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By Bob Burton

CANBERRA, Australia (March 4, 2002 - IPS/PINA Nius Online)---The Australian government's support for a trade fair at a seminar this month, organized to promote an expansion of Papua New Guinea's controversial logging industry, has angered environmentalists. But it has been welcomed by the timber industry's peak lobby group.

The seminar, scheduled for Port Moresby in two weeks, is being organized by the PNG Forest Industry Association (PNGFIA) in an effort to counter the loss of key markets and promote overseas investment in an industry mired in controversy.

In conjunction with the seminar, the Australian Trade Commission (Austrade) is organizing a forestry trade fair to "showcase Australia's leading products and services applicable to the forestry industries." It is a member of the seminar organizing committee.

The executive director of the PNG Forest Industry Association, Dick McCarthy, welcomes the support of Austrade. "Australia is really looking at establishing those trade links back into the industry because Australia is a big market for sawn timber from PNG,'' he said.

However, McCarthy declined to reveal details of Austrade's support. "That is a silly question. I know that is extremely sensitive to Australia," he said.

The trade commissioner for PNG, Michael Boyle, insisted that while Austrade was co-organizing the trade fair, it was not sponsoring the whole event.

Details of the costs incurred for the event, he insisted, were "commercially confidential."

Environmental groups are dismayed by Austrade's support for a seminar promoting logging in PNG. "It is inappropriate. It is quite clear that the logging industry has a destabilizing effect on the governing of PNG and on the economy,'' said Greenpeace's Papua New Guinea campaigner, Brian Brunton.

The advocacy group PNG Forest Watch charges that logging is having a major impact on the ability of communities to gain access to clean water and gather traditional food and medicines. "It is the local people who are suffering, a human population that already has the lowest quality of life in the Pacific region,'' the group argues.

While Austrade is keen to promote a greater role for Australian companies in Papua New Guinea's forest industry, the Australian government's own overseas aid agency, AusAID, has expressed deep misgivings about funding forestry projects in that country.

In a report on the current four-year aid program, AusAID stated that the "management of forests is a particular concern. Continued Australian support for forestry projects will be dependent on the PNG government implementing policies that address the longer term social and environmental costs of logging."

Papua New Guinea has the world's third most extensive tract of forests, nearly all of it held as customary land by the country's 4 million people. Eighty percent of its people use forests -- which cover more than 60 percent of the land area -- for timber and non-timber products.

But because of the depletion of the forests elsewhere, PNG's forests have attracted the interest of major industrial logging companies. According to McCarthy, 270 million U.S. dollars worth of forest products are exported from the country a year, most of it as raw logs shipped to Japan and China.

However, accusations of mismanagement and corruption have proliferated with the dramatic escalation of the rate of logging.

In 1988, Justice Thomas Barnett, following persistent criticism of foreign timber companies, led a Commission of Inquiry probe into the forest industry. While the inquiry was under way, Barnett himself was almost stabbed to death outside his Port Moresby home -- and the records of the National Forest Authority were destroyed in a fire.

In his damning report, he wrote that some of the logging companies "are now roaming the countryside with the self assurance of robber barons; bribing politicians and leaders, creating social disharmony and ignoring laws in order to gain access to, rip out, and export the last remnants of valuable timber."

The current prime minister, Sir Mekere Morauta, acknowledged the problem in introducing his first budget in late 1999. "Governance has been particularly poor in the area of forestry with the side effect of promoting corrupt practices and undermining environmental sustainability,'' he told parliament.

In April 2001, a World Bank independent review team investigating forest management reported that the PNG Forest Authority was "incompetent at almost every level of the forest management process."

McCarthy believes the widespread accusations of corruption leveled against the timber industry are exaggerated: "I just think it is a total over exaggeration. There is various hype around at the moment because some of the vested interests are unhappy with some of the decisions that have been made.''

"The major problem with the forest industry in PNG is not the forest industry. There are vested interests from the NGOs and the consultants who work for the donors who make sure that you leave PNG in a state of continual perplexity and never allow anything here to develop rationally because that keeps certain people in work,'' he said.

However, the controversy over forestry escalates. In one recent case study PNG Forest Watch revealed that 12,000 cubic meters (420,000 cubic feet) of logs had been felled and approved for export even though no logging permit had been issued to the company.

Brunton is adamant in saying that when the Australian government insisted late last year that funds from the World Bank be released to the PNG government, it missed a chance to help prevent further mismanagement of the forests.

"The Australian government is essentially propping up the illegal logging industry by assuming an uncritical posture and not insisting on major reforms,'' he pointed out.

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