest resources, seeking optimum use of a larger number of
species and their integration into the production chain (item a).
Access to technology, training, technical assistance, information and markets (item d).

The project is also related to the guidelines of the Agrarian Policy in terms of forest development and accessto markets and production chains. It will collect information that will enable producers to diversify their products
and services, and reach previously unknown markets, thus promoting forest development in the country.
The National Plan for Production Diversification, presented in 2014 by the Ministry of Production (PRODUCE),
is divided into three policy areas: production diversification, reduction of cost overruns and regulations, andproductivity enhancement. The most important factor in the development of these policy areas is to understandthe market.
The Ministry of Foreign Trade and Tourism – MINCETUR has established the National Strategic Export
Plan 2025 – PENX. As part of the government policy, this Plan focuses its strategy on four pillars: theinternationalization of enterprises and market diversification; diversified, competitive and sustainable export
supply; foreign trade facilitation and efficiency in the logistic chain; and finally, capacity building for globalizationand consolidation of an export culture.
In their strategic plans, the regional governments of Madre de Dios and Ucayali state the need to "enable theindustrial processing of natural and other resources generating higher value-added for export"; the objectivesof the regional governments are in line with ITTO objectives "i" and "k".
1.3
1.3.1

Target area
Geographic location

The project’s target area will be strategically located in the Amazon departments of Ucayali and Madre de Dios
and in Lima, the capital of the Republic of Peru. These two Amazon departments together produce 40% of thenational sawnwood production, with 845 companies participating in the timber processing industry, that are
the main suppliers of timber products for the national and international markets. On the other hand, thedepartment of Lima is the main market for domestic consumption of timber products as well as the mostimportant export hub for the international market, as it is home to the largest group of national exporters. The
following table describes the project area.
Geographic location of the project area
Department

Ucayali

Madre de Dios

Lima

Description
Located in the central-eastern tropical forest area of Peru, between geographicalcoordinates 07º20' and 11º27' latitude south and 70º29' and 75º58' longitude
west. It has a total area of 102,411 km2, which accounts for 7.9% of the national
territory and 13.8% of the country’s tropical forest region. Its capital is the city of
Pucallpa, located at 154 meters above sea level and 842 km from the city of Lima,on the left bank of the Ucayali River. Its climate is warm and humid. It has apopulation of 496,459 (50.5% men and 49.5% women).
Located in the south-eastern region of Peru, between geographical coordinates
9º55' and 13º20' latitude south, and 68º39' and 72º23' longitude west. It has atotal area of 85,301 km2, which accounts for 6.6% of the national territory and11.6% of the country’s tropical forest region. Its capital is Puerto Maldonado
located at 139 meters above sea level and 2,024 km from the city of Lima. It has
a warm and humid tropical climate. This region has a population of 141,070(52.3% men and 47.7% women).
Located in the central-western region of the Peru, it covers both inter-Andean andcoastal areas, between geographical coordinates 10º16' and 13º19' latitude southand 75º30' and 77º53' longitude west. It covers a land area of 34,801 km2 that
accounts for 2.7% of the national territory. It has an estimated population of
9,485,405 (51.2% women and 48.8% men) and its capital is the city of Lima.

-3-

1.3.2

Economic, environmental, cultural and social aspects

Social, cultural and economic aspects
The population of Peru in 2017 was 31,237,385 with an annual growth rate of 1.01%. It is therefore estimatedthat by 2020 the country’s population will increase to 32,83,909. Likewise, the BCRP indicates that Peru’s GDP
increased by 2.16% last year (2019), in line with the growth trends of the past 5 years.
In 2017, the average monthly per capita income was US$ 333 for the department of Ucayali with a wage gap
between men and women of 30.2%, equivalent to US$ 100.6; for Madre de Dios it was US$ 476 with a wage
gap of 37.9%, equivalent to US$ 180; and for the department of Lima it was US$ 549 with a wage gap of
28.2%, equivalent to US$ 155. In 2019, the employability and salaries of women in the formal sector is reported
to have increased by 4% and 2,8%, respectively.
In 2017, economically active population (EAP) was 201,512 (63.0% men and 37.0% women) in the departmentof Ucayali, 67,301 (63.4% men and 36.6% women) in the department of Madre de Dios, and 4,137,455 (57.0%
men and 43.0% women) in the city of Lima. In forest sector enterprises, women represent 15% of the total
operational staff and 45% of the total administrative staff.
According to INEI reports, the activities that contribute most to Gross Value Added (GVA) in the departmentof Ucayali are trade (US$ 211 million) followed by manufacturing (US$ 170 million) and then agricultural,
livestock, hunting and forest activities, which are directly related to the harvesting, processing and marketingof timber (US$ 116 million). In Madre de Dios, the activities that contribute most to GVA are mining (US$ 269
million) followed by trade, agriculture, livestock ranching, hunting and forestry, and manufacturing (US$ 32
million, US$ 46 million and US$ 32 million, respectively). As can be clearly seen, forestry is a particularly
important economic activity in the departments of Ucayali and Madre de Dios, not only because of the trade it
generates, but also because of the number of people employed throughout the timber production chain. On
the other hand, the profitability for these businesses increases when timber is efficiently used by giving a higher
value added to the product and it is directed to the country’s main markets, including both national (Lima andArequipa) and international markets. In forest production activities, the main role of women is focused on thequality control of wood products, due to their meticulous work skills and attention to detail, while the role ofmen is centered mostly on business management and field work.
The project will promote the increased participation of women and the enhancement of their role as key
stakeholders, which is in line with and reinforces ITTO’s Policy Guidelines on Gender Equality and the
Empowerment of Women (GEEW).
According to CITEmadera, in 2015 there were 24,495 enterprises throughout Peru involved in timber forestry
activities. Out of this total, 96.28% were micro enterprises, 3.45% small enterprises, 0.11% medium enterprises
and 0.15% large enterprises. The total national turnover was US$ 1,385 million, distributed as follows: medium
and large enterprises (which only represent 0.26% of the national total) had a turnover of US$ 568 million(41.0%); while the sum of all micro and small enterprises only had a turnover of US$ 831 million, despite thelarge number of this type of enterprises in the country (99.74%). However, for 2019, SUNAT reported that
there were 806 forest enterprises in the department of Ucayali and 701 in Madre de Dios. Annex 4 shows this
distribution.
Environmental aspects
The departments of Ucayali and Madre de Dios have extensive forested areas, which are part of the tropicalrainforests of the Peruvian Amazon region. Ucayali has a total forested area of 9,336,773 ha, equivalent to91.4% of its land area and Madre de Dios has a total of 7,905,744 ha, equivalent to 92.7% of its land area.
One of the main problems for both departments is the loss of forests, particularly through land-use changes.
In the 2001–2018 period, a total of 384,474 ha was deforested in the department of Ucayali (3.8% of its landarea) and 209,733 ha in the department of Madre de Dios (2.5% of its land area).
According to forest inventories conducted by INRENA in 2003 over 3,349,511 ha of production forests in
Ucayali and 2,285,448 ha of Permanent Production Forests (PPF) in Madre de Dios, a total volume of
127.3 m3/ha was reported for Ucayali and 181.8 m3/ha for Madre de Dios. Species volumes reported in Ucayali
are as follows: cedar (0.8 m3/ha); lupuna (6.7 m3/ha), shihuahuaco (5.7 m3/ha), quinilla (5.0 m3/ha), moena(2.5 m3/ha), tahuarí (2. 2 m3/ha), ishpingo (1.3 m3/ha), copaiba (9.1 m3/ha), catahua (6.1m3/ha), cumala(5.5 m3/ha, manchinga (5.0 m3/ha), mashonaste (3.2 m3/ha), pashaco (2.1 m3/ha), among other species. For
Madre de Dios the species were: cedar (0.8 m3/ha) shihuahuaco (7.7 m3/ha), lupuna (5.8 m3/ha), quinilla-4-

(5.7 m3/ha), moena (3.9 m3/ha, tahuarí (2. 2 m3/ha), manchinga (10.6 m3/ha), mashonaste (4.1 m3/ha), renaco(3.8 m3/ha), cumala (3.3 m3/ha), ana caspi (2.7 m3/ha), and itauba (1.6 m3/ha), among others.
Timber processing enterprises in the department of Ucayali are mainly located in the provinces of Coronel
Portillo (in the city of Pucallpa) and Padre Abad. In Madre de Dios, they are located in the provinces of
Tambopata (in the city of Puerto Maldonado) and Tahuamanu.
The project is aligned and consistent with the principles and regulations of the ITTO Environmental and Social
Management Guidelines, especially those related to the forest industry, such as Environmental and SocialStandard - ESS 7: Forest product production and processing (wood and non-wood).
1.4

Expected outcomes at project completion

The following outcomes will have been achieved at project completion:
•

•
•
•

Timber processing companies are more efficient in the management of their enterprises, in both technicaland business aspects, harvesting a larger number of forest species, obtaining better yields from raw
materials, increasing their income and improving their levels of capitalization. As a result, forest producers(concessionaires and native communities) are managing their forests, after having increased the numberof species harvested, thus obtaining a greater volume of timber per hectare.
Enterprises are working with legally sourced timber and are using traceability mechanisms and tools intheir supply and processing chains to guarantee legality.
Families involved in the forest sector have better quality of life and are represented in forest governance,
and women are actively participating in the sector.
Relatively speaking, the country has improved in terms of exports of forest products and its trade balance,
using timber species from the Peruvian Amazon region.

This will include the following:
•
•
•
•
•
•

40 timber companies improve their competitiveness40 timber processing companies use chain of custody, timber traceability and/or logbook registration
methods in their production and/or marketing processes
20 logging companies use due diligence mechanisms for the acquisition of legally sourced timber
40 people (at least 30% women) are trained in timber product marketing techniques
20 new forest business opportunities are identified and implemented with project intervention
400 people (at least 30% women) strengthen their business management skills in the forest industry
sector-5-

PART 2. PROJECT RATIONALE AND OBJECTIVES
2.1
2.1.1

Rationale
Institutional set-up and organizational issues

Based on the profile of the Project, the institutional set-up for its implementation will be made up of a privateorganization and a public agency related to the forest sector, as described below.
National Forestry Chamber – CNF
The CNF was established more than 30 years ago and it was officially recognized by the Ministry of Agriculture
through Ministerial Resolution No. 00321-89-AG of 20 September 1989, as a private organization representing
the timber sector before public institutions and agencies of the agricultural, industrial and export sectors. Its
membership includes: the National Confederation of Micro and Small Enterprise Associations (Confederación
Nacional de Gremios de la Micro y Pequeña Empresa -- CONAMYPE); Small and Medium Forest Producers
and Industrialists Association of Peru (Asociación Forestal de Pequeños y Medianos Productores y
Empresarios del Perú -- AFORPYME); Timber Producers Association of the Department of Ucayali (Asociaciónde Madereros del Departamento de Ucayali -- AMDU); Timber Logging and Reforestation Association of the
Ucayali Region (Asociación de Extractores Madereros y Reforestadores de la Región de Ucayali -- AEMRU);
Peruvian Environmental Network (Red Ambiental Peruana -- RAP); Association for Integrated Research andDevelopment (Asociación para la Investigación y el Desarrollo Integral -- AIDER); Peruvian Foundation for theConservation of Nature (Fundación Peruana para la Conservación de la Naturaleza -- PRO NATURALEZA);
Peruvian Society of Engineers (Colegio de Ingenieros del Perú -- CIP); Peruvian Association of Forest
Engineers (Asociación Peruana de Ingenieros Forestales -- APIF); National Agrarian University of La Molina(Universidad Nacional Agraria La Molina -- UNALM); Civil Association for Forest Development (Asociación
Civil para el Desarrollo Forestal -- FORESTAS); AIDESEP Regional Organization, Ucayali – ORAU; theConsultancy Firm PERUFOREST S.A.; and the company Bosque, Agua, Cultura y Vida SRL.
The National Forestry Chamber will be the executing agency of this project. The CNF represents the private
sector and serves as a platform for the interaction of its members and representative organizations of timber
producers in the main regions of the project’s area of action. The role of the CNF, as a non-profit civil
association, is consistent with its institutional objective of promoting the sustainable development of the forest
sector, harmonizing conservation principles with scientific, technological and socioeconomic development. Its
functions are:
•
•
•
•
•
•

Promoting the sustainable use of forest resources, harmonizing the principles of conservation withtechnology and economic and social development.
Coordinating national forest activities and acting as the main interlocutor of the private forest sector before
public and private institutions and agencies.
Proposing and achieving efficient and stable forest policies to encourage forest management, industry,
trade and the promotion of exports.
Building up and disseminating an adequate image of the forest activity at the national level consistent withthe magnitude of the resource and its territorial significance.
Providing feedback/making statements on issues of national interest.
Designing and implementing research, training and development projects related to forestry.

The CNF, as the executing agency, will be responsible for the institutional communication and coordination of
the project. At the beginning of project implementation, a communication plan will be developed and the CNF
will designate a professional who will coordinate its implementation. Communication and outreach activities
will be carried out both externally, prioritizing the project’s target beneficiaries and other stakeholders linked toforest activities, and internally, among the members of the institution and its staff. Project activities, as well as
project outputs, topics of interest, opinions, etc. will be disseminated through the Internet, the institutional web
portal, emails, as well as through the use of social media networks, such as Facebook and WhatsApp, among
others, which will ensure a fluid, fast, powerful and low cost communication process. Video conference
platforms will also be used.
The expertise of the CNF as an executing agency stems from the fact that it is a non-profit forestry association,
representative of the forest sector and composed of a number of forest-related institutions, such as forest
production associations, environmental and development NGOs, academia and organizations of forest
engineers and indigenous communities, among others. It promotes sustainable forest development in the
country and participates in various spaces and fora where technical and political issues of national importance-6-

are discussed. The CNF has executed a series of projects, in the areas of both forest management and forest
industries, including six ITTO-sponsored projects and one support activity for the 5th Latin American Forestry
Congress, organized by the CNF, in close cooperation with the National Forest Authorities (SERFOR and the
Natural Resources Institute), all of which have culminated satisfactorily, mainly benefiting national
stakeholders in forest production activities (Annex 1).
National Forest and Wildlife Service – SERFORThe National Forest and Wildlife Service – SERFOR is responsible for proposing policies, strategies,
regulations, plans, programs and national projects related to the sustainable harvesting of forest and wildlife
resources and associated genetic resources in consonance with the National Environmental Policy andenvironmental regulations. Its functions include the development of proposals for policies, regulations, plans,
programs, strategies and projects for the management, control, administration and promotion of theconservation and sustainable harvesting of forest and wildlife resources, as well as taking actions for the
implementation of national and international agreements and commitments signed by Peru in the field ofconservation and sustainable utilization of wild fauna and flora in coordination with the foreign trade sector.

-7-2.1.2

Stakeholder analysis

Stakeholder group

Characteristics

Problems, needs,interests

Strengths

Involvement in
the projectPrimary stakeholders

Micro timberenterprises

Small timberenterprises

Medium timberenterprises

They havesmall-scale
infrastructure
and limited
machinery forwood working
and finishing.
Widelydispersed andvolatile (shortlived)
companies, staff
generally remainin the timberindustry
They have wood
resawing,
working andfinishinginfrastructure.
Limitedknowledge andinterest about
the legal originof the raw
materials(timber).
They have wood
sawing,resawing,
working,finishing anddryinginfrastructure.
There is only asmall number of
mediumenterprises.
However, they
have more
personnel andbetter raw
materials(timber)
processing
practices andcan serve as amodel for thedevelopment of
small
enterprises.

Poor knowledge oftimber productmarkets, utilizationof a very limited
number of forest
species, lowcompetitiveness,
obsoletemachinery andpoorly qualified
personnel

Interested in
improving theirtechnical,
production andmanagement
capacities

Primary projectstakeholders.
Primary source of
information.
The greatest
number of
microenterprises
will be identified,
and their
formalization andparticipation inassociations will
be promoted.
Their production
capacities will bestrengthened

Little knowledge oftimber productmarkets, utilizationof a very limited
number of forest
species, lowcompetitiveness,poorly qualified
personnel andobsoletemachineryInterested inincreasing the
supply of timber
products according
to market
requirements anddemands
Willingness toimprove businesscompetitivenessPrimary projectstakeholders.
Primary source of
information.
Awareness andtraining on thebenefits ofprocessing legallysourced timber
will be provided

Little knowledge oftimber productmarkets. Limited
use of forest
species. Poorly
qualifiedpersonnel andobsoletemachinery.

Interested in
improvingproduction capacity
Willingness toimprove theirprocessing and to
apply businessstrategies.
Willingness toimprove market
knowledge.

Primary projectstakeholders.
Primary source of
information
The project will
strengthen the
production
capacities ofthese enterprises
together withthose of small
enterprises.

-8-

Stakeholder group

Timber productexporting companies

Forestconcessionaires

Producer
associations: AEMRU,
AMDU, APROFU,
CONAFOR-PERÚ,Cámara de Segunda
Transf. de Ucayali(Secondary Process.
Assoc. of Ucayali)
Asociación deMueblería Sr. de
Coylloriti (Furniture
Makers’ Association)

Characteristics
They conduct
foreign trade.
They areinterested inincreasing
export volumes.
However, they
have limited
interest inaligning withsustainable
forestmanagement.
They control
extensive areasof forest and aretimber loggers.
In some cases,
they have theirown sawing
machinery.
They areresponsible for
implementing
forestmanagement,
they know about
production
methods in theforest, but there
is limited
articulation withthe rest of the
production
chain.
These organizedgroups havepotential topromote moreassociations.
The participationof these
associations isvital for the
implementationof the project
strategy aimed
at reachingtargetbeneficiaries,
however, they
are currently
weakened.

Problems, needs,interests

Insufficient supplyof timber andtimber productsthat meetinternational
market standards

Low capacity for
integrated forest
use, limiting
logging to a
reduced numberof forest species
and obtaining low
timber yield levels.

Weak leadership
to attract a larger
number ofmembers.

-9-

Strengths

Involvement in
the project

Trust in theinstitutions

Primary projectstakeholders.
Primary source of
information.
Exporters will bemade aware of
the benefits offorestmanagement forconservation andforest production.

Interested inincreasing the
production capacityof forests byfocusing on agreater number of
speciesPrimary
stakeholders, as
forest producers
through theirforestmanagement
activities.
Primary source of
information.
The project willdevelopcapacities basedon theirexperience andstrengthen theirarticulation withother links in thetimber production
chain.

Involved in
facilitating
dialogue,dissemination of
information,organization ofactivities andevents aimed atensuring increased
participation ofmembers, signingof agreements.

Primary
stakeholders
representing
organizations oftimber producers
and processors.
Primary source of
information.
The project will
support actions
on an ongoingbasis tocoordinate andstrengthen
partnerships.

Stakeholder group

Characteristics

Secondary stakeholders
Private organizations: Institutions
ADEX, Chambers of
involved in thecommerce
development ofexportenterprises.
They areinterested inincreasing themarketing offorest products,
but they provide
very limited
support to theforest sector.
Public promotion
Publicorganizations:institutions that
SERFOR, MINAGRI,
help promote the
OSINFOR,
marketing of
PRODUCE,
forest products
PROMPERÚ,for the export
CITEmadera,market.
They organise
CITEforestal
events topromote forest
production
activities.
National publicorganizations that are
timber consumers,such as the following
ministries: MINEM,
MVCS, MINEDU,MINSA)

Publicinstitutions that
promote theacquisition oftimber products
through different
social programs
at the national
level.
National
programs
require large
volumes oflegally sourced
timber, however,they do notprioritise timbersourced from theAmazon region.

Problems, needs,interests

Strengths

Involvement in
the project

To obtain
information onexport demand forforest products

Experience andknowledge about
the requirements ofinternational
markets

Secondary sourceof information.
The project willorganise eventswith these
institutions topromote forest
activities.

Limited knowledge
and experience
about timbertraceability andcontrol to promote
the marketing oftimber products

Knowledge about
negotiations andofficial
requirements forthe transport andmarketing of wood
products.
Promoting national
consumption andexports.

Secondarysources of
information. They
can participate intheimplementation ofsome activities.
The project will
participate in andco-organise forest
related eventswith theseorganizations.

Limited knowledge
on how to use
timber from
Amazon forests insocial programs

Include the use oftimber forconstruction,
furniture making,etc. in their social
programs, taking
into account theavailability of manypotentially suitablespecies inmanaged forests

Secondary sourceof information.
They can promote
the use of lesserknown forest
species.
The project will
promote the useof timber sourced
from managed
forests in the
Amazon region.

-10-

Stakeholder group

Characteristics

GOREs(Regional
Governments)

They contributeto sustainable
integrated
development bypromoting bothpublic andprivateinvestments.
Forestryfunctions andresponsibilities
have beentransferred to
the regional
governments of
Ucayali andMadre de Dios,but they have
limitedcapacities for the
management ofthese resources.
They actively
participate in theimplementationof development
plans.
They contributeto thedevelopment ofregional forest
activities.
However, very
few actions are
aimed at timber
production
activities.

NGOs

Tertiary stakeholders
Other public
institutions: MEF(Ministry of Economy
and Finance)

Through its
national multiannual
programmingand investment
management
system, it guides
the use of public
investment
resources for theprovision ofservices andinfrastructure as
required for thecountry's
development

Problems, needs,interests
They require
technical
assistance toimplement
regional forest
development
policies

Strengths
Forest authorities
with the resources
to promote
development

Involvement in
the project
Secondarystakeholders.
Secondarysources of
information.
The project will
promote joint
activities withthese regional
governments.

Insufficientfinancial resources

Experience indevelopment
activities andfinancialmanagement

Directparticipation inproject activities
aimed at capacity
building among
stakeholders.
The project will
promotecollaborative workand thedevelopment ofsynergies with
these
organizations.

Poor knowledge ofthe national forest
potential tosustainably meettimber needs ofboth national andinternational
markets

Financial resources
are available tosupport the
adoption ofnational social
programs that use
timber as aconstruction
material and in thefurniture industry,
as well as tosupport thepromotion of forest
product exports

Will participate in
the organization
andimplementation of
public investment
workshops andmeetings-11-

Stakeholder group

Characteristics

Financial institutions

Financingsources for local
development

SUNAT

Promotes tax
and customs
compliance

Problems, needs,interests
They lack themeans to financecooperation
activities
Lack of attention
to timberentrepreneurs

Strengths
Experience inproviding loans for
local development
An influential
authority in society

Involvement in
the projectWill participate inareas related tothe provision of
credit facilities
Will cooperate intax related
matters

The primary project beneficiaries will be micro, small and medium enterprises (MSMEs) in the timber
processing industry that market their products for the national and/or export markets, as well as entrepreneurs
and technical and administrative personnel, including both men and women, who participate in the production
and/or management of these enterprises within the project area.

-12-2.1.3

Problem analysis
Problem Tree

Limited market access forprocessed and semiprocessed productsMissed and unidentified
business opportunities

Loss of market share toalternative products and exotic
timber species

Reduced participation in timber
product value chains

Low productivity andcompetitiveness of thetimber production sector

High production costs andpoor capitalization of timberenterprises

Accelerated negative
growth of the country’s
timber product tradebalanceHigh degree of informality
and illegality in the trade oftimber products

Weak technical and business management of the timber industry that relies on native species from the Peruvian Amazon Region

Limited interaction between
timber industries and forest
producers

Weak links established between
forest enterprises and national
and international markets fortimber products

Poor production
organization of timber
processing companies

Weak organization of
producers in the timberindustry

Limited knowledge about
the potential of Amazon
forests

Limited knowledge anddissemination of forest
certification, chain of custody,
traceability systems andoperational logbook data

Limited technologicaldevelopment of timberenterprises

Limited involvement ofpublic and private forest
stakeholders in forest
governance

Limited interest ofindustrialists in sustainable
forest management

Poor reliability of legal originof timber in forest production
and marketing

Poor technical capacity
in timber processing
mills

Weak involvement offorest stakeholders in
dialogue spaces

Poor business
communication between
timber processors andforest producers

Limited commercial
information on the (national
and international) forest
product markets

Limited capacity forbusiness management
and production
processes

Poor knowledge of forest
regulations

Poor diversity of quality forest
products supplied to markets

Poor knowledge about
the physical andmechanical properties
and technologicalapplications of thediversity of forest
species found in the
Amazon region

Forest industrialists have
limited capacity andinterest in establishingpartnerships

Weak implementation oftimber traceability andother control systems(logbooks)

Timber products produced
without due market
orientation-13-

Limited interaction oftimber enterprises withformal and competitive
financial services

Peru has large areas of natural forests, with the second largest Amazon forest area in South America which
covers a total of 69,020,330 hectares, and these forests are characterized by high diversity of forest species
and by high volumes of potentially harvestable species whose timber can be processed and marketed.
However, processing companies only use a few species and operate with serious weaknesses as they havenot developed sufficient capacity in the industrial forest sector. This is the case with forest MSMEs (micro andsmall enterprises), which together account for 99.8% of national forest enterprises (2019). In this context, thekey problem identified is the weak technical and business management of the timber industry that relies onnative species from the Peruvian Amazon Region. Four main causes have been identified as the reasons forthis problem:
Firstly, the limited interaction between timber industries and forest producers, as forest managers harvest theirforests almost without being aware of what the forest industry requires for production to meet the needs oftimber-product markets. Moreover, industrialists have limited knowledge about the full potential of forests. In
other words, they are unaware of the great potential of production forests and little is done to achieve integrated
forest utilization. The common practice is in fact the marketing of only a few species, producing low quality
logs and dimensions that do not optimize yields, with high levels of waste and low efficiency in the production
process, at both the forest and the industrial mill, resulting in an extremely deficient utilization of forest
resources.
The second cause identified is that forest enterprises are not appropriately linked to national and internationaltimber product markets. In general terms, both forest producers and industrialists are poorly informed about
the timber products that are in demand in these markets in terms of quantity, quality, product characteristics,
consumer needs and preferences, new market trends, etc. Normally, timber harvesting and processing
activities are implemented using traditional methodologies, with high production costs, technologies not
adapted to current conditions, and limited implementation of timber traceability systems, which does not allow
the industry to guarantee the legality of timber products. All of this is contributing to the loss of (both national
and international) markets, the introduction of substitute products (melanin boards), an increase of exotic wood
consumption, mainly pine species, an increasingly unfavorable trade balance of timber products for thecountry, etc.
The third cause identified is the poor production organization of timber processing enterprises, as thesecompanies are not well organized in their production or administration and entrepreneurial activities,
demonstrating serious weaknesses in their management structures. These companies are technologicallyoutdated and timber processing mills (sawmills and secondary processing industries) are managed with limited
technical capacity. Furthermore, they have very limited knowledge about the mechanical properties andtechnological applications of the timber they process, as well as on other species they could potentially use.
They only process a limited number of timber species, discarding other species that have great potential andcould be suitable for both the industry and end consumers.
The fourth and final cause identified is the poor organization of timber industry producers due to the limited
involvement of public and private forest stakeholders in forest governance; the weak involvement of forestrelated stakeholders in dialogue spaces; the poor knowledge of forest regulations; the fact that forest
industrialists have limited capacity and interest in establishing partnerships; and the low levels of interaction
between timber enterprises and formal and competitive financial services.
The weak technical and business management skills that characterize the timber industry that relies on native
species from the Peruvian Amazon region (the key problem) causes a series of negative effects in the forest
production system, for enterprises and especially for the population that depends on forest resources for its
livelihood and development. These include a high degree of informality and illegality in the trade of timber
products, accelerated negative growth of the country's timber product trade balance, reduced participation intimber product value chains, loss of market share to alternative products and exotic timber species, and limitedaccess to markets for processed and semi-processed products. Furthermore, there are many business
opportunities that are not identified and that are therefore missed and there is low productivity andcompetitiveness in the timber production sector with high production costs and low levels of capitalization intimber enterprises. In general terms, this problem is hindering the development of the forest economy in the
country and contributing to the low quality of life of the communities that depend on forest resources for theirlivelihoods.

-14-

To address the key problem, the project will ensure that the timber industry that relies on native species fromthe Peruvian Amazon region is both technically and entrepreneurially managed in an efficient manner. To thisend, the project will work towards ensuring that timber industrialists in timber processing mills and forest
producers, including forest concessionaires and native communities, have increased interaction in relation toforest businesses so that they can interrelate in their production activities and thus make more efficient use offorest resources. Furthermore, forest enterprises will be encouraged to operate in a manner that is in line withthe demands of national and international markets for timber products, so that individual enterprises can direct
their production in relation to market requirements in terms of products, quantity, quality, certification, etc.
Likewise, there will be an efficient management of production organization in timber processing enterprises
and the organization of producers in the timber industry will be strengthened through enhanced participationand interest of forest stakeholders.

-15-2.1.4

Logical Framework Matrix
PROJECT ELEMENTS

Development objective:
Contribute to the sustainable
development of the country's
timber industry, promoting formal,
efficient and competitive marketoriented forest enterprises, taking
advantage of business
opportunities articulated withvalue chains, and marketingproducts based on the use oftimber from legal sources inmanaged forests in the Amazon
Region of Peru for the benefit of
Peruvian society and, inparticular, the men and womenthat depend on the forest for theirlivelihoods.

Specific objective:
Strengthen the technical andbusiness management of theforest industry that relies ontimber species from the Peruvian
Amazon Region.

MEASURABLE INDICATORS
•
•
•
•
•
•
•

•
•
•
•
•
•

2 years after project completion, 40 enterprises areproducing and marketing processed or semi-processedtimber products sourced from legally managed forests
2 years after project completion, the timber product tradebalance improved 10% annually
2 years after project completion,10% annual increase inexports of timber products sourced from Amazon forests
1 year after project completion, Amazon forest production
articulated with 4 timber value chains
2 years after project completion, 5 new or lesser-known
forest species from the Amazon Region are introduced
into the market
2 years after project completion, 40 timber enterprises
increase their income and capitalization levels
2 years after project completion, 160 families improvetheir quality of life

At project completion:
40 timber enterprises improve their competitiveness40 timber processing enterprises use chain of custody,
timber traceability and/or operational logbooks in theirproduction and/or marketing processes
20 timber enterprises use due diligence mechanisms forthe acquisition of legally sourced timber
40 people, inc. 30% women, are trained in the marketingof timber products
20 new forest business opportunities are disseminatedand taken advantage of with project support
400 people, inc. 30% women, strengthen their technicalcapacities in business management of the forest industry-16-

MEANS OFVERIFICATION
•

•

•
•
•

•
•
•
•
•
•
•
•
•

ASSUMPTIONS

Reports fromSERFOR, ARFFS,
GOREs as well as
project reports
Reports from ADEX,MINCETUR and
SUNAT regarding
exported timber
Project reports
Surveys andinterviews
Photographs•

Project reports
Event proceedings
Record ofparticipants
Organizations’
reports
Company reports
Agreement
documents from
dialogue spaces
Attendance records
Photographs
Interviews• Timber industry
enterprises maintain theiropenness, are willing toshare information andactively participate inproject activities• Ongoing interest ofnational and regional
forest authorities topromote mechanisms toguarantee the legality oftimber••Ongoing compliance withlaws and agreements on
the implementation ofmanagement plans andthe origin of timber fromlegal sources
Stakeholders maintaintheir interest and support
the implementation of the
project
Willingness of forest
entrepreneurs tocontinue promoting
positive change toachieve the sustainable
development of the forest
industry by incorporating
new forest species intheir production
processes

PROJECT ELEMENTS
Output 1:
Timber industries are interactingwith forest producers

Output 2:
Forest enterprises are linked tonational and international markets
for timber products

MEASURABLE INDICATORSMEANS OFVERIFICATIONASSUMPTIONS• 1 study on the potential of managed forests in Madre deDios and Ucayali by the first year of the project• 7 training workshops on forest potential in managed
forests, 3 by the first year and 4 by the first half of thesecond year of the project• 140 people trained on the potential of managed forests,inc. 30% women• 4 awareness-raising events on forest conservation andsustainable forest management for timber processing
industries by the second year of the project• 40 timber processing enterprises are interrelated withother timber companies in Lima, Madre de Dios andUcayali• 160 technical assistance provided to enterprises in forest
certification, chain of custody, timber traceability andoperational logbooks• Study document on
forest potential• Reports ofworkshops/ courses,
photographs,
attendance records.
• Agreements between
forest producers andtimber industries• Report of technicallyassisted companies• Availability of secondary
information to determine
the regional forestry
potential• Willingness of producers
and industrialists tointeract and share
information• Willingness of enterprisesin the timber industry toreceive training andtechnical assistance• 1 due diligence mechanism on the acquisition of legal
timber identified, promoted and implemented by the firsthalf of the second year of the project• 8 training workshops on the use of due diligencemechanisms for the acquisition of timber of legal origin
and record of stakeholders along the timber value chain –6 workshops by the second year and 2 workshops by thethird year
• 80 representatives of timber processing companies -inc.
30% women- trained in the application of due diligencemechanisms• 4 electronic newsletters on prices of timber products andforest production services published every 6 months,
starting from the second half of the first year of the project• 200 technical assistance services on industrial innovationin timber processing to forest industry managers• 6 market-oriented business plans for timber products
developed by the second year of the project• 54 technical assistance services provided for the
implementation of business plans• Forest transport
waybills, bills of
lading, Customs
Declaration of Goods(DAM), projectmonitoring report,
photographs• Proceedings oftraining workshops,
photographs andbrochures.
• Electronic
newsletters postedon the web portal• Technical assistancereports• Business plan
documents• Willingness of enterprisesin the timber industry toreceive training andtechnical assistance• Willingness of forest
industry enterprises toinnovate and implement
innovative business plans-17-

PROJECT ELEMENTS
Output 3:
The production organization oftimber processing companies isefficiently managed

Output 4:
The organization of producers in
the timber industry has beenstrengthened

MEASURABLE INDICATORSMEANS OFVERIFICATIONASSUMPTIONS• 6 proposals for technological development submitted andpromoted to timber companies• 6 workshops on technology and timber production
organized – 2 by the first year and 4 by the second year of
the project• 120 technicians from timber processing companies
trained in wood technologies and production processes, atleast 25% women• 6 workshops on business management and production
aimed at business leaders – 2 by the first year and 4 by
the second year of the project• 1 fact-sheet booklet on technological properties and usesof timber species from Peruvian Amazon forests produced
and disseminated by the first half of the second year of
the project• 3 dissemination events on the use of tropical timber – 2 by
the second year and 1 by the third year of the project• Technology
development
proposal documents• Training workshop
reports• Technologicalproperties booklet• Proceedings ofevents on thedissemination oftropical timber uses

• Forest industry
enterprises are willing to
improve their productivity• Forest entrepreneurs’
positive attitude towards
the use of technologicalfact-sheets

2 forest governance dialogue spaces strengthened
30 forest stakeholders supported to enable their
participation in extra-regional dialogue spaces,
30% women
2 fact-sheet booklets on forest regulations produced anddisseminated by the end of the first year
2 events on forest regulations by the first half of thesecond year
80 people trained on forest regulations, 30% women
4 awareness events on the importance of participating in
production organizations, by the second year of the
project
40 representatives of timber processing companies
sensitized on the importance of participating in production
organizations, 30% women
2 enterprise associations strengthened
5 enterprises have access to financial services• Agreement
documents from
dialogue spaces• Fact-sheets onforest regulations• Event proceedings,
photographs,
attendance records• Documents ofbusinessagreements for
production
partnerships• Report onenterprises assisted
and linked tofinancial services• Active participation oftimber entrepreneurs in
dialogue spaces• Entrepreneurs’ interest in
participating in theirorganizations

•
•
•
•
•
•
•
•
•

-18-

2.2

Objectives

Increased market access forprocessed and semiprocessed products
Regaining market share oftimber products from native
species

Solutions TreeBusiness opportunities
identified and taken
advantage of by forest
enterprises

Improved productivity
and competitiveness ofthe timber production
sectorCompetitive production costs
and improved capitalization oftimber enterprises

Coordinated participation intimber product value chains

Reduced negative tradebalance for timber
products in the country

Reduced informality andillegality in the trade of timber
products

Efficient technical and business management of the timber industry that relies on native species from the Peruvian Amazon Region

Forest enterprises linked tonational and international
markets for timber products

Efficient management of
production organization oftimber processing
companies

Strengthened organization of
producers in the timberindustry

Reviewing, disseminating
and training on the timberpotential of Peruvian
Amazon forests, promoting
the use of lesser-known
species in timber
processing

Training on and disseminationof forest certification, chain ofcustody, timber traceability
and operational logbooks

Promoting thetechnologicaldevelopment of timberenterprises

Promoting involvement ofpublic and private forest
stakeholders in forest
governance

Awareness raising among
timber industrialists onforest conservation andsustainable forest
management

Guaranteeing the reliability oflegal origin of timber in forest
production and marketing

Building technical andorganizational skills oftimber producers

Encouraging involvement offorest stakeholders in
dialogue spaces

Promoting business
communication between
timber processors andforest producers

Dissemination of commercial
information on forest products
trade and markets

Strengthening enterpriseleaders’ business andproduction management
capacity

Dissemination of andtraining on forest
regulations

Increasing the diversity ofquality forest products
supplied to markets

Dissemination andtraining on technologicalproperties and uses oftimber species from the
Peruvian Amazon
RegionAwareness raising topromote involvement inproduction partnerships,
supporting theestablishment andstrengthening of enterpriseassociations

Timber industrialists interact with
forest producers

Strengthening theimplementation of timbertraceability and othercontrol systems such as
operational logbooks

Development of marketoriented business plans fortimber products-19-

Providing technicalassistance to timberorganization to facilitate
their interaction with formal
and competitive financial
services

2.2.1Development objective and impact indicators

Development objective:
Contribute to the sustainable development of the country's timber industry, promoting formal, efficient andcompetitive market-oriented forest enterprises, taking advantage of business opportunities articulated withvalue chains, and marketing products based on the use of timber from legal sources in managed forests in the
Amazon Region of Peru for the benefit of Peruvian society and, in particular, the men and women that dependon the forest for their livelihoods.
Indicators:
•
•
•
•
•
•
•

2 years after project completion, 40 enterprises are producing and marketing processed or semi-processedtimber products sourced from legally managed forests
2 years after project completion, the timber product trade balance improved 10% annually
2 years after project completion, 10% annual increase in exports of timber products sourced from Amazon
forests
1 year after project completion, Amazon forest production articulated with 4 timber value chains
2 years after project completion, 5 new or lesser-known forest species from the Amazon Region are
introduced into the market
2 years after project completion, 40 timber enterprises increase their income and capitalization levels
2 years after project completion, 160 families improve their quality of life.

2.2.2

Specific objective and outcome indicators

Specific objective
Strengthen the technical and business management of the forest industry that relies on timber species fromthe Peruvian Amazon Region.
Indicators:
At project completion:
•
•
•
•
•
•

40 timber enterprises improve their competitiveness40 timber processing enterprises use chain of custody, timber traceability and/or logbooks in theirproduction and/or marketing processes
20 timber enterprises use due diligence mechanisms for the acquisition of legally sourced timber
40 people, inc. 30% women, are trained in the marketing of timber products
20 new forest business opportunities are disseminated and taken advantage of with project support
400 people, inc. 30% women, strengthen their technical capacities in business management of the forest
industry.

-20-

PART 3. DESCRIPTION OF PROJECT INTERVENTIONS
3.1
3.1.1

Outputs and Activities
Outputs

Output 1:

Timber industries are interacting with forest producers• 1 study on the potential of managed forests in Madre de Dios and Ucayali by the first year of the project.
Phase 1
• 7 training workshops on forest potential in managed forests, 3 by the first year and 4 by the first half of thesecond year of the project. 5 workshops in Phase 1• 140 people trained on the potential of managed forests, inc. 30% women. 100 people trained in Phase 1• 4 awareness-raising events on forest conservation and sustainable forest management for timber
processing industries by the second year of the project. Phase 2• 40 timber processing enterprises are interrelated with other timber companies in Lima, Madre de Dios andUcayali. Phase 2• 160 technical assistance provided to enterprises in forest certification, chain of custody, timber traceability
and operational logbooks. Phase 2
Output 2:

Forest enterprises are linked to national and international markets for timber products• 1 due diligence mechanism on the acquisition of legal timber identified, promoted and implemented by the
first half of the second year of the project. Phase 2• 8 training workshops on the use of due diligence mechanisms for the acquisition of timber of legal origin
and record of stakeholders along the timber value chain – 6 workshops by the second year and 2 workshops
by the third year. Phase 2• 80 representatives of timber processing companies -inc. 30% women- trained in the application of due
diligence mechanisms. Phase 2• 4 electronic newsletters on prices of timber products and forest production services published every
6 months, starting from the second half of the first year of the project. Phase 1 and Phase 2• 200 technical assistance services on industrial innovation in timber processing to forest industry managers.
50 technical assistance services in Phase 1 and 150 in Phase 2• 6 market-oriented business plans for timber products developed by the second year of the project. Phase 2• 54 technical assistance services provided for the implementation of business plans. Phase 2
Output 3:

The production organization of timber processing companies is efficiently managed• 6 proposals for technological development submitted and promoted to timber companies. 3 proposals in
Phase 1 and 3 proposals in Phase 2• 6 workshops on technology and timber production organized – 2 by the first year and 4 by the second yearof the project. 3 workshops in Phase 1 and 3 workshops in Phase 2• 120 technicians from timber processing companies trained in wood technologies and production processes,
at least 25% women. 60 technicians in each phase• 6 workshops on business management and production aimed at business leaders – 2 by the first year and
4 by the second year of the project. Phase 2• 1 fact-sheet booklet on technological properties and uses of timber species from Peruvian Amazon forests
produced and disseminated by the first half of the second year of the project. Phase 2• 3 dissemination events on the use of tropical timber – 2 by the second year and 1 by the third year of the
project. Phase 2
Output 4:
•
•
•
•
•
•

The organization of producers in the timber industry has been strengthened

2 forest governance dialogue spaces strengthened. Phases 1 and 2
30 forest stakeholders supported to enable their participation in extra-regional dialogue spaces,
30% women. Phases 1 and 2
2 fact-sheet booklets on forest regulations produced and disseminated by the end of the first year. Phase 1
2 events on forest regulations by the first half of the second year. Phase 2
80 people trained on forest regulations, 30% women. Phase 2
4 awareness events on the importance of participating in production organizations, by the second year of
the project. Phase 2

-21-

•
•
•

40 representatives of timber processing companies sensitized on the importance of participating in
production organizations, 30% women. Phase 2
2 enterprise associations strengthened. Phase 2
5 enterprises have access to financial services. Phase 2

3.1.2

Activities

For Output 1:

Timber industries are interacting with forest producers

Activity A1.1

Reviewing, disseminating and training on the timber potential of Peruvian Amazon
forests, promoting the use of lesser-known species in timber processing. Based on
the information available from forest inventories of management plans and species technicalfact-sheets, an analytical study will be conducted to determine the current forest potentialand estimate the future potential of forests under management in Ucayali and Madre de Dios.
Outreach materials on the results of the study will be prepared and disseminated throughdissemination and training events, promoting the use of timber species of ecologicalsignificance that are lesser known or unknown by the market. Phases 1 and 2

Activity A1.2

Awareness raising among timber industrialists on forest conservation andsustainable forest management. Events will be organized for the industrial timber sector
to raise awareness on the proper use of timber from managed forests in the Amazon Region
and the importance of forest conservation through sustainable forest management. Phase 2

Activity A1.3

Promoting business communication between timber processors and forest
producers. Meetings will be organized between timber processors, including sawmills andother timber processing mills, with forest producers represented by concessionaires andnative communities responsible for forest management in their areas, in order to shareexperiences and ideas so that both groups can improve and become more efficient in theirproduction activities, coordinate their activities and make better use of forest resources, forexample, through the commercial use of a larger number of forest species, reduction of wood
waste, improvement of raw material yields in production, etc. In addition, field visits will beorganized between suppliers and buyers of timber in Ucayali, Madre de Dios and Lima, sothat all links in the production chain are engaged, from the forest to the end consumer andexport markets, in order to understand the whole production and marketing system,
identifying business potential, limitations and challenges, while at the same time jointly
proposing solutions and improvements for the benefit of the forest industry. Phase 2

Activity A1.4

Strengthening of and training on forest certification, chain of custody, timbertraceability and operational logbook systems. Specialized technical assistance will be
provided to develop or strengthen forest certification, chain of custody, timber traceability,
and operational logbook systems, so that enterprises may have both voluntary and official
operational tools that guarantee that timber products come from managed forests, thus
complying with legal regulations. Phase 2

For Output 2:

Forest enterprises are linked to national and international markets for timber products

Activity A2.1

Training and dissemination in forest certification, chain of custody, timber traceability
and plant operations logbooks. Training and dissemination events will be developed for the
personnel of beneficiary companies, with a view to developing capacities in forest certification,
chain of custody, implementation of timber traceability systems and use of the plant operations
logbooks, linking production information to the physical flow of products in processing plants
and thus contributing to ensuring the legal origin of the timber used. Phases 1 and 2

Activity A2.2

Guaranteeing the reliability of legal origin of timber in forest production andmarketing. An implementation procedure will be developed to facilitate the voluntary
participation of timber production chain stakeholders in a due diligence system that canguarantee that the timber and timber products they purchase are from legal sources. The
procedure will be developed in a participatory manner through the organization ofworkshops. Outreach materials will be prepared and published. Phase 2-22-

Activity A2.3

Dissemination of commercial information on forest products trade and markets. The
project’s technical staff will collect information on prices of timber products and forest
production services in the areas of the cities of Pucallpa, Puerto Maldonado and Lima. An
electronic newsletter with this information will be prepared and published every six months.
Phases 1 and 2

Activity A2.4

Supporting timber enterprises in innovation and market supply of new quality
products. Field visits will be made to timber processing mills in order to assess their needs
for technological innovation and to put forward relevant proposals. Through technicalassistance, selected companies will be supported in the development of innovative products.
Phases 1 and 2

Activity A2.5

Development of market-oriented business plans for timber products. According tomarket requirements and to their management and production capacity, enterprises will beselected to support the development of business plans for innovative products, and technicalassistance will also be provided to them in their implementation process. Phase 2

For Output 3:

The production organization of timber processing companies is efficiently managed

Activity A3.1

Promoting the technological development of timber enterprises. Field visits will bemade to timber companies in order to assess the current state of the technology used,
identifying "bottlenecks" in production, production organization, efficiency in the use of raw
materials (logs or other products) which are processed at the mill, yield levels, timelines andflows, etc.; based on this analysis, specialized technical assistance will be provided to
improve the technology used and to promote the use of lesser-known or unknown timber
species by the industry. Phases 1 and 2

Activity A3.2

Building technical and organizational skills of timber producers. In coordination with
forest enterprises, training events will be developed and specialized technical assistance will
be provided to improve production efficiency, including improvement of organization fortimber production, sawing, drying, preservation and finishing; woodworking techniques;maintenance of machines and equipment; work safety; assembly techniques; log scaling;
packaging, etc. Outreach thematic materials will also be developed and disseminated.
Phases 1 and 2

Activity A3.3

Strengthening enterprise leaders’ business and production management capacity.
Business management weaknesses in timber processing mills will be identified, and the
project will coordinate with enterprise leaders to organize training events and provide
technical assistance on topics such as strategic planning, business organization, leadership,labour legislation, marketing and commercial management, operations and logistics,
production costs, profitability, finance and accounting, etc. Outreach thematic materials will
also be developed and disseminated. Phases 1 and 2

Activity A3.4

Dissemination and training on technological properties and uses of timber species
from the Peruvian Amazon Region. Using secondary information, a booklet and factsheets will be prepared for each forest species on wood technological properties andproposed uses, in order to promote a more diversified use of species and to increase theirconsumption by the timber industry, exporters, construction sector, etc. Dissemination
events will be organized, and the project will participate in mass media and in meetings withvarious sectors to promote increased use of timber. Outreach materials will be developed.
Phase 2For Output 4:

The organization of producers in the timber industry has been strengthened

Activity A4.1

Promoting involvement of public and private forest stakeholders in forest governanceand in dialogue spaces. Greater participation of forest stakeholders, especially timber
processors, in dialogue spaces, events and meetings will be promoted to strengthen regionaland national forest governance, providing logistical support as required. Phases 1 and 2

Activity A4.2

Dissemination of and training on forest regulations. Outreach materials on forest
regulations will be developed and training and dissemination events will be organized toincrease awareness on forest legislation. Phases 1 and 2-23-

Activity A4.3

Awareness raising to promote involvement in production partnerships, supporting theestablishment and strengthening of enterprise associations. Awareness-raising events
will be organized for forest stakeholders and especially for timber processors to increase
their involvement in producer associations. Logistical support will be provided to maintainand strengthen their associations and, if necessary, to support the creation of new
associations. The production of a video for project outreach is envisaged within theframework of this activity. Phase 2

Activity A4.4

Providing technical assistance to timber organization to facilitate their interaction withformal and competitive financial services. Technical assistance and support will be
provided to enterprises to facilitate their interaction with financial organizations and ensure
they have the capacity to access competitive credit facilities. Phase 2

Activity A4.5

Establishing and maintaining project coordination and management. This activity refers
to the management of the project, including administrative actions; preparation of monthly,
half-yearly and final reports; preparation of yearly plans of operation; coordination;
monitoring, etc. Phases 1 and 2

3.2

Implementation approaches and methods

The project will be implemented in cooperation with stakeholders and beneficiaries who are directly or indirectly
involved in improving existing forest production systems, especially in timber processing activities, so as toensure that companies are managed more efficiently and that better use is made of timber from forest species
found in the managed forests of the Amazon region. The project will use a participatory approach (including
both men and women) to achieve its proposed objective, as it will promote participation in the implementationof activities through a shared vision aimed at raising the level of competitiveness of producers and promoting
the use of mechanisms that will guarantee the legality of timber activities and the sustainable use of forest
resources in the region. The implementation of the project will focus on optimizing the production processesof companies through a market approach and through training and strengthening business strategies that meetthe needs of stakeholders by implementing activities in accordance with the following intervention strategies:•

Making information available on forest management plans and species used by the processing
industry. A study will be carried out based on information from project beneficiaries and public institutions
in order to determine the potential of forests in the departments of Madre de Dios and Ucayali, and forest
enterprises will be surveyed about the species they process as well as their timber needs.

•

Strengthening capacities for the efficient management of the production organization of forest
enterprises. With the participation of men and women in charge of timber enterprises, the project will
identify business-related problems that limit production efficiency and will propose solutions to address
them.

•

Developing business management plans aimed at timber product markets. The project will provide
business management plans to enterprises so that they can implement new technologies, processes
and/or products. The business management plans will be formulated with the ongoing participation ofboth men and women stakeholders, who will identify and propose the requirements to be addressed by
the project.

•

Strengthening organizations in the forest production sector. This will be achieved by working withleaders of production organizations and encouraging their participation in workshops and meetingsorganized by the project and relevant associations. Producers will be made aware of the advantages ofbeing organized and actively involved in their organizations. Furthermore, workshops will be organizedon leadership skills, and technical assistance and support will be provided to strengthen theirorganizations and participation in forest dialogue roundtables. In addition, the project will promote theparticipation of the forest production sector as well as authorities and officials of the public forest sector,
in order to promote greater interaction between both sectors through the organization of events, meetingsand visits, thus contributing to improving the formalization and legalization of forest activities.

-24-

•

Gender equity approach. This will be a cross-cutting aspect of all project activities, to ensure theequitable participation of both men and women along the production chain as producers, entrepreneurs,
professionals, etc., taking into account their expertise in timber processing activities. In each activity, theproject will ensure that due consideration be given to gender issues, forests and the forest industry.
The project will also promote the participation of women in leadership roles, and production organizations
will be strengthened to ensure the participation of both men and women in positions of responsibility.

Interaction between forest
potential and industry needs

Efficientmanagementof timberindustry
processing alargernumber of
Amazonforestspecies

Articulation with markets

Technological and managerial
improvement

Organized industrial producers

-25-

3.3

Work Plan
Outputs/activities

Responsible party

Output 1. Timber industries are interacting with forest producers
1.1 Reviewing, disseminating and training on the timber
Forest management
potential of Peruvian Amazon forests, promoting theconsultant

1

Year 1
Quarter2
3

4

use of lesser-known species in timber processing

1.2 Awareness raising among timber industrialists on

Regional Officers
forest conservation and sustainable forest
management
1.3 Promoting business communication between timber
Regional Officers
processors and forest producers
1.4 Strengthening of and training on forest certification,
Regional Officers
chain of custody, timber traceability and operational
logbook systems
Output 2. Forest enterprises are linked to national and international markets for timber products
2.1 Training and dissemination in forest certification, chain
Project Directorof custody, timber traceability and plant operations
logbooks.
2.2 Guaranteeing the reliability of legal origin of timber in
Project Director
forest production and marketing
2.3 Dissemination of commercial information on forest
Project Director
products trade and markets
2.4 Supporting timber enterprises in innovation andRegional Officers
market supply of new quality products
2.5 Development of market-oriented business plans for
Business plansconsultant
timber products
Output 3. The production organization of timber processing companies is efficiently managed
3.1 Promoting the technological development of timber
Industry consultant
enterprises
3.2 Building technical and organizational skills of timber
Industry consultant
producers
3.3 Strengthening enterprise leaders’ business andRegional Officers
production management capacity
3.4 Dissemination and training on technological properties
Regional Officers
and uses of timber species from the Peruvian Amazon
RegionOutput 4. The organization of producers in the timber industry has been strengthened
4.1 Promoting involvement of public and private forest
stakeholders in forest governance and in dialogue Project Coordinatorspaces
Project Director
4.2 Dissemination of and training on forest regulations
4.3 Awareness raising to promote involvement inRegional Officers
production partnerships, supporting the establishment
and strengthening of enterprise associations
4.4 Providing technical assistance to timber organization
Regional Officers
to facilitate their interaction with formal andcompetitive financial services
4.5 Establishing and maintaining project coordination and
Project Director
management

-26-

1

Year 2
Quarter234Year 3
Quarter
1
2

3.4
3.4.1

BudgetMaster budget schedule

Output 1
Act. A1.1

Act. A1.2

Timber industries are interacting with forest producers
Reviewing, disseminating and training on the timber potential of Peruvian Amazon forests, promoting the use of lesser-known species in timber processing
Forest management consultant
13.1
5Man-month
1,800
9,000
9,000
Development, editing and publication of forest potential study
21
1Sub-contract
4,000
4,000
4,000
DSA
31.1
12
6
Day
50
900
600
300
Local transport
33.1
12
6
Month
40
720
320
160
Air travel
33.1
4
2
Ticket
100
600
400
200
Office supplies
52
12
6
Month
30
540
300
150
Development, editing and publication of outreach materials
61.1
1
Service800
800
800
Information collection and data entry services
61.2
3
4
Event
250
1,750
500
750
Logistical services
61.3
3
4
Event
150
1,050
300
450
Rental of venue premises
61.4
3
4
Event
150
1,050
Refreshments
61.5
120 160
Serve
3
840
360
480
Participants in events
12.5
60
80
Man-day40
5,600
Awareness raising among timber industrialists on forest conservation and sustainable forest management
DSA
31.1
12
Day
50
600
Local transport
33.1
12
Month
40
480
320
Air travel
33.1
4
Ticket100
400
Office supplies
52
12
Month
30
360
300
Development, editing and publication of outreach materials
61.1
1
Service800
800
800
Information collection and data entry services
61.2
4
Event
250
1,000
Logistical services
61.3
4
Event
150
600
600
Rental of venue premises
61.4
4
Event
150
600
Refreshments
61.5
80
Serve
3
240
240
Participants in events
12.5
40
Man-day
40
1,600

-27-

ExecutingagencyYear 3

Year 2

ITTO
Year 1

Total cost
US$

Unit

Unit cost
US$

Year 3

Year 2

Quantity
Year 1

Description

Budgetcomponent

Outputs/
Activitiesa) Master budget by year (US$)

240
90
500
300
1,050
5,600
600
160
400
60
1,000
600
1,600

Act. A1.3

Act. A1.4

Output 2
Act. A2.1

Act. A2.2

Promoting business communication between timber processors and forest producers
DSA
31.1
120
Day
50
Local transport
33.1
12
Month
40
Air travel
33.1
40
Ticket100
Office supplies
52
12
Month
30
Information collection and data entry services
61.2
4
Event
250
Logistical services
61.3
4
Event
150
Refreshments
61.5
320
Serve
3
Participants in events
12.5
160
Man-day
40
Strengthening of and training on forest certification, chain of custody, timber traceability and operational logbook systems
Technical assistant
12.1
2
Man-month800
Business technicians
12.4
80
Man-day
40
Forest certification consultant
13.2
2
Man-month
1,800
DSA
31.1
12
Day
50
Local transport
33.1
6
Month
40
Air travel
33.1
4
Ticket100
Office supplies
52
6
Month
30
Development, editing and publication of outreach materials
61.1
1
Service
800
Refreshments
61.5
160
Serve
3
Forest enterprises are linked to national and international markets for timber products
Training and dissemination in forest certification, chain of custody, timber traceability and plant operations logbooks.
Technical assistant
12.1
2
Man-month800
Business technicians
12.4
80
Man-day
40
Forest certification consultant
13.2
2
Man-month
1,800
DSA
31.1
12
Day
50
Local transport
33.1
6
Month
40
Air travel
33.1
4
Ticket100
Office supplies
52
6
Month
30
Refreshments
61.5
160
Serve
3
Guaranteeing the reliability of legal origin of timber in forest production and marketing
Refreshments
61.5
60
20
Serve
3
Rental of venue premises
61.4
6
2
Event
150
Logistical services
61.3
6
2
Event
150
Information collection and data entry services
61.2
6
2
Event
250
Development, editing and publication of outreach materials
61.1
1
Service
800
Office supplies
52
12
6
Month
30
Local transport
33.1
12
6
Month
40
Air travel
33.1
4
4
Ticket
100
DSA
31.1
12
12
Day
50
Development of due diligence mechanism for the purchasing of
221
Sub-contract
4,000
legal timber
Participants in events
12.5
60
20
Man-day
40

-28-

6,000
480
4,000
360
1,000
600
960
6,400

3,000
320
4,000
300

1,600
3,200
3,600
600
240
400
180
800
480

1,200

1,600
3,200
3,600
600
240
400
180
480

1,200

240
1,200
1,200
2,000
800
540
720
800
1,200

180

60

900
1,500
800
300
320
400
600

300
500

4,000

4,000

3,200

3,000
160
60
1,000

600
960

6,400
400
3,200

3,600
600
160
400
150
800

80
30
480
400
3,200

3,600
600
160
400
150

80
30
480

150
160
400
600

1,200

90
240

3,200

Act. A2.3

Act. A2.4

Act. A2.5

Output 3
Act. A3.1

Act. A3.2

Dissemination of commercial information on forest products trade and markets
Local transport
33.1
6
12
6
Office supplies
52
6
12
6
Website maintenance
61.6
6
12
6
Supporting timber enterprises in innovation and market supply of new quality productsTechnical assistant
12.1
4
Business technicians
12.4
200
DSA
31.1
36
Local transport
33.1
12
Air travel
33.1
12
Office supplies
52
12
Development of market-oriented business plans for timber productsTechnical assistant
12.1
4
2
Business technicians
12.4
36
18
Business plans consultant
13.3
4
DSA
31.1
12
12
Local transport
33.1
12
6
Air travel
33.1
4
4
Office supplies
52
12
6
The production organization of timber processing companies is efficiently managed
Promoting the technological development of timber enterprises
Technical assistant
12.1
12
4
Timber industry consultant
13.4
9
9
DSA
31.1
24
24
Local transport
33.1
12
12
Air travel
33.1
88
Office supplies
52
12
12
Building technical and organizational skills of timber producers
Technical assistant
12.1
2
4
Participants in events
12.5
40
80
DSA
31.1
6
12
Local transport
33.1
6
12
Air travel
33.1
2
4
Office supplies52
6
12
Development, editing and publication of outreach materials
61.1
1
Information collection and data entry services
61.2
2
4
Logistical services
61.3
2
4
Rental of venue premises
61.4
2
4
Refreshments
61.5
80 160

-29-

Month
Month
Month

40
30
30

960
720
720

160
150
180

320
300
360

160
150
180

Man-monthMan-dayDay
MonthTicket
Month

800
40
50
40
100
30

3,200
8,000
1,800
480
1,200
360

2,400

Man-monthMan-day
Man-monthDay
MonthTicket
Month

800
40
1,800
50
40
100
30

4,800
2,160
7,200
1,200
720
800
540

2,400

1,200

7,200
600
320
400
300

600
160
400
150

Man-monthMan-monthDay
MonthTicket
Month

800
1,800
50
40
100
30

12,80032,400
2,400
960
1,600
720

7,200
13,500
1,200
320
800
300

2,400
13,500
1,200
320
800
300

3,200
5,400

Man-monthMan-dayDay
MonthTicketMonth
Service
Event
Event
Event
Serve

800
40
50
40
100
30
800
250
150
150
3

4,800
4,800
900
720
600
540
800
1,500
900
900
720

1,200

2,400

300
160
200
150
800
500
300
150
240

600
320
400
300

1,200
4,800

800
8,000
600
160
400
60

1,200
320
800
300

1,000
600
300
480

320
120

1,200
2,160
240
90

320
120

240
90

450

Act. A3.3

Act. A3.4

Strengthening enterprise leaders’ business and production management capacity
Technical assistant
12.1
2
4
Man-month800
Business management trainer
12.3
2
4
Event
300
Participants in events
12.5
40
80
Man-day
40
DSA
31.1
6
12
Day
50
Local transport
33.1
6
12
Month
40
Air travel
33.1
2
4
Ticket100
Office supplies
52
6
12
Month
30
Development, editing and publication of outreach materials
61.1
1
Service
800
Information collection and data entry services
61.2
2
4
Event
250
Logistical services
61.3
2
4
Event
150
Rental of venue premises
61.4
2
4
Event
150
Refreshments
61.5
80 160Serve
3Dissemination and training on technological properties and uses of timber species from the Peruvian Amazon Region
Lecturer
12.3
1
2
Event
300
Sub-contract – fact-sheets on wood technological properties and23
1Sub-contract
5,000
uses
DSA
31.1
12
6
Day
50
Local transport
33.1
12
6
Month
40
Air travel
33.1
4
2
Ticket100
Office supplies
52
12
6
Month
30
Development, editing and publication of outreach materials
61.1
1
Service
800
Information collection and data entry services
61.2
2
1
Event
250
Logistical services
61.3
2
1
Event
150
Rental of venue premises
61.4
2
1
Event
150
Refreshments
61.5
40
40
Serve
3

-30-

4,800
1,800
4,800
900
720
600
540
800
1,500
900
900
720

1,200
600

2,400
1,200

300
160
200
150
800
500
300
150
240

600
320
400
300

1,200
4,800
240
90

1,000
600
300
480

900

300

5,000

5,000

900
720
600
540
800
750
450
450
240

600
320
400
300
800
500
300
150
120

450
300
300
160
200
150
250
150
150
120

300

240
90

150

Output 4
Act. A4.1

Act. A4.2

Act. A4.3

The organization of producers in the timber industry has been strengthened
Promoting involvement of public and private forest stakeholders in forest governance and in dialogue spaces
DSA
31.1
24
24
12
Day
50
3,000
1,200
1,200
Local transport
33.1
12
12
6
Month
40
1,200
320
320
Air travel
33.1
8
8
4
Ticket
100
2,000
400
400
Office supplies
52
12
12
6
Month
30
900
300
300
Refreshments
61.5
720 720 360
Serve
3
5,400
720
720
Dissemination of and training on forest regulations
Lecturer
12.3
2
Event
300
600
Sub-contract – fact-sheets on forest regulations
24
1
Sub-contract
2,000
2,000
2,000
DSA
31.1
12
Day
50
600
600
Local transport
33.1
6
6
Month
40
480
160
160
Air travel
33.1
4
Ticket100
400
400
Office supplies
52
6
6
Month
30
360
150
150
Development, editing and publication of outreach materials
61.1
1
Service800
800
800
Information collection and data entry services
61.2
2
Event
250
500
500
Logistical services
61.3
2
Event
150
300
300
Rental of venue premises
61.4
2
Event
150
300
150
Refreshments
61.5
80
Serve
3
240
240
Awareness raising to promote involvement in production partnerships, supporting the establishment and strengthening of enterprise associations
Participants in events
12.5
40
Man-day40
1,600
Business partnerships consultant
13.5
2
Man-month
1,800
3,600
3,600
Development, editing and publication of project video
25
1
Sub-contract
8,000
8,000
8,000
DSA
31.1
12
Day
50
600
600
Local transport
33.1
12
Month
40
480
320
Air travel
33.1
4
Ticket100
400
400
Office supplies
52
12
Month
30
360
300
Information collection and data entry services
61.2
4
Event
250
1,000
1,000
Logistical services
61.3
4
Event
150
600
600
Rental of venue premises
61.4
4
Event
150
600
300
Refreshments
61.5
80
Serve
3
240
120

-31-

600
160
200
150
360

400
1,000
150
3,600
600
160
60

150
1,600

160
60
300
120

Act. A4.4

Act. A4.5

Providing technical assistance to timber organization to facilitate their interaction with formal and competitive financial services
Technical assistant
12.1
2
2
Man-month800
3,200
Business financing consultant
13.6
1
1
Man-month
1,800
3,600
DSA
31.1
12
12
Day
50
1,200
Local transport
33.1
6
6
Month
40
480
Air travel
33.1
4
4
Ticket100
800
Office supplies
52
6
6
Month
30
360
Development, editing and publication of outreach materials
61.1
1
Service800
800
Establishing and maintaining project coordination and management
Project Director
11.1
12
12
6
Month
2,500 75,000
Coordinator - CNF
11.2
12
12
6
Month
1,300 39,000
Regional officers (2)
11.3
18
24
6
Man-month
800 38,400
Monitoring officer
11.4
4
4
2
Man-month800
8,000
Forest assistant
12.2
11
12
6
Month
1,000 29,000
DSA
31.1
36
36
18
Day
50
4,500
Local transport
33.1
12
12
6
Month
40
1,200
Air travel
33.1
12
12
6
Ticket100
3,000
Project offices
41
12
12
6
Month
1,200 36,000
Office furniture
421Overall
900
900
Computer equipment
43.1
6
Unit
500
3,000
Multimedia projector
43.2
3
Unit
500
1,500
Multifunction printer
43.3
3
Unit
250
750
Scanner
43.4
2
Unit
300
600
Spare parts – computer equipment
51
11
12
6
Month
30
870
Office supplies
52
12
12
6
Month
30
900
Utilities – basic services
53
12
12
6
Month
150
4,500
Bank charges, courier, photocopying, other
61.7
12
12
6
Month
35
1,050
Maintenance of computer equipment
61.8
11
12
6
Month
30
870
Financial audit
62
1
1
1
Audit
2,000
6,000

-32-

1,200
1,800
600
160
400
150
800

1,200
1,800
600
160
400
150

800

26,40026,40013,20010,80014,400

3,600

6,600
1,200
320
800

7,200
1,200
320
800

3,600
600
160
400

2,000
500
500
300
330
300
1,800
420
330

360
300
1,800
420
360

180
150
900
210
180

9,000
39,0009,600
8,000
11,600
1,500
400
1,000
36,000
900
1,000
1,000
250
300

160
60

150

6,000

Output 1
Act. A.1.1

Act. A.1.2

ExecutingagencyPhase 2

ITTO
Phase 1

Total cost
US$

Unit

Unit cost
US$

Phase 2

Quantity
Phase 1

Description

Budgetcomponent

Outputs/
Activitiesb) Master budget by phase (US$)

Timber industries are interacting with forest producers
Reviewing, disseminating and training on the timber potential of Peruvian Amazon forests, promoting the use of lesser-known species in timber
processing
Forest management consultant
13.1
5Man-month
1,800
9,000
9,000
Development, editing and publication of forest potential
211
Sub-contract
4,000
4,000
4,000
study
DSA
31.1
15
3
Day
50
900
750
150
Local transport
33.1
14
4
Month
40
720
360
120
Air travel
33.1
51
Ticket
100
600
500
100
Office supplies
52
15
3
Month
30
540
360
90
Development, editing and publication of outreach
61.1
1Service
800
800
800
materials
Information collection and data entry services
61.2
5
2
Event
250
1,750
750
500
Logistical services
61.3
5
2
Event
150
1,050
450
300
Rental of venue premises
61.4
5
2
Event
150
1,050
Refreshments
61.5
160
120
Serve
3
840
480
360
Participants in events
12.5
100
40
Man-day40
5,600
Awareness raising among timber industrialists on forest conservation and sustainable forest management
DSA
31.1
12
Day
50
600
Local transport
33.1
12
Month
40
480
320
Air travel
33.1
4
Ticket100
400
Office supplies
52
12
Month
30
360
300
Development, editing and publication of outreach
61.1
1Service
800
800
800
materials
Information collection and data entry services
61.2
4
Event
250
1,000
Logistical services
61.3
4
Event
150
600
600
Rental of venue premises
61.4
4
Event
150
600
Refreshments
61.5
80
Serve
3
240
240
Participants in events
12.5
40
Man-day
40
1,600

-33-

240
90
500
300
1,050
5,600
600
160
400
60
1,000
600
1,600

Act. A.1.3 Promoting business communication between timber processors and forest producers
DSA
31.1
120
Day
50
6,000
Local transport
33.1
12
Month
40
480
Air travel
33.1
40
Ticket100
4,000
Office supplies
52
12
Month
30
360
Information collection and data entry services
61.2
4
Event
250
1,000
Logistical services
61.3
4
Event
150
600
Refreshments
61.5
320
Serve
3
960
Participants in events
12.5
160
Man-day40
6,400Act. A.1.4 Strengthening of and training on forest certification, chain of custody, timber traceability and operational logbook systems
Technical assistant (2)12.1
2Man-month800
1,600
Business technicians
12.4
80
Man-day40
3,200
Forest certification consultant
13.2
2
Man-month
1,800
3,600
DSA
31.1
12
Day
50
600
Local transport
33.1
6
Month
40
240
Air travel
33.1
4
Ticket100
400
Office supplies
52
6
Month
30
180
Development, editing and publication of outreach materials
61.1
1
Service
800
800
Refreshments
61.5
160
Serve
3
480
Output 2 Forest enterprises are linked to national and international markets for timber products
Act. A.2.1 Training and dissemination in forest certification, chain of custody, timber traceability and plant operations logbooks.
Technical assistant (2)12.1
11
Man-month800
1,600
Business technicians
12.4
20
60
Man-day40
3,200
Forest certification consultant
13.2
1
1
Man-month
1,800
3,600
DSA
31.1
3
9
Day
50
600
Local transport
33.1
2
4
Month
40
240
Air travel
33.1
1
3
Ticket100
400
Office supplies
52
2
4
Month
30
180
Refreshments
61.5
40
120
Serve
3
480
Act. A.2.2 Guaranteeing the reliability of legal origin of timber in forest production and marketing
Refreshments
61.5
80
Serve
3
240
Rental of venue premises
61.4
8
Event
150
1,200
Logistical services
61.3
8
Event
150
1,200
Information collection and data entry services
61.2
8
Event
250
2,000
Development, editing and publication of outreach materials
61.1
1
Service
800
800
Office supplies
52
18
Month
30
540
Local transport
33.1
18
Month
40
720
Air travel
33.1
8
Ticket
100
800
DSA
31.1
24
Day
50
1,200
Development of due diligence mechanism for the purchasing
22
1
Sub-contract
4,000
4,000
of legal timber
Participants in events
12.5
80
Man-day
40
3,200

-34-

3,000
320
4,000
300
600
960
1,200
3,600
600
160
400
150
800

600

600

1,800
150
40
100
30

1,800
450
120
300
120
240
1,200
2,000
800
450
480
800
1,200

3,000
160
60
1,000
6,400
400
3,200
80
30
480
400
3,200
80
30
480
1,200

90
240

4,000
3,200

Act. A.2.3

Act. A.2.4

Act. A.2.5

Output 3
Act. A.3.1

Dissemination of commercial information on forest products trade and markets
Local transport
33.1
9
15
Month
Office supplies
52
9
15
Month
Website maintenance
61.6
9
15
Month
Supporting timber enterprises in innovation and market supply of new quality productsTechnical assistant
12.1
1
3
Man-monthBusiness technicians
12.4
50
150
Man-day
DSA
31.1
9
27
Day
Local transport
33.1
3
9
Month
Air travel
33.1
3
9
TicketOffice supplies
52
3
9
Month
Development of market-oriented business plans for timber productsTechnical assistant
12.1
6
Man-monthBusiness technicians
12.4
54
Man-day
Business plans consultant
13.3
4
Man-month
DSA
31.1
24
Day
Local transport
33.1
18
Month
Air travel
33.1
8
TicketOffice supplies
52
18
Month
The production organization of timber processing companies is efficiently managed
Promoting the technological development of timber enterprises
Technical assistant
12.1
13
3
Man-month
Timber industry consultant
13.4
12
6
Man-month
DSA
31.1
30
18
Day
Local transport
33.1
15
9
Month
Air travel
33.1
10
6
TicketOffice supplies
52
15
9
Month

-35-

40
30
30

960
720
720

160
180
270

480
420
450

320
120

800
40
50
40
100
30

3,200
8,000
1,800
480
1,200
360

600

1,800

800
8,000
600
160
400
60

800
40
1,800
50
40
100
30

4,800
2,160
7,200
1,200
720
800
540

800
1,800
50
40
100
30

12,80032,400
2,400
960
1,600
720

40
30

1,200
280
800
270
3,600
7,200
1,200
480
800
450

7,800
18,000
1,500
320
1,000
330

1,800
9,000
900
320
600
270

1,200
2,160
240
90
3,200
5,400
320
120

Act. A.3.2

Act. A.3.3

Act. A.3.4

Building technical and organizational skills of timber producers
Technical assistant
12.1
2
4
Man-month800
4,800
Participants in events
12.5
60
60
Man-day
40
4,800
DSA
31.1
9
9
Day
50
900
Local transport
33.1
9
9
Month
40
720
Air travel
33.1
3
3
Ticket100
600
Office supplies
52
9
9
Month
30
540
Development, editing and publication of outreach
61.1
1Service
800
800
materials
Information collection and data entry services
61.2
3
3
Event
250
1,500
Logistical services
61.3
3
3
Event
150
900
Rental of venue premises
61.4
3
3
Event
150
900
Refreshments
61.5
100
140
Serve
3
720
Strengthening enterprise leaders’ business and production management capacity
Technical assistant
12.1
3
3
Man-month800
4,800
Business management trainer
12.3
3
3
Event
300
1,800
Participants in events
12.5
60
60
Man-day
40
4,800
DSA
31.1
9
9
Day
50
900
Local transport
33.1
9
9
Month
40
720
Air travel
33.1
3
3
Ticket100
600
Office supplies
52
9
9
Month
30
540
Development, editing and publication of outreach
61.1
1
800
800
Servicematerials
Information collection and data entry services
61.2
3
3
Event
250
1,500
Logistical services
61.3
3
3
Event
150
900
Rental of venue premises
61.4
3
3
Event
150
900
Refreshments
61.5
100
140
Serve
3
720
Dissemination and training on technological properties and uses of timber species from the Peruvian Amazon Region
Lecturer
12.3
3
Event
300
900
Sub-contract – fact-sheets on wood technological23
1Sub-contract
5,000
5,000
properties and uses
DSA
31.1
18
Day
50
900
Local transport
33.1
18
Month
40
720
Air travel
33.1
6
Ticket100
600
Office supplies
52
18
Month
30
540
Development, editing and publication of outreach
61.1
1Service
800
800
materials
Information collection and data entry services
61.2
3
Event
250
750
Logistical services
61.3
3
Event
150
450
Rental of venue premises
61.4
3
Event
150
450
Refreshments
61.5
80
Serve
3
240

-36-

1,200

2,400

450
160
300
180

450
320
300
270

1,200
4,800
240
90

800
750
450
150
300

750
450
300
420

1,800
900

1,800
900

450
160
300
180

450
320
300
270

450
1,200
4,800
240
90

800
750
450
150
300

750
450
300
420
600

450
300

5,000
900
480
600
450

240
90

800
750
450
300
240

150

Output 4
Act. A.4.1

Act. A.4.2

Act. A.4.3

The organization of producers in the timber industry has been strengthened
Promoting involvement of public and private forest stakeholders in forest governance and in dialogue spaces
DSA
31.1
30
30
Day
50
3,000
1,500
1,500
Local transport
33.1
15
15
Month
40
1,200
320
480
400
Air travel
33.1
10
10
Ticket
100
2,000
600
400
1,000
Office supplies
52
15
15
Month
30
900
390
360
150
Refreshments
61.5
900
900
Serve
3
5,400
720
1,080
3,600
Dissemination of and training on forest regulations
Lecturer
12.3
2
Event
300
600
600
Sub-contract – fact-sheets on forest regulations
24
1
Sub-contract
2,000
2,000
2,000
DSA
31.1
12
Day
50
600
600
Local transport
33.1
9
3
Month
40
480
200
120
160
Air travel
33.1
4
Ticket100
400
400
Office supplies
52
9
3
Month
30
360
240
60
60
Development, editing and publication of outreach
61.1
1Service
800
800
800
materials
Information collection and data entry services
61.2
2
Event
250
500
500
Logistical services
61.3
2
Event
150
300
300
Rental of venue premises
61.4
2
Event
150
300
150
150
Refreshments
61.5
80
Serve
3
240
240
Awareness raising to promote involvement in production partnerships, supporting the establishment and strengthening of enterprise associations
Participants in events
12.5
40
Man-day
40
1,600
1,600
Business partnerships consultant
13.5
2
Man-month
1,800
3,600
3,600
Development, editing and publication of project video
25
1
Sub-contract
8,000
8,000
8,000
DSA
31.1
12
Day
50
600
600
Local transport
33.1
12
Month
40
480
320
160
Air travel
33.1
4
Ticket100
400
400
Office supplies
52
12
Month
30
360
300
60
Information collection and data entry services
61.2
4
Event
250
1,000
1,000
Logistical services
61.3
4
Event
150
600
600
Rental of venue premises
61.4
4
Event
150
600
300
300
Refreshments
61.5
80
Serve
3
240
120
120

-37-

Act. A.4.4

Act. A.4.5

Providing technical assistance to timber organization to facilitate their interaction with formal and competitive financial services
Technical assistant
12.1
4
Man-month800
3,200
Business financing consultant
13.6
2
Man-month
1,800
3,600
DSA
31.1
24
Day
50
1,200
Local transport
33.1
12
Month
40
480
Air travel
33.1
8
Ticket100
800
Office supplies
52
12
Month
30
360
Development, editing and publication of outreach
61.1
1Service
800
800
materials
Establishing and maintaining project coordination and management
Project Director
11.1
15
15
Month
2,500 75,000
33,000
Coordinator - CNF
11.2
15
15
Month
1,300 39,000
Regional officers (2)
11.3
24
24
Man-month
800 38,400
14,400
Monitoring officer
11.4
55
Man-month800
8,000
Forest assistant
12.2
14
15
Month
1,000 29,000
8,400
DSA
31.1
45
45
Day
50
4,500
1,200
Local transport
33.1
15
15
Month
40
1,200
320
Air travel
33.1
15
15
Ticket
100
3,000
800
Project offices
41
15
15
Month
1,200 36,000
Office furniture
421Overall
900
900
Computer equipment
43.1
6
Unit
500
3,000
2,000
Multimedia projector
43.2
3
Unit
500
1,500
500
Multifunction printer
43.3
3
Unit
250
750
500
Scanner
43.4
2
Unit
300
600
300
Spare parts – computer equipment
51
14
15
Month
30
870
420
Office supplies
52
15
15
Month
30
900
330
Utilities – basic services
53
15
15
Month
150
4,500
2,250
Bank charges, courier, photocopying, other
61.7
15
15
Month
35
1,050
524
Maintenance of computer equipment
61.8
14
15
Month
30
870
420
Financial audit
62
1
2
Audit
2,000
6,000

-38-

2,400
3,600
1,200
320
800
300

800
160
60

800
33,00014,400
9,000
1,800
480
1,200

450
420
2,250
526
450

9,000
39,0009,600
8,000
11,600
1,500
400
1,000
36,000
900
1,000
1,000
250
300
150

6,000

3.4.2

Consolidated budget by component (US$)

Category
10

Description

Year 2

Year 3Phase 1

Phase 275,00030,00030,00015,00037,50037,50011.2 Coordinator - CNF

39,00015,60015,6007,800

19,50019,50011.3 Regional officers (2)38,40014,40019,2004,800

19,20019,2004,000

11.4 Monitoring officer

8,000

3,200

3,200

1,600

4,000

12.1 Technical assistant36,80012,80020,8003,200

16,00020,80012.2 Forest assistant

29,00011,00012,0006,000

14,00015,00012.3 Trainer /lecturer

3,300

600

2,100

600

900

2,400

12.4 Business technicians

16,56015,840720

2,800

13,76012.5 Participants in events

28,0005,600

21,600800

8,800

19,20013.1 Forest management consultant

9,000

9,000

13.2 Forest certification consultant

7,200

7,200

13.3 Business plans consultants

7,200

7,200

13.4 Timber industry consultant
Business partnerships
13.5
consultant
13.6 Business financing consultant

32,400

20
21
22
23
24
25
29

Sub-contracts
Sub-contract – development,
editing and publication of forest
potential study
Sub-contract – due diligencemechanism
Sub-contract – fact-sheets onwood technological properties
and uses
Sub-contract – fact-sheets onforest regulations
Sub-contract - development,
editing and publication ofproject video
Component Total

16,2009,000
1,800
21,600

3,600

3,600

1,800

1,800

176,340

42,320118,400

4,000

4,000

10,8003,600

3,600
337,060

5,400
7,200

16,2003,600
155,100

181,960

4,000

4,000

4,000

4,000

5,000

5,000

5,000

2,000

2,000

2,000

8,000

8,000

8,000
23,0006,000

17,0006,000

17,00031.1 DSA

27,9006,000

18,300

3,600

8,100

19,80033.1 Local transport

30,6006,880

19,640

4,080

9,400

21,20058,50012,88037,9407,680

17,50041,00036,00014,40014,4007,200

18,00018,000

900

900

900

43.1 Computer equipment

3,000

3,000

3,000

43.2 Multimedia projector

1,500

1,500

1,500

43.3 Printer

750

750

750

43.4 Scanner

600

600

600

42,75021,150Travel39 Component Total
40

Year 1

11.1 Project Director

19 Component Total

30

Total

Personnel

Capital items
41 Office rental
42 Furniture

49 Component Total-39-

14,4007,200

24,75018,000Category50

Description

Year 1

Year 2

Year 3Phase 1

Phase 251 Equipment spare parts

870

330

360

180

420

450

52 Office supplies /materials

9,000

2,160

5,580

1,260

3,030

5,970

53 Utilities – basic services

4,500

1,800

1,800

900

2,250

2,250

59 Component Total

14,370

4,290

7,740

2,340

5,700

8,670

61.1 Publications

7,200

2,400

4,800

2,400

4,800

61.2 Information collection

11,000

1,750

8,500

750

2,750

8,250

61.3 Logistics

6,600

1,050

5,100

450

1,650

4,950

61.4 Venue premises

6,000

1,050

4,500

450

1,650

4,350

61.5 Refreshments

10,800

3,000

6,540

1,260

3,900

6,900

720

180

360

180

270

450

1,050

420

420

210

524

526

870

330

360

180

420

450

62 Auditing

6,000

2,000

2,000

2,000

2,000

4,000

69 Component Total

50,24012,18032,5805,480

15,564

34,67645,19660

Miscellaneous

61.6 Website maintenanceBank charges, courier,
61.7
photocopying, other
61.8 Maintenance of equipment

70
80
81
82
83
89
100

Total

Consumable items

National management costs
Project monitoring andadministration
ITTO monitoring and review
ITTO mid-term, ex-post
evaluation
Sub-total
ITTO programme support costs(12% of above items)
Component Total

78,88833,692

15,257

15,25700

15,257

15,25739,916

17,87655,17333,13322,040

GRAND TOTAL

659,981291,439

368,542-40-

22,0403.4.3

ITTO budget by component (US$)

Category
10
11.1
11.3
12.1
12.2
12.3
13.1
13.2
13.3
13.4
13.5
13.6
19
20
21
22
23
24
25
30

40

50

60

80

29
31.1
33.1
39
43.1
43.2
43.3
43.4
49
51
52
53
59
61.1
61.2
61.3
61.4
61.5
61.6
61.7
61.8
69
81
82
83

100

89

Description
Personnel
Project Director
Regional officers (2)Technical assistantForest assistantTrainer /lecturer
Forest management consultant
Forest certification consultant
Business plans consultants
Timber industry consultant
Business partnerships consultant
Business financing consultant
Component Total
Sub-contracts
Sub-contract – development, editing andpublication of forest potential study
Sub-contract – due diligence mechanism
Sub-contract – fact-sheets on woodtechnological properties and uses
Sub-contract – fact-sheets on forest
regulations
Sub-contract - development, editing andpublication of project video
Component Total
TravelDSA
Local transport
Component Total
Capital items
Computer equipment
Multimedia projector
Printer
Scanner
Component Total
Consumable items
Equipment spare parts
Office supplies /materials
Utilities – basic services
Component Total
Miscellaneous
Publications
Information collection
Logistics
Venue premises
Refreshments
Website maintenanceBank charges, courier, photocopying, other
Maintenance of equipment
Component Total
Project monitoring and administration
ITTO monitoring and review
ITTO mid-term, ex-post evaluation
Sub-total
ITTO programme support costs (12% of
above items)
Component Total
GRAND TOTAL

Total

Year 1

Year 2

Year 366,00028,80027,60017,400
2,400
9,000
7,200
7,200
27,0003,600
3,600
199,800

26,40010,800
9,600
6,600
600
9,000

26,40014,40015,6007,200
1,500

13,200
3,600
2,400
3,600
300

4,000

4,000

13,50076,5007,200
7,200
13,5003,600
1,800
98,400Phase 1

Phase 233,00014,40012,000
8,400
900
9,000
1,800

33,00014,40015,6009,000
1,500

18,0001,800
24,90097,500

5,400
7,200
9,000
3,600
3,600
102,300

4,000

4,000

4,000

4,000

5,000

5,000

5,000

2,000

2,000

2,000

8,000

8,000

8,000

23,0006,000

17,00022,20023,80046,0005,400
5,120
10,52013,50015,56029,060

2,000
500
500
300
3,300

2,000
500
500
300
3,300

870
7,500
4,500
12,870

330
1,800
1,800
3,930

360
4,650
1,800
6,810

180
1,050
900
2,130

420
2,250
2,250
4,920

450
5,250
2,250
7,950

7,200
8,500
6,300
1,650
6,120
720
1,050
870
32,410

2,400
1,500
900
300
1,560
180
420
330
7,590

4,800
6,250
4,950
1,200
4,020
360
420
360
22,360

750
450
150
540
180
210
180
2,460

2,400
2,250
1,350
300
1,800
270
524
420
9,314

4,800
6,250
4,950
1,350
4,320
450
526
450
23,096

3,300
3,120
6,420

6,000

17,0006,600
6,080
12,68015,60017,72033,320

2,000
500
500
300
3,300

15,2570
15,257

15,2570
15,25739,916

17,87622,04055,173
372,553

33,133
166,847

22,040205,706-41-

3.4.4

Executing agency budget by component
Category
10

Description

Total

Year 1

Year 2

Year 3Phase 1

Phase 2

Personnel
11.1 Project Director

9,000

3,600

3,600

1,800

4,500

4,500

11.2 Coordinator - CNF

39,00015,60015,6007,800

19,50019,50011.3 Regional officers (2)

9,600

3,600

4,800

1,200

4,800

4,800

11.4 Monitoring officer

8,000

3,200

3,200

1,600

4,000

4,000

12.1 Technical assistant

9,200

3,200

5,200

800

4,000

5,200

12.2 Forest assistant11,600

4,400

4,800

2,400

5,600

6,000

12.3 Trainer /lecturer

900

600

300

12.4 Business technicians

16,56015,840720

2,800

13,76012.5 Participants in events

28,0005,600

21,600800

8,800

19,20013.4 Timber industry consultant

5,400

2,700

2,700

3,600

1,800

137,260

41,90077,94017,42057,60079,66031.1 DSA

5,700

600

4,800

300

1,500

4,200

33.1 Local transport

6,800

1,760

4,080

960

3,320

3,480

12,500

2,360

8,880

1,260

4,820

7,680

41 Office rental

36,00014,40014,4007,200

18,00018,00042 Furniture

900

900

900

43.1 Computer equipment

1,000

1,000

1,000

43.2 Multimedia projector

19 Component Total
30

900

Travel39 Component Total
40

Capital items

1,000

1,000

1,000

43.3 Printer

250

250

250

43.4 Scanner

300

300

300

39,45017,85014,4007,200

21,45018,00052 Office supplies /materials

1,500

360

930

210

780

720

59 Component Total

1,500

360

930

210

780

720

2,500

250

2,250

500

2,000

300

150

150

300

61.4 Venue premises

4,350

750

3,300

300

1,350

3,000

61.5 Refreshments

4,680

1,440

2,520

720

2,100

2,580

62 Auditing

6,000

2,000

2,000

2,000

2,000

4,000

69 Component Total

17,830

4,590

10,220

3,020

6,250

11,58078,88826,23542,9009,753

33,69245,19679 Component Total

78,88826,23542,9009,753

33,69245,196

GRAND TOTAL

287.428

93,295

155,270

38,863

124,592

162,836

49 Component Total
50

Consumable items

60

Miscellaneous
61.2 Information collection
61.3 Logistics

70

National management costs
71

National management costs/EA management costs (15%)

-42-

3.5
3.5.1

Assumptions, risks and sustainability
Assumptions and risks

The main assumptions that will guarantee the success of the project include the following:•••

Development objective: ongoing compliance with laws and agreements on the implementation ofmanagement plans and the origin of timber from legal sources; stakeholders maintain their interest andsupport the implementation of the project; and willingness of forest entrepreneurs to continue promoting
positive change to achieve the sustainable development of the industry by incorporating new forest
species in their production processes.
Specific objective: timber industry enterprises maintain their openness, are willing to share information
and actively participate in project activities.
Outputs: the assumptions related to timber enterprises include: their willingness to improve productivity;
willingness of producers and industrialists to share information and interact; maintaining their interest in
training and in the use the project outputs; active participation of entrepreneurs in their organizations andin dialogue spaces; while in relation to forest authorities, the assumption is an ongoing interest inpromoting mechanisms to guarantee the legality of timber.

The main risks that could affect the implementation of the project and the mitigation measures that would need
to be implemented would be as follows:•••

Development objective: the most important risk would be that users of forest resources do not show
willingness to comply with forest legislation, show indifference to demonstrate that the forest products
they process and market come from legal sources and are not interested in working with new forest
species. The countermeasures that the project would take would be to carry out awareness campaigns
to change attitudes and to work with users who abide by the current forest legislation, show interest in
applying traceability mechanisms and are willing to process new forest species.
Specific objective: one of the risks to consider is that part of the private forest business sector could be
reluctant to provide and share information. If this situation were to arise, other sources such as forest
authorities would be used.
Outputs: the most important risks are that entrepreneurs show little interest in improving their productivity
and receiving training and are indifferent to the outcomes of project activities; and that forest authorities
do not to continue promoting the use of mechanisms to guarantee the legality of timber. To mitigate thesepotential risks, the project would implement awareness raising campaigns addressed to timber
processors, working with proactive entrepreneurs and promoting voluntary mechanisms from the private
sector to guarantee the legal origin of timber products.

3.5.2

Sustainability

There are associations of forest producers in the project’s area of influence that are highly involved andcommitted to working for the sustainable development of the processing industry that uses timber species frommanaged forests. Project objectives and activities are aimed at improving the technical and managerial
efficiency of timber processors that are indeed using native timber species, as this will not only contribute toimproving the quality of life of Amazon communities but will also to contribute to the development of the
Amazon region in general. Thus, project sustainability will be ensured by having highly sensitized
entrepreneurs who will ensure the ongoing sustainability of project outputs. The methodology for knowledgetransfer will be continued by the National Forestry Chamber – CNF by supporting project beneficiaries in thepractical implementation of the knowledge acquired through training, workshops and technical assistanceprovided to timber industry sector stakeholders, especially through their associations. Entrepreneurs who show
little commitment or sense of business responsibility will also benefit from the vision, mission and businessvalues promoted by the project, in addition to other issues such as the advantages and benefits derived frombusiness formalization and development. Furthermore, the dissemination of technical views will be guaranteed
through the participation of the CNF in the opinion forum called "Executive Roundtable for Forest Sector
Development " under the leadership of the MEF, which aims to identify, promote and propose actions to boost
the forest sector as well as enable and promote the productivity and competitiveness of this sector to contributeto economic growth.

-43-

PART 4. IMPLEMENTATION ARRANGEMENTS
4.1
4.1.1

Organization structure and stakeholder involvement mechanisms
Executing agency and partners

The National Forestry Chamber (Cámara Nacional Forestal – CNF) will be responsible for the implementationof the project through a steering committee made up of representatives of the government, the private sector
and organized civil society. To this end, the participation of various forest-related organizations will be ensured,
including public agencies, NGOs, and timber industry management committees, among others. All of theseinterested parties will be involved in work meetings, training, technical assistance, and national andinternational trade promotion, with a view to improving the productivity of the timber industry for the processingof products according to the technical specifications required by the market.
The main objectives of the National Forestry Chamber are to promote the sustainable use of forest resources,
harmonizing the principles of conservation with technology and economic and social development, and toachieve efficient and sound forest policies to encourage the development of forest management, industry andtrade and the promotion of exports. The CNF has been working with forest stakeholders for more than
30 years. Past experiences implemented by the CNF in cooperation with ITTO and the National Forest
Authority (SERFOR, formerly INRENA) include ITTO Projects PD 621/11 Rev.3 (M) “Traceability of timber
produced by forest concessions and native communities in Madre de Dios and Ucayali”, PD 540/09 Rev.2 (I)“Support to improve the productivity of the Peruvian timber industry for the production of higher value-added
products”, PD 421/06 (F) “Strengthening of the Production Chain for Timber from Forest Concessions andOther Forests under Management”, and PD 23/00 Rev.4 (F) “Promotion and transfer of knowledge onsustainable forest management models to timber producers”.
4.1.2

Project management teamThe project management team will be appointed by the executing agency and will be made up of a project
director, a project coordinator, two regional officers, a professional assistant and a monitoring officer. Offices
will also be established in the regional headquarters of the cities of Pucallpa (Ucayali) and Puerto Maldonado(Madre de Dios). The Lima office will be the main headquarters and will be located on the premises of the
CNF. Both the Project Director and the Project Coordinator will be based in the city of Lima and will travel
regularly to the regional offices. The Coordinator will provide administrative, accounting and technical support
to each of the offices.
4.1.3

Project Steering Committee

A Steering Committee will be established at the highest level of the project organizational structure.
This Committee will be responsible for supervising the project, reviewing and approving budget expenditures,and reviewing the implementation of activities, among other responsibilities. The Committee will be made up
of a representative of each of the following institutions: National Forestry Chamber (CNF) as chairperson,
International Tropical Timber Organization (ITTO), the National Forest and Wildlife Service (Servicio Nacional
Forestal y de Fauna Silvestre – SERFOR) and representatives of donor countries and primary and secondary
timber processing associations. The Project Director will act only as the Secretary of this Committee.
4.1.4

Stakeholder involvement mechanisms

Consultative Committees will be established as a consultation platform to guide project actions. Three CCs
will be established – one at the national level in the city of Lima and two at the regional level, including one in
the city of Pucallpa (Ucayali) and another in the city of Maldonado (Madre de Dios). These committees will bemade up of representatives of project beneficiaries, forest producer organizations (concessionaires and native
communities), timber processing enterprises (entrepreneurs, industrialists, exporters, professionals),
SERFOR, regional governments, MINAGRI, PRODUCE, NGOs, research institutions, and university andtechnical forest education institutions, as well as guest participants to be invited by the Committees.
The purpose of the Consultative Committees is to provide information on project implementation to allinterested parties and ensure their participation, in addition to offering a platform for stakeholders to contributeto the project. The CCs may request and receive information and provide guidance, but they will not have anofficial duty under the project. Their recommendations will be submitted to the chair of the Project Steering
Committee.
The project organizational chart is shown below:-44-

Project organizational chart
Steering Committee:
CNF, ITTO, SERFOR and representatives of donor
countries and primary and secondary timber
processing associations
Executing
Agency:CNF
Coordination,
administrationand monitoring

National
Consultative
Committee
Project
Director

Regional Consultative
Committee– - Madre deDiosRegional Consultative
Committee - Ucayali
Regional
Officer
Madre de Dios

Regional
Officer
Ucayali

-45-

4.2

Reporting, review, monitoring and evaluation

The following reports will be submitted:
Inception report (upon project approval)
Yearly plan of operation (together with the inception report)
Monthly reports
Progress report (by 28 February and 31 August of each year and/or 4 weeks before the date of a review
and monitoring mission)
Technical report (every six months during project implementation)
Financial reports (on an annual basis and upon project completion)
Project completion report (upon project completion)

•
•
•
•
•
•
•

A basic monitoring system will be applied that will include internal and external monitoring procedures as
described below.
Internal monitoring: The system will ensure the successful implementation of the Project including adjustmentsof the work plan and/or YPO and the implementation of defined corrective actions. Internal monitoring will
include the following subjects:
•
•
•
•
•

Follow up of commitments resulting from the agreement between ITTO and the Executing Agency;
Progress and proper execution of work;
Timely delivery and quality of outputs;
The extent to which the specific objective has been achieved;
Social, economic and environmental impacts and the effect of mitigating measures.

External monitoring: the external monitoring of the project will be undertaken by ITTO, in cooperation withdonors as appropriate, to supervise project implementation. The purposes of this process will be as follows:•••

assess whether the project is proceeding according to the agreed work schedules, so that thenecessary ITTO actions (e.g. payments to the Executing Agency) may be taken;
propose and participate in any necessary reviews of the project as a result of these assessments;
andreport to the Committees and the Council on the situation and completion prospects for the project.

The evaluation of the project will be based on the systematic and objective collection of information, on the
spot assessments and analysis of the validity, design, appropriateness, performance and impact of the project.
The project mid-term evaluation will include the systematic and objective collection of information, on the spot
assessments and analysis of the validity, design, appropriateness, performance and impact of the project
during its implementation stage. Mid-term evaluations will be carried out in circumstances when:••

there are problems in project implementation, upon request from the ITTO secretariat, donors or the
Project Steering Committee, as appropriate;
the need for a mid-term evaluation is foreseen at the early stage of project development or
implementation.

The ex-post evaluation will include the systematic and objective collection of information, on the spot
assessment and analysis of the validity, design, appropriateness, performance and impact of the Project after
its completion, with the aim of establishing the extent to which it achieved its objective, its degree ofeffectiveness and efficiency, as well as its sustainability.

-46-

4.3
4.3.1

Dissemination and mainstreaming of project learning
Dissemination of project results

Project results will be reported to beneficiaries through various events, including courses, workshops, technicalmeetings, conferences, congresses and congress presentations, as well as documents in printed and digitalformats to be published by the project and other information to be posted on existing electronic platforms suchas CNF and SERFOR websites, so as to ensure widespread dissemination at the national and international
levels. In addition, the project’s professional staff will be available to users, both in person and online, foradditional enquiries and consultations.
4.3.2

Mainstreaming of project learning

The project will be implemented with the active participation of forest sector stakeholders (including both men
and women) such as forest producers and timber processors who have a particular interest in this project.
Beneficiaries will receive the necessary training through their participation in courses and workshops andthrough the technical assistance and support provided by the project. Thus, enterprises will become morecompetitive, process more forest species, incorporate due diligence mechanisms, use official or voluntary
traceability systems to guarantee the legality of the wood. This will enable them to supply a greater volume oftimber from managed forests in the Amazon Region to national and international markets. In addition, byunderstanding market demands and conditions, they will be able to restore and expand the markets for timber
products that have currently been lost. Given the nature of this project, only a group of enterprises will directly
benefit from it; however, project experiences will be disseminated by various means so that they can be known
and replicated. An article will be written for publication in ITTO's Tropical Forest Update (TFU). The
experiences gained by the project will be systematized and published in order to share them with all interested
stakeholders and to disseminate the importance of promoting the forest sector to improve the living conditionsof the population within the framework of sustainable development. In this context, the Internet is an important
tool as it facilitates widespread dissemination at a low cost.
Project information and outputs will be published in the CNF web portal and also disseminated through othermass media outlets. In order to raise policymakers’ awareness and increase their access to these materials,
representatives of the CNF will continue to participate in various technical-political spaces such as the forestry
dialogue roundtables, including the Forestry Executive Roundtable, led by the country's Ministry of Economy
and Finance, which seeks to activate new sectors of the Peruvian economy and increase the competitivenessof forest production activities through increased coordination with the private sector as well as through regional
forest dialogue roundtables. Representatives at the highest decision-making levels of different public andprivate entities of the national and regional forest sectors will participate in these roundtables. Furthermore,
the project will establish consultative councils, both at the national and regional levels, where representativesof the main forest sector institutions will participate. These councils are important spaces to disseminate project
information, outputs and achievements. In addition, the CNF, as the executing agency, will promote andorganize meetings and events with officials and policymakers in order to facilitate the mainstreaming of project
outcomes into national policies and strategies for the development of the national forest industry.

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ANNEX 1. Profile of the executing agency
NATIONAL FORESTRY CHAMBER
Address:
Ramón Dagnino No. 369. Jesús María, Lima 11, Peru.
Telephone: (511) 430-46-05
E-mail:cnf@cnf.org.pe
Website:www.cnf.org.pe
The National Forestry Chamber (Cámara Nacional Forestal – CNF) is a non-profit civil association established on
16 August 1989 after a consensus-building process between the most representative institutions at the national
level in the fields of forest production and conservation as well as forest and conservation professionals.
The objectives of the CNF are as follows:
•
•
•
•
•
•
•

Promoting the sustainable use of forest resources, harmonizing the principles of conservation withtechnology and economic and social development;
Coordinating national forest activities, and acting as the main interlocutor of the private forest sector
before public and private institutions and agencies;
Proposing and achieving efficient and sound forest policies to encourage forest management, industry,
trade and the promotion of exports;
Protecting the national forest production;
Building up and disseminating an adequate image of the forest activity at the national level consistent withthe magnitude of the resource and its territorial significance;
Providing feedback/making statements on issues of national interest;
Designing and implementing research, training and development projects related to forestry.
CNF Flowchart
Assembly
Executive Council
Management
Secretariat

Treasury
Projects
Coordination
Administration

Coordination
Pucallpa

Coordination
Puerto Maldonado

The National Forestry Chamber is headquartered in the city of Lima, where it has an office that is conveniently
equipped for ongoing communication via the internet and mobile telephones with its two coordination officesin the cities of Pucallpa and Puerto Maldonado.

-48-

List of studies carried out by CNF over the last few years
PeriodTitle

Funding source

Total cost

Jun – Dec
2019

“Baseline of legal timber supply in Peru,
including technical, social and commercial
aspects”

USAID PRO -BOSQUES

US$ 79,191

Jul – Nov
2019

“Implementationofsurveysandsystematization of results of the study andimproving timber legality in Peru”

PROFONANPE

US$ 34,481“Shiringa production chain to strengthen
competitiveness”

Programme for Inclusive andCompetitiveness Sustainable
Forest Development in the
Peruvian Amazon Region –SERFOR - CAF

US$ 43,582

Oct 2017 –Jan 2018

List of ITTO projects implemented by CNF
PeriodProject Title

Total cost
US$

CNF
Contrib.

ITTO
Contrib.

Oct. 2013 –Mar. 2016

PD 621/11 Rev.3 (M) “Traceability of timber
produced by forest concessions and native
communities in Madre de Dios and Ucayali”

627,157

278,125

349,032

Oct. 2012 –Mar. 2015

PD 540/09 Rev.2 (I) “Support to improve theproductivity of the Peruvian timber industry forthe production of higher value-added products”

873,440

425,078

448,362

166,129

116,129

50,000986,225405.693580.532

812,777

392.565420.212

841,750

380,500

461,250

829,250

380,500

448,750

Mar. – Nov.
2011

Support for the implementation of the 5th Latin
American Forestry Congress
PD 421/06 Rev.2 (F) “Strengthening of theNov. 2007 – production chain for timber from forest
Mayo- 2010 concessions and other forests undermanagement”.
PD 23/00 Rev.4 (F) “Promotion and Transfer ofOct. 2004 –Knowledge on Sustainable Forest Management
Mar. 2007
Models to Timber Producers”
Mar. 1992 – PD 37/88 Rev.3 (I) “Industrial utilization of new
Nov. 1993 forest species in Peru” - Phase II
Abr. 1990 – PD 37/88 Rev.3 (I) “Industrial utilization of new
Mar. 1992 forest species in Peru” - Phase I

Pre-project approved and funded by ITTO about to be implemented by CNF as executing agency

PeriodPre-Project Title

Approx.
startingdate
May 2020

PPD 189/17 Rev.3 (F) “Development of afull project proposal to generate tools toensure the establishment of timber forest
species through natural regeneration in
the Province of Tahuamanu, Peru”-49-

Total cost
US$

National
Contribution
US$

103,410

CNF: 9,900
UNALM: 43,510

ITTO
Contribution
US$

50,000ANNEX 2. Tasks and responsibilities of key experts provided by CNF
Terms of reference for the project coordinator - CNF
Qualifications• Registered forest engineer• A minimum of 5 years of experience in the management of forest development projects• Experience in the management of international cooperation funds• Knowledge of forest management, forest industries, forest business and forest governanceDuties• In coordination with the project director, coordinate the technical and financial aspects of project
implementation• Facilitate project planning, monitoring and evaluation• Establish coordination mechanisms with the project collaborating agencies• Sign off project reports to be submitted to ITTO
Work base: Lima + availability for regional travel
Terms of reference for the monitoring officer
Qualifications• Forest engineer• A minimum of 2 years of experience in forest development projects• Verbal and written communication skills
Duties• Monitor the implementation of scheduled project activities• Coordinate with the project director and regional officers for the implementation of project activities• Issue quarterly monitoring reports
Work base: Lima + availability for regional travel-50-

ANNEX 3. Terms of reference of personnel funded by ITTO
Terms of reference for the project director
Qualifications• Registered forest engineer, preferably with an advanced academic degree• A minimum of 15 years of professional experience in the field• Experience in the formulation, implementation and management of forest projects, working withstakeholders along the timber production chain, in particular, forest concessions and timber processing
industries• Verbal and written communication skills• Experience and leadership skills for the coordination of international cooperation projects
Duties• Manage the technical aspects of the project and the implementation of activities• Manage and supervise the technical team for project implementation• Design and supervise work plans for the achievement of project objectives• Work on an ongoing basis in coordination with the CNF coordinator, regional officers, forest
technicians, forest assistant, consultants and other technical and administrative staff of the project forthe planning, implementation and monitoring of project activities• Prepare project reports and propose plans of operation for the project in accordance with theprovisions of the ITTO Project Manual• Promote and organize meetings between public authorities, timber industrialists and other forest
production chain stakeholders• Ensure the adequate administration and proper use of the project's financial resources, including both
ITTO and counterpart contributions, and assist in financial reporting• Under the supervision of the CNF coordinator, lead the process of hiring consultants and other staff
according to project activities.
• Coordinate and jointly participate with other professionals in the preparation of project documents andtechnical reports• Program and coordinate the organization of the events as required within the framework of project
activities• Implement the activities to be carried out in the city of Lima
Work base: Lima + availability for regional travel-51-

Terms of reference for regional officers
Qualifications• Forest engineer or equivalent degree• A minimum of 3 years of experience in management and/or forest industry projects• Knowledge of the socio-cultural context of communities involved in forest activities• Ability to relate to local communities as well as engaging ability• Skills in the use and management of communication and training techniques• Ability to work in a teamDuties• Implement project activities in their respective areas as required• Assist project beneficiaries in their respective areas as required• Support field logistics• Participate in training and technical assistance activities for project beneficiaries in their respectiveareas• Work directly, closely and on an ongoing basis with the director for the implementation of project
activities in their respective areas• Support the director in promoting and organizing meetings as required for the implementation of the
project• Provide guidance and assistance on the production of timber products• Train community members in project-related activities• Participate in the planning of project activities• Coordinate and jointly participate with other professionals in the preparation of project documents andtechnical reports• Program and coordinate the organization of events in their respective areas as required within theframework of project activities
Work bases: Pucallpa (Ucayali) and Puerto Maldonado (Madre de Dios), as appropriate
Terms of reference for the forest assistantQualifications• Forest engineer or equivalent degree• A minimum of 2 years of experience in forestry projects or studies• Ability to relate to forest sector stakeholders• Skills in the use and management of communication techniques• Ability to work in a teamDuties• Collect secondary information• Visit information centers and web pages, carry out interviews and meet with information providers• Support the project director in the preparation of project documents• Implement project activities as required in Lima
• Provide logistical support as required in Lima
• Participate in training and technical assistance activities addressed to project beneficiaries• Work directly, closely and on an ongoing basis with the director for the implementation of project
activities• Support the director in promoting and organizing meetings as required for the implementation of the
project• Participate in the planning of project activities
Work base: Lima + availability for regional travel-52-Terms of reference for regional technical assistants
Qualifications• Forest engineer or equivalent degree• A minimum of 3 years of experience in management and/or forest industry projects• Ability to relate to local communities
Duties• Implement project activities in their respective areas as required• Assist forest producers and timber processors in their respective areas as required for the project• Support field logistics• Provide technical assistance in the following areas: Forest certification, chain of custody, traceability and operational logbooks
 Innovation and market supply of new quality products Development and implementation of business plans Technological development and production organization
 Business management and production processes Financial Services
Work bases: Puerto Maldonado (Madre de Dios) and Pucallpa (Ucayali), as appropriate
Terms of reference for trainers /lecturers
Qualifications• Forest engineer, economist or professional in a related discipline• A minimum of 8 years of professional experience• Knowledge of the forest sector• Experience in the development and implementation of forest-related studies and/or projects• Verbal and written communication skills• Experience in knowledge transfer
Duties• Develop training topics in their fields of expertise as required by the project• In coordination with the project director, establish a work methodology for the implementation of the
training workshops/courses• Prepare reports for each individual workshop/course• Training workshop/course topics to be developed are in the areas of business management andtechnological properties and uses of timber species-53-Terms of reference for the forest management consultant
Qualifications• Forest engineer, preferably with an advanced academic degree• A minimum of 8 years of professional experience in forest management• Experience in the development of forest management plans• Knowledge of silviculture and tropical rainforest dynamics• At least one publication on forest management• Verbal and written communication skills
Duties• Assess the timber potential of production forests in Madre de Dios and Ucayali based on secondary
information from forest concessions and native communities• Estimate the potential annual harvestable volume of commercial and potentially commercial species
for a second logging cycle in managed forests• Conduct dissemination and training events on current and future forest potential to promote the use oflesser-known species for the production of timber products• Submit a document on forest potential for publication
Terms of reference for the forest certification consultant
Qualifications• Forest engineer• A minimum of 5 years of professional experience• Knowledge of forest certification, chain of custody, timber traceability and operational logbooks• Verbal and written communication skills• Experience in knowledge transfer
Duties• Provide technical assistance in forest certification, chain of custody, timber traceability and operational
logbooks• Prepare outreach documents for publication on forest certification, chain of custody, timber traceability andoperational logbooks
Terms of reference for the business plans consultant
Qualifications• Economist, forest engineer or professional in a related discipline• A minimum of 8 years of professional experience• Knowledge of the forest sector• Experience in the development of forest business plans• Verbal and written communication skills
Duties• Develop market-oriented business plans for timber products• Provide technical assistance during the development and implementation of business plans-54-Terms of reference for the forest industry consultant
Qualifications• Forest or industrial engineer or professional in a related discipline• A minimum of 8 years of professional experience in the industry• Experience in the development and implementation of forest industry studies and/or projects• Verbal and written communication skills
Duties• Implement a situational diagnosis on the technology used by timber enterprises in the project area andsubmit proposals for technological innovation and production improvements• Provide technical assistance aimed at promoting the technological development of timber enterprises
Terms of reference for business partnerships consultant
Qualifications• Economist, forest engineer or professional in a related discipline• A minimum of 10 years of professional experience• Knowledge of the forest sector• Experience in the development and implementation of forestry studies and/or projects• Verbal and written communication skills
Duties• Organize events to raise awareness on the importance of participating in production partnerships• Provide technical assistance for the development, maintenance and/or strengthening of business
partnerships• Submit a script proposal to produce, edit and publish a project video
Terms of reference for the business financing consultant
Qualifications• Economist, forest engineer or professional in a related discipline• A minimum of 5 years of professional experience• Knowledge of the forest sector• Expertise in accessing the formal financial system• Verbal and written communication skills
Duties• Implement a situational diagnosis on access to the financial system used by timber companies in the
project area and submit innovative proposals for business financing• Provide technical assistance to timber organizations to enable them to interact with formal andcompetitive financial services• Prepare outreach documents on business financing for publication-55-

ANNEX 4. Micro, small and medium forest industry enterprises in Peru –2019
The following table shows the characteristics of each business category:Business category
Micro enterprises

Characteristics
Companies with annual turnover up to a maximum of 150 taxable units(TUs), equivalent to US$ 180,000
Small enterprises
Companies with annual turnover over 150 TUs and up to 1,700 TUs,
equivalent to US$ 2,040,000
Medium enterprises
Companies with annual turnover over 1700 TUs and up to 2300 TUs,
equivalent to US$ 2,760,000
TU (year 2020): 4,200 soles, equivalent to US$ 1,200
Enterprise groups:•••

MSEs: micro and small enterprises
SMEs: small and medium enterprises
M&SMEs: grouping MSEs and SMEs together (micro, small and medium enterprises)

Distribution of forest enterprises by category –2019 (SUNAT)Enterprise category
Department
Micro
Small
Medium%%enterprises
enterprises
enterprises
Lima
7,688
36.7
326 72.0
6
Ucayali
Madre deDios
Other
departments
National
Total

Large
enterprises
54.5
13
%

Total

%

46.4

8,033

37.5

%

795

3.8

6

1.3

1

9.1

4

14.3

806

3.8

691

3.3

2

0.4

3

27.3

5

17.9

701

3.3

11,753

56.2

119

26.3

1

9.1

6

21.4 11,879

55.5

20,927

100

453

100

11

100

28

100 21,419

100

-56-

ANNEX 5. Recommendations of ITTO Expert PanelRESPONSE TO EXPERT PANEL RECOMMENDATIONS IN TABULAR FORM
PD 912/20 (I)Strengthening Technical and Business Management in the Timber Forest Industryof Peru

Assessment by the Fifty-fifth PanelA)

Overall Assessment

The propose project intend to contribute to the sustainable development of the country’s timberindustry through the promotion of competitive market-oriented forest enterprises. The proposal wasdeveloped with strong adherence to the ITTO Manual for project formulation. However, the proposal needs
to be further refined. Several of the proposed activities are worthwhile whereas some aspects of the proposal
are out of the project control (exports, governance, and efficiency). The Panel considered that the proposal
is too ambitious for its targets and it needs to be scaled back and focus on small and medium-sized businessplan development, due diligence and efficiency in timber processing. 30 months is a short timeframe toachieve the stated large increase in exports.
B)

Specific Recommendations

Modifications made1.

In Section 1.2.1, improve the section by citingon ITTO Action Plan 2013–2018;

The references to the ITTO Action Plan 20132018 under Section 1.2.1 were improved

2.

In Section 1.3.2, Improve the section bydescribing conformity of the project with the
GEEW and ESIA guidelines;

Section 1.3.2 was improved by describing
conformity of the project with the GEEW and
ESIA guidelines

3.

In Section 3.3.1, improve the defined activities
under Output 2 to make them correspond to
the Problem and Solution Trees;

A new Activity A2.1 was added and described so
as to make activities correspond to the problem
and solution trees. It was also necessary torenumber all activities; thus, previous Act. A2.1
became A2.2 and so on up to Act. A2.5. It wasalso necessary to add this new activity to theWork Plan (Section 3.3) and the Master Budget(Section 3.4.1), sharing costs with Act. A1.4

4.

In Section 2.1.1, improve the section by
providinginformationoninstitutional
communication
andcoordination
andcompetence of the CNF as the EA;

Section 2.1.1 was improved by providing
information on institutional communication andcoordination and competence of the CNF as theexecuting agency

5.

In Section 2.1.2, improve the section byadding information on pros and cons of the
stakeholders, if any, and how such issue
would be resolved;

Section 2.1.2 was improved by developing
information related to the pros and cons ofstakeholders and actions needed to resolve
identified issues

6.

In Section 2.2.1, improve the section by
providing time bound of the indicators. Insert"… years after project completion" wording
before listing the indicators;

Section
2.2.1 wasimproved, providing
timeboundindicators
andaddingtherecommended text, which was also reflected in
Section 2.1.4 (Logical Framework Matrix)

7.

In Section 2.2.2, before listing the indicators,
insert "At project completion:"

The recommended text was adding before
listing the indicators under Section 2.2.2

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8.

In Section 3.4.3, significantly reduce
contribution of ITTO to payment of project
personnel by increasing share of EA or scaling
down rates of monthly pay or both;

ITTO's contribution to project staff payments
was significantly reduced in section 3.4.3; CNF’s
contribution was increased and the monthly fee
payments were reduced; it was therefore
necessary to update the budget tables in
sections 3.4.1, 3.4.2, 3.4.3, and 3.4.4. The figuresof the proposed budget on the first page and in
the Project Brief (page iv) have also been
updated accordingly

9.

In Section 3.4.4, increase share of EA in
payment of personnel component;

The share of the executing agency in thepayment of the personnel component wasincreased by US$ 44,500 in section 3.4.4

10.

In section 4.1.3, add in the Project Steering
Committee representatives of donor country/sand at least the primary and secondary
stakeholders;

In Section 4.1.3, representatives of donor
countries and primary and secondary timber
processing associations were added to theProject Steering Committee

11.

In Section 4.3.2, explain how policy makers
will have access to using developed tools andpolicy briefs. Also clarify on how the EA will
facilitate mainstreaming of project outcomes
into national policy and strategies for forest
industry development;

In Section 4.3.2, it was explained how
policymakers will have access to the tools andpolicy briefs developed. It was also clarified how
the executing agency will facilitate themainstreaming of project outcomes into national
policies and strategies for forest industry
development

12.

Include an Annex that shows the overall
assessment and specific recommendations of
the 55th Expert Panel and respective
modifications in tabular form. Modifications
should also be highlighted (bold andunderline) in the text.

This Annex 4, which shows the overall
assessment and specific recommendations of
the 55th Expert Panel, has been included, as wellas the respective modifications in tabular form.
The modifications have been highlighted in bold
and underlined throughout the text.

-58-

ANNEX 6. Financing provided for project PD 912/20 Rev. 2 (I)Under Decision 1(LIX) adopted at the 59th session, held on 13-17 November 2023, in Pattaya,
Thailand, funding was allocated by ITTO (Government of Japan) in the amount of US$ 180,000
to finance the implementation of Phase 1 of project PD 912/20 Rev.2 (I).

ITTC(LIX)/12
page 3
ANNEX
Financing during 2023 for Projects, Activities and Concept Notes(i)

Projects:
PD 808/16 Rev.5 (F) Phase I
Conservation of African Barwood (Pterocarpus Erinaceus Poir) in the Gazetted
Forests of La Palee and Boundiali in Northern Côte d’Ivoire with the Participationof Local Communities (Côte d’Ivoire)– Budget revised in 2023
[Japan $320,000 (Note 2)]$320,000.00

PD 916/21 Rev.2 (F)Pilot Sustainable Management Systems for Secondary Natural Forests in theCollective Afro-Descendant Community Territory of the Bajo Calima Community
Council, Municipality of Buenaventura, Colombia (Colombia)– Balance funded / budget revised in 2023
[Japan $200,000 (Note 2)]$200,000.00

PD 935/23 (I) (CN-23025)
Promoting Sustainable Wood Use for Domestic Market in Malaysia[Japan $212,088 (Note 2 and Note 3)]$212,088.00

PD 903/19 Rev.2 (F)Management of Sungai Menyang Conservation Area for Orangutan Protection
and Uplifting Community Livelihood, Sarawak, Malaysia (Malaysia)[USA $140,000 (Note 4)]$140,000.00

PD 912/20 Rev.2 (I)Strengthening Technical and Business Management in the Timber Forest
Industry of Peru (Peru)[Japan $180,000 (Note 4)]$180,000.00-59-

ANNEX 7. Submission of the modifications to PD 912/20 Rev. 2 (I)Considering the budget allocated for the implementation of Project PD 912/20 Rev.2 (I), theproposal has been redesigned to be carried out in two phases: Phase 1 for a total of
US$291,439, with ITTO contributing US$166,847 from the Government of Japan and the
National Forestry Chamber (CNF) contributing US$124,592; and Phase 2 for a total of
US$368,542, with ITTO contributing US$205,706 and the CNF contributing US$162,836.
The amendments made to the project document for the two-phase implementation arehighlighted in bold and underlined on the cover page, in Sections 3.1.1 and 3.1.2, and in thebudget tables in Sections 3.4.1, 3.4.2, 3.4.3 and 3.4.4.

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