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PAPUA NEW GUINEA RAINFOREST CAMPAIGN NEWS

Small and Medium Scaled Logging Backed

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Forest Networking a Project of Ecological Enterprises

http://forests.org/

6/17/98

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Greens: Small best in logging game

Post Courier--Local News

17/06/98

GREENPEACE forest campaigners are adamant that small and medium scale

logging operations in PNG are more vibrant and provide better returns

for forest resource owners than industrial loggers.

Greenpeace has asked the World Bank to take a strong position against

the proposal to reduce log export taxes.

The tax relief measures (which include reducing log tax by 10-20 per

cent, selective felling of only high value log species and relaxation

of royalty payments, harvest requirements and others) are aimed at

reviving the industry.

According to Greenpeace: ``Small and medium scale sawmill operators

have been producing much higher rates of return for landholders than

what the logging companies are paying. They also employ more people

and create skills.''

Greenpeace's forest campaign co-ordinator Christoph Thies wrote to

World Bank PNG country officer in Washington, Bilal Rahill on June 10.

Compared to a K10 a cubic metre royalty paid to landholders by large

operators for logs harvested and exported, small to medium and private

operators pay between K200 to K400 a cubic metre.

In the Western Province, according to statistics supplied, small and

medium operators pay Kiunga and Kikori landowners between K300 to K400

a cubic metre and Alotau operators pay K300 a cubic metre.

European Union and a private operator pay between K300 to K350 a cubic

metre in West New Britain - and generally across the country resource

owners receive between K300 to K350 a cubic metre for all high-quality

logs.

Greenpeace Pacific's Dr Brian Brunton said yesterday that industrial

loggers paid ``peanuts''.

Mr Thies added that ``the reality is that most logging companies are

simply operating inefficiently'' considering a recent PNG Forest

Authority seminar highlighted that cost of production was high and

return was low - suggesting that log export duty be reduced.

Giving tax relief to the industry without concessions in return would

perpetuate many negative impacts ``on an outdated and unsustainable

industry and would be against conventional economic logic''.

Mr Thies said since the Asian economic crisis, PNG's logging industry

was faced with a different future - the changing markets would never

be the same again because tropical hardwoods were no longer in high

demand and there was low demand for round logs.

This might open the way for a destructive and inappropriate forest

management style rather than controlled, small scale community based

sawmilling systems catering for specialised markets.

Providing tax relief would not add extra revenue to government or

landowners.

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