TFD's Dialogue on

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TFD's Dialogue on ILLEGAL LOGGING Hong Kong -
March 8-10, 2005 Roberto Smeraldi Director,
Friends of the Earth - Brazilian Amazon THE
CASE OF BRAZIL
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What does legality mean in the case of Brazilian
Amazon? and Should we look for legality?
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Legality from the point of view of the official
Environmental Licensing
Estimated 22 million cubic meters - or 75 - of
current Amazon timber production is covered with
some legally issued document from the federal or
state environmental authorities. Approximately
two thirds of it - or 50 of the total production
- is originated by clearcutting licences, aimed
at converting forest into pasture or agricultural
land. Approximately one third of it - or 25 of
the the total production - is originated by
forest management plans also licensed by
environmental authorities. The remaining 25 of
the total production is environmentally illegal,
i.e. resulting from unlicensed practices
(invasions of Indigenous land or parks,
clearcutting without any licensing).
estimates from repeated surveys by Amigos da
Terra in key regions, since 1992.
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Legality from a general point of view
At least 90 of clearcutting practices occur in
invaded and untitled public land, mainly through
mechanisms known as grilagem (land grabbing or
squatting) or sometimes through simple occupation
or expulsion of local communities. At least 95
of forest management plans are granted in invaded
and untitled public land, mostly through simple
occupation or expulsion of local communities, or
sometimes through grilagem. This implies that
approximately 94 of Amazon timber - regardless
of environmental practices or environmental
licensing - is stolen from the Federal Union,
from the states or from local legitimate forest
dwellers. estimates from repeated surveys
by Amigos da Terra in key regions, since 1992
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How could environmental bodies grant
environmental licenses to forest conversion
and/or forestry management operations which are
completely illegal?

• Lack of capacity, personnel and equipment in a
  large territory (no field checking of documents).
• 2. Political and social pressure (the
  unemployment blackmail)
• 3. Corruption (increasing cost due to government
  enforcement, but still economically attractive).
• 4. Poor coordination between different government
  agencies (i.e., IBAMA and INCRA)

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Summary estimate of the Cost Breakdown of Wood to
Sawmills at the Main Logging Centres (Per m3).
Amigos da Terra Amazônia Brasileira, 2002
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The buyer's conventional assumption an
environmental license is the evidence of legal
exploitation.
Mistaken point! This situation is similar to one
of a guy with a regular driving license, however
driving a stolen car. He might not be fined
for breaking the driving code, but should be
arrested for using a stolen car (even if it was
stolen by a third party, as it is often the case
with grileiros).
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Even environmentally-reasonable forest management
can be illegal!
According to a 2004 survey by IMAZON in Eastern
Pará, focusing on 63 companies with a licensed
forestry management plan

• only 6 of them were actually performing some form
  of management
• within the 6, only 3 were performing a
  reasonable-quality management
• however, within the 3 only 1 had legal access to
  the land (titling).

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In this context, who are the loggers then?

• a large majority, with low risk aversion,
  short-term perspective and little capital, are
  engaged in the production chain described before
  and offer cheap products.
• - a small minority, with more capital,
  long-term perspective and a cautionary approach
  to land situation, are engaged in sustainable
  management in hardly purchased properties,
  usually with FSC certification and offering
  relatively expensive products.

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Can a well intentioned company establish a really
legal operation? Hard job!

• if it is public land - which means 75 of the
  Amazon region, including National Forests
  supposedly aimed at sustainable management - no
  concession mechanism is currently allowed under
  the Brazilian law
• if the land is provided with suitable
  transportation means, it is often already
  deforested
• if it is still forestland, it was often already
  selectively logged and has few trees with
  commercial diameter
• if it is still in good shape, it is rarely
  matched by legal private land titles
• if it has legal private land titles, due
  diligence to prove it might take years
• if the investor is able to go through due
  diligence, it is likely that it has also to
  negotiate with some pre-existing legitimate
  inhabitants or recent opportunistic occupants.
• - after all this, it has to make his
  management plan be approved, supposedly without
  bribes.

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Was anybody able to go through all this? Yes,
believe it or not...
FSC certified forest in the Brazilian Amazon
(which are audited on the grounds of legal
titling of land, too) rose up to 1.7 million
hectares in December, 2004, with a five-fold
increase over the last four years (the total
certified area in Brazil is now 3 million
hectares, including plantations from the
South-East).
Wow, it sounds a lot!
No doubt it is an impressive increase. However,
it accounts for less than 4 of the Amazon timber
and new investors are unable to find additional,
significant and suitable legal land.
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But in the end, what is legal and what is
desirable in the Amazon?
In 2002, the Friends of the Earth report
"Predatory Legality" defined three broad
categories.
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A) Activities considered legal but undesirable

• facilitated issuance of deforestation land
  clearcutting permits
• imposition of major bureaucratic difficulties by
  governmental decrees and regulations
• wood wastage in extraction and in processing
• burning of wastes
• priority for activities that require "conversion"
  of forest covering in the main financing sources
  for credit and development
• - regularization by INCRA of areas recently
  deforested (thereby circumventing the regulation
  that bans settlements in the forest).

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B) Activities regarded as illegal but desirable

• community management of forestry timber and
  non-timber products (almost always illegal due to
  the lack of appropriate formal insertion of this
  public and bureaucracy)
• management practices and selection of the most
  advanced and modern trees, without adherence to
  the division of allotments, that are considered
  as illegal
• - sustainable management in indigenous lands,
  regarded as illegal with the exception of a pilot
  ad hoc authorized pilot-project (Xicrin of
  Catete).

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C) Activities regarded as illegal and undesirable

• squatting (landgrabbing) for "opening up" new
  areas
• widespread corruption in the regulatory and
  licensing agencies
• extraction of wood from conservation units
• trading of transportation permits (ATPF)
• - use of slave, forced or child labour.

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Main drivers for change?

• implementing task-force to formally register the
  land of traditional local communities and the
  public land
• passing legislation allowing forest concessions
  on registered and secure public land (30 years
  waiting for legislation, now a light at the end
  of the tunnel?)
• stopping to license the illegal (non-recognition
  of precarious land titles for licensing
  purposes)
• adopting economic instruments at the processing
  mill and at manufacture's stage (additional
  taxation on conversion timber, tax breaks on
  concession timber, etc.)
• - market increasingly requires meaningful
  certification (so far, FSC) and not generically
  licensed timber.

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MORE INFORMATION? Please visit our websites!
www.amazonia.org.br/english
www.forestmanagement.org.br