Last week, the global climate summit got underway in the city of Belém, in the heart of the Brazilian Amazon, with the creation of the Tropical Forest Forever Facility (TFFF). This investment fund would pay countries to keep their rainforest standing and channel finance directly to Indigenous and local communities who protect the world’s most biodiverse ecosystems.
The Japanese government was among the 53 countries that pledged support. Even though Japan has one of the world’s five largest economies, it hasn’t backed its pledge with funding. While Japan has signed multiple international treaties committing it to address climate change – it is not possible to do so effectively without tackling deforestation.
Deforestation together with the commercial agriculture that often follows on land cleared of forests, is the second most important driver of climate change triggered by human activity. Deforestation also decimates ecosystems that support the livelihoods of millions of people who draw food, medicine, and cultural identity from their forests.
To step up its support for combatting global deforestation, Japan should support initiatives like the TFFF. Japan can also align its development aid with this goal, by financially supporting the policies that advance forest peoples’ land rights, modernize agriculture, and decouple food and timber production from deforestation.
However, the most powerful tool that Japan has at its disposal is its own domestic market. With the right regulation, Japan can leverage its purchasing power to support deforestation-free trade. This is important, because without such regulation, Japan’s own consumption of timber products is driving environmental destruction.
Japan has increasingly turned to burning wood pellets instead of coal in its power plants – and the last remaining rainforests of Southeast Asia are being razed to manufacture these pellets. This shift is based on the false premise that wood pellets are a green alternative, when in reality neither coal nor woody biomass belong in a sustainable energy future.
A report published by environmental watchdogs found that Japan received 38 percent of Indonesian wood pellet exports over 2021-2023. Uniquely biodiverse and carbon-rich rainforests, including vital rainforests inside Indigenous territories, are being razed in several Indonesian islands to manufacture these pellets.
Malaysia is following a similar pattern. I investigated how Zedtee, a company part of the Shin Yang Group conglomerate, one of Malaysia’s seven largest timber companies, logged in an Indigenous territory without the community’s consent. When the community protested, the company sought to expel them to take over their land.
Rather than hold the company accountable, the state government threatened to demolish the Indigenous village and arrest protesters. The community is now living in fear of being forcibly evicted overnight and losing their home.
Shin Yang Group advertises Japan as a market for their wood products, which include wood pellets. France, the Netherlands, Japan, and South Korea are top importers of wood pellets from Sarawak. (Shin Yang Group did not respond to a request for comment, while ZedTee denied any wrongdoing.)
Japan should leverage its domestic market by passing a law that requires goods sold locally to be free from deforestation and human rights abuses. This would create a major market for sustainable products in Asia, while also addressing Japan’s footprint in the region’s forests.
Japan did adopt an important law called the Clean Wood Act in 2016, which requires imports of timber products to be of legal origin. However, the penalties for non-compliance are so low it would be easy for any major business to assume them as an operational cost. Fines would not cost more than about ¥1 million (US$6,500) for an offender.
To be a real deterrent, Japan should reform the Clean Wood Act in two significant ways.
First, Japan should revise the law to require imports of timber products to be free from deforestation and from rights abuses, aligning it with the European Union’s deforestation-free products regulation. The EU’s new market requirements have already prompted important and positive reforms in trading partners that will better protect forests and forest peoples. Japan’s support for the same standard could boost this impact.
Second, Japan should also revise the Clean Wood Act’s enforcement mechanisms to adopt genuinely dissuasive penalties. These penalties could be calculated as a percentage of a company’s yearly earnings. Repeat offenders could be temporarily barred from applying for government procurement contracts.
These two approaches – climate finance for standing forests and their protectors, and regulation for businesses – is aptly summarized as “the carrot and the stick.” One does not work without the other.
The Japanese economy has a large footprint in the world’s forests, particularly in Southeast Asian landscapes. It is overdue for Japan to tackle this responsibility.
Lucana Téllez Chávez is a senior environment researcher and forestry lead at Human Rights Watch.
