The Quagmire of Rain Forest Logging : Trade: Misguided policy and profiteering combine to squander resources in Malaysia and other tropical nations.

The government of Sarawak did the unthinkable last summer. The timber-rich state in eastern Malaysia abruptly announced that it would slash logging quotas in its ancient tropical rain forests.

Environmentalists were caught off guard. Sarawak, after all, has chopped and sawed and bulldozed itself into infamy.

A recalcitrant Sarawak has brushed off intense international pressure to reform its logging practices and to recognize the rights of indigenous forest dwellers. Its provincial politicians are vilified for fostering corruption, allegedly taking kickbacks from logging conessionaires who are, in turn, accused of ravaging the forests for windfall profits.

Could all this change overnight?

Sarawak now says it is abiding by the recommendations of a U.N.-affiliated timber agency to slow the rate of logging. But forest economists are skeptical that the move will have significant impact. The cutbacks are only temporary, and come too late to spare Sarawak from a devastating pattern of boom and bust, which has exhausted rain forest resources--and undermined bio-diversity--throughout developing Asia, Africa and Latin America.

Perhaps Sarawak’s lesson is that “sustainable forestry,” by which trees are harvested wisely and nurtured for future generations, remains little more than theory, an elusive dream.

“In many ways it’s an intractable problem,” said Steven Johnson, a Scottish forest economist with the U.N.-affiliated International Tropical Timber Organization. “Producing countries say it’s basically a problem of poverty, and that’s a compelling argument.”

Malaysia, a small but rapidly industrializing country, accounted for 30% of all tropical timber felled by the world’s loggers in 1991. About half of that was cut in Sarawak. Three out of every four raw tropical logs exported worldwide came from Sarawak or other parts of Malaysia, according to the Yokohama-based ITTO.

Compounded by the cutting of wood for fuel, jungle homesteading and slash-and-burn agriculture, tropical logging contributes significantly to the planet-wide threat of global warming, as many environmentalists warn.

But the trade in hardwood from rain forests such as Sarawak’s is an economic quagmire.

Questionable government policies, in both producing and consuming countries, combine with the unconstrained activities of loggers and traders to squander national resources.

“We need greater accountability in the political economy of logging in Malaysia,” said Jomo Kwame Sundaram, a Harvard-trained economist at the University of Malaya. “Outside this context we cannot understand the problem, and there are no solutions.”

In Sarawak’s case, the community loses many of the tax benefits of logging because clever bookkeeping by logging companies routes the lion’s share of profit from the rain forests into overseas subsidiaries, Jomo and other critics allege.

Most of the hardwood logs are exported to Japan, where banks and trading companies underwrite much of the logging operations, and “transfer pricing,” the practice of masking profits, is condoned in international trade, critics contend.

In Japan, a large proportion of the logs are turned into plywood for disposable concrete molding panels, priced cheaply and consumed by a hungry building boom.

These smooth-grained sheets of generic lauan (Philippine mahogany) are thrown into the trash after only one or two uses, symbolizing the perplexing waste of the tropical hardwood trade.

Similarly, but on a smaller scale, Hollywood studios use lauan plywood from Indonesia for temporary stage sets. In October, a band of environmental activists chained themselves to cranes at the Port of Long Beach, protesting imports of Indonesian plywood with origins in “unsustainable forestry.”

The logging cycle starts with a human dilemma. About half of Sarawak’s population of 1.7 million belong to the Dayak family of indigenous tribes. Many live in poor villages in the hinterlands.

Theirs is a traditional forest economy based on shifting agriculture, sometimes referred to as “slash and burn.” Farming is supplemented by hunting and gathering of forest products and, now, low-skill jobs in the logging camps.

Ethnic Malays and Chinese inhabit the cities along the South China Sea coast and dominate commerce, politics and logging. The two sides of society clash in the rain forest.

A decades-old dispute between indigenous people and encroaching loggers gained wide notice in the mid-1980s when members of the nomadic Penan, one of the Dayak tribes, set up blockades on logging roads to halt intrusions into their customary lands.

The Penan’s struggle became a potent symbol, but the cause of saving their prehistoric culture is just one piece of the logging puzzle. Only about 200 Penan maintain a nomadic lifestyle, while hundreds of thousands of other Dayak people have assimilated to varying degrees. And their complaints about logging are legion.

Consider Akem Jok Ngau, a member of the Kayan tribe from the village of Long Bemang on the Apoh River, a tributary of the big, muddy Baram.

Gap-toothed Akem, 57, and his community of about 100 families settled about 50 years ago in their communal “long house.” They adopted Western clothing, integrated paper money into their subsistence economy, and sent their children to government schools.

The accommodation with the modern world was successful--until the loggers came a few years ago. The strangers hurriedly carved roads in the hilly terrain, damaging the village’s rice fields and fouling the river with silt from erosion.

“It was getting more and more difficult to hunt and fish,” said Akem, who wore an orange T-shirt decorated with a small, green alligator. “Then the logging company built a bridge that’s impossible to pass by boat.”

Akem and three other men from the village were arrested earlier this year and charged with sabotaging the loggers’ bridge. He came to Marudi to seek advice from his local representative in Malaysia’s Parliament, Harrison Ngau, the lone environmentalist in Sarawakian politics.

“The decision to put up blockades or (commit civil disobedience) is a last resort for the indigenous people,” Ngau said. “They’ve already filed official complaints with the authorities and gotten nowhere.”

Sarawak’s recent order to slow the pace of logging will yield few results, Ngau said, because the state lacks the manpower to enforce it.

“Look at the map of Sarawak; it’s a checkerboard of logging concessions,” he said. “Logging goes on everywhere except the national parks. The state Forestry Department has no practical ability to supervise this or enforce the law.”

Even if there were enough rangers, he said, the state lacks the political will to constrain the loggers.

Ngau notes that Sarawak’s state minister of the environment, James Wong, is also a logging baron. Chief Minister Abdul Taib Mahmud, the equivalent of a governor, has enriched himself through logging concessions awarded to his friends and family, critics contend.

In fact, in the mudslinging of a contentious election campaign in 1987, Taib and his challenger--a former chief minister--disclosed damaging lists of names, providing rare evidence linking high officials to suspicious logging patronage.

In Kutching, the state capital, Taib and Wong were not available for comment. State forestry officials would not speak to the question of corruption.

Officials said they are cracking down on illegal logging by levying export duties in the logging camps, instead of downstream at the ports, a practice that should stop cutting of undersized trees.

“But we are grossly understaffed,” conceded James Mamit, a forest conservator in the department’s international bureau. Mamit did not know the number of inspectors in the field.

Slowing down the army of lumberjacks would be a formidable task even with a larger police force. Critics of the patronage system complain that concessions are assigned for short periods, and companies log into the night under floodlights to amortize investments and reap profits before the deadline.

The accelerating rate of logging alarmed ITTO when it sent a study mission to Sarawak in 1989. The official count of that year’s harvest was 13 million cubic meters, which ITTO recommended reducing over two years by a total of 3 million cubic meters.

But last year volume had risen sharply to 18.8 million cubic meters. By mid-August of this year, the hardwood harvest had reached an estimated 15 million cubic meters, nearly double the 1989 cut at an annualized rate.

A strained constitutional relationship between the federal government in Kuala Lumpur and the eastern states of Sarawak and Sabah on Borneo has complicated the tropical timber conundrum. Sarawak is relatively autonomous politically and, unlike states in peninsular Malaysia, it maintains control over its forest resources.

The export of raw logs has been virtually banned elsewhere under federal policy, while Sarawak and Sabah have been free to ship logs overseas. Already, Sabah has nearly depleted its primary growth forests.

Although small sawmills are springing up around Kutching, sparsely populated Sarawak lacks the human resources and infrastructure to develop value-added industries.

Malaysia’s furniture industry has boomed over the last five years, but Sarawak has been left out of the income stream from such export industries, which conservationists favor because they consume fewer trees for better returns.

Meanwhile, the government of Prime Minister Mahathir Mohammed has for many years been in the bind of supporting environmental causes in international forums, while being unable to control its most conspicuous environmental problem, Sarawak logging.

That embarrassing contradiction intensified during the Earth Summit in Rio de Janeiro in June, where Mahathir adopted a high profile as spokesman for the Third World. Returning home, Mahathir’s administration reportedly applied “moral suasion” to pressure Sarawak into complying with ITTO’s 1989 admonishment to slow down logging.

“It’s in the interests of the country and future generations that we get our house in order,” said Wong Kum Choon, secretary general of the Primary Industries Ministry, which oversees national forestry policy. “We should take a long-term view of managing our resources.”

The situation on the ground in Sarawak, however, may be irredeemable, said Thayalan Muniandy, a prominent environmental lawyer.

“There’s no point in talking about sustainable logging when you look at the pattern of corruption in Sarawak,” Thayalan said.

“Some people even talk about regenerating the rain forest, logging and preserving species at the same time,” Thayalan said. “I think it’s all a dream.”

Tropical Timber Malaysia, a small but rapidly industrializing country, leads the major producing countries in both production and exports of tropical forest products. Overall in 1990, the Asia-Pacific region accounted for 71% of all world production of tropical forest products and 86% of exports. Source: International Tropical Timber Organization