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Logo of Phnom Penh Post newspaper Phnom Penh Post - Renewal of logging contracts alarms NGOs

Renewal of logging contracts alarms NGOs

THE government has confirmed that negotiations with all Cambodia's logging

concessionaires have begun, despite the fact that none of the companies has met

recommendations on forest management and sustainable logging drawn up by the

government and the Asian Development Bank (ADB).

Negotiations began last

Monday (September 10), shortly after the appointment of the new Minister for the

Ministry of Agriculture, Forests and Fisheries (MAFF), Chan Sarun, and are

scheduled to finish September 29.

Some observers voiced alarm at the news

and said they were worried that the new contracts would now be "set in stone".

One suspected that the rush to get the contracts signed was the government

trying to circumvent the deadline for meeting its targets on logging reform.

The reforms are necessary for the release of international funding under

the Structural Adjustment Credit.

The renegotiations follow an extensive

review of the industry by the ADB in April, 2000 in which the bank strongly

condemned the conduct of the country's logging concessionaires.


Malik, ADB's country representative, said the bank had recommended

concessionaires provide a document containing an Environmental and Social Impact

Assessment (ESIA) and a Forestry Management Plan (FMP) before they were allowed

back to their concessions. However, none has yet finalized the document and most

have done nothing.

"Those [renegotiation] contracts have to be finalized

by the end of November," Malik said. "The ESIAs and FMPs are to be drawn up by

the end of September and the negotiations finished by the end of


Bruce McKenney, forest policy advisor with WWF Cambodia, said

that all those that had not submitted management plans by September 30 were

meant to have their concessions canceled outright. He said he found the conduct

of the process strange.

"We are trying to understand the logic on how you

renegotiate a contract without the information from the management plan. It

seems somewhat odd to have a renegotiation about concessions before you know

what is in them," he said.

"How can you decide the value of the

concession?" he asked. "Wouldn't you need to know about items such as an

inventory of trees, the effect on the community, and the like?"


Witness coordinator, Eva Galabru, said that the way the process was being run

conflicted with repeated assurances given by the government that the September

2001 deadline would stand. By the time the contracts were to have been

renegotiated, all the management plans and ESIAs were to have been submitted,

publicly reviewed and approved.

"We are very disappointed. The best way

to proceed would be to cancel everything and restart with an open, transparent

bidding process for areas that have been identified as suitable for commercial

timber extraction," said Galabru.

The Department of Forestry and Wildlife

(DFW), part of the Ministry of Agriculture, Forestry and Fisheries (MAFF), is

conducting the negotiations. Dennis Cengel, an advisor to the department, said

this was the first step in the renegotiation process. He said the reason NGOs

were unaware of the renegotiations was down to time constraints.


process happened so fast that there hasn't been the time to communicate this as

fast as possible," he said. "However, we will try to improve communications with

NGOs and make an effort to keep them informed."

He added that the donor

working group, the DFW's "first outreach", should also have informed NGOs. WWF's

McKenney said he had found out about the renegotiation meetings only by


"We're pretty concerned about that, but it's typical," he said.

"Normally if we are invited we only hear about it the day before.'


said the deadline for submitting management plans was September 30, and that

those companies that did not comply would not be allowed to cut. However, there

would be a window of two to three months allowing inadequate management plans to

be improved.

WWF's McKenney added: "We are also concerned about how

enforcement of those companies not allowed to cut will be enforced. There are

apparently a number of concessionaires who already have cutting permits for next


In the past the conduct of logging

companies in Cambodia

has been woeful. When the ADB conducted its review, it found that nine of the 20

concessionaires were not operating. It was unable to locate another, which left

ten in the study. The results were grim.

The bank rated as

'unacceptable' the performance of nine of these. Six received the worst possible

'black' rating, while three were placed in the 'red' category. The only one that

received the mediocre 'green' rating was GAT International, which holds the

distinction of being the only concessionaire to have been sentenced in a court

of law for illegal logging.

The ADB report stated that forest management

plans were "completely inadequate as a tool to ensure sustainable yield and

sustainable forest management". It said the plans were "neither responsive to

the requirements of the environmental laws nor to acceptable technical and

managerial standards nor to the socio-economic policies of the


Three companies were stripped of their concessions by the Prime

Minister on the back of the ADB report; its clear recommendation was for new

forest management plans. The DFW confirmed that all 17 remaining companies have

applied for renewal of their concessions.

"[Of these 17] I believe three

are at a very advanced stage of finalizing their sustainable management plans,

and either four or five are showing due diligence and may be ready. That leaves

[around ten] concessions where we have not seen much on the table," he


Malik said six of these would likely not meet the conditions for

renewal, which under donor recommendations should lead to their outright

cancellation. The position of the remainder was uncertain. He said he hoped that

despite the lack of independent observers during the current contract renewals,

it would be transparent.

"The Prime Minister made a very bold decision to

cancel three concessions when we came out with the results of the review, and I

think the leadership should demonstrate its commitment to forestry sector reform

by canceling [those who do not comply]," he said.

Cengel explained that

the companies still had until the end of the month to meet the conditions laid

down by the ADB. He said donors were in agreement with the process, and

explained that contracts were conditional on companies meeting these


The current negotiations, he added, were for renewal of the

concessions; the licenses for logging would wait until the government was

satisfied with the companies' management plans.

Cengel said the ministry

and the department were committed to the ADB recommendations of transparency and

sustainable forest management and had invited interested donors to review the

concession application process.

"To ensure transparency we invited donor

observers to these concessionaire renegotiations. We will also invite donor

observers and interested NGOs to the review of the management plans [after Sept

30]," he said.



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