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By Gumisai Mutume

Washington, D.C. (January 27, 2001 - IPS/PINA Nius Online)---Environmental non-governmental organisations have embarked on a campaign to block the release of the second disbursement of loans for Papua New Guinea's structural adjustment program.

The groups, led by Greenpeace Pacific and Papua New Guinea's Eco Forestry Forum, fear that the release of the loans coupled with the approval by the World Bank of the country's Forest and Conservation Project (FCP) will contribute to the destruction of its forests. These are the world's third largest tropical rainforests.

Conditions attached to a 90-million-dollar structural adjustment loan (SAL) in 1999 require the country to impose a moratorium on new logging concessions until a full review of existing concessions is carried out. The country already has nearly half of its accessible forests committed to industrial logging. NGOs say some 30 proposed timber projects threaten most of the rest.

Lafcadio Cortesi of Greenpeace Pacific says the Bank would be backsliding on its commitments to forest conservation if it releases the second tranche of the adjustment loan because the forestry review has not been completed.

The moratorium was intended to facilitate a review of existing problems in the sector and to allow for the implementation of reforms.

''Once this (loan release) is done, the government of Papua New Guinea (PNG) is likely to ignore the moratorium and begin final clearing of one of the world's last great rainforests,'' says Cortesi. ''The World Bank and PNG government are poised to make decisions that may lead to the unleashing of bulldozers, which will swiftly carry out the final dismantling of PNG's large and contiguous forest wilderness.''

NGOs want the moratorium to remain in force until adequate policies have been designed and implemented, ''and the Forestry Act, regulations and guidelines, as well as Forest Authority processes and structures, are updated to legitimize and make fully accessible small-scale eco-forestry management'', notes the campaign's sign-on letter seeking broader NGO support in opposing the Bank loan.

The Bank recently supported the production of a document entitled "Forest Strategies for Community-Based Forestry and Conservation in Papua New Guinea," which recommends that government revise the National Forest Policy to fully recognize eco-forestry and small-scale and medium-scale logging.

The report recommends a wide range of forest conservation measures aimed at upgrading the status of eco-forestry. It calls for the updating of logging maps clearly showing current and planned conservation areas, fragile forest types, areas of threatened or restricted plants and animal species and important water catchments not available for logging.

But there are fears that under continued pressure from government officials and renegade officials within the National Forest Authority, the moratorium will be undermined and the remaining accessible rainforests allocated for commercial harvesting.

According to California-based independent consultant Dana Clark, who monitors the policies of the international financial institutions, NGOs are worried about compliance with the original conditions of the adjustment loan ''and we are concerned about the upcoming, not-yet-approved Forest and Conservation Project (FCP) loan.''

During the last few years the Bank has been developing the FCP, originally intended to broaden the types of forest management practiced in the country.

Several meetings attended by Bank officials, government and non-governmental representatives established a critical need for a forest policy and guidelines for more ecologically sustainable, small to medium scale, community-based forestry operations.

''In a startling and inexcusable turnaround, these elements were removed late into project development on the justification that other donors were covering them,'' notes the NGO campaign document. ''This is patently false.''

The European Union and AusAID, the other major donors in the sector are providing small-scale support to community-based projects, but do not have programs to reform the Forestry Act or the Forest Authority.

The present forest allocation process in the nation of 4.5 million people remains biased towards large-scale intensive management for log-export by foreign companies, critics charge.

Studies carried out by the WorldWide Fund for Nature (WWF) in Papua New Guinea show that despite the moratorium being in place, the Forest Authority has continued to process several areas in order to bring them to tender and allocation. WWF specifically identifies two concessions -- Amanab Blocks 1 to 4 and Sembo -- as having been put to public tender after the establishment of the moratorium.

In a November 1999 budget speech, the country's prime minister, Mekere Morauta, conceded that ''governance has been particularly poor in the area of forestry, with the side effect of promoting corrupt practices and undermining environmental sustainability in logging activities.''

The new government in PNG came to power in July 1999 pledging to stabilize macro-economic conditions, improve the transparency and governance of public institutions and restore relations with the international financial institutions.

Morauta pledged his government's commitment to a moratorium on all new forestry licenses, extensions and conversions, ''and to proceed with a review of all existing licenses, to ensure that proper procedure is followed, that logging practices are not carried out in an unsustainable way and that landowners get their fair share of benefits from resource use.''

A decision by the Bank's board on the FCP and the disbursement of the second tranche of Papua New Guinea's SAL could come in a few weeks.

Officials at the Bank's external relations department declined to comment on the status of the project saying an announcement would be made in due course.

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