Papua New Guinea: Government vs Loggers, Landowners, Ecologists

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WORLDWIDE FOREST/BIODIVERSITY CAMPAIGN NEWS

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Forest Networking a Project of Ecological Enterprises

7/22/96

OVERVIEW & SOURCE by EE

Following is an insightful press release from the InterPress Service which

does a good job of paraphrasing Papua New Guinea's increased criticism from

all sides concerning its current forest policy. A huge expanse of lowland

rainforests' future is being determined in an overtly power politics based

fashion. Somewhere in the middle between the timber industry, landholders,

the PNG government and ecologists lies community eco-forestry efforts.

g.b.

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/* Written 3:07 PM Jul 21, 1996 by newsdesk in igc:reg.newguinea */

/* ---------- "IPS: PAPUA NEW GUINEA: Government v" ---------- */

Worldwide distribution via the APC networks.

*** 18-Jul-96 ***

Title: PAPUA NEW GUINEA: Government vs Loggers, Landowners, Ecologists

By David Robie

PORT MORESBY, Jul 18 (IPS) - The Papua New Guinea (PNG) government, foreign

logging companies, environmentalists and landowners are all caught up in a

bitter dispute over the country's timber and forestry policies.

The Port Moresby authorities face criticisms all around, with the foreign

logging concerns having threatened to pull out of the country unless the

government scraps a new timber policy that stipulates increased royalties

to landowners.

Top executives of the "big six" foreign logging companies which control

most of the industry have categorically stated they will not pay an extra

K10 (about seven dollars) a cubic metre royalty on top of current taxes

imposed by the government this month at the insistence of the World Bank.

"There is just no more money," said Forest Industries Association (FIA)

President Francis Tiong, in an interview with his own newspaper 'The

National' -- a fast growing daily.

Tiong, head of the Malaysian concern Rimbunan Hijau, the biggest logging

company in the country, added: "You think if there is money to be made, we

are going to go to this extent to confront the government? The truth is we

are losing money. We are going to close down."

FIA executive officer Jim Belford of PNG, warned that in introducing the

new policy, the government may have planted the "kiss of death" on its

dream of having a timber processing industry in country.

But it is not only the powerful logging industry that has taken the

government to task. A lobby group for the landowner, have accused the

government of failing to fulfil previous promises on royalty payments.

"All forest landholders -- you are losing millions of kina!" read a full

page advertisement carried in the influential weekly newspaper 'The

Independent' last week.

Placed by the Individual and Community Rights Advocacy Forum (ICRAF) and

funded by Greenpeace, the advertisement made reference to Deputy Prime

Minister Chris Haiveta's budget speech last November when he said: "I am

introducing a new tax and landowner royalty system which will go into

effect immediately."

According to the landowner lobby group, while the government had already

started imposing the new export tariff taxes, the graduated royalty for

landholders had been delayed under pressure from the logging companies.

Currently royalties paid to landowners are between four and five kina a

cubic metre. The new government regime has increased that amount to between

six and 10 kinas. The market value of logs is about 160 kinas (about 118

dollars) a cubic metre.

The government has hardly had time to respond to the respective charges

from the logging companies and landowners, as environmentalists have

launched an attack on another front -- this time over a proposed new

national forestry policy due to be tabled in parliament later this month.

Environmentalists say the policy is no more than "a business brochure to

tell everybody what remains to be logged" and does little in terms of

measures to protect Papua New Guinea's fast dwindling forest cover.

An estimated 15 million hectares, worth about 100 billion kinas (74 billion

dollars) at current prices, of lowland rainforest remains in Papua New

Guinea. More than half of this has already been allocated for logging.

The environmental lobby has warned that the country may soon be stripped

bare of forest cover and has drawn up an "alternative NGO forest policy"

which calls for a major shift to small and medium scale sustainable

community forest projects.

Brian Brunton, an ICRAF lawyer and former judge who is also a forest

specialist for Greenpeace, says government's forestry policies are flawed

because they are export-oriented and tailored to the needs of the foreign

logging concerns.

"Information and statistics are hard to come by. The sole concern of the

government is logging and planning future logging. No attention is being

paid to conservation needs, biodiversity priority, and non-timber use of

the forests."

Brunton had been a highly effective NGO representative on the government's

forestry board until he was dumped by Forest Minister Andrew Baing in a

shake-up that activists say favoured the pro- logging lobby.

Among the newcomers on the board is Tiong, who ironically, may turn out to

be the government's worst nightmare.

"The industry, the FIA, is saying that there is no more affordability for

the operators," he said, in reference to the new timber policy. "If the

government wants to give more to the landowners, then it must come from the

government's portion."

Tiong, speaking for the six major logging concerns -- Cakara Alam, Open Bay

Timber, Rimbunan Hijau, Stettin Bay Lumber Company and the WTK group -- and

smaller FIA members, said the government that rather than pay the new

royalties, the companies would close shop and look for greener pastures.

If that happens, he added, PNG would immediately lose between 400 million

and 500 million kinas (between 296 and 370 million dollars) in income, and

three times that in potential earnings. In additional, more than 10,000

local jobs would be lost.

According to Belford, the foreign logging companies would have no choice

but to pull out unless the timber policy is shelved.

By his calculations, with the new policy, industry is being asked to pay

more than 50 per cent of income in tax revenue -- 36 per cent to government

and 15 per cent to landowners. Counted with operating costs, this means

most companies would then be operating at a loss, he said.

On a recent trip to Malaysia, Papua New Guinea Prime Minister Julius Chan

appeared to have buckled under the pressure when he was quoted by reporters

saying he would change the policy. But while the news was widely reported

here, there is no sign yet the government intends to back down.(END/IPS/AP-

EN-IP-DV/DR/CPG/96)

Origin: Manila/PAPUA NEW GUINEA/

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[c] 1996, InterPress Third World News Agency (IPS)

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