Globalization and the Acceleration of
Forest Destruction since RioWhen world leaders gathered at the 1992 Earth Summit in Rio de Janero they declared to the word that the present economic model must change. Never before had so many heads of state gathered in one place to agree on such a unifying theme: charting a new economic course for the planet that would provide for the needs of all species while ensuring that future generations could do the dame. This was the hope of Rio. But while world attention was transfixed on prospects for resolving the looming social and ecological crisis, off camera its very aggravation was being planned.
By Victor Menotti
Far from the media circus assembled in Rio, trade ministers met secretly in Geneva to finalise a lesser-known agreement that would expand world trade and thus have far greater impact on natural resource exploitation into the next century.
That agreement, known as the General Agreement on Tariffs and Trade (GATT), embodied a singular premise that underpins Rio's many government declarations, action agendas and non-binding treaties: ecological sustainability through economic globalization. Indeed, Agenda 21, Section 1, emphatically declares that sustainable development would be achieved through trade liberalization. This was the strategic vision of Rio, whose tragic failure is now increasingly evident.
Since Rio:
- Timber from the vast woodlands of Siberia has started flowing to ports of the Pacific Rim.
- After depleting the forests of Sarawak and Sabah, Malaysian logging companies have moved to Amazonia.
- The rate of deforestation in Amazonia has increased by one third, and burning has tripled.
- The United States suspended all laws on National Forests in order to log some of their few remaining roadless areas.
During Rio, few questioned the inherent contradictions between the free-trade agenda and planetary ecological limits; in fact those who warned that the two were on an inevitable collision course were largely ignored. (1) It was entirely predictable, environmentalists said, that, without any new safeguards, intensifying economic activities through expanded international trade and investment would only magnify the negative environmental effects of the very development model the world was supposed to be abandoning. From the outset, this paradox undermined Rio's hope.
But if Rio's conceptual framework was not contradictory enough, government actions on behalf of global corporate interests have subverted any remaining hope. Since Rio, governments have demonstrated enormous energy and political will to forge new free-trade agreements that increase corporate access to and control over natural resources and consumer markets, whilst letting treaties which might protect the planet languish. Rio's vision that free trade would stabilise global climate, protect endangered species and slow deforestation has proven catastrophically wrong.
As evidence mounts of economic globalization's role in accelerating the ecological crisis, government and industry leaders are finding free trade's failures increasingly difficult to deny. At the United Nation's five-year review of Rio's progress, there was near consensus that not only had governments failed to achieve their modest targets but significant backsliding had occurred. Indeed, one of the chief advocates of Rio's free-trade rhetoric, the World Business Council on Sustainable Development (WBCSD, formerly BCSD which was founded by some of the world's largest corporations to influence the Rio process) has since admitted that its strategic vision is backfiring. In a recent "scenarios report", WBCSD explains that. "Globalization and liberalisation of markets alone with the pressures of rapid urbanisation have raised the degree of social inequity and unrest to a level that threatens basic survival of both human and environmental ecosystems".(2)
Globalization has shifted control over planetary health from communities to corporations that operate in a global marketplace with no government oversight. Fierce competition forces firms to shift ecological costs onto society in order to satisfy the demands of global financial markets. The result is a new political structure where no one is in control or accountable for the accelerating destruction. Captured by corporate interests governments have taken action in at least four key areas that have combined to create a global economy that systematically punishes ecologically-sustainable practices while rewarding environmentally-destructive ones. These include:
1) Forging Free-Trade Agreements: The North American Free Trade Agreement (NAFTA), the GATT (now administered by the powerful World Trade Organisation [WTO]), the Asia-Pacific Economic Community (APEC), the European Union, and other initiatives to integrate markets have established sweeping new rules for trade and investment, consequently redefining the terms of economic competition everywhere. Where such agreements traditionally aimed at only reducing tariffs (import taxes), they now extend into new areas like buying land, dismantling supports for small producers, protecting foreign investors' property, and eliminating so-called non-tariff barriers such as environmental laws. Free-trade pacts provide an enforceable international legal framework that transfers access and control over natural resources out of local hands and into those of the highest bidder in the global marketplace.
2) Rolling back National Regulations: To accommodate the new international framework created by trade agreements, national governments spend enormous energy changing domestic policies to attract more foreign investment, promote exports, and generally increase their competitiveness in the global marketplace. Some of the measures common to many countries include weakening environmental protections, reducing their legal enforcement, raising corporate subsidies and protections, and weakening citizens' rights.
3) Globalizing Financial Markets: While globalization of the logging industry has shifted control to large corporations operating in unregulated global markets, it is important to note that these firms, like all firms, are under increasing pressure to deliver profits for their shareholders. Because globalization provides unprecedented opportunities to increase one's return on capital, investors' expectations have been raised to levels that can only be achieved through wholesale exploitations of the natural world. In the business of logging, such high profits can only be maintained by ignoring protections for endangered species, cutting along steep slopes and riparian zones or sacrificing worker safety.
4) Restructuring under the World Bank/International Monetary Fund (IMF): In a painful process beginning more than a decade ago, economies of the Third World have been systematically opened via Structural Adjustment Programs (SAPs) and other market-opening conditions of the World Bank and the IMF. Working together, and usually for the direct benefit of the Third World elites and northern lenders, their lending policies have aid the regulatory groundwork for large multinationals to enter their economy, access resources, and export them back home with minimal restrictions. Environmental damage and particularly deforestation was often a direct consequence of the export-oriented policies imposed by the Bank and Fund.(4)
Globalization has rendered nations vulnerable to forces far beyond their control, as seen in the recent financial turmoil that has rocked the so-called emerging markets. The crisis has not only subjugated the economies of Mexico, Indonesia, Russia and Brazil to the crushing demands of foreign investors, but it has also deepened the vulnerability of forests as a desperate means for indebted nations to repay their foreign creditors. As a result, collapsing currencies could reverberate throughout the Sierra Madre, Borneo, Siberia and Amazonia as the world's last significant tracts of forests fall victim to finance capitalism.
The causal relationship between crashing currencies and falling forests became clear in 1994 (see section below on Mexico). Most recently, Brazil's President Fernando Henrique Cardoso, under enormous pressure to attract $50 million in foreign investment in 1999, declared a 10-year moratorium n penalty fees for environmental crimes.
Moreover, as the financial contagion spreads globally, it directly influences forest industries in other countries such as Canada, Chile and the United States. Gluts in the world timber markets compel governments to increase logging subsidies, or roll back more regulations all in a bid to maintain competitiveness. While there may be an initial slowing of logging or delays in the expansion of new investment, crisis situations tend to weaken the weak and strengthen the strong, creating the potential for even greater concentrations of wealth and power in the industry.
"Commercial logging", notes the Washington D.C-based World Resources Institute in its 1997 report, The Last Frontier Forests, "poses by far the greatest danger to frontier forests", referring to the planet's remaining large intact natural forest ecosystems that have maintained their original biodiversity. The report explains that "Logging in turn opens forests to hunting, fuelwood gathering and clearing for agriculture".
This article focusses on the globalization of the logging industry. What follows are some examples of how the "globalization policy package" of privatisation, deregulation, subsidisation and liberalisation of trade and investment is affecting forests in different countries.
UNITED STATES
Without question the US logging industry has led the way in using government to scuttle what paltry international efforts there have been to forge an agreement to protect world forests. At the same time, by dominating the national policy-making bodies that virtually set negotiating instructions for the US Trade Representative (the Industry Sector Advisory Committees, or ISACs), the industry has ploughed ahead with expansionist trade policies to increase access to other nations' forest resources and consumer markets.
The most significant initiative affecting US forests since Rio has been the 1995 Timber Salvage Rider, which served as a sort of "Global Competitiveness Restoration Act" for domestic companies that at once faced decreasing access to forest resources, increasing regulatory costs, and greater competition from cheaper imports.
Maintaining its position as the world's leading exporter of forest products required across-the-board cost reductions. The requirement to protect endangered species habitat, riparian zones water and soil quality, among other things, made US timber producers "less competitive" in the globalised marketplace they had fought so hard to establish. Even non-exporting companies found competition stiffened by lower-cost imports, as world markets became increasingly integrated.
To sharpen its competitive edge therefore, the US logging industry needed unrestricted access to more trees at less cost. The Timber Salvage Rider delivered precisely these measures. Without a hearing or proper committee vote, the rider was attached to a larger piece of legislation that was widely hailed as the holy grail of the so-called Republican Revolution. Known as the Recission Act of 1995, it rescinded $16 million from federal programmes, some aiding America's poor, hungry and elderly, while handing out millions of dollars in subsidies to the logging industry.
The Timber Salvage Rider, passed on April 7, aimed to expand logging on an additional six billion board feet over the next two years, nearly double the amount planned by the Forest Service (4). It suspended all laws applicable to logging on National Forests, including the Endangered Species Act, the Clean Air Act, the Clean Water Act, and the National Forest Management Act. As a result, some of the few remaining roadless areas in the country went up for bid at below market cost, effectively privatising public assets at a highly subsidised price. In California alone, nearly one billion board feet of timber went up for sale (5).
By massively increasing logging in National Forests, taxpayers not only absorbed the cost of degraded salmon habitats and damaged watersheds but even paid for the building of logging roads into their country's last reservoirs of biological diversity. Had the US Senate ratified Rio's Convention on Biological Diversity, the Timber Salvage Rider would almost certainly have been in violation of the agreement's provisions for habitat protection,
Logging on private lands has also increased as property owners, under Federal order to protect endangered species, were given new ways to relieve themselves of the responsibilities by "soft deregulation" such as Habitat Conservation Plans. HCP's allow owners of private forests to log areas classified as important habitats for endangered species on condition that they set aside other areas with similar characteristics (6). Since the early nineties, logging companies have sought and in many cases obtained, approval for HCPs on 11.4 million acres of forest land in California, Oregon, Washington, Idaho and Montana (7).
Increasing market access to overseas timber supplies is also undermining efforts to reduce wood fibre consumption in the United States. Paper mills that invested in technology upgrades to produce higher-recycled-content products are being undermined by cheap and plentiful imports of virgin pulp (8). Deregulated global markets can thus subvert sustainable practices from ever taking hold, let alone flourishing.
As one top lobbyist for US logging corporations explained, "The market for forest products is a global market, and the only way we can compete is to be able to maximize efficient use of the capital of our shareholders: to do this we need to achieve a barrier-free market" (9). Thus they continue to expand into markets abroad under the auspices of international trade fora such as the WTO and more recently the Asia-Pacific Economic Community (APEC) whose member countries are home to 63 per cent of the world's last frontier forests (10). These forests are the target of a planned trade initiative that goes by the forgettable name of "Early Voluntary Sectoral Liberalisation (EVSL). As its name indicates, it is committed to expanding markets by eliminating both the tariffs and "non-tariff barriers" to trade (11).
The industry's chief lobbying arm, the American Forest and Paper Association, is pushing the US Trade Representative to take the EVSL initiative to the WTO, where they can pressure other member countries to sign up as well. Efforts to forge a worldwide agreement may begin as early as 1999, when the so-called Millennium Round is launched at the WTO Ministerial, to be held in the US.
CANADA
Canada's western province of British Columbia possesses some of the most significant tracts of large, intact, temperate coastal rainforests in the world. However, since the early nineties and the development of global free trade, they have been subjected to ever-increasing exploitative pressures. The 1989 Canada-United States Trade Agreement (CUSTA) brought Canadian forests under the discipline of binding international trade rules, creating a significant departure from the imperatives that guided past management practices (12). Deregulation, privatisation of public resources, government subsidies, and liberalised trade have together given rise to a huge export-driven wood products industry.
Local environmental groups have fought hard to bring the resulting ecological holocaust to an end. To begin with they were reasonably successful, and in 1995 managed to establish a Forest Practices Code. In 1997, five years after the Rio summit, they proposed legislation that would have brought Canada into line with its commitments under Rio's Biodiversity Convention for protecting endangered species. However, timber companies argued that any restrictions would raise costs and harm Canada's ability to compete in global markets. A team of timber executives rewrote the Forest Practices Code to "streamline regulations and cut costs", while the Timber and Jobs Accord rolled back protection and increased logging subsidies.
In May 1998, the British Columbian Premier Glen Clark again increased subsidies by further reducing stumpage fees by 16 per cent (the price paid to provincial governments per tree cut on public land) to "restore competitiveness to our forest industry" (13). Canada hopes the backlash from environmentalists and smaller American loggers does not force the US Trade Representation to take steps to counter Canada's "beggar thy neighbour" trade policy on forests.
MEXICO
Mexico ranks as one of the five countries with the greatest biodiversity in the world. However, since Rio it has made a particularly ambitious effort to expand its forestry sector. Since NAFTA, 15 US wood product companies set up operations in Mexico, and much of their investment is in regions possessing some of North America's largest remaining intact forests (14).
Forest protection was given no consideration by those who drew up NAFTA. One of its predictable consequences, however, is the voracious demand for wood-fibre (packaging created by the maquiladoras -- the export-oriented factories that line the US-Mexican border. Further forest destruction is also occurring as a result of deregulation of border controls which have greatly increased drug trafficking and the production of cocaine in the Sierra Madre mountains of Chihuahua.
Mexico's entry into the global marketplace has brought rapid and profound structural changes, not only to trade and investment policies but also to underlying property laws, subsidies and strategic priorities for land use. The globalization policy agenda is attracting new foreign investment by offering: 1) stronger legal protections for foreign investors at the expense of local communities and indigenous tribes, 2) increased subsidies to ensure international competitiveness, and 3) weakened environmental regulations, which were rarely enforced in the first place.
The massive economic transformation Mexico has undergone since Rio evolved through a process of at least three phases: a preparatory phase, the NAFTA negotiations, and fall-out from the peso crash. In the preparatory phase, one priority was the repeal of Article 27 of the Mexican Constitution , which gave people rights to communal land ownership. Mexico's land distribution system, one of the most progressive in Latin America, was the veritable fruit of the Mexican Revolution, obtained by one of its leaders, Emiliano Zapata. However, the welfare and democratic rights of Mexico's peasantry was of little concern to Mexico's leaders who, with the signing of NAFTA, sought above all to attract foreign investment, particularly in the rapidly industrialising agricultural sector. Repealing Article 27 was necessary to conform to the macro-changes NAFTA would impose.
Under NAFTA negotiations, other important barriers were eliminated or reduced. Perhaps chief among them was the elimination of restrictions on foreign ownership of property, previously limited to 49 per cent. At the same time, import barriers on US grains were drastically reduced, as were support programmes for assisting the rural population, such as ready access low-interest credit an technical and marketing assistance. Needless to say, the effect of these new laws could only be to drive people off the land into the slums of the major cities or across the border into the United States.
The peso crash of 1994 accelerated these trends, as well as the Zedillo government's desperate efforts to attract foreign capital. The International Paper Corporation used that leverage to reform Mexico's laws governing forest exploitation, winning generous federal subsidies and "new flexibility" for the Environment Secretariat to waive protections for biodiversity, soil and water quality (15). The Forest Reform Law also created a new legal status for private industrial tree plantations, a critical protection for investors who recognised that 0 per cent of Mexico's forests are to be found in indigenous reserves or are part of communal land holdings. Under these highly favourable conditions International Paper is planning a 100,000 hectares plantation of eucalyptus and pine in Chiapas -- an area that is largely inhabited by indigenous Mayas. It fully expects to obtain highly generous subsidies (16).
It is largely because most of the good land in Chiapas has already been taken away from its indigenous inhabitants and made into plantations and vast livestock enterprises that the Zapatista rebellion took place. Clearly the Mayas, who make up the bulk of the Zapatistas, want to regain their traditional lands. This si something that they cannot conceivably do within the context of NAFTA which favours vast export-oriented enterprises such as that being planned by International Paper. That company has already set up a highly subsidised joint venture with US-based Simpson Corporation in the state of Chihuahua, obtaining its initial wood supply from neighbouring communal land-holdings, or ejidos (17).
Another US-based joint venture, Temple Inland Forest Products and Simpson, is plaqnning a 70,000 hectare plantation of eucalyptus and pine in the souther states of Tabasco and Veracruz (18). Chips form this plantation are destined to be transported to a paper-mill in Texas, where nearby maquiladoras need large amounts of wood fibre for packaging exports. These plantation proposals have been strongly denounced by local campesino organisations as the livelihoods of their members would be seriously threaened were they to be implemented.
Bosie Cascade has been exporting tropical hardwoods out of the southern state of Guerrero where the process of land concentration is particulary advanced. Drawing initial logs from 24 different ejidos, the US-based corporation is planninf to export back home 20 million board feet for the next five years (19). In June 1995, neneteed campesinos were massacred whole en route to protest against expanded logging in the mountainous regions that was threatening their farm lands below. At a ceremony marking the first anniversary of the massacre, Mexico's Popular Revolutionary Army emerged to denounce the economic policies that drove so many people to such poverty and despair. It saw no alternative, it stated, but to declare war against the government.(20)
Mexico's Chimalapas forest -- the country's most important tropical forest -- is also threatened by highway and other infrastructure projects required to accommodate long-distance trade. Plans are alsoafoot to forge an industrial waterway through the Chimilapas, which is to compete with the Panama Canal. Intermodal cargo carriers wold receive containers on the Atlantic coast and transport them via the Tehauntepec isthmus, Mexico's narrowest point between the two oceans, to ports on the Pacific coast. Some 12,000 Zoque indians inhabit the area of over 18,000 square kilometres (21) that would be affected by this project. Indigenous people are widely recognised as the best caretakers of the land, the Zoques' dislocation by an industrial waterway will certainly result n the loss of Mexico's most important biological zone as well as the Zoques' own cultural integrity. Moreover, their displacement will force them onto other areas, most likely slashing and burning to eke out a living.
BRAZIL
Only a few years after hosting the Earth Summit, Brazil's shift into higher economic gear is accelerating the devastation of Amazonia, perhaps the Earth's most important reservoir of biological diversity. Adalberto Verissimo, a leading researcher with the Institute for the Study of Man and the Environment (IMAZON) in Belem, believes that, due to a number of recent developments, Amazonia is on the brink of an unprecedented level of destruction.
At the Earth Summit there was considerable optimism that governments would recognise that the best way to protect forests was to protect the rights of their original caretakers -- their indigenous inhabitants. This optimism however was short lived, for shortly after the Summit ended and the international press had left, the Brazilian government announced that private interests could now legally challenge indigenous land titles, which cover vast forested areas throughout Amazonia. Corporations wasted no time in taking advantage of the new legislation. Peracchi, a logging company well-known for its illegal logging of mahogany in indigenous lands lodged a claim for land forming part of two indigenous reserves in the State of Paraj -- that of the Bau and the Apyterewa Indians(22).
Shortly after coming to power in 1996, President Fernando Henrique Cardoso adopted a series of bold initiatives to integrate Brazil's domestic economy and hence the natural resources it depends on -- including the entirety of Amazonia's natural wealth -- into the global economy.
The basis of President Cardoso's strategic plan, known as Brasil e Acao or Brazil Action, is the building of a massive trade infrastructure to expedite the exploitation of Brazil's natural resources. Government briefing documents declare quite openly that they are "redesigning the country" (23). Fourteen transport projects aim to increase Brazil's global competitiveness by reducing shipping costs of timber, minerals, energy and agricultural products from the region. Highways, waterways, railroads and ports are planned throughout the basin to link some of the most remote areas to major ports via shipping routes for intermodal cargo carriers. Foreign investors are being aggressively courted to finance this totally irresponsible mega-project, to which the government itself will contribute 50 billion reas -- a massive subsidy to the corporations that will benefit.
Indigenous people in particular have suffered and indeed are likely to suffer most from Brazil's current trade infrastructure scheme, as industrial waterways, in particular those designed to facilitate the export of soya (Brazil is now the second leading soya bean exporter after the US), will run adjacent to , and in some cases through, demarcated indigenous reserves.
The indigenous Xavante people are fighting the dredging, widening and straightening of the Rio das Mortes in the state of Mato Grosso, a key section of the Tocantins-Araguia waterway. Once completed it will accommodate multi-ton grain barges making their way via the Amazon to European markets (24). Change to the river ecosystem could also endanger local fish stocks, a main source of protein for the Xavante people residing in the Pimental Barbosa Indigenous Reserve. Tragically, and indeed ironically, the project will thus sacrifice the vital food sources of indigenous people in order to enhance the profits of global corporations that claim to feed the world.
Indeed, one of the most important factors driving the destruction of the Brazilian Amazon is the expansion of industrial agriculture. A recent parliamentary investigation identified soya bean plantations as one of the four "belts of destruction" advancing north-eastward into the vast tropical rainforest (25). Monsanto, the chemical-maker turned biotech behemoth, has teamed with Brazil's National Institute of Agricultural Research (EMBRAPA) to create a selection of genetically-modified soya bean seeds tailored to various growing regions (26). Seeds may be modified in order to enable crops to tolerate greater amounts of pesticides required for agriculture in the cerrado or central savannah of south-east Amazonia. Within a few years growers should know if large-scale production on the thin topsoils of its tropical forests is, in fact, viable (27).
Export agriculture also exerts pressure on the Amazon because the best farmlands inevitably fall into the hands of a few giant producers, leaving small, family farmers roaming the countryside in search of land on which to grow their food. Tens of thousands of landless peasants have already grouped together to form a movement that is committed to taking over unoccupied farmland. [link here for article on Sem Terra]. To defuse this explosive situation, President Cardoso has set in motion an ambitious plan to settle thousands of people every year on such land. However, a recent parliamentary study found that nearly 90 per cent of them were being settled in Amazonia, which spells doom for its beleagured forests (28). The peasants of course usually get the blame for starting forest fires, though in reality it should rest with the global economic system itself which forces them of the land in areas where they are a hindrance to the development of vast export-oriented plantations that earn foreign exchange --such as the sugar plantations of the Recife area or the soya bean fields in the central cerrado, or the orange groves of the south, and into remote and usually infertile areas which include most of Amazonia.
In the meantime Brazil's forestry sector is booming, largely as a result of the vigorous attempts made by Cardoso's government to attract foreign investment and promote exports. Since 1996, Brazil has successfully lured several Asian logging companies to purchase millions of acres of concessions (29). These logging companies have acquired financial, technological and management skills while clear-cutting their own forests which will be exhausted in a matter of years. They are now investing worldwide in order to be able to satisfy the timber requirements of their, until recently, insatiable markets, and Brazil is an obvious country to invest in. American logging companies are also moving into Brazil en masse. Champion International, for instance, recently sold its degraded land in New England and is now expanding operations in Brazil (30). As the debate heats up in the US to end commercial logging on pubic lands, Brazil is moving quickly to privatise 39 of its national forests to make sure that it is to that country that the American logging companies will have to move (31). Not surprisingly, Brazil's, and indeed South America's last remaining untouched forest, are now under serious threat.
CHILE
Chile provides a text book case of how export-oriented management under the brutish imperatives of global competition can exact a heavy toll on forest ecosystems and biological diversity. Nearly two decades before the Rio Summit, Chile embarked on a path of national economic development that opened itself up to international trade and investment, emphasizing the export of its natural resources to maximize economic growth.
Chile's comparative "advantage" based on its cheap labour, its externalized environmental costs, and the direct subsidies provided to its forestry corporation, has made possible its rapid economic growth. According to the Chilean Central Bank's Natural Accounts Programme, if the government maintains its "business as usual" policies, logging will completely deplete the country's native forests by the year 2025 (32).
According to the World Resources Institute report already referred to, "Chile and Argentina share the largest single block of remaining temperate frontier forest in the world. (33) It contains at least 50 species of timber trees (half of them endemic). Chile's native temperate rainforests -- that constitute one third of the world's largest tract of relatively undisturbed temperate forest -- is being rapidly logged for woodchip export, mainly to Asia, and replaced with plantations of fast-growing non-native species that yield maximum wood fibre on short rotations. Of course, with the current collapse of the Far East economies the demand and price for commodities have fallen dramatically. Exports of timber to Japan , for instance, have almost entirely dried up. What the future holds is not yet altogether clear.
Because Chile had already spent considerable energy in putting in place a neoliberal policy framework that had already exposed its industries to the imperatives of global competition, the adoption of WTO rules triggered off less of a transformation of its forestry sector than it did to Mexico's for instance. Nevertheless, since Rio, destructive activities continue to expand with the help of state subsidies.
Because one of the main aims of government policy in Chile is to become accepted as a member of NAFTA, more lip service than usual has been paid to the importance of environmental conservation, and environmental laws are under consideration. However, the very modest regulations proposed to protect forests would do little to reduce the destruction particularly as the government, at the same time, continues to intensify its efforts to expand forest exploitation. One controversial project is a proposed investment by the US-based Trillium Corporation in a project to log hundreds of thousands of acres of rare native forest for chip exports. (34) Yet another pending Trillium investment to log 140,000 acres of lenga forests on the Argentine side of Terra del Fuego (a complement to the Chilean Rio Condor Project) signals that some foreign logging companies might not even wait for Chile to become a member of NAFTA.
Under NAFTA, the destruction of Chile's forests would inevitably accelerate rather than slow down. By adopting NAFTA's provisions on investment (similar to those in the proposed Multilateral Agreement on Investment), any Chilean regulation passed to protect forests which has the effect of reducing the profits of a planned foreign investment could be challenged as an "appropriation of property" and judged illegal. Under such rules, the protection of forests in any country that is signatory to the agreement would be well nigh impossible. (35)
INDONESIA
Anticipating the boom in demand for wood products in south-east Asia, Indonesia has been preparing to become a pulp and paper powerhouse in the region. New investment in mills and equipment show that Indonesia has been planning to make the most of its greater capacity to export forest products (36).
The financial meltdown in Asia -- in itself an effect of the globalisation of financial markets -- will have major effects on how and by whom Indonesia's forests will be controlled. State or domestically-owned logging companies have certainly not managed forests sustainably. Nevertheless, bailout agreements with the IMF will put Indonesia's forests under more direct control of foreign corporations and globalized market forces. Forestry products rank third among Indonesia's foreign exchange earners, after textiles and gas and oil products. In 1997, forestry products yielded some 6.25 million US dollars of foreign exchange (37). The agreement that the Indonesian government has signed with the IMF aims to remove the restrictions on the foreign ownership of land in that country (38).
The export of cash crops such as palm oil, cocoa, rubber, coffee and pepper, are likely to increase next year, and this will further remove forest cover. Because these commodities are some of the country's best generators of foreign exchange, it seems that new government policies are to be formulated to address the monetary crisis by expanding agribusiness. Palm oil production is particularly destructive to native forests, and it is a matter of considerable concern to hear that the Ministry of Agriculture has announced a 1.5 million hectare expansion of palm oil plantations in 1998 (39). This would increase the extent of oil palm estates to about three and a half million hectares in that country. Once again, the IMF can be held partly responsible for the destruction this would cause, as on the basis of their recent agreement with Indonesia, that country is forced t eliminate all restrictions on the setting up of palm oil plantations.
Indonesia may also look to the Asia Pacific Economic Community (APEC) forest initiative (EVSL) to stimulate more exports of wood products. Leaders of the 18 APEC nations agreed in November 1997 to lift trade barriers on wood products. The Indonesian Government would gain advantages from this initiative since it would enable it to insist that its 435 forest concessionares that control 30 million hectares of forests, shift their production into higher gear as wider market access must obviously mean more sales (40). Needless to say, all this woud greatly increase forest destruction in that country.
CONCLUSIONS
The 1990s were supposed to be the "turnaround" decade, when economic development would "change course" towards ecological sustainability. Instead, economic globalisation, as was totally predictable from the very nature of the phenomenon, has had exactly the opposite effect of still further reducing the sustainability of our economic activities, including those of the forestry industry.
Globalisation has led to the development of increasingly big and powerful transnational corporations, many of which are bigger than the average nation state of today. Corporations, by their very nature, have no social or ecological concerns -- only their immediate financial interests concern them. They are accountable to nobody except their shareholders, and because of their ever-increasing power they are today in a position in which they can, in effect, dictate economic policies to the governments of even the most powerful nation states such as the US itself.
Through the recent GATT Agreements and the World Trade Organization that they brought into being, corporations have built a sort of utopia for themselves by creating nearly all those conditions worldwide that best favour their immediate interests, which unfortunately are generally in conflict with those of human communities, local economies, and the natural world. So long as these uncontrollable corporations are given free rein to exploit the world's forest resources, the fate of the planet's remaining accessible forests is sealed.
If our political leaders had the slightest sense of responsibility and the necessary courage and integrity, they would change the direction in which our whole society is moving -- away from economic globalisation towards economic localisation -- with small and medium companies taking over that are rooted in their respective societies and that cater for very much more restricted markets. Only in such an economy do our forests have any future whatsoever.
References
1. See Rio's "NGO Declaration on Trade and the Environment", or transcripts from Rio's NGO Global Forum debate panel, "Free Trade vs Sustainable Development" which was moderated by this article's author and included officials from GATT, OECD, USTR, as well as NGOs Institute for Agriculture and Trade Policy, World Wide Fund for Nature, Institutio Brasileiro de Analises Socio-Economico, and Third World Network, June 1992.
2. "Exploring Sustainable Development: Global Scenarios 2000 -- 2050" World Business Council on Sustainable Development, Geneva, 1998.
3. Bello, Walden, Dark Victory, documents the cause-and-effect relationship between SAPs and deforestation in Ghana, Chile, Costa Rica and the Philipines, Third WOrld Network, 1996.
4. Ross, Carl and Winstein, Mark, Save America's Forests, Vol 6 no.1 Washington DC, April 1995.
5. Henson, Ryan, personal communication with Program Director at the Davis-based California Wilderness Coalition, August 1996.
6. Hall, Daniel, Western Forest Habitat Conservation Plan Inventory, Western Ancient FOrest Campaign, Forest Biodiversity Program, Portland, OR, 1998.
7. Hall, p cit, Note 6.
8. Imhoff, Daniel, personal communication with California-based consultant for users of sustainably-produced fibrous materials.
9. Langman, James, unpublished interview with Maureen Smith, Vice-President of the American Forest and Paper Assn. International Wood Products Division, Washington DC, March 1998.
10. Bryant, Nielsen, Tangley, The Last Frontier Forests, World Resources Institute, Washington Dc, 1997.
11. Seligman, Dan, Director of Sierra Club's Trade Program in letter to Marcia Miller, Chair of the US International Trade Commission, Washington Dc, April 28, 1998.
12. Shrybman, Steven, Selling Canaa's Environment Short: The Environmental Case Against the Trade Deal, Canadian Environmental Law Assn. Toronto, Canada, 1989.
13. News Release, British Columbia Ministry of Forests, May 28 1998.
14. Ross, John, "Treasures of the Costa Grande" Sierra magazine, July/August 1996.
15. Villamar, Alejandro, Datos de la "Version Mexicana" de la Estragia Global de la Industria Maderera-Papelera Internacional bajo el Tratado de Libre Comercio, Red Mexicana e Accion frente al Libre Comercio, DF, Mexico, 1998.
16. Villamar, op cit Note 15
17. Villamar, op cit Note 15
18. Villamar, op cit Note 15
19. Ross, op cit Note 14
20. Ross, op cit Note 14
21. Villamar, op cit Note 15
22. Santili, m., "Terras ENcholhidas" Parabolicas No. 28, InstitutioSociambental April 1997, Brasilia.
23 Cardoso, Fernando Henrique, from the presentation "Brasil Em Acao, Resultados no Primerio Ano" made at the Palacio do Planalto Brasilia, August 12, 1997
24. Liguori, Jose Lescaut, personal communication with the Director of Hidrovias in Brazil's Transport Ministry, Brasilia, Dec. 1997.
25. Viana, Gilney, Relatio Parliamentaro Sobre Amazonia, COmissio Externa da Camara dos Deputados, Brasilia, Dec1997
26. Serrao, EA< presentation by General Director of EMBRAPA, Brasilia, Dec 1997.
27. Kishinami, R., personal communication with the Director of Greenpeace Brasil, Sao Paulo, 1998.
28. Viana, Gilney, op cit, NOte 25.
29. Soltani, A., and Osborne, T., Arteries of Global Trade, Amazon Watch, Malibu, April 1997.
30. News Release, "Champion International COrporation Announces Plan to Maximise Shareholder Value", Champion International, Stanford, Oct 8, 1997.
31. Ramos, A., "Flonas e Cifroes" Parabolicas No 28 Institutio Socioambental, April 1997, Brasilia.
32. Larrain, S., and Menotti, V., "Implicianos de la Globalizacion Economica y el Libre Commercio Sobre la Biodiversidad y los Bosques de Chile" Santiago, 1998.
33. Bryant, N., Tangley op cit Note 10.
34. Hoffman, A., "Algo Se Avanza" Voces del Bosque, Defensores des Bosque Chilano, Santiago, No 14, Winter 1997.
35. Menotti, v., Testimony given before the British Columbia Legislative Assembly's Special Committee on the Multilateral Agreement on Investment, Vancouver, Bc., Sept. 1998
36. Yamin, K., "Freer Trade May Quicken Pace of Logging" InterPress Service, Jan 5, 1998.
37. Daju Prajna Resosudarmo, "Indonesian Economic Crisis Implies Immense Changes in the Forest Sector" Update by CIFOR Jakarta, Mar 26, 198.
38. Fischer, P., personal communication with the co-ordinator of the APEC FOrest Campaign at the PAcific Environment Resources Center, Sausalito, CA, May 1998.
39. Daju Pradjna Resourdarno, op cit NOte 37.
40. Yamin, K. op cit Note 36.
Source: The Ecologist Vol.28 No.6 November/December 1998
For personal use only. Not to be reproduced without permission from the source.