Title: Siberias Timber Trade: Selling Nature By Mark Frick Geog 308 Zoltan Grossman
1Siberias Timber TradeSelling NatureBy Mark
Frick Geog 308 Zoltan Grossman
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2Collapse of Russian Wood Processing
- In 1992, Russia privatized State owned forest
industry - Russian economy desired cheap, high quality
timber and paper products from West - As a result, domestic demand plummeted
- Large, obsolescent, formerly State-run wood
processors rapidly went bankrupt - Processed timber production fell to 1/3 original
3Rise of the Black Market
- Small logging firms are created to export raw
logs - Declining budgets and infighting between federal
and regional governments led to lack of funds - Russian Forest Service is forced to illegally
log, make deals with logging firms to finance
itself - Corruption quickly spreads
- Half of Siberian-Russian Far East (S-RFE) lumber
is logged or sold illegally
4Russian Boreal Forest Taiga
http//www.cs.rice.edu/ssiyer/cam/Banff/.small/Co
nifers20in20the20Taiga..jpg
5http//peacecorps.mtu.edu/siberia.htmlBackground
6Potentially intact ancient forest, 50,000
hectares Other forests Sources Intact forest
landscapes/forest cover, Greenpeace Russia and
GFW 2001
7Taiga Facts
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- Taiga represents
- 25 of the worlds total forests
- 57 of the worlds coniferous forest
- 25-50 of Taiga remains pristine
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8Importance of Taiga
Above Siberian Tiger Middle Taiga Flycatcher
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- Carbon Sink traps greenhouse gas CO2 to
prevent global warming - Contains 1/7 of worlds total carbon pool
- Green Lung absorbs 2nd most CO2 in the world,
only behind Amazon rainforest - Rich biological diversity
http//www.pennington.charitydays.co.uk/pics/Taiga
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9Russian Forest Service
- Russian Federal Forest Service (RFFS) responsible
for forest management and control - 81 Regional Forest Service Departments (RSFD),
one for each administrative district - Each RFSD had Forest Service Districts
responsible for oversight and management at the
local level.
10Reality
- RFFS is under funded and must engage in logging
to support itself - Federal and Regional governments have little
control in forest management - Illegal logging operations are rampant
- Cooperation between district government and firms
widespread - Putin dissolved the RFFS to eliminate it as a
front for the black market - Non-Governmental Organizations (NGOs) really the
ones collecting data and regulation - NGOs often denied access to documents and
inspection
11Widespread poverty in S-RFE
- Logging only industry in many areas processing
factories all shut down the only place to work - Workers live almost as slaves
- Wood sells for 70-100/m3
- Loggers receive 10 cents/m3
- Truckers receive 25 cents/m3
- Many workers laid off
- Boom and Bust economy sensitive to export
prices, tastes in wood of East Asian markets - The profit leaves Russia, as the owners invest
the capital gained abroad
12Current Logging Practice
- Extremely wasteful practices
- 90 logging clear cutting vs. selection, thinning
- 40-60 of timber cut lost during transport
- All timber is cut, only the best logs are taken,
the rest are left behind - Inadequate roads
- All harvesting is done in a concentrated area
- Destruction of old growth forests
- Raw logs are exported vs. value added timber
- 1992 - 41 of timber processed domestically
- 1997 - 10 processed domestically
13Effects of Deforestation
- Loss of Biodiversity
- Abandoned cut trees, sloppy logging cause
hundreds of fires per year - Coniferous forest replaced by broadleaf forest
.8 per year - Falling water levels, soil erosion on rivers,
destruction of riparian wildlife - Clear cutting - River systems clogged with logs,
reduced topsoil - Massive release of carbon dioxide
- Melting permafrost in clear cut areas turns
forest to swamp, decomposition releases methane
14The Timber Trade
Most S-RFE timber sold to Japan, China,
Korea Hardwood Ash, Korean Pine highly
prized 40-50 of timber
logged or sold illegally
Common Illegal Activities
- Logging without a license - Logging in
protected zones - Taking protected species -
Logging outside concession boundaries - Tax
Evasion/Fraud
http//www.pacificenvironment.org/PDF/logging_fina
l.pdf
15Black Market Strategies
16False Documentation, Tax Evasion
- False company names, aliases used
- Fake contracts, logging and transport
certificates available for about 300 - With papers, guards at checkpoints and Chinese
customs officers can be bought off at the border - False documentation avoids taxes and fees
- When timber is traded, it appears undervalued on
the transaction documents to evade taxes - If an owner is caught and cannot pay the fees, he
simply declares bankruptcy and starts a new
company
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17Salvage Operations
- Salvage/Sanitary logging initially designed to
remove old and sick trees from forest - Salvage is exempt from tax, stumping fee
- Was allowed in protected areas to maintain forest
- Now, companies bribe the district government for
salvage rights for healthy forests - District governments turn a blind eye to logging
firms - Almost all salvage timber is high-value timber,
especially ash - 10 of all logging in S-RFE is salvage logging
18Undervalued timber export
- Russian trucker takes high-quality timber to
Japanese or Chinese wholesaler to sell - Trader officially rejects the lumber because it
is poor quality - Trucker is forced to sell it as pulp wood
- The difference is settled between the trucker and
trader in cash, and off the tax records - The trucker makes black market profit for his
firm and keeps a little for himself - The lumber is re-classified as high value upon
reaching its destination
19Logging Protected Species
- Illegal to log Korean Pine
- Companies bribe district for salvage rights
- Request increased plot size which happens to
contain Korean Pine stand - Official documents read only Pine or
Coniferous
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20Effects of Corruption and Inefficiency
- Half of logged timber is wasted, half of the
remaining is illegal. 25 of harvest is sold
legitimately - Tax which would help develop local industry is
not collected - Capital flight from Russia the money made in
logging leaves the country
21Possible Solutions
- Increase penalties for violations imprisonment,
loss of logging rights - Launch higher government inspections, force all
data to be available to NGOs - Strengthen police checkpoints and stiffen export
goods and document inspections - Eliminate exemptions from salvage logging
- Increase public awareness of illegal logging
22Summary
- Corruption and mismanagement is widespread in
S-RFE forestlands - Environmental degradation results from careless
logging - Massive black market activity promotes capital
flight and undermines tax revenue - Economic recovery and development is impossible
due to corruption in business and government
23Text Sources Peace Corps Website Deforestation
in Siberia and the Russian Far East http//peaceco
rps.mtu.edu/siberia.html Greenpeace
International Website, Asian Russia http//www.gre
enpeace.org/international/campaigns/forests/asian-
russia/map-of-the-snow-forests Plundering
Russias Far Eastern Taiga. Research Josh Newell,
Anatoly Lebedev. Written by David Gordon.
2000 Forest Monitor Website, The Wild
East http//www.forestsmonitor.org/reports/russia/
twe1.htm East Central Europe and the Former
Soviet Union. Turnock, David, 2001 In Siberia.
Thubron, Colin. 1999