The government expects the suspension of concession logging activities to last for most of this year.
In a text distributed Wednesday at the semi-annual donors meeting, Minister of Economy and Finance Keat Chhon said, “there will be almost no tree cutting in 2002 as the [forest] management plans submitted by concession companies did not meet the standards allowing for sustainable practices.”
Since this will mean little or no revenues from logging, the government is taking steps to develop other agricultural sectors, he said.
Companies hold logging contracts for 25 to 30 years, but must obtain a new cutting permit each year. They were told to submit their forest renewal and preservation plans by Sept 30, 2001, said Chan Tong Yves, secretary of state for the Ministry of Agriculture, Forestry and Fisheries. “They did not submit them, so that’s why we suspended their activities,” he said.
Last year’s permits expired Dec 31, and the suspension announced by Prime Minister Hun Sen began Jan 1. The government may give companies until June to present their plans, said Chan Tong Yves. In the meantime, there will be no logging.
“Unfortunately, I think that almost every company had plans to conduct business [in Cambodia] this year,” said David Chanaiwa, an attorney who represents six logging companies in concession negotiations.
In a report presented at the donors meeting, the Ministry of Agriculture stressed that what it requested from 17 companies operating on over 4.3 million hectares of forest land is a long-term conservation management strategy that would meet international standards.
Chanaiwa said Wednesday he was not sure whether the companies’ plans had been completed. In any case, he contended, “The government cannot just say ‘we reject this’ because these are binding contracts.”
Chanaiwa also said the government should let companies know in writing which international standard they don’t meet.
Government authorities and logging concessionaires also disagree over royalties and taxes. The Ministry of Agriculture mentioned in its report that companies want to maintain the royalty rate of $14 per cubic meter, and keep export and import tax exemptions as written in their existing contracts. “However, the Royal Government of Cambodia has not accepted these requests,” says the report.
A report by a donors’ working group on natural resources management commended the government for its decision to suspend logging activities in order to ensure forest renewal.
Regarding the government’s overall forestry policy, “there are encouraging things and some things that are worrisome,” said Jean Claude Levasseur, representative of the UN Food and Agriculture Organization and co-chair of the donors’ working group. He said that since measures to renew forest resources mean less revenues for logging companies, he found it difficult to imagine companies implementing them.
Wednesday’s all-day meeting was a mid-year session to review progress made by Cambodia on priorities set during the Tokyo Consultative Group Meeting in June 2001, at which donors pledged $615 million to Cambodia.
Japanese Ambassador Gotaro Ogawa described Wednesday’s meeting as productive. “There has been progress during the last several months, and donors recognize that,” he said.
“The government has listened to our concerns and responded to our questions,” said Canadian Ambassador Normand Mailhot.
Hun Sen closed the meeting by saying: “May I send my gratitude to your governments and to your taxpayers who have helped Cambodia.”
Mailhot said that comment proves “that the prime minister understands that we have to show results to our taxpayers [when donating to Cambodia].”
