Cambodia Sharply Increases Logging Royalties
6/24/97
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Headline: Cambodia Sharply Increases Logging Royalties
Source: Agence France-Presse
Date: 6/24/97
Copyright 1997 by Agence France-Presse
PHNOM PENH, June 24 (AFP) - The Cambodian government has
dramatically increased the royalty fee logging companies must pay to
fell timber ahead of an international donors conference, an
environment group said Tuesday.
The fees were raised 1,250 percent on May 29 by Finance Minister
Keat Chhon to 175 dollars a cubic meter (35 cubic feet) of highest
quality timber, said British environmental group Global Witness.
The group released a letter it said was written by Keat Chhon to
Minister of Agriculture, Forestry and Fisheries Tao Seng Huor
detailing the sharp increase.
According to the letter, the rates were being raised because
logging companies had been taking advantage of lower fees and
harming the environment.
"These rates have urged a lot of investment companies to rapidly
and intensively log, resulting in very fast destruction of forest
resources which in turn affects very badly on the environment of the
nation," it said.
The letter released by the group said that the previous royalty
rate was lower than that charged before the new Cambodian government
was elected in 1993.
"Any company or businessman that cannot commit perfectly to the
payment of these (new) rates, should stop its logging activities,"
the letter said.
Cambodia's logging policy has been harshly criticized by
environmental groups for its ecological unsustainablity and by
donors for its failure to earn revenue the cash-strapped government
desperately needs.
Last year the International Monetary Fund (IMF) cancelled a
20-million-dollar loan installment to the government due to serious
concerns about logging.
Cambodia depends on foreign aid for nearly 50 percent of its
budget.
Global Witness hailed the letter as a sign Phnom Penh was
becoming more serious about logging reform but urged donors, who are
to meet July 1 and 2 in Paris, to be vigilant in ensuring it was
enforced.
"If it's implemented, it will boost state revenue and curb
wasteful extraction and exploitation," said Charmian Gooch of Global
Witness in a statement. "It deserves the donors' support."
But the London-based group predicted that even though logging
companies would likely be able to pay the new rates easily, they
would search for a way to avoid them.
"Many timber companies target poor countries in Asia and South
America because they obtain timber at knock-down prices. The finance
minister's decision is a clear message that they have to think
again," Gooch said.