Plantations, poverty and power - Critical Information Collective

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13 Another reason for the move to the South is that energy is often cheaper there. Pulp production is extremely energy intensive. In Finland, for example, the importance of cheap energy to the pulp and paper industry is indicated by the fact that UPM-Kymmene and Stora Enso own shares in Pohjolan Voima, Finland’s second biggest energy company. Pohjolan Voima is a major shareholder and founder of Teollisuuden Voima which is building the 1,600 MW Olkiluoto 3 nuclear plant. 27 “Energy is the biggest single issue affecting the competitiveness of European industry today, including the paper industry”, notes Frits Beurskens, chairman of the Confederation of European Paper Industries (CEPI). 28 While the amount of energy needed to produce one tonne of pulp has declined in most countries in the North, the costs of energy have increased. 29 Although increases in the price of oil lead to increases in transportation costs, the transport costs of exporting pulp from, say, Uruguay to China is small compared to the costs of energy for pulp production. The major costs involved in pulp and paper production, apart from energy, are capital, fibre and labour. Trees grow faster in the South than in the North. Companies today can choose where they want to establish their plantations based on the growth rates of trees. The faster that trees grow in any particular country, the cheaper the fibre produced from the plantation. Decades of research and development into fast growing trees in plantations means that companies in Brazil are at the forefront of research into selecting species and managing industrial tree plantations. 30 Meanwhile in many countries in the North, it is becoming increasingly unacceptable to continue logging on the scale that the timber and pulp industries would prefer. In Canada, for example, many accessible forest areas have been logged. Environmental protests and increased regulation has made it more difficult for the industry to continue destructive clearcutting (although clearcutting has not been eliminated). In Finland, the industry faces protests against the logging of old-growth forests in northern Lapland. Greenpeace has documented timber logged from old-growth forests arriving at Stora Enso’s Veitsiluoto paper mill. 31 In March 2007, Greenpeace protested at the Botnia pulp mill and the Stora Enso paper mill at Kemi in northern Finland, demanding a stop to the destruction of ancient forests in Lapland. 32 September 2000. http://www.wrm.org.uy/bulletin/38/China.html 27 Päivi Munter (2005) “Finland stomachs nuclear growth”, Financial Times, 31 October 2005. Construction of the Olkiluoto 3 nuclear plant started in 2005. In 1986, Finland was about to order a new nuclear power plant. The Chernobyl catastrophe put paid to those plans, for almost twenty years. Enrique Tessier (1989) “Exporters’ cause for concern - Problems for Finnish manufacturers”, Financial Times, 13 December 1989. 28 Frits Beurskens (2007) “Editorial”, European Pulp and Paper, CEPI’s external newsletter, Issue 19, January/February 2007. 29 Adrian Whiteman (2005) “Recent trends and developments in global marNielsonkets for pulp and paper”, Paper presented at Paperex 2005 – International Technical Conference on Pulp and Paper Industry, 3-5 December 2005, New Delhi, India, page 42. 30 Adrian Whiteman (2005) “Recent trends and developments in global markets for pulp and paper”, Paper presented at Paperex 2005 – International Technical Conference on Pulp and Paper Industry, 3-5 December 2005, New Delhi, India, page 3. 31 “Stora Enso: pulping old-growth forests – old-growth forest wood route documented by Greenpeace, 10 January, 2007”, http://www.forestinfo.fi/forestlapland/storaenso.html In January 2008, Greenpeace photographed clearcut old-growth forests in eastern Finland. Trees up to 400 years old were logged. The wood was sold to Stora Enso’s pulp and paper mill in Oulu and to UPM’s paper mill in Kajaani. http://www.flickr.com/photos/greenpeacefinland/sets/72157604007222744/ 32 “Greenpeace reveals that production of magazines and packaging linked to destruction of Europe’s last ancient forests”, Greenpeace, 22 March 2007. http://www.greenpeace.org/international/press/releases/greenpeace-reveals-that-produc
14 Campaigners in Tasmania and Japan succeeded in persuading Japanese importers of wood chips from Tasmania not to use wood chips from old-growth forests. As a result, exports of wood chips from Tasmania to Japan have dropped in recent years. However, the decrease in exports from Tasmania is matched by an increase in exports to Japan of wood chips from industrial tree plantations in South Africa. The pulp and paper industry’s global demand for cheap wood fibre has shifted the destruction from Tasmania’s old-growth forests to South Africa’s grasslands. Government regulation of pollution from pulp mills is often less stringent in the South. Standards in countries in the North are “essentially the same”, according to International Paper’s Thomas Jorling, who has spent almost 30 years working in the paper industry. “There are differences, however, in some of the developing countries where they don’t have regulations yet for some types of substances that Westernized countries do,” he said in a 2004 interview, with Paper Watch. 33 An important difference, for example, is the length of time it can take to get government permission to build a massive new pulp mill. “Permits can be achieved in a much more rapid time outside the U.S.,” says Jorling. “The average time now for a major capital permit in the U.S. is three years, whereas in Europe it’s probably six months and in Brazil it’s a couple of weeks. In those countries, you don’t tie up capital waiting for permits.” 34 Subsidies and dictatorships “Land is cheap in both Brazil and Chile, generous government subsidies encourage reforestation (sic), and trees grow faster there than almost anywhere else in the world,” explained an article in the Financial Times in 1992. 35 In several countries, these “generous government subsidies” were implemented under military dictatorships or extremely repressive regimes. In addition to financial subsidies, the use of force by governments to remove local people from their land is a subsidy little discussed by the industry itself, for obvious reasons. In Thailand, a massive expansion of industrial tree plantations was planned in the late 1980s, by an alliance of the pulp and paper industry, the Royal Forestry Department and the army. The Green Isaan Project started in 1987, which included plans for the army to solve the drought problems in north-east Thailand by building dams and “regreening” by planting eucalyptus trees. The British company Biwater carried out the feasibility study and co-wrote the Master Plan for the project. The project also received support from the British government. 36 A second project started in 1990, the Land Distribution Programme for the Poor Living in Degraded National Forest Reserves in North-east Thailand, known by the Thai initials, Khor Jor Kor. Despite the project’s benign-sounding name the project was carried out by the military’s Internal Security Operations Command and aimed to evict five million villagers from National Reserve Forests and planting 1.37 million hectares of industrial tree plantations. 37 33 “Environmental Balancing Act”, Paper Watch, BILT Corporate Communications, Issue no. 52, 5 July 2004, page 4. Paper Watch is the Indian company BILT’s corporate publication. 34 “Environmental Balancing Act”, Paper Watch, BILT Corporate Communications, Issue no. 52, 5 July 2004, page 4. 35 Leslie Crawford (1992) “Cheaper land, faster trees - Regional report: Latin America”, Financial Times, 14 December 1992. 36 Oliver Pye (2005) Khor Jor Kor Forest Politics in Thailand, White Lotus Press. 37 Ricardo Carrere and Larry Lohmann (1996) Pulping the South Industrial Tree Plantations and the World Paper Economy, Zed Books, page 237.
Page 2 and 3: 1 Plantations, poverty and power: E
Page 4 and 5: 3 CONTENTS Introduction 1. Plantati
Page 6 and 7: 5 New investors have emerged recent
Page 8 and 9: 7 1. Plantations do not plant thems
Page 10 and 11: 9 plantations established on grassl
Page 12 and 13: 11 Nations Food and Agriculture Org
Page 16 and 17: 15 In his book, “Khor Jor Kor, Fo
Page 18 and 19: 17 Between 1991 and 2006, the numbe
Page 20 and 21: 19 are asking for”, notes WWF. 60
Page 22 and 23: 21 consume fewer goods. Less advert
Page 24 and 25: 23 credit crunch, unstable oil pric
Page 26 and 27: 25 Investment in plantations in the
Page 28 and 29: 27 possible price. Subsidies, linke
Page 30 and 31: 29 2. The anatomy of five pulp proj
Page 32 and 33: 31 However, while the Bank confirme
Page 34 and 35: 33 make way for its tree plantation
Page 36 and 37: 35 In April 2004, about 2,000 famil
Page 38 and 39: 37 Sappi, Swaziland: 50 years of in
Page 40 and 41: 39 after an assessment by the Soil
Page 42 and 43: 41 impact of the plantations on wat
Page 44 and 45: 43 Advance Agro, Thailand: Deforest
Page 46 and 47: 45 confiscation and liquidation of
Page 48 and 49: 47 management was facing a bankrupt
Page 50 and 51: 49 Indah Kiat, Asia Pulp and Paper,
Page 52 and 53: 51 company owners want profits to b
Page 54 and 55: 53 • US$4.5 billion owed by APP i
Page 56 and 57: 55 explained that “association wi
Page 58 and 59: 57 Indah Kiat faces a series of lan
Page 60 and 61: 59 logging. While the investigation
Page 62 and 63: 61 experimental areas and not from
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63 Staples and Office Depot in the
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65 “the exhaustive studies have c
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67 CEDHA has also filed complaints
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69 of converting grasslands to indu
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71 3. Pulp Inc. Profiles of seven p
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73 Thailand, a power plant for a Ne
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75 Management’s experts the possi
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77 A year after Aracruz’s third p
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79 In January 2003, Pöyry announce
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81 Bank in the early 1990s. Groome
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83 Pöyry’s role in the Baikal Pu
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85 Under carbon financing, Pöyry o
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87 Pöyry is working on second gene
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89 The Confederation of European Pa
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91 CEPI Eurokraft states that “it
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93 sectors need to reduce by 21% co
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95 The ADB’s report notes that th
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97 Nepal In Nepal, the target area
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99 loan for the second plantations
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101 International Finance Corporati
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103 •In December 2000, IFC approv
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105 firm’s activities. After his
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107 safeguards are in practice.
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109 Bank projects are approved by a
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111 •€80 million to Portucel to
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113 The Food and Agriculture Organi
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115 Nevertheless, Poore and Fries n
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117 failure to define industrial tr
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119 FAO’s guidelines recommend th
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121 Rosengren did not reply to my e
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123 Forest Stewardship Council: Mis
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125 body that rubber stamps operati
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127 Criterion 1.6, for example, sta
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129 fast wood plantations have take
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131 Principle 10.8 should prevent t
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133 By April 2004, FSC had, at last
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135 plantations, because it creates
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137 integrated set of common Princi
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139 for clearing areas of Atlantic
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141 Colombia were certified by SGS.
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143 The dissociation became necessa
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145 4. Future planned pulp mills As
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147 Planned pulp projects: 698 Comp
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149 UPM and Sveza Group Vologda Rus
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151 paper industry along ecological
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