The Forestry Tasmania scrutiny hearing left no doubt that its survival depends on selling more native forest woodchips at higher prices.
Filling the void left by Gunns’ departure and venturing into the space currently occupied by private woodchippers and exporters is not without public policy problems, notably a need to adhere to national competition principles.
Getting government funds into Forestry Tasmania is more than simply a question of a choice between deficit funding and equity transfers.
The principle of competitive neutrality applies to government businesses competing with the private sector, and ensures that any advantage arising solely from their government ownership be removed unless it’s in the public interest, and prices need to be set as if they were privately owned and are fully cost reflective.
…
Profitable native forest woodchips is Forestry Tasmania’s only chance of salvation.
Minister Harris and Forestry Tasmania don’t talk in such blunt terms. They use the less pejorative term ‘residues’ giving the impression they are referring to sawmill residues rather than the bulk of native forests that head straight for the chipper.
Providing deficit funding would be a clear breach of competitive neutrality given the other players in the chip industry.
Hence any assistance needs to be structured differently.
…
So we have this charade of running an overdraft and then raiding another government business to clear it when it reaches the limit, just so as to comply with the letter of competitive policy.
Hardly in keeping with the spirit of the principle, especially seeing the overdraft is secured by a letter of comfort from the Treasurer.
…
Forestry Tasmania as presently constituted will never be profitable as a log supplier.
It can only survive if native forest woodchip demand and prices return to the days when John Gay had a smile on his face, and it can only do that by competing with privateers.
Displaced public servants have a right to know the Government has chosen to use the resources of the State sector to assist Forestry Tasmania compete with private companies contrary to the
principles of competitive neutrality and national competition, using subterfuge to inject funds via the back door and weasel words to disguise the deed.
Read the full article on Tasfintalk, here
• Forestry Tasmania’s battle to survive coincides with a visit by FSC auditors to review its logging practices.
It also comes at a time when Forestry Tasmania has encountered community opposition with plans to clearfell a 68 hectare coupe at Lapoinya in North West Tasmania.
Friends of Lapoinya Action Group (FLAG) lobbied Greens leader Kim Booth to obtain further information about costs and revenue from the coupe but Forestry Tasmania refused to cooperate.
Forestry Tasmania have claimed the coupe will be profitable, in which case it could have been used as an example to FSC of its sustainable business if not environmental practices.
FLAG obtained their own assessment of the coupe which has been shown to FSC. The assessment confirms the unsustainable model Forestry Tasmania is pursuing.
The net proceeds are calculated on a mill door value basis.
To the extent Forestry Tasmania is able to add value by chipping and exporting the chips itself, the net cash loss will be less.
But unlikely to be profitable.
Not to mention in breach of national competition guidelines.
• John Powell, in Comments: Eastwards today to St Helens et al via Scottsdale and the Weld etc. devastation, clearfell. crappy Nitens plantations etc. A wonderful example to my wife’s 89 year old uncle from Brisbane on how not to log sustainably. Chinese tourists at Pyengana Cheese factory critical of what they saw! Paul Harriss = not a good look for President Xi. Listen and hear the people Will Hodgman!
Pete Godfrey
December 10, 2014 at 21:45
Comparing the above losses with the overall loss that FT manage to achieve, would make this one of the more profitable coupes. This 65 ha coupe is actually reduced to 37 ha once all the streamside reserves are taken out, there are also active landslips shown on the Forest Practices Plan which would also have to be excluded from the harvest zone.
The example above is not abnormal, Mr Lawrence is correct in saying that FT are anti competitive. What farm forester or private grower could afford to lose on every coupe they log.
K.Stevens
December 10, 2014 at 23:16
As John Lawrence points-out the language used by FT is dishonest. ‘Residues’ actually refers to the unskilled workers that the Tasmanian Government uses to ‘harvest’ votes.
Thats all this industry really is in my view. Politicians in rural electorates sucking votes out of the margins of society from people that are probably the residues of civilisation.
Take Paul Harriss for example? Do you really think he cares about the Asian packaging industry? I would say he only cares about his own career if you could call his self-absorbed waffle a ‘career’.
Karl Stevens
December 10, 2014 at 23:33
I have got Paul Harriss’s Xmas present sorted this year.
‘Money Logging: On the Trail of the Asian Timber Mafia’ is an ideal present for Paul. It’s all about Paul’s friends in Sarawak
It’s available at Amazon for $24.
http://www.amazon.com/Money-Logging-Trail-Asian-Timber/dp/3905252686
john hayward
December 10, 2014 at 23:52
You need to remind yourself that the attraction of woodchips is that the loggers themselves are allowed to grade the trees as chips, pay residue prices for them, and avoid the costs of employing people to process them.
The racket might be curtailed if we imposed fiduciary duties on the Minister and FT honchos.
John Hayward
Factfinder
December 11, 2014 at 14:53
FOREWORD
By Mutang Urud
I was born in a village in the “Heart of Borneo†as Tom Harrison
described it, near the remote headwaters of the Limbang River, in the
Malaysian state of Sarawak. There is nothing more beautiful than the
rainforests of Borneo where I spent my childhood. It was both our playground
and our sweets shop. We foraged for rinuan honey and ground
fruits on the forest floor, and climbed up vines and fruit trees to feed our
sugar-starved young souls. Growing up surrounded by mountains, the
forest was our only world, and under the dark canopy where the noonday
seems like dusk, only the calls of birds and cicadas told us the time
of day. Borneo’s virgin forest is also home to tens of thousands of insects,
hundreds of bird species, and many mammals that are found nowhere
else. A single hectare of our forest supports more tree species than all of
Europe.
As a young adult in the 1970s, I watched the loggers not only destroy
the forest, but divide communities with corrupting bribes and pay-offs.
They were like thieves in the night; indeed, they were working in such
haste that their machinery could be heard at midnight, even on Sunday.
Our ancestral land has been desecrated, our history erased, the very
memory of our origins lost. As a young idealist, I could not stand by while
this crime was occurring. In the late 1980s, I helped organise blockades
to stop the bulldozers and chainsaws. I founded the Sarawak Indigenous
Peoples’ Alliance as a rallying point for our peoples’ resistance. Only reluctantly
did I travel to twenty-five cities in thirteen countries to tell the
world what was happening to our homeland. Back in Sarawak, police
attacked our blockades and sent many people to jail. I was arrested,
interrogated, and held in solitary confinement. Upon my release, I left
Malaysia to speak about these environmental crimes at the Earth Summit
in Rio de Janeiro. In 1992, I addressed the United Nations General
Assembly in New York in support of land rights for indigenous peoples.
Unable to return home, I studied anthropology in Canada in order to
acquire new skills that would help me save some of what was being lost.
Fearing arrest, for twenty years I dared not return to my homeland.
When I finally did, I found that the ecological crimes had only increased.
The forest I had loved was almost gone. Rainforests that had been the
10 • LUKAS STRAUMANN
home of human beings for at least 40,000 years had been destroyed in
little more than thirty. Close to 90% of Sarawak’s ancient forest is now
gone. Only 11% of the primary growth remains. How did it disappear?
I applaud my dear colleague Lukas Straumann for his diligence and
investigative skill in writing the book that follows. His research exposes
the wanton greed that has fuelled the destruction of the place I call home.
This book investigates two crimes. The first is how a single man,
Abdul Taib Mahmud, along with a small group of very rich politicians
and businessmen could destroy the richest ecosystem on earth despite
not owning it, despite local and global outcry, despite international laws
and regulations. Simply put: Who has stolen our trees?
The second crime is more subtle. Surely, if my people have lost their
ecosystem, their traditional way of life, their clean drinking water, and
their freedom to roam the forests, they must have gained something. Yet
they haven’t. Many of the people of Sarawak are as poor as they were when
I was born. And yet, the value of the trees that have been felled is estimated
to exceed US$50 billion. This profit has fed corruption, kept oligarchs
in power, been used to commit further crimes. Fortunes have
moved through the world’s financial system, mostly secretly, to places as
distant as Zurich, London, Sydney, San Francisco, and Ottawa.
Lukas Straumann shows how this, one of the greatest environmental
crimes in history, is much bigger than just the theft of trees. It is also
about power, more precisely, how a corrupt autocrat has liquidated a forest
in order to keep himself at the helm of a state. For my people it is also
more than a question of trees. It is about our culture they have stolen.
This book should be essential reading for anyone who uses a bank,
buys property, or invests in the stock market. Only by understanding how
a rainforest can be converted into a building as far away as the FBI headquarters
in Seattle can we hope to stop the kind of corruption that threatens
the world’s natural places, and the people for whom these are home.
Mutang Urud
Montreal, Canada
July 2014
http://www.money-logging.org/upload/excrept/moneylogging_dp_excerpt.pdf
Factfinder
December 11, 2014 at 14:56
TAIB’S SECRET REAL ESTATE EMPIRE
On 20 June 2010, Clare Rewcastle’s Blackberry flashed. A curious message
had landed in her inbox: “I was Sulaiman Taib’s Chief Operating
Officer in the US for twelve years. I have sensitive information and am
ready to share it. But are you ready to fight with Taib? Careful, my
phones are tapped and my computer is compromised. Ross Boyert.â€
Four months later, Ross Boyert was dead.
Clare Rewcastle, a former BBC journalist, did not hesitate for long before
contacting the Bruno Manser Fund. “We’ve got to meet Boyert at
once,†she said to me over the telephone. “This man holds the key to
Taib’s secret real estate empire. We’ve got to go over to the US as soon as
possible. I never thought we’d find him.†Two days later, I was sitting in
an aircraft bound for Los Angeles.
Clare Rewcastle lives in London now and is married to a brother of
the former British Prime Minister, Gordon Brown, but she spent her
childhood in Sarawak, Malaysia, as the daughter of British colonial
servants. She left at the age of eight, returning to the United Kingdom
with her family. At the end of 2005, she travelled to Sarawak to attend
an environmental conference and was shocked to find the country of her
childhood unrecognizable. 90% of Sarawak’s exploitable timber had
been felled. Land that had once been covered in dense rainforests had
been replaced by palm oil plantations. The indigenous inhabitants’
longhouses were gone, and in their place were the logging companies’
camps. The people in the countryside were poorer and worse off than
they had been when Clare was a child, but, in stark contrast, the mansions
of the leading politicians and timber barons glistened in the towns
and cities.
One man had ruled Sarawak for over thirty years: Abdul Taib bin
Mahmud, known in Malaysia as “Taib Mahmud†or simply “Taibâ€. With
holdings in more than 400 businesses in twenty-five countries and offshore
financial centres, Taib’s family is a global player. It is estimated that
Taib’s wealth is worth a total of 15 billion US dollars, making him one of
the richest and most powerful men in Southeast Asia.1 Under Taib’s rule,
16 • LUKAS STRAUMANN
Sarawak had become a “hotspot†in the global crisis afflicting tropical
rainforests.2
Clare Rewcastle first visited us at the Bruno Manser Fund in Basel,
Switzerland, in 2009, and we agreed to work together to expose the
crimes of Taib and his entourage. Early in 2010, the energetic journalist
launched her blog Sarawak Report, which soon became one of Malaysia’s
best-read news pages. Together, we scoured the Internet—Clare, from her
base in London, and myself, in my office in Basel—searching for information
about Taib’s global businesses. Very quickly it became clear to us
that Taib must have earned billions illegally from the timber trade, and
he must have parked that fortune somewhere abroad. But where? If we
could find it, we would be one step closer to the smoking gun we needed
in our fight for the rainforests of Sarawak. “Follow the money†had become
our motto, and now, out of the blue, we were suddenly hot on the
trail of Taib’s investments abroad.
Ross Boyert’s existence was not news to us. We’d heard about him
through the Californian NGO The Borneo Project, but all our attempts
to track down the whistle-blower had ended in failure. We had not even
known whether he was still alive. Until now.
We met Ross Boyert and his wife Rita (name changed) on Wednesday,
23 June 2010, at eight o’clock in the morning in the bar of the Marriott at
Los Angeles airport, a high-rise hotel built in the 1970s that was beginning
to show signs of age. Clare and I had flown in from Europe the evening
before. The Boyerts turned out to be a fashionable pair, both around
sixty and both dressed in designer clothes. The strong, dark-haired Ross
with his bushy eyebrows greeted us jovially. Rita, too, a graceful blonde
woman in a dark dress with a pearl necklace, was visibly pleased to see
us. “Don’t give us any advance notice of when you’re coming and don’t
call until you’re here,†Ross had warned us on the telephone. “We’ll come
to the airport immediately. That’s the only way we can meet without being
shadowed. Since I initiated proceedings against the Taib family, our
life has become hell.†…
http://www.money-logging.org/upload/excrept/moneylogging_dp_excerpt.pdf
Factfinder
December 11, 2014 at 15:03
… With the introductions completed, we hurriedly withdrew to a meeting
room in the Marriott basement, where we would be able to talk without being interrupted. As a final gesture, Ross turned to look anxiously
at the hotel entrance, but there was no one there to be seen.
“It’s terrible. We’re being followed day and night,†Rita Boyert burst
out the instant the door to the meeting room was closed.
Ross added: “Taib and his people have inflicted the same on us as on
the Borneo rainforest: destruction, annihilation, theft, and betrayal.
Ruination for the sake of ruination. I see no future any more, and that’s
precisely what they want.â€
Always a shrewd journalist, Clare had started recording the conversation.
She began asking precise questions. I merely watched and listened.
“Taib owns properties worth 80 million US dollars in San Francisco
and Seattle,†Ross explained, “and I administered them for twelve years
on behalf of his son, Sulaiman. Sakti International Corporation,
Wallysons Inc., and W.A. Boylston are companies owned by the Taib
family, with properties on the west coast of the USA. The companies are
registered in the names of Taib’s children and his brothers and sisters,
but in reality they belong to him in person. Here’s proof.â€3
Ross Boyert put a hand into his leather case and pulled out a sheaf of
photocopies. He placed one document in the middle of the wide conference
table. “Articles of Incorporation of Sakti Corporation†read the title
of the deed creating Taib’s Sakti real estate business on 5 March 1987.
Ross flipped through the documents and then snatched a second
paper. Its title was “Certificate of Amendment of Articles of Incorporationâ€,
and at the bottom was the official seal of the State of California.
The document proved that the Sakti Corporation had changed its name
to the Sakti International Corporation on 10 September 1987, and that
act was witnessed with the neat signatures of the company’s directors at
the time, Taib’s two brothers, Onn and Arip, and the elder of Taib’s two
sons, Mahmud Abu Bekir, known as Abu Bekir.
“But here’s the real proof,†said Ross. He stood and pointed triumphantly
at a two-page document dated 8 April 1988 with the cumbersome
title of “Action by Unanimous Written Consent of the Board of Directors
of Sakti International Corporationâ€. The document reported the issuing
of one thousand Sakti shares at one dollar per share, split unequally
18 • LUKAS STRAUMANN
between five people: Taib’s two brothers: Onn and Arip; and three of
Taib’s children: Abu Bekir, Jamilah, and Sulaiman Abdul Rahman.
“All the shares are formally held by Taib’s brothers and children,â€
Ross Boyert explained, “but the trick is that half the shares are held in
trust for Taib personally. His name does not appear in the share register,
although he is the biggest Sakti shareholder.†And, in point of fact, in the
column with the heading “Number of Sharesâ€, it became clear for whom
it was that Taib’s brothers and children held the shares: “200 of which
to be held in trust for Abdul Taib Mahmud†was the endorsement next
to the 400 shares of his brother Onn. In the case of his brother Arip and
his two sons, it was 100 shares each, giving Taib a total holding of 500
out of the 1,000 shares being held in trust for him. With the secret 50%
shareholding, it is also clear who had control over the company: the chief
minister in person and he alone. Here, for the first time, we had proof of
the chief minister’s secret wealth.
Ross Boyert handed the documents over to Clare and me, and then he
sat down again. Suddenly it seemed as if that blazing fire inside him had
been snuffed out. He was once again very apprehensive. Slowly, quietly,
and haltingly in that windowless cellar meeting room, Ross and Rita Boyert
began to relate the story of their life as Taib’s confidential agents in the
USA.
…
http://www.money-logging.org/upload/excrept/moneylogging_dp_excerpt.pdf
Andrew Ricketts
December 11, 2014 at 19:59
I completely disagree with the statement (below) by John Lawrence:
“Profitable native forest woodchips is Forestry Tasmania’s only chance of salvation.”
The mere fact Forestry Tasmania might one day make a profit is not a justification for the unrepentant irresponsible uncaring and selfish destruction of nature.
That is what happens when you turn a government department (The Forestry Commission) into a GBE. Profit becomes a base justification for its existence and its actions.
Why when it is not (and mostly has never been) profitable should Forestry Tasmania be allowed to continue to trade?
In the circumstance under the current legislation, including the still unsustainable rate of cut, the intent to log an existing RFA 200,000 Ha of informal reserves in 6 years time and the ongoing plan to mine out Tasmania’s natural forests with its attendant assault on Tasmania’s unique fauna; salvation would absolutely elude Forestry Tasmania, even if a miracle occurred and profit from native forest woodchip would ensure Forestry Tasmania became viable.
William Boeder
December 11, 2014 at 20:39
Thank you Factfinder, Again this matter of Tasmania and its Lib/Lab State ministers being engaged in the raping of Tasmania’s Rain-forests is being displayed.
It is just a matter of joining all the dots together, the starting point is in Myanmar in the mansion of Taib Mahmud from there to his Ta Ann business headquarters, from there the dots take a direct line that leads to the Tasmanian office of the Liberal minister for forests.
Previously there were 2 direct lines between Taib Mahmud and Tasmania, one leading to Hydro Tasmania and in turn this led to its Victorian based Hydro Electricity based consultancy, which in turn were to become the consultants to the Taib Mahmud proposed construction of 12 or more Hydro Electricity Dams.
I believe Entura’s involvement as a consultant to this huge Taib Mahmudin Hydro Electricity Dam construction project, has been heavily down-played or even flatly denied.
…
With both the logging of our State’s rain-forests (to the benefit of the Ta Ann veneer plants, for both high grade furniture veneers as well as lesser grade veneers for ply-board manufacture) and the Hydro consultancy work, showing us that Tasmania’s major business activities have been and are still aligned with the corrupted empire of Taib Muhmud and associates.
Is this the best that Tasmania’s government can provide this State with as a source of long term economic sustainability?
Surely there are more honest and respectable business relationships about that this Government could develop an economic business relationship therewith.
K.Stevens
December 11, 2014 at 21:57
Thanks Factfinder for the excerpts from ‘Money Logging: On the Trail of the Asian Timber Mafia’. And to think Tasmania is part of the ‘Timber Mafia’ empire?
John Powell
December 12, 2014 at 00:00
Eastwards today to St Helens et al via Scottsdale and the Weld etc. devastation, clearfell. crappy Nitens plantations etc. A wonderful example to my wife’s 89 year old uncle from Brisbane on how not to log sustainably. Chinese tourists at Pyengana Cheese factory critical of what they saw! Paul Harriss = not a good look for President Xi. Listen and hear the people Will Hodgman!
John Hawkins
December 12, 2014 at 11:11
My PA arranged for me to download Straumann’s book on Kindle over a month ago; it is cheaper.
The paper copy ordered at the same time has still not arrived and it is of note that Taib and his minions have the lawyers on the case in London in the usual push to clamp down and harass any form of opposition.
Straumann’s book makes most interesting reading.
…