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Forestry is a good, if risky, business in South Africa. A handful of private companies, together with government, have dominated a commercial forestry sector based on plantations. Today, world market trends are causing companies to focus on what they do best, and to outsource everything else. Government is privatising its plantations and is pursuing policies aimed at empowering formerly marginalised people. This means that forestry is changing fast. Forest certification is one response to change, and is helping some companies who were already practising reasonable management, to make further improvements and consolidate their reputations. Another response is to run outgrower schemes. These have been quite good for company business, and have also improved community livelihood assets, but have not yet pulled poor people out of poverty. Raising the stakes: Impacts of privatisation, certification and partnerships in South African forestry is based on the findings of some 20 sub-studies and widespread consultation in South Africa. Trends in the development of South Africa’s forest industry. Over the space of about 100 years, South Africa’s forest industry has grown into an internationally significant one – focused on pulp and paper – of great importance to the national economy. Today, from South Africa’s 1.2% of national land area under plantation (1.5 million ha) some 19 million m3 of roundwood is produced each year, half of it pulpwood, making the country the twelfth largest producer of pulp in the world. The industry is highly concentrated in a few big companies. The trend towards contracting out offers an important opportunity for greater participation in the industry, particularly by entrepreneurs from the previously disadvantaged community. However, poor conditions in the contracting industry are a concern. Macro policy in South Africa generally supports the multiple-use emphasis of forest policy. Land reform policy, although rather slow to gather momentum, presents opportunities for new players and some threats to existing plantation ownership through the land restitution process. Privatisation. Post-1994 policies in South Africa call for radical changes in the way forests are managed to achieve national goals. A key element of this redefinition is the privatisation of publicly owned commercial forestry operations – not through outright sale but using long-term leases. In addition to leases the government had two other main instruments of privatisation at its disposal – transactions involving weighted bidding criteria and negotiated terms of sale between government and the preferred bidder, and the existing legislative framework, defining obligations in respect of forest management, land issues, and labour relations. The process of plantation privatisation has revealed a changed philosophy amongst many – which recognises that government and the private sector need not be adversaries, provided the instruments which can balance public as well as private sector interests are put in place. Certification. About 0.83 million of South Africa’s 1.5 million hectares of industrial plantation forest are currently certified under Forest Stewardship Council certification, with another 0.5 million hectares notionally covered by ISO 14001 certification. A desire to improve competitiveness was the major motivation for certification, although the need to deal with supply chain pressure and environmental and social criticism of the industry were also important. Several key impacts of the certification experience to date can be identified: Certification has helped those whose plantation management was already good, and who could afford to implement it. These companies are now busy finding other ways to demonstrate their credentials as good managers. Certification has enabled them to talk with international friends, national stakeholders, and even the local neighbours, without quite so much blood-letting as in the past. But the large South African forestry dog is still being wagged by a tiny consumer tail – since the only important market for certified wood products thus far is the DIY retail market in the UK. There is much still to be done if certification is to become capable of effectively addressing the ‘messy’ social issues generated by these companies, and by all those forest enterprises that are not the biggest and the best. Indeed, certification has shored up the reputations of the biggest companies just as wider societal debates are promoting a larger number of smaller, communally based producers and more equitable patterns of land and resource control. Concerns for the future also revolve around the impact of changed requirements for certification with respect to further afforestation – particularly with regard to genetically modified material. Another major challenge lies in the fact that certification has had no effect on all those forests that really need improving – the plethora of small, planted forest patches and woodlots and the vast areas of indigenous woodlands. Company–community partnerships. Corporate social responsibility initiatives in forestry have been around for years and outgrower schemes in South Africa grew out of these. Under the schemes, trees are grown by smallholders with support from companies who later buy the product for pulp. Outgrowing is a way of allocating risk between producer and contractor: the former takes the risk of production and the latter the risk of marketing. Outgrower schemes have become a vital part of the commercial strategy of the large forest companies in South Africa. On the ‘community’ side, outgrowing timber has contributed to household income but has not yet taken households out of poverty. Growers are tied by contract to the companies – restricting their ability to bargain for the best prices – and associations capable of negotiating better terms of contract with the companies are still weak. The report argues that current trends in South African forestry will not miraculously combine to produce a balance of economic efficiency, environmental sustainability and social empowerment. For such a balance to be achieved, a strong vision needs to be generated and spread – involving a new pattern of ownership with an increase in the numbers of medium and small-scale players.
Some 25 options for improved forestry and livelihoods are presented, which need to be further negotiated and prioritised by the above players. The most crucial of these require a partnership approach between players from the outset. Copyright © 2005 International Institute for Environment and Development. |
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