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Untitled - Greenpeace

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CARVING UP THE CONGO<br />

47<br />

©<strong>Greenpeace</strong>/Davison<br />

TAXING CREDIBILITY: THE<br />

REVENUE FROM LOGGING WILL<br />

NOT GO FAR … FROM KINSHASA<br />

Central to the World Bank’s strategy for<br />

development via reform of the forestry sector<br />

is the redistribution of tax revenues back from<br />

national to local level, backed up by an<br />

increased level of area tax. This is supposed to<br />

bring funding to enable the state to provide<br />

social infrastructure.<br />

The tax revenue redistribution is at best a<br />

limited measure, however. In 2007 the area tax<br />

is $0.50/hectare (in the case of new<br />

allocations following the legal review, the level<br />

of area tax to be paid will be determined by<br />

the offer of the highest bidder). Assuming that<br />

10 million hectares of forest is under<br />

concession after the legal review and that tax<br />

collection from these concessions is 100%<br />

effective, the measure will still only net total<br />

revenue of $5 million annually, of which 40%<br />

($2 million) is to be redistributed to provinces<br />

and territories to ensure the provision of basic<br />

community infrastructure in a country about<br />

the size of Western Europe.<br />

‘Information in our possession<br />

gives an account of the<br />

current state of play<br />

regarding the assignment of<br />

forest area royalties resulting<br />

from logging in Orientale<br />

Province … This completely<br />

incomprehensible situation<br />

not only violates the relevant<br />

provisions of the Forestry<br />

Code, but also by its nature<br />

deprives Orientale Province of<br />

necessary resources for<br />

reconstruction after the years<br />

of war and destruction.’ 272<br />

Théo Baruti Amisi Ikumaiyete,<br />

Governor of Orientale<br />

Province, 2005<br />

It is clear that access to the<br />

documents allowing proper<br />

verification of the state of<br />

affairs of tax payment ...is<br />

difficult if not impossible. 273<br />

WRI-Agreco (Independent<br />

Observer for DRC forestry<br />

reform), 2007<br />

In reality, of course, even less money is likely<br />

to be available, since the process threatens to<br />

be undermined by corruption, as has happened<br />

in neighbouring Cameroon. To date in the DRC,<br />

systems of distribution or control to ensure<br />

that this money is actually devolved have<br />

simply not been set up at provincial or<br />

territorial levels. According to the World Bank,<br />

area fees were not transferred in 2003-<br />

2006. 274<br />

Given the experience of the impacts of poor<br />

institutional capacity and corruption in<br />

Cameroon, it is hard to imagine how the World<br />

Bank can have been so naïve as to allow such a<br />

situation to arise again. In any event, it is clear<br />

that local communities have not benefited at<br />

all, as yet.

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