Bulletin Issue 54 – January 2002

For years forest activists have focused their attention --and rightly so-- on the World Bank's role in forest destruction. Those efforts have to a certain extent been instrumental in the introduction of a number of positive policy changes within the Bank, which have at least meant an improvement in World Bank lending. However, efforts to influence an equally or even more important actor in forest loss --the International Monetary Fund-- have been mostly absent or at least clearly insufficient, while there is ample proof of the direct link between IMF-imposed policies and deforestation.

The dense, moist forests of the Central African Republic cover about four million hectares. Although the country has maintained loan arrangements with the IMF dating back to the 1980’s, it came under increased pressure when the Central African Republic signed a three-year, $66 million loan agreement with the IMF in 1998. The IMF has encouraged the Central African Republic to increase exploitation of forest and mineral resources. “Mineral resources in the Central African Republic have so far been insufficiently exploited…” reads a policy framework paper jointly drafted by the IMF, World Bank, and Central African Republic in 1998.

For over a decade, the Ivory Coast has been under the influence of IMF structural adjustment programs, of which intensification of exports has been a significant factor. The 1990s saw the heightened pursuit of fiscal and structural reform in the Ivory Coast. The Ivory Coast devalued their currency in 1994 and eliminated export taxes in compliance with the IMF’s adjustment program and in 1995 the country liberalised its domestic markets.

Beginning in 1983, Ghana has been implementing IMF structural adjustment programs focused on export-led growth, which has included measures to devalue the currency and remove various barriers to trade. While this has resulted in significant economic gains, it has also meant severe detrimental consequences for the rainforests and forest-dwelling people of this western African nation. Ghana’s most recent three-year, $239 million loan from the IMF was initiated in 1999, and modified in 2000.

Called the “naturalist’s promised land” by French explorer Phillippe de Commerson in 1771, Madagascar is one of the most ecologically rich countries in the world. Twelve thousand species are found on the island the size of Texas; 80 percent are endemic, existing nowhere else. Nine new species of lemur were recently discovered in Madagascar, placing the country only behind Brazil in the number of primates that call it home. In 1996, the Malagasy government accepted a three-year, $118 million loan and bowed to IMF pressure in their agreement to further liberalise trade policies and open its economy to foreign investment. Among the measures adopted were allowing foreigners to own land and eliminating export taxes.

A project is in progress to build a number of roads in Kachin State in return for huge logging concessions. While improving and expanding the infrastructure in Kachin State is much needed, the impact of this deal on the environment could prove to be disastrous. A recent agreement involves the Kachin Independence Organization (KIO), the New Democratic Army-Kachin (NDA-K), the State Peace and Development Council (SPDC) and a Chinese construction company. The middleman in the deal is the Kachin Jadeland company, owned by Kachin businessmen Yup Zau Hkawng. The agreement stipulates that the Chinese company will build roads leading from Myitkyina to Sumprabum and, eventually, Putao, from Myitkyina to Bhamo, and from Wai Maw (near Myitkyina) to the Chinese border near Kampaiti.

Tapping trees for resins has a long history in Southeast Asia. The traditional tapping practice involves cutting a hole in the base of the trunk and using fire to stimulate a continuing flow. Resin from Cambodia is traded throughout Indochina and to other parts of Southeast Asia and China.

As we had reported in our last bulletin (December 2001), the possibility of a moratorium on logging was looming on Cambodian timber industry’s horizon, which had previously attempted a "voluntary restructuring process" that proved to be a failure. It has been evident also that it’s not simply a problem of illegal logging. The fierce exploitation of timber resources by large-scale projects developed by big foreign companies has led the country to an unbalanced ecological state that was responsible in 2000 for the worst flood suffered by the country in 70 years, as denounced by the United Nations.

Last year the Vietnam Paper Corporation (Vinapimex) announced an ambitious plan to expand the pulp and paper industry in Vietnam. With a total cost of more than US$1 billion, the plan involves 15 new pulp and paper production projects. If they were all built, the projects would raise Vinapimex's annual paper production capacity from the current 171,000 tons to 419,000 tons. The pulp and paper industry in Vietnam presently produces a total of approximately 360,000 tons of paper a year. Vinapimex hopes to increase this figure to more than one million tons by 2010.

The Belize National Environmental Appraisal Committee (NEAC) announced in November 2001 that the government has granted environmental clearance for the construction of a proposed hydro-scheme (see WRM bulletin 44) slated for an undisturbed river valley within the Central Maya Mountains near the Guatemalan border, conditional upon the development of an Environmental Compliance Plan (ECP), which will incorporate the mitigation measures identified in the environmental impact assessment, along with others recommended during the evaluation process. Belize Electricity, Ltd (with Canadian Fortis Inc. holding a majority stake) is behind the project, with governmental support.

The Mexican authorities themselves have recognised, through the Secretariat for the Environment and Natural Resources (SEMARNAT), the seriousness of the Mexican situation in terms of forest loss. On 3 December 2001, the director of SEMARNAT, Victor Lichtinger made public the Forest Inventory, containing deforestation figures for the country. Over the past seven years, the annual rate of deforestation rose to 1.1 million hectares. The previous rate of 600 thousand hectares per year was practically doubled. This places Mexico second in the world in the loss of forests, behind Brazil.

Ted Williams, author of the excellent article on the impacts of monoculture pine tree plantations in Southern US ("False Forests", Mother Jones magazine, http://bsd.mojones.com/mother_jones/MJ00/false_forests.html ), has now published an equally excellent article focused on eucalyptus ("America's Largest Weed"). The following are some excerpts from his recent article: If you smell like a cough drop when you stumble out of the California woods, it's because 100 of the world's 600 species of eucalyptus grow there. None is native. They were imported from Australia during the second half of the 19th century as we were hawking our redwoods to the Aussies. "Wonder trees," the eucs were called, because they shot up in coastal scrub and vast redwood clearcuts.

As a result of successful campaigning efforts in the state of Espirito Santo --where Aracruz Cellulose has its huge pulp mill and most of its eucalyptus plantations-- the state Parliament passed a law banning further eucalyptus planting until an agroecological study is carried out to decide where the tree can and cannot be planted.

On 27 December 2001, the Colombian Inter-Congregational Justice and Peace Commission sent the President of the Republic, Doctor Andrés Pastrana Arango and other national authorities a letter in which, among many other things, it reported that during the first twenty days of December, the “Maderas del Darién” company had been logging in a place known as Mendoza, in the perimeter of San Jose de La Balsa, La Balsa, Bocachica, San Higinio, within the Collective Territory of Cacarica. The limits of the Cacarica basin border the Los Katios National Park which hosts one of the highest levels of biodiversity per square kilometre in the world.

Since the 2nd of January, the inhabitants of local communities, students and environmentalists have been carrying out a permanent and peaceful occupation of the most fragile zone of the Los Guarumos forest, at the entry of the Mindo Nambillo cloud forest, to halt the construction of a new oil pipeline which will cross the whole of Ecuador. The 500 km long oil pipeline will transport heavy crude oil for the Oleoductos de Crudos Pesados (OCP) company, (see bulletin 45, April, 2001).

The Department of Rio Negro, located in the western side of Uruguay, presently has 70,510 hectares of plantations (mainly eucalyptus) which makes it one of the Departments having more tree monocultures in the country.

Mining operations in Papua New Guinea (PNG) are part of the IMF backed policy which opens the country to foreign investments for the unsustainable export-driven exploitation of natural resources. The serious record of mining activities includes flooding of forests and homes caused by the dumping of waste rocks and levels of mercury in the Ajkwa river four-times higher than the maximum allowed of 0,001 mg/l (WRM bulletin 7, December 1997).

A new report clearly links the disappearance of the world's forests with the horrifying catalogue of human rights abuses taking place as a result of conflicts between forest peoples and the powerful government and corporate interests within forests. Published by Fern, "Forests of Fear: the abuse of human rights in forest conflicts" calls for governments, environmental groups and aid donors to prioritise the defence of human rights as the primary solution to solving the forest crisis.

What follows is a letter circulated by Fern, explaining the objectives of the EU Forest Forum and inviting interested organizations to join: Dear friends,