Logging industry ready to restart

With mechanisms now in place to resume logging operations and three companies awarded tenders, revenues from the lucrative industry will soon start creating jobs and funding basic social services, the Liberian government and its international partners say.

“This time around logging will allow greater participation by the rural population in the benefits of log exports,” Blamo Robinson, spokesman of the Liberian government’s Forestry Development Authority (FDA) told IRIN.

The forestry expert for the World Bank’s Liberia office, Peter Lowe, told IRIN that forestry has “huge economic potential” for improving the lives of people in Liberia. "The Liberian forestry sector will contribute 14 to 15 percent of the gross domestic product and will be the main engine of rural economic growth,” Lowe said.

The UN Security Council banned exports of Liberian timber in July 2003 after determining that proceeds from the industry were providing local warlords with cash to buy weapons that were fueling civil wars in Liberia as well as neighbouring Sierra Leone.

Timber accounted for 6 per cent of the national GDP before the civil conflict started in 1990 and swelled to 20 percent at the time of the Security Council imposed the ban, the FDA said. Liberia has since been losing US$17 million per year in taxes from log exports, a report by the UN panel of experts on Liberia issued in August 2003.

The UN lifted the sanctions in 2006, although recommended 10 further mechanisms be put in place to avoid corruption and track revenues – measures which a UN report in March 2008 concluded had been enacted.

Trickling in

Lowe said it will take at least five years before commercial forestry reaches its potential output levels but benefits will start trickling in before then. “Logging will help fund overall development needs such as roads, schools and hospitals through increased government revenue, which are projected to grow from $1.77 million in 2007/08 [fiscal year] to $26 million in 2009/10 [fiscal year],” he said.

FDA spokesman Robinson said logging companies will be made to sign social agreements with local communities to help fund development needs such as schools, health centers and roads.

The Liberia Forest Initiative, which is an international coalition of Liberia’s development partners including the World Bank and US for International Development (USAID) has put in place systems to track logs and to avoid illegal logging and loss of revenue.

“As part of this reform, all timber from Liberia will be tracked under a state-of the art electronic tracking system administered by an independent trade surveillance company”, Lowe said, adding that “all payments from private companies to government would be monitored.”

Liberia’s neighbour Sierra Leone banned logging activities in January 2008 because of foreign companies were cutting down trees illegally. However Lowe said illegal logging is “not a major issue” in Liberia.

“The situation in Liberia is not comparable with Sierra Leone,” the World Bank expert said, “[as] all payments from private companies to the government will be monitored under the international Extractive Industries Transparency Initiative.”