Radio Australia

Forest clearance on disputed land-leases in Papua New Guinea is likely to continue at record levels for the next five to six years, according to the organisation which represents logging companies.

In 2011, logging on Special Agricultural and Business leases pushed Papua New Guinea's log exports to record highs - so much so that some commentators now place PNG as the second largest exporter of tropical logs in the world.

A public outcry prompted the PNG government to set up a Commission of Inquiry into this kind of logging and announce a moratorium on the approval of new forest clearance authorities.

But that does not seem to have slowed the chainsaws.

Presenter: Jemima Garrett, Pacific Economic and Business reporter
Speaker: Bob Tate, Executive Officer of the PNG Forest Industries Association

GARRETT: The island of New Guinea is home to the world's third largest intact tropical rainforest.

But in the past 10 years, 11 per cent of Papua New Guinea's land mass has been leased out for 99 years under controversial Special Agricultural and Business leases - many of which were concluded without the knowledge or permission of landowners.

In 2011, log exports from these leases reached 650,000 cubic metres.

Bob Tate, Executive Officer of the PNG Forest Industries Association says that despite the moratorium on the issuing of new forest clearance authorities, that harvest is set to continue.

TATE: Obviously, a consequence of the government deciding to expand these SABLs would be an increase in log exports from those projects and it is envisaged that this increase of 600,000 is probably going to be maintained for about another 5-6 years.

GARRETT: Non-government Organisations say Special Agricultural and Business leases are being used as a quick and dirty back door method for getting access to forests and that many of the companies with these leases do not intend to set up agricultural businesses as they are supposed to.

Bob Tate says the Forest Industry is concerned about the situation.

TATE: It may surprise some of your listeners, but again the NGO movement and ourselves are, if you like, singing the same song. We've been long concerned about the potential for abuse and what we believe has turned into, in many instances, real abuse of the system.

GARRETT: Are members of the Forest industry Association involved in logging SABLs?

TATE: Only one of our members has an SABL and that covers what used to be old plantations developed even before the second world war.

GARRETT: So just how many new companies do you see, who aren't members of the FIA, coming into PNG to take up these SABLs for log exports?

TATE: In our experience we have very little to do with them so its very hard for me to put an actual number to it. I think there is roughly probably 70 odd SABLs operated ..off hand I could think about only 2 or 3 that are operated by existing timber companies in PNG, so it leaves the way open for a lot of new players to come in.

GARRETT: And come in they are.

Late last year Hong Kong company Pacific Plywood joined forces with China's largest state-owned timber company, the Logging and Forest Industry Group, to buy into SABLs covering 268 square kilometres of forest. 

Despite the record level of log exports, Bob Tate says Papua New Guinea is still within its sustainable yield of timber.

He is asking the the Commission of Inquiry for moderate response.

TATE: You shouldn't throw out the baby with the bathwater. PNG needs rural development, it needs food security, foe want of a better description. It is how we manage the change to that stage of development that is critical. We believe at the moment it is not being managed very well.

GARRETT: Indeed there has been doubt cast over the way some of these SABLs have been negotiated and allegations that landowners didn't give the proper consent. Should there be a moratorium on clearing these leases until all this is sorted out?

TATE: Personally, I don't think so. The reality, on the ground, is that probably less than one dozen of the SABLs, is there any activity happening on the ground. A lot of them, for various reasons, have, if you like, remained paper approvals for yet to appear activity.

GARRETT: Nevertheless, they are attracting outside companies and companies are paying quite big money for SABLs with the intention of logging them, and talking about them as logging leases. Does that concern you?

TATE: Yes, it does. And that, hopefully, will be one of the outcomes of the Commission, is to, if you like, shift the focus from access to logging rights to reasonable well-managed agricultural development, or whatever else is slated for that area. At the moment, it is viewed as a get rich quick scheme. 

GARRETT: Is the actions of some of the more suspect companies or deals involving these leases tarnishing the broader timber industry in PNG?

TATE: Many would say we don't have much of a reputation to start with! But, yes, obviously the genuine operators in a normal forest operation have costs imposed, the regulatory framework to comply with whereas on SABLs that all goes out the window. So yes, its cheaper, its easier and by implication they are referred to as 'Oh that is just another logging company'. The genuine operators are put under pressure, if you like, in an adverse sort of way.