Papua New Guinea Log Exports on Road to Recovery

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WORLDWIDE FOREST/BIODIVERSITY CAMPAIGN NEWS

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1/28/99

OVERVIEW & COMMENTARY by EE

The following article is self-explanatory, and a testament to the fact

that if you eliminate all log export taxes you can find someone to

give tropical logs too.

g.b.

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RELAYED TEXT STARTS HERE:

Title: Log exports on road to recovery, says Skate

Source: National

Date: 1/29/99

PORT MORESBY: Forestry exports were on the road to recovery after

hitting the bottom in July and August 1998, Prime Minister Bill Skate

said yesterday.

In a statement, Mr Skate said that exports of forest products had

risen following the tax relief given to the sector last November.

Exports rose by 28 per cent to US$9.5 million (K20 million) in that

month. They rose further in December by 43 per cent and are estimated

to have increased by another 14 per cent to US$15.5 million in January

1999.

"This is yet another positive sign that the economic recovery program

is working," said Mr Skate.

Parliament approved the tax relief for the forestry sector in November

by abolishing the export tax on logs shipments with an average export

value of below K130 per cubic meter, effectively lowering the tax to

allow the operators to recover their operating costs during this

period of depressed prices.

"In terms of volume, export of logs has increased by 130 per cent

between August 1998, when the tax relief was actually announced as

part of my Government's eight-point plan, and January 1999," said Mr

Skate.

"Total exports in 1998 are estimated to have reached 1.6 million cubic

meters, compared with three million cubic meters in 1997, or 47 per

cent lower.

"The current monthly export volume of 220,000 cubic meters remains

below the monthly average of 250,000 cubic meters achieved in 1997.

However, the Government will strictly enforce the conditions of the

Forest Management Agreements to ensure that the maximum allowable cuts

are not exceeded.

Mr Skate said that "while the forestry sector remains important to our

economy, the protection of the environment and our national heritage

are of paramount importance of PNG's long-term development."

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