The Untouchables. Rimbunan Hijau's world of forest crime & political ...

THEUNTOUCHABLESRimbunan Hijau’sworld of forest crime& political patronage

EXECUTIVE SUMMARYThe global trade in illegal and destructivelylogged timber is now out of control.Unlawful access to forest resources,environmental damage and forest destruction,human rights abuses and social dislocation of forestdwellingpeoples in some of the poorest areas of theworld, are being fuelled by those who buy timberand timber products from these illegal sources.One major player in this field is Rimbunan Hijau.Rimbunan Hijau is a global conglomerate ofcompanies controlled by the Tiong family fromSarawak in Malaysia. Initially built as a timberempire, the company now has extensive interests inlogging, timber processing, publishing, propertyinvestment, new technology and travel.Rimbunan Hijau dominates the logging industryin Papua New Guinea and is a powerful industryplayer in Malaysia and Equatorial Guinea. It also hassignificant forestry interests in Gabon, Indonesia,Vanuatu, New Zealand, and Russia. 1In these countries, the operations of RimbunanHijau are often characterised by a disregard for thelaw with documented illegalities in many aspects oftheir operations.Illegal access to forest resources, environmentaldamage and human rights abuses are repeatedcomplaints. But the company seems impervious tocriticism and appears to be protected by anextensive and well-established network of politicalpatronage and media control.Timber produced by Rimbunan Hijau is tradedacross the globe with little concern for theenvironmental damage, misery and sufferingcaused in producer countries.Rimbunan Hijau’s illegal timber and timberproducts are being traded across-the-counter inAsia, America, Europe, Japan, Australia and NewZealand.Kuwene Nakeye, a landowner from the Haya clan, Kosuo tribe in a reserve she protected from logging. Kuwene is seen here with her nephew Alex Ubiye.Theyhave worked together to protect their land from logging by Rimbunan Hijau.© Scheltema/GreenpeaceTHIS REPORT• Examines the extent and impact of Rimbunan Hijau’s (RH) timber operations in five key countries;• Highlights the environmental damage, human rights abuses and social suffering caused by RH;• Reveals some of the networks of political patronage that protect RH;• Details the global trade in illegal timber from RH logging operations;• Suggests simple and effective solutions to forest crimes and to mitigate the activities of companies like RH.2 THE UNTOUCHABLESRimbunan Hijau’s world of forest crime & political patronage

THE GLOBAL FOREST CRISISAncient forests are fundamental to life on Earth.They provide a home and vital sustenance tomillions of people. They provide a habitat forinnumerable species of plants and animals. Andthey perform vital ecological functions.Ancient forests are the place that millions ofindigenous peoples call home. Some of thesepeoples constitute the poorest and mostdisadvantaged of all world citizens. They sufferhuman rights abuses, great poverty, disease andother social problems as forest areas are harvested,with little or no consideration for their plight orlivelihoods.“...landowners were forcedto sign papers with abarrel of a gun at theirback. In the presence ofpolice and companyofficials, without properlegal advice, with gunspointed at them.”Annie Kajir, Human Rights Lawyer, PortMoresby, Papua New Guinea. 3Now, just 20percent of the Earth’soriginal forest coverremains as large intactareas; with more thana third of these underthreat. Industrial-scalelogging poses thesingle largest menaceto the forests’survival. 2Across the globe,trans-nationalcorporations continueto operatedestructively, and often outside of the law, as theyharvest the world’s last remaining accessible forestresources.Malaysian logging company, Rimbunan Hijau(RH) is one such corporation.Logging destruction is fuelled by a complacentinternational marketplace. In addition, consumingnations worldwide, eager to fulfil a relentlessdemand for wood and paper, turn a blind eye to“Some 350 million of the poorest people on Earth areentirely dependent on forests for their survival”World Commission on Forests and Sustainable Development 1999. 4the social, environmental and legal problems thatcharacterise the logging operations of companieslike Rimbunan Hijau.The actions of forest plunderers amount to farmore than just a huge ecological disaster.They have severe impacts on local people and onthe national economies of some of the LeastDeveloped Countries (LDCs) in the world.KEY POINTS1. Much of the global trade in timber and timberproducts is unlawful.2. Destructively and illegally extracted timberexacts a ruinous toll on forest eco-systems andon the lives of forest-dwelling peoples. It cheatsdeveloping countries of revenue and resourcesnecessary for survival and nationaldevelopment.3. Companies like Rimbunan Hijau operate acrossnational boundaries and are a key participant inthe illegal harvesting of timber.4. Such companies operate with impunity andcultivate a network of political patronage thatbreeds off political systems that are underimmense stress in Southern nations.5. Only measures at both the producer level (whereforests must be protected from illegal anddestructive logging) and at the consumer level(where illegal timber and timber products mustbe identified and banned) willeffectively address the problem.6. International and bilateralpolitical processes, such as theConvention for BiologicalDiversity (CBD), are anopportunity for governments tofund the protection of ancientforests and put in place strictinternational guidelines andprogrammes to achieve the“significant reduction inbiodiversity loss by 2010”, agreedto at the Johannesburg EarthSummit in 2002.Pepsy Diabe, Kamala clan, KusuoTribe stands amidst devastationof recent logging, Wawoi Guavi,Papua New Guinea. ©Scheltema/GreenpeaceTHE UNTOUCHABLES 3Rimbunan Hijau’s world of forest crime & political patronage

WHO IS RIMBUNAN HIJAU?Rimbunan Hijau is a conglomeration of manyhundreds of companies spread across threecontinents all owned and controlled by the Tiongfamily but which sometimes have no other officialconnection.Rimbunan Hijau has business interests in Australia,British Guyana, China, Equatorial Guinea, HongKong, Indonesia, Gabon, Malaysia, Aotearoa (NewZealand), Papua New Guinea, Russia, Singapore,Vanuatu and an estimated annual turnover in excessof US$1 billion according to the Malaysia-ChinaBusiness Council. 5The Tiong family has built Rimbunan Hijau into animmense corporate empire that started out as alogging company but which now extends to includeinterests in timber processing, agriculture (cocoa andoil palm), aquaculture, insurance, banking,publishing 6 , optical fibres, information technology,shipping, retailing, travel, real estate and propertydevelopment, mineral and mining development andprint media.The business dealings and corporate structure ofRimbunan Hijau as a company are not open ortransparent, particularly as regards its manycorporate shareholdings and takeovers.In Papua New Guinea for example, Greenpeaceresearch has identified over 60 separate companiesas being owned or politically controlled by the Tiongfamily — but only a small minority are openlyacknowledged as being a part of the RimbunanHijau group. The ownership and control of the rest isobscured by undisclosed buyouts, proxy directors andshareholders, outdated company records, foreignownership and widespread use of tax havens. 7MALAYSIAN MULTINATIONALLOGGING COMPANIESMultinational Malaysian logging companies gottheir start in Malaysia’s rainforests.Malaysian logging companies are often registeredas family-owned private limited companies, allowingthem to operate secretly as they are not publiclylisted corporations.Many of these companies have politicalconnections that helped them secure large areas offorest.Within a couple of decades they left large areas ofMalaysia deforested.Less than 15 percent ofMalaysia’s forests todayremain intact 8 .After years ofdestructive loggingpractices, the Malaysiangovernment began toenact stricter regulationsto attempt to save whatlittle rainforest was leftin the country. Thiscaused the Malaysiancompanies to lookelsewhere for lumber —a path which led themto Indonesia, Papua NewGuinea and other partsof the world.Equipment at an RHlogging camp in Kandrian,Papua New Guinea© Solness/Greenpeace"Established in 1975, Rimbunan Hijau Group has adiversified portfolio of businesses with estimated annualturnover exceeding USD 1 billion, withmost items exported. Currently comprising 10,000employees in Malaysia, the Group continues to expand,including diversifying overseas. Over theyears, Rimbunan Hijau Group has built up extensiveexperience in logging, sawmilling, export of logs andsawntimber and downstream processing activities,ranging from plywood to medium density fibreboardand particleboard. Rimbunan Hijau Group is also apioneer in supporting Sarawak's emphasis ondownstream activities. In 1985, it established the state'sfirst large scale plywood mill under Rimbunan HijauPlywood Sdn. Bhd. The Group is also the majorshareholder of Jaya Tiasa Holdings Bhd and Subur TiasaHoldings Bhd, the public listed companies on the KualaLumpur Stock Exchange with market capitalisation ofabout more than RM 2 billion and the largest plywood,veneer and particleboard producer inMalaysia.In addition to its operations in Malaysia,Rimbunan Hijau Group has expanded internationally toPapua New Guinea, New Zealand, Australia, China, HongKong, Singapore, Gabon, Rusia, Congo, EquatorialGuinea & British Guyana." 9Malaysian German Chamber of Commerce and Industry4 THE UNTOUCHABLESRimbunan Hijau’s world of forest crime & political patronage

POLITICAL PATRONAGERimbunan Hijau enjoys wide political patronage.In Malaysia the Tiongs have been highly astute informing strategic alliances with the Malay politicalelite and are personally involved in the SUPP – themain Chinese Party in Sarawak.In the early nineties, the brother of Sarawak’sChief Minister (who controled the allocation oflogging concessions) was a director of a RimbunanHijau company and a sister of the Chief Ministerwas a Tiong business partner.Tiong Hiew King has himself been a StateSenator, a position that was also occupied by one ofhis sons, and Tiong family companies have sharedcontrol of their subsidiaries with Provincial Ministersand party officials. 10In Sarawak these ties have resulted in a blurringof the distinction between government and logginginterests and has led “to changes in legislation thatfavour corporate activities and which result in thedisregard and repression of many actors within civilsociety.” 11In Papua New Guinea Rimbunan Hijau is alsoclosely connected to the political elite.For example, one recent Deputy Prime Ministerwas criticised in an Ombudsman investigation forunlawfully pressuring the National Forest Board tofavour Rimbunan Hijau with an illegal timberpermit extension. 12The Minister for Justice is Chair of a companythat holds a timber permit that it sub-contracts toRimbunan Hijau. A National IntelligenceOrganisation report alleges a provincial Governorand two Members of Parliament were on RimbunanHijau’s payroll. 13CORPORATE RESPONSIBILITYOffice of the National newspaper,which is owned by RimbunanHijau, in Port Moresby, Papua NewGuinea © Solness/GreenpeaceRimbunan Hijau is just one of a number ofMalaysian companies that have global timberinterests. Many of these companies have beencriticised for poor environmental, social and humanrights records. 14If Malaysia is to be seen as a good global citizenthis attitude must change. Malaysia will attempt toportray a commitment to the environment whenhosting the Seventh Conference of the Parties(COP7) of the United Nations Convention onBiological Diversity in Kuala Lumpur in February2004.Globally, there are growing calls forgovernments to hold transnational corporationsaccountable for their actions in foreign countries.This is especially important for companies operatingin smaller or less developed countries where therule of law and governance frameworks may beweak.The final text of the Johannesburg Earth Summit– the World Summit on Sustainable Development –made a positive statement on corporateaccountability. WSSD called for: “Active promotionof corporate responsibility and accountabilityincluding through the full development andeffective implementation of intergovernmentalagreements and measures.”Malaysia is a signatory to the WSSD plan ofimplementation and must start to make its rhetoricmatch its actions.In order to make real its commitment to WSSD,the Malaysian government must consider:• Pursuit of amendments to its Corporations Lawto increase corporate accountability;• Passage of legislation to impose standards onMalaysian companies operating overseas;• Actively supporting international mechanismsthat increase the accountability of itstransnational corporations.THE UNTOUCHABLES 5Rimbunan Hijau’s world of forest crime & political patronage

PAPUA NEW GUINEAGuinea’s only veneer mill andits largest sawmill.In Papua New GuineaRimbunan Hijau controlscompanies involved incommercial printing, travel,wholesale and retail sales,shipping, propertydevelopment and owns adaily newspaper, TheNational.Rimbunan Hijau has closeconnections to Papua NewGuinea’s political elite. ThePrime Minister has beendirectly involved in thelogging industry 16 and hisDeputy has been criticised inan Ombudsman Commissionreport for ‘arbitrary andirresponsible’ interference indirecting the unlawfulallocation of the Kamula Dosalogging concession toRimbunan Hijau. 17Wawoi Falls from the air, Wawoi Guawi, Papua New Guinea.© GreenpeacePapua New Guinea is a South Pacific nation ofsome five million people, most of who still dependon the environment for their daily subsistence.The logging industry has already acquired 70percent of available forest resources and RimbunanHijau is at the forefront of attempts to gain accessto what remains.RIMBUNAN HIJAU IN PNGRimbunan Hijau is the dominant player in theforest industry in Papua New Guinea and it hassignificant investments in other sectors of theeconomy.Rimbunan Hijau maintains a veil of secrecy overthe true extent of its logging and other businessinterests but it has interests in more than 60interlinked companies that are registered in PapuaNew Guinea.These companies control more than 50 percentof Papua New Guinea’s large-scale commerciallogging operations and at least 55 percent of logexports.Greenpeace estimates that Rimbunan Hijaucontrols timber rights in more than three millionhectares of forest and in 2002 alone, exported logsworth more than US$50 million from Papua NewGuinea. 15Rimbunan Hijau also operates Papua NewThe Secretary of theDepartment of Environmentand Conservation was also criticised by theOmbudsman Commission for his role in the sameaffair.The Minister for Justice is the Chair of acompany 18 that holds the permit for the East Kikorilogging concession. His company employsRimbunan Hijau as its logging contractor.The Minister for Planning, the Minister forPrivatisation and the Chief Secretary are otherprominent leaders with well-documented links tothe logging industry in PNG. 19The rainforests of Papua New Guinea and Asia Pacific shelterregions of unusually high biodiversity. © Dorreboom/Greenpeace6 THE UNTOUCHABLESRimbunan Hijau’s world of forest crime & political patronage

RIMBUNAN HIJAU AND ILLEGAL LOGGINGMost large-scale logging operations in PapuaNew Guinea, including those operated byRimbunan Hijau, are unlawful as they are infundamental breach of a number of basic legalrequirements.Most logging operations do not have theinformed consent of the local resource owners(most of whom have never even been correctlyidentified) 20 , they have not been initiated andallocated according to the requirements of theForestry Act, they are being operated in almostcomplete defiance of environmental laws andregulations and they are not sustainable, which is aspecific requirement of both the PNG Constitutionand the Forestry Act. 21An independent review was recently ordered bythe government into a number of new loggingpermits and extensions. 22 Three of the reviewsinvolved logging projects operated by RimbunanHijau; Wawoi Guavi, Vailala Blocks 2 and 3 andPassismanua.The review found that the extensions to all threeprojects were unlawful as they breached legalrequirements and had not followed due process.The review reached the ‘unavoidable conclusionthat there have been serious departures andbreaches from due process and there are seriousanomalies in the timber permits and agreements’. 23As well as declaring the project extensionsunlawful, the review also found that the originaltimber permits for Vailala Blocks 2 and 3 andWawoi Guavi were also unlawful and that thetimber rights had never been properly acquiredfrom the landowners. 24Rimbunan Hijau managed to keep itsinvolvement in the unlawful extension of thePassismanua timber permit out of the PNG media bythreatening a defamation action against the PostCourier newspaper. 25 Rimbunan Hijau’s denial ofinvolvement to the media was contradicted in thesubsequent review, which confirmed that RH wasthe logging company for Passismanua. 26KAMULA DOSAKamula Dosa is Papua New Guinea’s largestunallocated logging concession in the western partof the country. It covers over 800,000 hectares andcontains an estimated 11.2 million cubic metres ofcommercial timber.The concession is the biggest prize currentlyavailable to the logging industry in PNG and it iscoveted by a number of logging companiesincluding Rimbunan Hijau.Forestry laws require that the timber rights bepublicly advertised in acompetitive biddingprocess to ensure thebest possible deal forthe local resourceowners. But RimbunanHijau has made anumber of attempts toavoid this process andto unlawfully acquirethe logging rights.In 1997 RimbunanHijau was granted anunlawful geographicalextension to its WawoiGuavi timber permitthat covered the wholeof the Kamula Dosaconcession area. Theextension wassubsequentlyinvestigated andoverturned by theOmbudsmanCommission. 27The Ombudsmancriticised a number ofpoliticians forinfluencing the decisionof the National ForestBoard and Boardmembers for floutingthe law and putting theinterests of RH abovethose of the resourceowners and the State. 28The Ombudsmanrecommended actionagainst a number ofBoard Members andRimbunan Hijau, butthose recommendationshave not beenenforced.In 2002, RimbunanHijau again tried tounlawfully secure thelogging rights forKamula Dosa. A Cabinet submission sponsored bythe then Deputy Prime Minister and a number of hisMinisterial colleagues proposed that RimbunanHijau should be given unique tax concessions andunlimited access to Kamula Dosa without having tofollow the legal allocation process or properprocedures.The submission was withdrawn after it waspublicly exposed.ROBBER BARONSThe latest official inquiry intothe forestry sector in Papua NewGuinea found that all six newpermits and permit extensionsreviewed were unlawful. This ishow the Review of DisputedForest Allocations, 2003,described the logging companiesoperating in PNG:‘the overwhelming conclusionis that the robber barons are nowas active as they ever were. Theyare not only free to roam, but arein fact encouraged to do so bypersons whose proper role is toexercise control over them...Onlya Commission of Inquiry couldhope to unearth the entirepicture and unravel the web ofdeceit’. 29The Review looked specificallyat two of Rimbunan Hijau’slargest logging operations,Wawoi Guavi and Vailala. Inrespect of these two concessionsthe Review stated:‘The time has come for a fullinvestigation into the affairs ofthese companies (both RHsubsidiaries). They should becompelled to produce documentsand account for their actions’. 30Despite these findings thePrime Minister has said:“I must congratulateRimbunan Hijau for investingheavily in the forestrysector...(this) is in line withgovernment policies...Thecompany and other genuineforestry companies must besupported.” 31THE UNTOUCHABLES 7Rimbunan Hijau’s world of forest crime & political patronage

Wawoi Guavi timber concessions,Papua New Guinea.THE ENVIRONMENTAL IMPACTSOF LOGGINGEnvironmental studies 40 indicatethat logging by Rimbunan Hijau inPapua New Guinea is among the mostenvironmentally destructive of anyselective logging operations studied anywhere onthe planet. Losses to the residual stand have beenrecorded at more than 100 trees per hectare. Whatis supposed to be selective logging is effectivelyclear felling.The logging mainly ignores the prescriptions inthe PNG Logging Code of Practice. Buffer zones arenot respected, logging tracks are bulldozed throughstreams, poor road construction wastes logs andpollutes water courses, oil and other wastepollution is endemic, standing water attractsmosquitos and increases the incidence of malaria,and undersized logs are constantly felled. 41Papua New Guinea’s Constitution and ForestryAct require that all forest operations are carried outin a sustainable manner and that resources areprotected for future generations. In reality, theseprescriptions are ignored and the average life of alogging concession is just 12 years. 42 This is less thanone-third of the legally mandated 40-year cuttingcycle and is also ecologically inadequate.NO MONITORING OR ENFORCEMENTDespite the very poor environmentalperformance of logging companies in PNG, noaction is ever taken against them. The Departmentof Environment and Conservation does not evenhave a forestry monitoring team and the 2002Ombudsman Commission found that theDepartment head, Wari Iamo has gone out of hisway to support Rimbunan Hijau. 43Wari Iamo has been criticised by the OmbudsmanCommission for neglect of duty for supporting anillegal logging permit extension for RimbunanHijau. When disciplinary proceedings were initiatedagainst him by his former Minister for a series ofoffences, the Prime Minister himself intervened,sacking his Minister and re-instating the suspendedSecretary.WAWOI GUAVIIn an unpublished report 44 commissioned byGreenpeace, scientist Dr David Melick has studiedthe environmental impacts of logging by RimbunanHijau in its Wawoi Guavi timber concession inWestern Province.The research uncovered an extensive catalogueof breaches of PNG’s Logging Code of Practice. Thereport identified 261 separate breaches of 18 keylogging standards.These breaches were seen to have seriousenvironmental impacts, including injury towaterways and watersheds, severe erosion andserious pollution to soil and waterways from oil andtoxic chemicals.The study also found frequent damage tocultural sites from logging operations and thefelling and removal of undersized trees.Although Greenpeace and Dr Melick were in thearea at the invitation of landowners, RimbunanHijau used the Southern Command Police Task forceto try andintimidatethem and torestrict accessinto the forest.RH also placedlocked chainsand logs acrossroads toinhibitmovement inthe area.“Having examined some of thelogging operations, it is nowdifficult to view the responsibleenvironmental position espousedon behalf of Rimbunan Hijau withanything other than cynicism”(Melick 2003)THE UNTOUCHABLES 9Rimbunan Hijau’s world of forest crime & political patronage

INDONESIAIndonesia has 10 percent of the world’sremaining tropical forests. They are home to some50 million indigenous people. These forests teemwith unique wildlife and the highest diversity oftrees and vines found anywhere in the world.Hundreds of unique mammal and bird specieslive in the forests of Indonesia, often only on asingle island.Yet, if the current rates of logging and forestconversion continue, the lowland dry forests ofSumatra and Indonesian Borneo will have beencompletely destroyed by 2010. 45Indonesia is one of the major sources of illegallytraded tropical timber. According to governmentestimates, as much as 90 percent of the country’sproduction is unlawful, amounting to some 50million cubic metreseach year. 46“Rimbunan Hijau hasbecome one of the mostruthless logging companiesin the world due to abusesof national laws andregulations, human rightsviolations and contractualbreaches”Richard Wilcox. Asian Economies FuelForest Meltdown, published inThe New Observer 47Evidence shows thatthis illegal productionand trade is continuingdespite a log exportban introduced inIndonesia in November2001 48 . The primarydestination of illegaltimber exports fromIndonesia is Malaysiawhere log imports arecontinuing, despite aban on log importsfrom Indonesiaintroduced in June2002.In October 2003, the Indonesian Minister ofForestry called on the European Union to rejecttimber products from Malaysia, saying that theycontain a large amount of illegal wood fromIndonesia. 49In Indonesia, much of the logging is unlawfulbecause it is done without a government permit orlicence. This is possible because of the bribes thatare paid to police, forestry officials and politicians. 50Kidnapping, bribery and attempted murder have allbeen documented as the methods used by thelogging companies to protect their illegal trade. 51ILLEGAL LOGGING, RIMBUNAN HIJAU ANDTHE MILITARY“Military involvement in illegal activities is takenfor granted in Indonesia. Hundreds of reports ofmilitary involvement in illegal logging haveemerged and there is recognition of this seriousproblem within government. Reports of militarypersonnel owning illegal sawmills, backing timberbarons and applying pressure for the release ofconfiscated logs are common and widespread.” 52The Environment Investigation Agency (EIA) 53 inLondon and the Indonesian group Telapak havereported links between the company PT RimbunanHijau Jaya and the Indonesian military. EIA andTelapak visited communities in West Papua andobtained documents clearly linking a military officerto PT Rimbunan Hijau Jaya and illegal logging.In a brief presented to the IndonesianGovernment they described how the illegal loggingis being facilitated by the use of ‘military power’that is used to threaten local communities. 54Illegal logging by PT Rimbunan Hijau Jaya hasbeen reported at three sites and is occurring despitethe opposition of the majority of the local people.Letters of complaint were sent to forestry officialsin 2002 but a promisedinvestigation has nevereventuated.The EIA and Telapak havecalled on the IndonesianGovernment to take decisiveaction to prevent the export ofillegally felled logs and todiscipline and prosecutemilitary officers involved withlogging companies in illegalactivities.Merbau Logs cut on Knasaimos land © EIA/Telapak 200310 THE UNTOUCHABLESRimbunan Hijau’s world of forest crime & political patronage

Landowner Sakas Aomono is dressedin the traditional warrior gear, usedwhen going out fighting.Aonoma’s grandparents used the localBula creek as medicine. “They woulduse this creek when they were sick, itwould make them better. This creekhas faded away. It cannot heal peoplebecause they came and disturbed thebeliefs we have. It will not be thesame as before. There’s no fish sincethe company came. Before my motherand father used to do this, now thereis nothing. Our medicine is not likebefore.Sakas Aonomo from Bula Creek, Middle Fly District, Western Province, PNG© Scheltema/Greenpeace“By looking at that place I feel verysad and upset and frustrated aboutmy land being destroyed”.EQUATORIAL GUINEARimbunan Hijau operates in a number ofAfrican countries including Gabon andEquatorial Guinea, where its subsidiaryShimmer International and its manyassociated companies have been a dominantplayer in the logging sector 55 under the“sponsorship of the Minister for Forests” 56 ,who is also the President’s son 57 .In Equatorial Guinea, some 70 percent ofthe forest has been allocated for large-scaleindustrial logging 58 despite the importance ofthe forest for the daily subsistence of thelargely rural population.Although local laws require that 60percent of log production must be processedon-shore, most timber is still being exportedas cheap raw logs 59 . This deprives the countryof resource revenues, economic investmentand employment opportunities.Enforcement of legal requirements isvirtually non-existent in commercial logging,according to the World Rainforest Movement(WRM) and although logging companies arerequired by law to provide health, educationand social facilities for local communities,enforcement is very poor. 60About 85 per cent ofthe African rainforestthat once spread acrossEquatorial Guinea,Cameroon, CentralAfrican Republic,Congo Brazzaville, theDemocratic Republic ofCongo and Gabon hasbeen lost. Industriallogging threatens mostof what remains.© Mauthe/GreenpeaceTHE UNTOUCHABLES 11Rimbunan Hijau’s world of forest crime & political patronage

MALAYSIAA Rimbunan Hijau logging tractor and feller team works in a logging concession in the middle Baram valley, Malaysia. © Dang/GreenpeaceMalaysia is one of the world’s major producersand exporters of tropical timber. It is the home basefor Rimbunan Hijau and a number of other majortransnational logging companies.The majority of Malaysia’s timber productioncomes from Sarawak where about 70 percent of the“Our forest and land have been supplying us withabundant resources and providing us with sources ofincome and have also shaped our culture, beliefs andcustoms. Thus, to destroy the forest has the sameimpact of destroying our community.”Long Sayan Declarationland area has been allocated for logging. Here,Rimbunan Hijau has an estimated 800,000 hectaresof production forest. 61Rimbunan Hijau produces 3-4 million cubicmetres of logs per year, which gives the company a20-25 percent share of the Malaysian timberindustry. 62SOCIAL IMPACTS OF LOGGINGLogging companies active in Sarawak are wellknownto indigenous dyak peoples for seriouslyundermining their livelihoods and survival.Widely documented negativesocial consequences of thelogging industry include a severeimpact on food security, pollutionof water supplies, increasingincidences of ill-health anddisease, the disruption of localeconomies and changes in socialstability. 63“Members of ourcommunity aresuffering frompoor health dueto the lack of abalanced dietand air andwater pollutioncaused byloggingactivities.”Long Sayan DeclarationIn 2002, the Penan people documented theabuses they have suffered at the hands of thelogging industry in the Long Sayan Declaration. 64The Penan are particularly affected as they are asemi-nomadic forest dwelling people- their foresthas been their home for thousands of years. Theirfight against logging is a fight for their lives.Over 700 people from 40 communitiesformulated the Declaration to clearly spell out theirsuffering as a people displaced and abused by thelogging industry.The Declaration details the food shortages,frequent illnesses and income loss brought about bylogging operations and calls for immediategovernment action as the very survival of the Penanpeople is severely threatened by the loggingindustry, which continues to reap huge profits fromthe sales of timber resources extracted from theirancestral land with impunity.12 THE UNTOUCHABLESRimbunan Hijau’s world of forest crime & political patronage

As is the case in Papua New Guinea, Indonesiaand Africa, Malaysia also suffers severe anduncontrolled environmental impacts from loggingactivities.Careless and negligent logging practices impacton local watersheds and cause soil erosion; theydisrupt local climates and cause or exacerbate forestfires. There is also a toll on bio-diversity withinforests, and the marine environment.A report by the World Rainforest Movement(WRM) and Forests Monitor in 1998, listed a numberof Malaysian citizens who had their human rightsabused and freedom of movement restricted as aresult of their opposition to illegal logging. In eachcase, the named individuals had been prevented bygovernment officials from travelling to attendinternational meetings and then had their passportswithdrawn. 65There is evidence that Rimbunan Hijau is nowtrying to apply similar tactics in Papua New Guinea.In November 2003, threats were issued to a localairline to only fly RH approved passengers to anairstrip inside its Wawoi Guavi logging concessionand to deny travel to any non-governmentorganisations. 66The top politicians in Sarawak havelong been awarding loggingconcessions to themselves, theirfamilies and their supporters.”WRM and Forest Monitor (1998)and other destructive development activities withintheir customary land and against infringement oftheir rights. In response they have been harassed,intimidated, suppressed and arrested by thegovernment and companies.Supporting these company interests, police andforest department officials have arbitrarily arrestedand detained those indigenous people who put upany form of protest, even though such protests areundertaken within the confines of their own landsand they have legitimate rights under the law tosuch forms of protest. 67In one such protest inAugust 2000, more than100 Penan people in theApoh and Tutoh regionsbarricaded a loggingroad to prevent accessby three timbercompanies including asubsidiary of RimbunanHijau. 68“The activities of theSarawak timber companyRimbunan Hijau havewreaked environmental andsocial havoc in Sarawak foryears through theirwidespread loggingactivities.”Utusan Konsumer, Penang, (Nov 1993) 69The action was takenafter numerous verbaland written appeals buttheir problems wereignored. The peopleaccuse the loggingcompanies of hiringgangsters to threaten them not to pursue theirclaims of encroachment, illegal logging anddamage to fruit gardens and burial sites.Protests and blockades continued through 2002and 2003.SOCIAL CONFLICTAND HUMANRIGHTS ABUSES INSARAWAKIndigenous peoplesin Sarawak have lodgedmany complaints to theauthorities aboutlogging-related andland rights problems,but their complaintshave constantly beenignored.Over the last 20years, thousands ofindigenous dyak peoplein Sarawak have beenblockading andprotesting againstlogging, plantationsPreviously logged Malaysian forests in the early morning fog. A Rimbunan Hijau logging road is just visible in the foreground.© Dang/GreenpeaceTHE UNTOUCHABLES 13Rimbunan Hijau’s world of forest crime & political patronage

RUSSIASpread over 774 million hectares, Russia has thebiggest forest area in the world. This representsabout 24 percent of all the forests on our planet.About two-thirds of these forests are located in theremote northern regions of Siberia and in the FarEast.In the more densely populated areas ofEuropean Russia, Southern Siberia and parts of theFar East, forests have been severely over-loggedduring the last 50 years, placing great pressure onremaining resources.All Russian forests are State-owned; with noprivate ownership. The State is responsible forprotection and management of forests, even inconcession areas. The forest service is the biggest inthe world, employing about 220,000 people.Environmental activists in the Russian Far Eastare becoming increasingly concerned about theextent of illegal logging in the region.They say the rich timber resources of the ancientforests are being plundered despite Russia’s strictlaws on logging. Environmentalists blamecorruption by local officials and lack of funds toenforce controls on timber shipments. 70Rimbunan Hijau has been operating in Russiasince 1997 when it acquired the rights to harvest305,000 hectares of State forest in a region that hadbeen earmarked for environmental protection. 71Since 1997, RH has acquired further large-scaleconcession areas in the Ul’chsky/Solnechny andVaninsky districts.The Forest Club of Russia have expressedconcerns about Rimbunan Hijau’s loggingoperations:“Logging in the upstream of river Soukpai by theRH company will result in destruction of theexisting forest ecosystems of the basin, spreadingof forest fires, soil erosion and disturbance to thehydrologic balance of local rivers... that now servesas an important sources of means of subsistencefor most of the local residents.” 72Rimbunan Hijau has been repeatedly fined forviolations of logging regulations and environmentallaws. 73In 2002, Rimbunan Hijau exported 700,000 cubicmeters of timber from Russia with a value of US$58million (2001). 74 Seventy-six percent of this was soldto China. Most of this trade is believed to be withsmall buyers around the border town of Suienghe.The remaining 24 percent was exported to PacificBarter Trade Limited in Hong Kong.Region where Rimbunan Hijau already has forestconcessionsRegion where Rimbunan Hijau plans to secureforest concessions14 THE UNTOUCHABLESRimbunan Hijau’s world of forest crime & political patronage

NEW ZEALAND/ AOTEAROARimbunan Hijau has committed to FSC in New Zealand but still has away to go to improve plantation management, especially streamprotection. © GreenpeaceAlthough the forest industry in New Zealand/Aotearoa is based on the plantation production ofsoftwood species, Rimbunan Hijau is a major player.Rimbunan Hijau’s first forestry investment inAotearoa was the purchase of five forest licensesfrom the national government in 1990 through theTiong controlled company, Ernslaw One. 75This gave the company logging rights in threeregions, Coromandel, Manawatu and Otago. Sincethen the company has diversified its intereststhrough investments in wood processing, timberimporting and wholesale, land and propertydevelopment, scientific products, fish farming andports. 76 In particular, the timber importingenterprise The Lumberbank, is importing timberfrom Rimbunan Hijau’s illegal operations in PapuaNew Guinea. This is a major part of the 4,000 m3 ofsawn timber imported into New Zealand from PNGin 2003.Since 1990, Ernslaw One has expanded its forestestate from an initial 22,000 hectares to 53,000hectares through the purchase of furtherplantations and the conversion of farmland.In stark contrast to the performance andmanagement of Rimbunan Hijau’s forest operationsin tropical countries (and Russia), in NewZealand/Aotearoa, it is seeking to be a responsibleforest manager. According to the company’swebsite:“Ernslaw One firmly believes in caring for theenvironment, and strives to ensure that it’s forestand timber processing operations meet therequirements of sound environmentalmanagement. It’s plantation forests are managed asa sustainable resource.” 77Ernslaw One has all its plantation operationscertified under the globally recognised greenlabellingForest Stewardship Council (FSC) scheme.To become FSC certified, Ernslaw One wasrequired under FSC rules, to “demonstrate a longtermcommitment to the Forest Stewardship CouncilPrinciples and Criteria” 78 .It is barely credible that Ernslaw One coulddemonstrate such a commitment when it is part ofthe Rimbunan Hijau group of companies that sodemonstrably fails to live up to the most basic socialand environmental standards in almost all of itslogging operations.However, even in New Zealand/Aotearoa ErnslawOne’s plantation forest operations still have someway to go to meet FSC responsible managementstandards. The certification of its North Islandoperations was subject to 25 conditions thatidentify failures to comply with FSC standards andwhich require stipulated remediation, most of themwithin 12 months.In particular, there are major concerns on theirclear-fell logging practices in catchments of theirplantations in the Coromandel in the North East ofthe North Island that are prone to severe highrainfall events. In the implementation of the locallaw, the Resource Management Act, a number oflocal community organisations and neighbours ofthe company have been battling to protect localstreams and harbour.Dairy farmer Paul Bibby, whose farm is aneighbour of Coromandel’s Whangapoua Forest,appeared on TVNZ’s “Frontline” investigation of thecompany 79 in 1994. His concern was that it waslogging too much, too fast and that the barehillsides would lead to a major silt problem, as hadhappened previously in the days of Forest Serviceownership. Both farms and Whangapoua Harbourhad been badly silted in the past, causing somefarms to be inundated under a metre of silt. Thecompany has denied that it is engaged in anyenvironmentally unsound practices on theCoromandel.“Ernslaw One had gone through the motions ofconsulting the locals but totally refused toaccommodate any of the residents association's DraftCode of Logging Practice. After rain, the dirty waternow extends right out through the harbour. We'vehad absolutely no satisfaction from the company."Paul Bibby, on behalf of the Whangapoua Environmental Protection Society.Local people were astounded to discover thatthe local District Council had agreed to reduce thewidth of the riparian strips (strips either side of astream, river or lake that is protected) from 20metres to five metres without consulting them.There are also complaints that shellfish beds in theharbour are being buried by silt. More recently, thecompany has created further controversy by buyingup an adjacent dairy farm and proposing to build alarge sawmill and processing plant.THE UNTOUCHABLES 15Rimbunan Hijau’s world of forest crime & political patronage

MARKETS AND CHAIN OF CUSTODYThe international trade in tropical timber onlyexists because of the demand from the marketplace. The trade in illegal timber and the humanand environmental suffering that it causes are thedirect result of a market where the buyers of timberand timber products do not discriminate betweentimbers from different sources.LOG EXPORTSThe major export markets for raw log exportsfrom Papua New Guinea, Indonesia, Malaysia andRussia are China and Japan. 90For instance, of 1.85 million cubic metres ofdeclared exports from Papua New Guinea in 2002,62 percent went to China and Hong Kong and 23percent to Japan. These figures reflect a trendwhere, over the last three years, log exports toJapan have declined as China has become thedominant market.In both countries species like Calophyllum areused to produce cheap plywood for theconstruction sector, with large Japanese tradinghouses like Nissho Iwai facilitating the trade.SAWN TIMBERSawn timber is the fastest-growing timber exportfrom Papua New Guinea. Volumes have risendramatically from 23,000 cubic metres in 1999 to42,348 cubic metres in 2002 91 . This reflects thecommissioning of Rimbunan Hijau’s major sawmillat Kamusie in Western Province.Rimbunan Hijau’s major markets for sawn timberfrom Papua New Guinea are in Australia and NewZealand/Aotearoa.In Australia, RH controls a subsidiary named TLBTimber that operates out of Brisbane. Thiscompany sells illegal and destructively loggedtimber to many small companies and individuals inAustralia. This timber is then turned into mouldingsand other building components.According to figures from the Forest Authority inPNG, in 2002 Australia imported 16,653 cubicmetres of rough sawn timber from Papua NewGuinea.This timber is tainted with illegality, humanrights abuses, environmental destruction, andnegative social impacts.VENEER AND PLYWOODOther processed commodities experienced sharpincreases in past years, mainly due to theinstallation of Rimbunan Hijau’s Panakawa mill inWestern Province. Exports of veneer rose from1,700 cubic metres in 1999 to 71,615 cubic metres in2002 and plywood exports likewise increased from7,000 cubic metres in 1999 to 70,083 cubic metres in2002. 92Again Asian market countries such as China,Taiwan and Korea imported the bulk of thesetimber products.RH timber bound for TLB in Australia being loaded in Port Moresby, Papua New Guinea. © Scheltema/GreenpeaceTHE UNTOUCHABLES 17Rimbunan Hijau’s world of forest crime & political patronage

SUMMARYThe findings illustrated in this report have clearlyidentified Rimbunan Hijau as being involved insignificant forest crime. It is destructively loggingvast areas of ancient forest in defiance of nationallaws, local customs and the rights of resourceowners. It is causing large-scale environmentaldamage and increasing the poverty of local peopleunder the protection of political elites.Rimbunan Hijau controls industrial-scale loggingoperations in at least eight countries and operatesacross three continents. Many of its loggingoperations are characterised by illegal access,environmental damage, human rights abuses, socialconflict and political corruption.Timber harvested by Rimbunan Hijau is tradedaround the world – as logs, sawn timber, veneersand plywood and as finished products like furnitureand ornamental blinds.Traded and re-traded through Asian, Americanand European ports, the illegal timber and timberproducts that come from Rimbunan Hijau’s forestoperations have been traced into the stores of someof the world’s most affluent nations.After decades of conferences and internationalcommitments including the Convention onBiological Diversity, Forest Law Enforcement andGovernance processes, International Tropical TimberAgreement and the United Nations Forum onForests, now is the time for action.Rimbunan Hijau is a transnational corporationthat represents everything that is wrong with theway in which forest resources are being managed.Rimbunan Hijau presents the perfect test againstwhich to judge the resolve of the internationalcommunity to deal effectively with the problems offorest crime and the trade in illegal timber.Greenpeace calls on the international communityto take up the challenge and match the globalrhetoric with effective action.SOLUTIONSGREENPEACE URGES:• Protection of remaining forest areas from illegal and destructive logging;• International financial support to individual countries to replace foregonelogging revenues;• Effective international action to enforce corporate responsibility and sanctioncorporations that operate outside the law;• International initiatives to stop the cross-border trade in illegal timber andtimber products, including consumer nation timber import controls;• Further support for market-based initiatives that identify and label productsfrom sources that are environmentally, socially and economically sustainable.© Scheltema/Greenpeace18 THE UNTOUCHABLESRimbunan Hijau’s world of forest crime & political patronage

REFERENCESAustralian Conservation Foundation (2003)Submission to the Senate Foreign Affairs,Defence and Trade References CommitteeInquiry into Australia’s Relationship withPapua New Guinea and other Pacific IslandCountriesBarnett T (1987) Commission of Inquiry intoAspects of the Timber Industry in Papua NewGuineaBBC (2001) Illegal logging spreads in Russia.Francis MarkusBrunois (1999) The Ecological Impacts of theWawoi Guavi Company’s LoggingExploitation on the Territory and Society ofthe Kasau People, Avenir des Peuples desForets Tropicales. Paris.Bryant et al (1997) The lost frontier forests.WRI, WCMC, Washington DC.Central Bank of Solomon Islands (1995)Annual Report, HoniaraDuncan, Prof.R.C. (1994) Melanesian ForestrySector Study. Australian InternationalDevelopment Assistance BureauEco-Forestry Forum (2002) PNG forestresources and the log export industry. PNGEco-Forestry Forum, Port Moresby.EIA and Telapak (2003a) Timber traffickers:How Malaysia and Singapore and reaping aprofit from the illegal destruction ofIndonesia’s forests.EIA and Telapak (2003b) Above the law:Corruption, collusion, nepotism and the fateof Indonesia’s forests.EIA and Telapak (2003c) Brief on militaryofficer involved in illegal logging.EMW (1995) ed. Frank Kurschner-Pelkmann,Maureen Trott, Inken Wohlbrand Our treesand all the wildlife have gone. Association ofProtestant Churches in Germany, Hamburg.Erskine (1999a) An Environmental ImpactAssessment of Logging Operations in Block 3of the Wawoi Guavi TRP, Kamusie, WesternProvince, Papua New Guinea.Erskine (1999b) Environmental and socialimpact assessment of logging operations inthe Vanimo Timber Area, Sandaun Province,Papua New Guinea.Frontline (1994) Television New ZealandForest Information Service (2003a) RimbunanHijau Corporate Map. Unpublished report forGreenpeace.Forest Information Service (2003b) RimbunanHijau Logging Concessions. Unpublishedreport for Greenpeace.Forest Information Service (2003c) RimbunanHijau Logging Operations. Unpublishedreport for Greenpeace.Forest Information Service (2003d) The Impactsof Large-scale Logging. Unpublished reportfor Greenpeace.Forest Information Service (2003e) WawoiGuavi Case Study. Unpublished report forGreenpeace.Forest Monitor (March 2001) Sold Down theRiverCountry Profile: Equatorial Guinea.http://www.forestsmonitor.org/reports/solddownriver/guinea.htmForests.org (2001) Rimbunan Hijau moves todestroy Russia’s forests.Four Corners (2002) The timber mafia.Broadcast on ABC television August 2, 2002.Greenpeace (1999) Buying Destruction.Greenpeace International, Amsterdam.Greenpeace Australia Pacific and Oliver, Pam(2001) Caught Between Two Worlds- a socialimpact study of large and small-scaledevelopment in Marovo Lagoon, SolomonIslands, Suva, Fiji.Greenpeace (2002) Partners in Crime:Malaysian loggers, timber markets and thepolitics of self interest in Papua New Guinea.Greenpeace International, Amsterdam.Independent Forestry Review Team (2001)Auditing forestry projects currently ‘inprocess’ for compliance with therequirements of policy, the Forestry Act andother regulations and guidelines.Independent Forestry Review Team (2003)Review of disputed forest allocations.International Network of Forests andCommunities (2002) Global Forests, GlobalCitizens.The Jakarta Post (Oct. 15, 2003) EU Urged toReject KL Wood ProductsKocher-Schmidt (1999) Vanimo - KilimeriIntensive Interdisciplinary Research Report.Kocher-Schmidt (2000) Lessons learned fromthe Vanimo Timber Rights Purchase area.Marshall (1989) Rimbunan Hijau. UnpublishedreportMelick, Dr D. (2003) A PreliminaryEnvironmental Investigation of the LoggingOperations in the Wawoi Guavi Area,Western Province, Papua New Guinea.Unpublished report for Greenpeace.Olsen and Turnbull (18 August 1993)Assessment of the growth rates of loggedand unlogged forests in the Solomon Islands.Solomon Islands National Forest ResourcesInventory, Working PaperOmbudsman Commission (2002) Final ReportInvestigation into a Decision of the NationalForest Board to Award Kamula Dosa toWawoi Guavi Timber Company (a subsidiaryof Rimbunan Hijau).National Intelligence Organisation (2000)Office of Counter Intelligence Baimaru FieldReport.Pwesei (2000) Environmental and Social ImpactAssessment of Logging Operations in theWest Coast of Manus Area, Manus Province.Review of Disputed Forest Allocations (2003a)Report on Confidential Matters.Review of Disputed Forest Allocations (2003b)Summary of Findings and Recommendations.Review of Disputed Forest Allocations (2003c)Review of Wawoi Guavi Blocks 1,2 and 3.Review of Disputed Forest Allocations (2003d)Review of Vailala TRP Blocks 2 and 3.Sahabat Alam Malaysia (1989) The battle forSarawak’s forests.Sahabat Alam Malaysia (2000) Penan stageprotest against logging companies.Special Broadcasting Service (SBS) (2001)Papua New Guinea - Wilderness laid wasteby corruption. Dateline May 2nd 2001Solomon Star (November 10, 1995) 7 millionscam surfacedSolomon Star (March 1998) Earthmoversordered to pay workersTrading Post (17 January 1996), VanuatuTimber Trade Federation (2003) ‘Report on aMission to Indonesia 20-31st January 2003’World Commission on Forests and SustainableDevelopment (1999) Our forests our future.Cambridge University Press, Cambridge.World Rainforest Movement (WRM) 2001.Equatorial Guinea: Transnational loggers inthe forest. WRM Bulletin Number 49, August2001.World Rainforest Movement and ForestMonitor (1998). High Stakes: The need tocontrol transnational logging companies.World Rainforest Movement and ForestMonitor.FOOTNOTES1 International Network of Forests andCommunities (2002)2 Greenpeace defines ancient forests as“the world’s remaining forests that havebeen shaped largely by natural eventsand that are little impacted by humanactivities”. Logging is a threat to 72% ofthe world’s threatened ancient forests,compared to 20% threatened byagricultural clearance and 38% by miningand road-building. Greenpeace (1999a);Bryant et al (1997)3 SBS Television, Dateline (2001).4 Quoted by International Network ofForests and Communities (2002)5 From the site of the Malaysia-ChinaBusiness Councilwww.mcbc.org.my/en/profile/pro_tionghk(Nov 2003)6 Rimbunan Hijau interests in newspaperpublishing include Sin Chew Jit Poh, theleading Chinese language daily inMalaysia, The National, an Englishlanguage daily in Papua New Guinea andGuang Ming Ribao, a Chinese daily inPenang7 Forest Information Service (2003a)8 Bryant (1997)9 http://www.mgcc.com.my/mgcc/memdir.nsf/ba9e7b9d0ad61b7b47256bf200400d23/2e9982968473324348256bea0041d511?OpenDocument10 Marshall (1989)11 World Rainforest Movement and ForestMonitor (1998), pg 812 Ombudsman Commission (2002)13 National Intelligence Organisation report(2000)14 World Rainforest Movement and ForestMonitor (1998)15 FIS (2003b)16 As the owner of 50% of the shares in theSepik River Development Corporation, theholder of a logging permit for the LowerSepik Local Forest Agreement the PrimeMinister was criticised in Barnett (1987)as SRDC was supposed to be arepresentative landowner company but itclearly was not, and the PM had putpressure on the Minister and Secretary ofForests to speed up the permit allocation(the project was also contrary to anAustralian funded Land DevelopmentFeasibility Study process)17 Ombudsman Commission (2002) pp 96and 9718 Gopera Investments19 The Minister for Privatisation is ashareholder in Heybridge Limited, thelogging contractor to Sepik RiverDevelopment Corporation (a company 50percent owned by the Prime Minister) inLower Sepik. The Minister for Planning’swife was a shareholder in Richard GaultIndustries, a logging company that wasalso part owned by the Kerawara loggingcompany. The Chief Secretary is a directorof Media Assets Limited, the permitholder for the Kapuluk loggingconcession.20 This problem was highlighted in thegovernment’s 2001 ‘Audit of ForestryProjects currently in process’. Of 32projects reviewed it was found that inevery case sufficient steps had not beentaken to identify landowners and informthem of their rights prior to the signing oflogging agreements, Independent ReviewTeam (2001)21 These problems have been noted in anumber of reports including IndependentReview Team (2001 and 2003); Kocher-Schmidt (1999 and 2000), Melick (2003),Erskine (1999a and 1999b), Pwesei(2000), Greenpeace (2002)22 An independent review established by thePNG government to investigateallegations that the six major newlogging concession allocations and permitextensions in 2002 were unlawful. Thereview comprised a forester, lawyer andlandowner specialist.23 Review of Disputed Allocations (2003).Covering letter to the Chief Secretarydated 25th March 200324 Review of Disputed Allocations (2003b,c&d)25 Pers Comm with Post Courier staff (andconfirmed by a copy of a letter from RH tothe PC)26 Review of Disputed Allocations (2003 b, cand d)27 Ombudsman Commission (2003)28 Ombudsman Commission (2003)29 Independent Forestry Review (2003a) atpage 130 Independent Forestry Review (2003b) atpage 731 Statement of the Prime Minister given athis party’s fund raising dinner at theGrand Palace restaurant on 30th August2003, www.pm.gov.pg/pmsoffice32 EMW (1995), World Rainforest Movementand Forest Monitor(1998), Kocher-Schmidt (1999 and 2000), Erskine (1999aand 1999b), Pwesei (2000), SBS (2001),Greenpeace (2002), Melick (2003).33 The best summary of these problems canbe found in the television documentaryDateline broadcast by SBS, an Australiantelevision station, on May 2, 2001.34 SBS (2001)35 Ibid36 Ibid37 Ibid38 Ibid39 Australian Conservation Foundation(2003)40 Kocher-Schmidt (1999 and 2000), Erskine(1999a and 1999b), Pwesei (2000),Melick (2003)41 Ibid42 Eco-Forestry Forum (2002)43 This was a finding of the OmbudsmanCommission in its investigation of theKamula Dosa affair, OmbudsmanCommission (2002)44 Melick (2003), pg 4845 EIA/Telapak (2003 b)46 Four Corners, (2002)47 As quoted in World Rainforest Movement(2001)48 EIA/Telapak (2003a)49 The Jakarta Post (2003)50 EIA/Telapak (2003a & b)51 Ibid52 EIA/Telepak, (2003b)53 Pers comm, EIA and GreenpeaceDecember 200354 EIA and Telepak, (2003c)55 World Rainforest Movement ( 2001)56 www.globaltimber.org.uk/eguinea57 Forest Monitor (2001)58 World Rainforest Movement and ForestMonitor (2001)59 World Rainforest Movement (2001)60 Ibid61 International Network of Forests andCommunities (2002)62 EMW(1995) p.10263 World Rainforest Movement and ForestMonitor (1998) p 33-3564 The Long Sayan Declaration, SarawakPenan Association, June 200265 WRM and Forest Monitor (1998)66 Personal communications to Greenpeacefrom PNG non government organisations(2003).67 EMW (1995)68 Sahabat Alam Malaysia (2000)69 as quoted in EMW (1995)70 BBC (2001)71 In 1994 scientists at the EnvironmentalIssues Institute in Khabarovsk detailedplans for the establishment of theVerkhne-Soukpai Nature Preserve. ThisPreserve was included in the national listof Nature Preserves and National Parksapproved by the Russian FederalGovernment on 10th October 1995.When it was announced that RimbunanHijau was to be allowed to log inside theproposed Nature Preserve the RegionalAdministration claimed the area hadalready lost its environmental values dueto forest cuttings and fires. However apreliminary investigation in the area in1999 by the Biodiversity ConservationCenter and ScanEx Technical Centrecontradicted these claims(www.scanex.ru/rus/tematica/project/sukpai)72 Forest Club of Russia.WWW.forest.ru/eng/hot_spots73 In 2000 Rimbunan Hijau was fined forenvironmental violations (RBCKhabarovski, 17 April 2000) and furtherfines have followed according to theWorld Wide Fund for Nature (RBC Daily,18 July 2003) and forests.org(www.forests.org/recent/2001/ ruhilogg).74 Forest Club of Russiawww.forest.ru/eng/problems/companies/rimbunan75 The Ernslaw One Group’s majorshareholder is Callander Limited with79% ownership. Callander is a holdingcompany registered in Liberia and iscontrolled by members of the Tiongfamily. Other shareholdings are held byHabacus Pte Ltd of Singapore and ShiangYang International Ltd, of Hong Kong (theownership split is 80/10/10). Managingdirector of Ernslaw One, Thomas SongChai Leng (known as Thomas Song)reports to Dr Tiong Ik King.(www.thelumberbanknewzealand.co.nzNovember 2003)76 In Aotearoa RH has owned Ernslaw One,Oregon Group, Manuka Holdings, theSalmond Smith Biolab group (includingArtel Industries, Biolab Scientific, ClickClack International, Selby Scientific,Newman’s Export, Rhone-PoulencLaboratory Products, and Johns Plastics) ,New Zealand King Salmon Company, NeilConstruction, Ascot ManagementCorporation and Lumberbank. ForeignControl Watchdog, CAFCA, (August2003).77 www.thelumberbanknewzealand. co.nz(Nov. 2003)78 FSC certification requires an operation toat minimum:∑ • Comply with all the laws of a country,∑ • Respect indigenous peoples’ and localcommunity rights,∑ • Be beneficial to local communities,∑ • Sustain the forest resources,∑ • Maintain and protect biodiversity,∑ • Minimise and phase out chemicalpesticide use,∑ • Prohibit genetically engineeredorganisms,∑ • Have a detailed management plan,∑ • Monitor environmental and socialindicators,∑ • Maintain and enhance HighConservation Value Forests, and∑ • Restore natural forests if it is aplantation.79 Frontline (30 October 1994)80 An AIDAB (Australian InternationalDevelopment Assistance Bureau) NationalForest Resource Inventory in 1995 foundlogging was 4 time the sustainable rate,and subsequent official log exportvolumes have confirmed theunsustainable harvest has continued overthe last decade.81 Central Bank of Solomon Is (1995). pp18.82 Duncan (1994) pp3083 Solomon Star (1995)84 Olsen and Turbull (1993)85 World Rainforest Movement and ForestMonitor (1998) pp5786 Greenpeace Australia Pacific( 2001) pp24.87 In 1998 Earthmovers was ordered to payback pay of a 10% wage increase andreinstate workers over poor levels of payand working conditions Solomon Star(1998)88 Trading Post (17 January 1996)89 WRM and Forest Monitor (1998)90 www.ipa.gov.pg/forestry_sector.htm91 Post Courier (12/11/03) and FAO ForestryTrade Flow Database92 Post Courier (12/11/03) and FAO dataTHE UNTOUCHABLES 19Rimbunan Hijau’s world of forest crime & political patronage

January 2004Greenpeace InternationalOttho Heldringstraat 51066 AZAmsterdamThe Netherlands