LOGGING IN EAST MALAYSIA - Part 1
MALAYSIA TODAY SPECIAL REPORT
During the 1980s, rampant logging in the Borneo states of Sabah and Sarawak allowed Malaysia to temporarily outpace Indonesia and become the world's largest exporter or tropical wood.On paper, Malaysia, once the world's largest exporter of tropical woods, probably has one of the best rainforest protection policies in developing Asia but, in practice, logging still carries on as it always has. The majority of Malaysia's remaining forests are managed for timber production and each state is empowered to formulate forest policy independently. During the past two decades of thorough logging of Malaysian forests, sustainable forest management has been non-existent. While Malaysia has the policy framework for sustainable forest management in the form of the National Forestry Act of 1984, it has failed to enforce the legislation. Peninsular Malaysia's primary forests are completely decimated and secondary forest covers only a fraction of former rainforest lands. Borneo Malaysia still has large areas of forest, however much of this has been selectively logged leaving low biodiversity. In Sabah (North Eastern Borneo), cutting has slowed over the years after a period of rapid deforestation. Tropical hardwood exports to Japan from Sabah fell from 2,064,000 cubic meters in 1992 to 6000 cubic meters in 1995. Sarawak (North Western Borneo) is the current area of forest exploitation with hardwood imports to Japan numbering 19,650,000 cubic meters from 1992-1995 alone. Although 8% of the land area is designated as reserves, half of Sarawak is slated for logging concessions and the rest of Sarawak has already been deforested for development.It is estimated that if logging continues at its current pace, the primary forests of Sarawak will be gone in 5-8 years. Those areas that have been set aside as reserves are understaffed and threatened by selective logging and encroachment by colonists who settle along logging roads that open up former forest lands. Local environmentalists claim that loggers are frantically clearing lands designated to become parks before they become legally protected by the government. Most of the lowland forests with the highest diversity have been logged and the timber companies are now moving into more marginal lands on rugged mountain slopes. The logging of these slopes has already caused severe soil erosion and river silting is some areas. With deforestation, the lands of indigenous Penans have been invaded. The Penans are given little compensation for losing their source of livelihood and their culture from the companies that exploit their lands, other than diseases like Malaria. In the late 1980s, the Penans protested these destructive practices by installing roadblocks and damaging logging equipment, but were ruthlessly put down by the Malaysian government and logging companies. Decades of mining in Peninsular Malaysia have left a heavy mark on the environment. Deforestation, pollution of rivers and silting has resulted in agricultural losses and road projects open new areas to colonization.Unfortunately, despite the government's pro-environment overtones, the heavy-handed government appears to side with destructive industries more than conservation. The government has never decided a major court case on behalf of the native forest peoples who are being displaced by rainforest destruction. The government recently tried to overturn a High Court decision that would have prevented a huge hydroelectric project that would have flooded 170,000 acres (69,000 hectares) of forest, while in the late 80s, the government restricted the media from entering a logging zone in Sarawak where it sent in troops to put down a protest by native Dayaks. However, the economic crisis of 1997 meant that the austere government shelved the project temporarily and may intend to scale down the size of the project. The economic downturn of Southeast Asia may mean a retraction of forest clearing projects as investors become more cautious about investing in Malaysian heavy industries. The economic problems of 1997 caused both Malaysian and Indonesian timber stocks to stumble as the Japanese recession affected timber exports and prices of imports increased. Malaysia is currently the world's largest producer of palm oil. Thousands of hectares of forest have been cleared to make way for this and other forms of plantation agriculture. To promote investment in plantations, profits are 100% tax-exempt for ten years. Plantations on cleared and degraded forest lands are ecologically and economically beneficial, but clearing forest for plantations results in increased erosion and biodiversity loss.Like Indonesia, the Malaysian government sponsored transmigration programs to open up rainforest for cash crop production. Between 1956 and the 1980s, Malaysia converted over 15,000 square kilometers of forest for resettlement programs. On the positive side, Malaysia has created several national parks. Nevertheless, in September 1997, the government granted a new 4.2 million acre (1.7 million ha) commercial logging concession of primary forest in Sabah.Fires during the el Niño event of 1997-1998 burned thousands of hectares across Malaysia, especially on the island of Borneo. The haze from these fires and the fires in Kalimantan (Indonesia) caused serious pollution and health problems in Malaysia. Twice Prime Minister Mohamad ordered the media to avoid negative reports on the fires and haze fearing that news would disrupt tourism and cause havoc. Again in 1999, the Malaysian government was criticized when it announced it would not disclose the pollution index in fear it would frighten off tourists. After the fires of 1997, the government pledged strict new laws against burning to clear land. Nevertheless fires again appeared in 1998. In late 1998 and early 1999, flooding in areas affected by the fires killed dozens.The IssueForestry is one of Malaysia's most rapidly growing economic sectors. Malaysia is the largest exporter of tropical wood in the world, accounting for 70 percent of the world's supply of raw-logs. Sabah and Sarawak, the two Malaysian states on the island of Borneo, occupy some of the oldest and the most diverse rain forest in the world. This forest provides most of Malaysia's exports of tropical logs. The increase in large-scale exploitation of Sarawak's rain forest was largely due to the entry of Japanese buyers. A 1990 report by the Yokohama-based International Timber Trade Organization (ITTO) predicted that the majority of Sarawak's forests would be gone by 1995 and therefore would be a major wood importer by 2001. Consequently, the Malaysian Federal Government will cut log exports drastically in 1995 and convert the demand to sawn wood products.DescriptionFrom 1962 onwards, logging operations in Malaysia steadily increased, largely due to the entry of Japanese buyers. Although more than half of the rain forests on earth have disappeared in the last fifty years, logging has hit Sarawak so rapidly and with such drastic consequences that many environmentalists consider it to be an urgent problem. Since many countries in south east Asia such as Indonesia and Thailand reacted to the Japanese logging by enacting restrictions. Malaysia and, in particular, Sarawak proved accommodating hosts for the Japanese importers.Despite several measures taken by the Malaysian Federal Government, such as the intention to totally cut the exports of logs from Sarawak by 1995, the Sarawak and Sabah state governments maintain a high level of autonomy in their logging policy (as in the oil industry). The constitution of Malaysia grants the legislative and executive authority over resources to the states. The role of the federal government is mainly confined to research and development, maintenance of experimental forest industries development and technical assistance to the states.The aim of the federal government is to increase exports of sawn wood instead of raw logs, to generate increased profit and to reduce the need to export raw logs. This will be difficult to achieve because of resistance by the Sarawak and Sabah state governments. The two eastern states fear that foreign investment in processing industries and financial compensation from Kuala Lumpur may not be enough to cover a decline in log-export revenues. Moreover, the two states enjoy a certain level of independence, both financially and politically, from the federal government. (This is also true in other federal republics such as Germany, Canada, and the United States. See some of their case studies.) In addition to the fear that financial compensation from Kuala Lumpur may not be enough to cover a decline in log export revenues, politicians and the wealthy timber merchants of Sarawak do not wish to lose revenues and benefits.A complex and uneasy alliance between two groups has been mainly responsible for the huge amounts of deforestation which Malaysia has suffered over the last several decades. The first group consists of Chinese business interests. The second is the state bureaucracy, mostly Malay. Most of the concessionaires are Sabah and Sarawak politicians who receive substantial "fees" for logging contracts (there is speculation that $20 million is needed to gain a single contract is not unusual). These concession holders are given little reason to care whether or not productivity is maintained for future harvests. In December, 1992, the federal government imposed a temporary freeze on raw-log exports from Sabah. At the time, the opposition United Sabah Party that controls the state government cried foul. Officials in the Sabah government, which derives more than half its annual revenue (Malaysian Ringgit of 1.3 billion or US$507 million) from timber-export royalties, suspected that the federal government was trying to undermine the state's finances because of political differences.Another major source of Sabah and Sarawak's high rate logging is the voracious Japanese appetite for tropical hardwood which has turned Sabah and Sarawak into something resembling a Japanese plantation. In 1990, Japanese imports of Sarawak's logs jumped by 20 percent and represented 53 percent of Japan's total tropical-log import volume. The Japanese, the leading importers of raw-logs, use the wood mainly in the construction industries. Over 75 percent of the tropical hardwood coming into Japan ends up as plywood, primarily as disposable forms for moulding concrete.Large Japanese trading companies are involved in all stages of exploitation, as partners and financiers of logging concessionaires, and as importers and processors. Why would Japan use this wood for such a lowly purpose as construction's plywood that quickly winds up on the scrap heap? The answer is "price". In defiance of logic, it costs less to cut down a tree in Sarawak and process it into plywood than to make plywood from an inferior softwood tree growing in Japan. Part of the explanations stem from the scarcity of Japanese forest and labour. European countries also import Malay hardwood, but these operations are being curtailed.Apart from the destruction of a valuable natural resource and the extinction of countless plants and animal species, the high rate logging in the two Malaysian states has led to negative impacts on many native people. Most adversely affected are the 10,000 Penan people who live in the forest. The Penan are nomads or semi-nomads and have been in the forefront of an immense battle to defend the forest. They have set up barricades on the roads and the trails that lead into the forest. With the state government's opposition, their action has not managed to stop logging in any significant way. However, it has made the world aware of the human as well as ecological problem.In addition to the internal problems mentioned above, another issue lies in the international economic system; the push for free trade in the GATT. The Malaysian federal government contends that in order to save the rain forests, strong regulation is required. This is in juxtaposition to trends in trade where barriers are being lowered. The two trends, between free trade and environmental protection, are contradictory.
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During the 1980s, rampant logging in the Borneo states of Sabah and Sarawak allowed Malaysia to temporarily outpace Indonesia and become the world's largest exporter or tropical wood.On paper, Malaysia, once the world's largest exporter of tropical woods, probably has one of the best rainforest protection policies in developing Asia but, in practice, logging still carries on as it always has. The majority of Malaysia's remaining forests are managed for timber production and each state is empowered to formulate forest policy independently. During the past two decades of thorough logging of Malaysian forests, sustainable forest management has been non-existent. While Malaysia has the policy framework for sustainable forest management in the form of the National Forestry Act of 1984, it has failed to enforce the legislation. Peninsular Malaysia's primary forests are completely decimated and secondary forest covers only a fraction of former rainforest lands. Borneo Malaysia still has large areas of forest, however much of this has been selectively logged leaving low biodiversity. In Sabah (North Eastern Borneo), cutting has slowed over the years after a period of rapid deforestation. Tropical hardwood exports to Japan from Sabah fell from 2,064,000 cubic meters in 1992 to 6000 cubic meters in 1995. Sarawak (North Western Borneo) is the current area of forest exploitation with hardwood imports to Japan numbering 19,650,000 cubic meters from 1992-1995 alone. Although 8% of the land area is designated as reserves, half of Sarawak is slated for logging concessions and the rest of Sarawak has already been deforested for development.It is estimated that if logging continues at its current pace, the primary forests of Sarawak will be gone in 5-8 years. Those areas that have been set aside as reserves are understaffed and threatened by selective logging and encroachment by colonists who settle along logging roads that open up former forest lands. Local environmentalists claim that loggers are frantically clearing lands designated to become parks before they become legally protected by the government. Most of the lowland forests with the highest diversity have been logged and the timber companies are now moving into more marginal lands on rugged mountain slopes. The logging of these slopes has already caused severe soil erosion and river silting is some areas. With deforestation, the lands of indigenous Penans have been invaded. The Penans are given little compensation for losing their source of livelihood and their culture from the companies that exploit their lands, other than diseases like Malaria. In the late 1980s, the Penans protested these destructive practices by installing roadblocks and damaging logging equipment, but were ruthlessly put down by the Malaysian government and logging companies. Decades of mining in Peninsular Malaysia have left a heavy mark on the environment. Deforestation, pollution of rivers and silting has resulted in agricultural losses and road projects open new areas to colonization.Unfortunately, despite the government's pro-environment overtones, the heavy-handed government appears to side with destructive industries more than conservation. The government has never decided a major court case on behalf of the native forest peoples who are being displaced by rainforest destruction. The government recently tried to overturn a High Court decision that would have prevented a huge hydroelectric project that would have flooded 170,000 acres (69,000 hectares) of forest, while in the late 80s, the government restricted the media from entering a logging zone in Sarawak where it sent in troops to put down a protest by native Dayaks. However, the economic crisis of 1997 meant that the austere government shelved the project temporarily and may intend to scale down the size of the project. The economic downturn of Southeast Asia may mean a retraction of forest clearing projects as investors become more cautious about investing in Malaysian heavy industries. The economic problems of 1997 caused both Malaysian and Indonesian timber stocks to stumble as the Japanese recession affected timber exports and prices of imports increased. Malaysia is currently the world's largest producer of palm oil. Thousands of hectares of forest have been cleared to make way for this and other forms of plantation agriculture. To promote investment in plantations, profits are 100% tax-exempt for ten years. Plantations on cleared and degraded forest lands are ecologically and economically beneficial, but clearing forest for plantations results in increased erosion and biodiversity loss.Like Indonesia, the Malaysian government sponsored transmigration programs to open up rainforest for cash crop production. Between 1956 and the 1980s, Malaysia converted over 15,000 square kilometers of forest for resettlement programs. On the positive side, Malaysia has created several national parks. Nevertheless, in September 1997, the government granted a new 4.2 million acre (1.7 million ha) commercial logging concession of primary forest in Sabah.Fires during the el Niño event of 1997-1998 burned thousands of hectares across Malaysia, especially on the island of Borneo. The haze from these fires and the fires in Kalimantan (Indonesia) caused serious pollution and health problems in Malaysia. Twice Prime Minister Mohamad ordered the media to avoid negative reports on the fires and haze fearing that news would disrupt tourism and cause havoc. Again in 1999, the Malaysian government was criticized when it announced it would not disclose the pollution index in fear it would frighten off tourists. After the fires of 1997, the government pledged strict new laws against burning to clear land. Nevertheless fires again appeared in 1998. In late 1998 and early 1999, flooding in areas affected by the fires killed dozens.The IssueForestry is one of Malaysia's most rapidly growing economic sectors. Malaysia is the largest exporter of tropical wood in the world, accounting for 70 percent of the world's supply of raw-logs. Sabah and Sarawak, the two Malaysian states on the island of Borneo, occupy some of the oldest and the most diverse rain forest in the world. This forest provides most of Malaysia's exports of tropical logs. The increase in large-scale exploitation of Sarawak's rain forest was largely due to the entry of Japanese buyers. A 1990 report by the Yokohama-based International Timber Trade Organization (ITTO) predicted that the majority of Sarawak's forests would be gone by 1995 and therefore would be a major wood importer by 2001. Consequently, the Malaysian Federal Government will cut log exports drastically in 1995 and convert the demand to sawn wood products.DescriptionFrom 1962 onwards, logging operations in Malaysia steadily increased, largely due to the entry of Japanese buyers. Although more than half of the rain forests on earth have disappeared in the last fifty years, logging has hit Sarawak so rapidly and with such drastic consequences that many environmentalists consider it to be an urgent problem. Since many countries in south east Asia such as Indonesia and Thailand reacted to the Japanese logging by enacting restrictions. Malaysia and, in particular, Sarawak proved accommodating hosts for the Japanese importers.Despite several measures taken by the Malaysian Federal Government, such as the intention to totally cut the exports of logs from Sarawak by 1995, the Sarawak and Sabah state governments maintain a high level of autonomy in their logging policy (as in the oil industry). The constitution of Malaysia grants the legislative and executive authority over resources to the states. The role of the federal government is mainly confined to research and development, maintenance of experimental forest industries development and technical assistance to the states.The aim of the federal government is to increase exports of sawn wood instead of raw logs, to generate increased profit and to reduce the need to export raw logs. This will be difficult to achieve because of resistance by the Sarawak and Sabah state governments. The two eastern states fear that foreign investment in processing industries and financial compensation from Kuala Lumpur may not be enough to cover a decline in log-export revenues. Moreover, the two states enjoy a certain level of independence, both financially and politically, from the federal government. (This is also true in other federal republics such as Germany, Canada, and the United States. See some of their case studies.) In addition to the fear that financial compensation from Kuala Lumpur may not be enough to cover a decline in log export revenues, politicians and the wealthy timber merchants of Sarawak do not wish to lose revenues and benefits.A complex and uneasy alliance between two groups has been mainly responsible for the huge amounts of deforestation which Malaysia has suffered over the last several decades. The first group consists of Chinese business interests. The second is the state bureaucracy, mostly Malay. Most of the concessionaires are Sabah and Sarawak politicians who receive substantial "fees" for logging contracts (there is speculation that $20 million is needed to gain a single contract is not unusual). These concession holders are given little reason to care whether or not productivity is maintained for future harvests. In December, 1992, the federal government imposed a temporary freeze on raw-log exports from Sabah. At the time, the opposition United Sabah Party that controls the state government cried foul. Officials in the Sabah government, which derives more than half its annual revenue (Malaysian Ringgit of 1.3 billion or US$507 million) from timber-export royalties, suspected that the federal government was trying to undermine the state's finances because of political differences.Another major source of Sabah and Sarawak's high rate logging is the voracious Japanese appetite for tropical hardwood which has turned Sabah and Sarawak into something resembling a Japanese plantation. In 1990, Japanese imports of Sarawak's logs jumped by 20 percent and represented 53 percent of Japan's total tropical-log import volume. The Japanese, the leading importers of raw-logs, use the wood mainly in the construction industries. Over 75 percent of the tropical hardwood coming into Japan ends up as plywood, primarily as disposable forms for moulding concrete.Large Japanese trading companies are involved in all stages of exploitation, as partners and financiers of logging concessionaires, and as importers and processors. Why would Japan use this wood for such a lowly purpose as construction's plywood that quickly winds up on the scrap heap? The answer is "price". In defiance of logic, it costs less to cut down a tree in Sarawak and process it into plywood than to make plywood from an inferior softwood tree growing in Japan. Part of the explanations stem from the scarcity of Japanese forest and labour. European countries also import Malay hardwood, but these operations are being curtailed.Apart from the destruction of a valuable natural resource and the extinction of countless plants and animal species, the high rate logging in the two Malaysian states has led to negative impacts on many native people. Most adversely affected are the 10,000 Penan people who live in the forest. The Penan are nomads or semi-nomads and have been in the forefront of an immense battle to defend the forest. They have set up barricades on the roads and the trails that lead into the forest. With the state government's opposition, their action has not managed to stop logging in any significant way. However, it has made the world aware of the human as well as ecological problem.In addition to the internal problems mentioned above, another issue lies in the international economic system; the push for free trade in the GATT. The Malaysian federal government contends that in order to save the rain forests, strong regulation is required. This is in juxtaposition to trends in trade where barriers are being lowered. The two trends, between free trade and environmental protection, are contradictory.
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