Beijing must better scrutinise imports of illegally logged timber from countries such as Papua New Guinea where deforestation is devastating ecosystems and livelihoods, Global Witness said Monday.
The watchdog said in a new report that a large number of logging operations in the Pacific nation violated local laws despite holding government-issued permits.
The alleged violations included corruption and bribery in the issue of permits, logging without the consent of indigenous landowners and the exporting of timber above amounts that are legally allowed.
"China is the world's largest consumer and manufacturer of wood and wood products. Yet it has no regulation to keep illegal timber from entering its borders," Global Witness said.
"The risk of illegal timber from countries like PNG flooding China's markets has the potential to damage its reputation and major trade relationships as buyers in the US and (the European Union), which ban illegal timber imports, take action to protect themselves."
Global Witness said PNG provided 29 percent of China's tropical log imports, making it the country's single largest supplier.
It added that the deforestation rate in PNG was "unusually high in recent years", with 640,000 hectares of forest lost in the past five years.
Some 70 percent of PNG is covered by forests that help sustain local livelihoods and provide habitat for some of the world's rarest plants and animals.
Global Witness called on Beijing to require timber importers to go beyond official documents to carry out checks ensuring that the wood was obtained through legal means.
It also urged Port Moresby to place a moratorium on issuing all new logging and forest clearance permits, and to cancel those that were illegally obtained.
PNG is due to host an APEC leaders' summit this year, with regional leaders including Chinese President Xi Jinping expected to attend.
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