Logo of Phnom Penh Post newspaper Phnom Penh Post - Comment: Credit and caution over logging

Comment: Credit and caution over logging

Comment: Credit and caution over logging

British environmentalists Global Witness applaud the measures taken to

clear up the anarchy in Cambodian forests - the future will tell if they will work.

THE Royal Government of Cambodia (RGC) and members of the Consultative Group on Cambodia

(CG), who met recently in Tokyo for the first CG meeting, should be congratulated

for their initiatives on Cambodia's illegal timber trade. This is one of the first

real attempts in recent years by members of the international community to work together

to deal with a serious and controversial issue in a consistent manner and the RGC,

which also appear finally willing to deal with this problem and accord it the urgency

it desperately needs. Tokyo has put the timber trade firmly on the map of crucial

issues that need to be dealt with for Cambodia and Cambodians to reap the full benefits

of development efforts currently taking place.

Just before the CG meeting in Tokyo the RGC called its second pre-CG meeting in Phnom

Penh to mitigate mounting donor concern about forestry issues and particularly the

"million meter" deal signed by the two Prime Ministers. The meeting announced

the formation of a Steering Committee (headed by the two PMs) and a Secretariat (with

representation from key ministries), later confirmed by the two PMs' July 3rd sub-decree.

Together with statements from key donors and the RGC at the CG meeting in Tokyo the

following week, this is very encouraging. Whilst Global Witness is pleased to see

these positive developments, it is important to stress that we are not yet "out

of the woods" on this issue. There remain key questions and elements of procedure

which simply have not been addressed, and in the positive climate following the CG,

these may be swept under the carpet, both by the RGC and CG members.

At the Tokyo meeting both RGC and CG members stressed that the Steering Committee

and Secretariat, would follow the guidelines as defined by the World Bank/UNDP/FAO

Forest Policy Assessment. Many aspects of this study are encouraging, especially

the inescapable conclusion that there should be a full moratorium on cutting and

export of timber and the application of the "precautionary principle" in

decision making. However, this document contains serious errors which, coupled with

the use of out-of-date information, means that to use the Forest Policy Assessment

as the sole basis for Cambodia's future forest policy would be counter to the precautionary


Despite assurances given at the CG meeting, there is nothing in the text of the July

3rd sub-decree, indicating that the Steering Committee will follow the guidelines

given in the Forest Policy Assessment. It does not indicate how the Committee will

make decisions - whether it requires unanimity or a majority vote. This lack of clarity

casts doubt on the transparency of the decision making process. It should not be

forgotten that many members of the Steering Committee and its Secretariat have been

implicated in illegal timber trade activities, and that previous committees have

achieved little and often made matters worse.

In addition, the problem with over 800,000 cubic meters of "already cut logs"

along the Thai border has not been adequately addressed. Whilst discussing these

points with some delegate members in Tokyo it became clear that to some, these deals

have become a side-issue. One could not help getting the impression that to focus

on the deals would "get in the way" of RGC efforts to set up a properly

functioning Steering Committee and Secretariat, when it fact it is the first test

of the RGC's commitment to deal with corruption. This begs the question: Why are

the donors trying to treat a deal which will fund the KR's war effort and reward

ministerial and corporate corruption, as a side-issue?

The facts show that the "million meter" deal is not a side issue, but one

which is central to Cambodia's illegal timber trade and its impacts. The original

deals, signed by the two PMs earlier this year, were for 18 Thai companies, operating

along the Thai-Cambodian border. Of the 18, only the BLP Company had a semi-legitimate

"concession", as indicated by its appearance on the Ministry of Agriculture

list, made public in December 1995.

Before the "million meter" deal was signed, the RGC had devised a system

to deal with "already felled timber" in RGC-controlled Cambodia. An inventory

of felled timber in RGC areas was prepared, with the timber to be auctioned to highest

bidder. Companies with winning bids would then be awarded a one-off export permit

to be strictly controlled over a short time period. The inventory showed there to

be approximately 331,000 cubic meters of felled timber in RGC-controlled areas. If

this strategy had been followed, the Ministry of Finance could have realized much

needed revenue from a source which would otherwise have been wasted without promoting

further cutting, which has occurred in the past. Until the "million meter"

deal was signed, it could have succeeded.

Global Witness has obtained a list of 15 (out of a reported 16) Thai based timber

companies which are due to receive permits for export to Thailand. These companies

supplied "deals" of their timber "stockpiles" in "portfolios"

to the Ministry of Agriculture by the Ministry's cut-off date of June 30th 1996.

The 15 companies make interesting reading.

The BLP company is now expected to receive only 71,000 cubic meters - a far cry from

its original request of 225,000 cubic meters. At least this company appears to have

been checked out, and its current request is within the bounds of possibility. BLP

expects to obtain its logs from the RGC-controlled area of Cambodia, meaning independent

monitors could ensure it complies with regulations.

The total volume allocated to the 15 companies, including BLP, is 877,910 cubic meters.

It is likely the new volumes requested by the other companies are the same as those

they requested in the original "million meter" deal (with the exception

of Pannee Enterprise, not on the original list), as including BLP's 71,000 cubic

meters, they total 871,316 m3 - a discrepancy of only 6,594 m3. This strongly implies

that the Ministry of Agriculture has accepted the original "million meter"

deal requests as "portfolio" evidence by 13 of the other 14 companies on

the new list. There are other factors which should be considered:

Company/KR links. Other than BLP, of the remaining 14 companies, at least 12 operate

in Khmer Rouge (KR) areas of control, leaving two, for which their log source is

unclear. If these companies export their timber the KR will generate around $35 million.

Of great significance are the two ways the KR generate revenue from timber. Initially,

they are paid by companies for the right to cut in their areas of control and influence,

which is followed by a second payment, roughly equivalent to the first, for the right

to export the logs. This means that the KR are already benefiting from these deals.

The longer the companies believe they will be able to retrieve their timber, the

more they will continue to cut, and the more revenue the KR will generate.

Do the companies have logs? Global Witness' April 1996 investigation along the Thai-Cambodian

border (supported by evidence obtained by the BBC in May), showed company claims

about log stockpiles should be dismissed. Companies on the "million meter"

deal and the new list, fit into a number of categories: 1) Some are already known

to us, as we have documented and filmed their illegal activities along the border

for one and a half years. Companies questioned stated that they did not have "already

felled" timber, but were fresh cutting at that time. 2) They did not exist in

their current location in late November/early December 1995. It is clearly not possible

for such companies to have large stockpiles of timber cut before 30th April 1995.

3) There are numerous other companies which are not on the "million meter"

deal, or the new list, or the possession of a semi-legitimate "concession"

(as defined above), which were fresh cutting and gearing up to import timber.

RGC verification. The RGC has stated that the companies' "portfolios will be

checked in the field by Cambodian officials and independent monitors, followed by

an arrangement whereby the Forestry Department will stamp the verified logs for export.

For at least 12 of the companies on the new list, in KR zones, RGC officials will

be unable to check their claims. Furthermore in the past, Forestry Department "stamp

hammers" have been frequently "hired out" to "legalize"

illegal logs for $5 per cubic meter. So, even if it is possible to visit a particular

company's rest area, Forestry Department approval of a stockpile's legitimacy will

be open to question. BLP is the only company on the new list which could be checked

in this way.

The Role of Thailand. The RGC have implied that Thailand will assist with a control

system on their side of the border - or, as Tao Seng Huor has declared, a "double

control system", but it is not quite clear what this means. However, Thailand

has consistently mislead the international community regarding the timber trade from

Cambodia, as we have documented on every border investigation. Comments by Thai Prime

Minister Banharn recently, where he stated that Cambodians will not be able to monitor

the Thai side of the border, add further doubts to Thai "commitments" to

help solve this problem. More recently, the Thais have opened An Mah pass, to allow

logs to enter Thailand, and have stated it will remain open to log imports until

July 25th 1997 - seven months past the RGC's new December 31st 1996 timber export

ban. This seven month extension is likely to stimulate illegal cutting and export

of timber.

It is not only trade with the KR which is worrying. The small Thai fishing harbor

of Kalapandha (Trat province) is currently importing 15,000 m3 of rough cut timber

per week from RGC controlled Koh Kong - annually, this is more than double the volume

identified by the inventory for RGC-controlled Cambodia. Thai Customs have stated

that these imports are illegal, yet this is not their "concern". Thai police

and military vessels, moored within meters of unloading timber boats, are also not

"concerned". Thus, neither the Thai authorities, or the RCAF are making

any effort to halt this significant trade, a large proportion of which generates

income for the KR. It is scandalous that the trade through this harbor is comparable

with that of the "million meter" deal, and yet it has been consistently

ignored by the Thai Government, the RGC, and the entire donor community.

The implications of the Tokyo meeting mean that Cambodian now has the potential for

a "fresh start". In partnership with CG members, the RGC must demonstrate

its words mean a real commitment for positive change in the forestry sector. Not

only must there be no further "exception" to RGC regulations, but the new

Steering Committee must be seen to work. One way for the Committee to demonstrate

its intent would be to begin regular, public reports, whereby it is made clear what

the Committee intends to do, and how it intends to do it. Results should be demonstrable.

Finally, it is crucial that both the RGC and CG members recognize the "million

meter" deal and the new company list, with the possible exception of BLP, as

defacto new concessions (not permits for felled timber), which are raising money

for the KR and prolonging the Cambodian conflict. As such, the only responsible move

which should be contemplated, is the immediate and full termination of all arrangements

with these companies, and a permanent export ban on all timber from KR areas of control.


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