Plantations, poverty and power - Critical Information Collective

4
Introduction
The area of industrial tree plantations is expanding in the global South. Vast areas of monocultures have
been established to feed raw material to the pulp and paper industry. This report investigates the role of
European companies and institutions in promoting this expansion and to look at the impacts on local
communities and their environments in the South. It demands an end to financing business as usual in the
plantations and pulp and paper sector, and an end to development “aid” to the sector.
European companies, aid agencies and institutions play a significant role in promoting the expansion of
the industry in the South. The largest pulp and paper machinery exporters are Germany and Finland. In
2005, Germany exported more than US$2 billion worth of pulp and paper machinery and Finland more
than US$1 billion.1 European companies and institutions promote the expansion of the pulp and paper
industry in the global South not as a form of “development” but because it is beneficial to Europe.
The first section of this report looks at the process by which plantations are established and pulp mills are
built. What happens before a pulp mill can be built Often the first stage is to build the political
framework, to convince the public that large scale industrial tree plantations would be beneficial for the
country. Plantation proponents, who include elites in the South, as well as Northern actors, repeat a series
of lies to justify the expansion of plantations in the global South. Depending on the audience, they tell us
that plantations provide jobs, relieve pressure on forests, are only established on degraded land, restore
soils, sequester carbon and help meet the global demand for paper. The biggest lie of all is that plantations
are forests.
The reality for people living in the areas where plantations have been established is that plantations have
destroyed their livelihoods and sucked streams and rivers dry. The few jobs created are dangerous, poorly
paid and often seasonal. Plantation proponents do not point out that pulp mills are among the most
polluting of industrial processes and that one of the reasons that the South looks so attractive is that
regulation is less strict in many countries in the South.
Other reasons for the expansion to the South include the fact that trees grow faster in the tropics, meaning
that plantations can be logged on much shorter rotations than in the North. Labour is cheaper in the South
and governments provide a series of subsidies to encourage the expansion of the industry in the South. In
several countries the area of industrial tree plantations expanded rapidly under brutal military
dictatorships, when protest against the impacts of plantations was either extremely dangerous or
impossible.
The nature of global finance is another reason for the expansion in the South. To investors looking to
finance the pulp industry, a US$1 billion pulp mill in Brazil is a much more attractive investment than,
say, a small scale mill in the UK fed with locally collected waste paper. This is related to the notoriously
cyclical nature of the industry. When pulp and paper prices are high, the industry expands, leading to
overcapacity and inevitably a price crash. Once the price starts to recover, the industry expands again and
the next boom-bust cycle is under way.
1 “Paper mill and pulp mill machinery, paper-cutting machines and other machinery for the manufacture of paper articles”,
Index Mundi website. http://www.indexmundi.com/trade/exports/product=725