To: Herman Wijffels,
Executive Director for
Netherlands, Armenia, Bosnia and Herzegovina, Bulgaria,
Croatia, Cyprus, Georgia, Israel, Former Yugoslav Republic of Macedonia,
Moldova, Romania, Ukraine
World Bank Group
MC 13-1302,
1818 H Street, NW
Washington, D.C. 20433, USA
Cc: Mrs. Donna Dowsett-Coirolo, Country Director for South Caucasus
Mr. Roy Southworth, Country Manager for Georgia,
Mr. David Tkeshelashvili, Ministry of Environmental Protection and Natural Resources
via fax: 202-522-1572
February 6, 2007
Dear Director
We would like to share our concerns with you regarding ongoing reforms in the forestry sector of Georgia and to request that the World Bank freezes its credit for “Forestry development project”, for as long as there is no framework for the ongoing forestry policy and the sector’s reform, namely one that is agreed with relevant stakeholders and adopted by the Parliament of Georgia.
We would like to underline the fact that the Government of Georgia is violating almost all its undertaken obligations and commitments in terms of the implementation of the “Forestry development project” (Project), is ignoring the project aims and the principles of sustainable forestry underlined within the World Bank Forest strategy and policy, and is dismissing consultations with stakeholders and instead is undertaking unilateral decisions.
It should be also noted that the so-called reform of the Forestry sector being carried out by the Government of Georgia would result in the increased deforestation of Georgia’s forests with all the negative consequences attached, including erosion, landslides, increased illegal logging and poverty within neighbouring communities. Furthermore, the ministry is constantly misinforming society, including members of parliament and the international donor agencies.
Background
The World Bank Forestry Development Project was adopted in 2002 by the WB’s Board of Directors. During the ratification of the loan agreement for the project, the Government of Georgia agreed that forestry would become a priority for the country[1].
One of the most important issues acknowledged by civil society is that the project recognised the non-existence of a state forest policy, as well as the need for an adequate inventory of existing forestry resources, the lack and inefficiency of controlling mechanisms, that combined with wide corruption and illegal logging, representing the major obstacles to sustainable forest management.
Under the loan agreement and a Governmental Memorandum, a clear timetable and sharing of responsibilities between the project and the government to address the above-mentioned problems as developed. However, neither the former nor the new, current government[2] (that came to power after the Rose Revolution) has ever tried to implement the undertaken commitments, including anti-corruption activities.
Furthermore, since 2004, due to the activities of the Government of Georgia, almost all the components of the project have been delayed. One of the most important obstacles has been the never ending structural changes within the government, added to the frequent changes of ministers and personnel[3] that makes it impossible to carry out even technical work.
In addition, the new government has no clear understanding that so called “fast economic modernization practice” that envisages the total minimisation of state intervention through complete deregulation and liberalisation in a number of sectors, may bring even more harm than benefits for sectors like forestry.
Unfortunately, bundled in the overall fast economic modernization reforms, so enthusiastically supported by the World Bank, there are a number of reforms that include the liberalisation and deregulation of sectors where the government should maintain a presence to ensure the health and safety of its own population and environment.[4] The same principle applies towards the environment and particularly forestry, where according to the acting decision-makers, a number of the principles established in the WB Forest Strategy and policy, the Forest Stewardship Council and different conventions, including the Convention of Biodiversity Protection, are outmoded and may not be implemented.
Since 2004 representatives of the Georgian government have underlined the need for the quick privatisation of forests and protected areas to “find an owner for the forests” and through it decrease the government’s responsibility, controlling function and costs for forest management. According to the government, this new approach will support the preservation of the forests for future generations without any costs. The Georgian government claims that the market will regulate the relations and encourage “sustainable development”, because the private sector will find new sources of financing and guarantee professional monitoring. This approach may seem naive, if there wasn’t the suspicion that there are private interests of concrete groups that wish to appropriate Georgian forests – including protected areas – behind such an approach.
Problems in reforming the forestry sector in Georgia
According to the WB project Component A, the borrower takes responsibility to improve the forest sector governance through national regulatory, financial and institutional reforms[5], through the development of a national forest policy, including standards and forest certification, the strengthening of institutions and human resources and building public support for improved forest management and monitoring through the financing of goods, services, training and incremental operating costs. There should also be the improvement of the legal, regulatory, financial and policy framework in accordance with the borrower’s letter of forest sector development policy.
As a foundation for the implementation of further reforms in the forestry sector of Georgia, Georgian civil society consistently underlines that as a first step the Georgian Forest Policy should be developed with wide participation from all sectors of society. This is one of the leading components in the WB project that should be implemented with UN Food and Agricultural organization’s support, along with other necessary legislative developments. It was agreed that a policy based on consensus should define the different ownership forms (private, rent, community) of Georgia’s forests and their function.
Another major step identified for the eventual success of the reforms in the sector is a full inventory of Georgia’s forests together with a total economic valuation of the country’s forest resources. This also represents part of the World Bank Forestry Project. However, up to now these components have been completely ignored both by the Shevardnadze and Saakashvili governments; this has resulted in a never ending policy burden within the forestry sector where each newly appointed minister attempts some kind of reform in line with their own style.
Imitation of forestry sector reform by the new Government of Georgia
Since 2003 there have been no steps undertaken to develop the National Forest Policy, while there have been several attempts at regulatory and institutional reforms. In 2005 FAO and WB unsuccessfully tried to bring the Georgian government back to its obligation to prepare a National Forest Policy to lay the foundation for further changes, so called “reforms’ group” in the Ministry of Environment (independent of the Forestry Department and the WB project) started the elaboration of a reform concept.
In January 2006, after numerous requests from NGOs, the “reforms’ group” published for public comments and suggestions a so-called concept paper “the position of Ministry of Environmental Protection and Natural Resources in regard to the reforming of the management of state-owned forests and use of resources”. The concept paper that seeks best practices in such geographical areas as Africa, Canada and Russia has been criticised by all relevant stakeholders, including environmental NGOs, forest sector representatives and entrepreneurs. The public discussions of the document were arranged by different interests groups and during those discussions the word “unprofessional” has been the most unproblematic[6].
Despite the fact that the ministry did not take into account comments submitted by environmental groups and professional foresters, and also did not arrange any public discussions, it still continued to “work” on the document and published it in its original form on its official website on April 4, 2006. In order to justify the ministry’s actions, an official representative of the ministry (currently the head of Forestry Department) told journalists that the ministry did not receive any comments or suggestions related to the draft document.[7]
Meanwhile in parallel, with the support of FAO and WB as well as pressure from Georgian environmental groups, in February 2006 the process of elaboration of the draft Forest Policy was started. The draft document “principles of Georgian Forest Policy” were reviewed in mid-May 2006 in a Gudauri Workshop that was attended by relevant stakeholders, including the ministry and parliament. Agreement between all interested parties (including the ministry) was reached that no new reform document would be prepared until the Forest Policy is agreed between all stakeholders through relevant hearings and consultation, and ultimately approved by the parliament.
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At the beginning of June, and despite the agreement with FAO and WB to wait till the draft version of the Georgian Forest Policy would be ready, the Ministry of Environment decided to submit the April version of the concept paper “the position of Ministry of Environmental Protection and Natural Resources in regard to the reforming of the management of state-owned forests and use of resources” for approval to the Cabinet of Ministers.
Environmental NGOs arranged a protest rally in front of the State Chancellery in order to hinder the approval of the concept paper by the government of Georgia. As the action had quite high resonance with the public, the government tried to justify itself. The Georgian Prime Minister said no reform has been considered; however, the Minister of Environment Protection and Natural Resources and State Minister stated that there was the draft of a reform to be presented[8]. After two weeks, during a specially convened parliamentary committee meeting, the Deputy Minister of Environment Protection and Natural Resources presented the concept prepared in January and underlined that it was based on recommendations prepared by an international expert, and not the ministry’s position! He also pointed out that a new document “Forest Policy” is under preparation and will be soon presented to the parliament; however, he could not make any competent arguments around the issue and mixed the position of the ministry and Forest policy documents. The government’s tactic with regard to the above-mentioned concept paper and its incompetence caused significant irritation among Georgian MPs.
In November 2006, the ministry once again violated the agreement between FAO, the WB and stakeholders agreed prior to the beginning of the process, when the final draft of the “Georgia Forest Policy and Strategy” document was presented for public commenting. The document represents an artificial mixture of “Georgian Forestry Policy Principles” and the concept paper “the position of Ministry of Environmental Protection and Natural Resources in regard to the reforming of the management of state-owned forests and use of resources”. The distribution of the paper was also quite shocking for the editorial board that was formed in April 2006 to prepare a final draft of “Georgian Forest Policy”. While the content and form of the document is far from the promotion of sustainable forestry, the agreed process to develop the “Forest Policy” through consultation and consensus with all relevant stakeholders again has been forgotten by the ministry.
Further, in December 2006 the newly appointed head of the Forestry Department openly declared that the concept paper “the position of Ministry of Environmental Protection and Natural Resources in regard to the reforming of the management of state-owned forests and use of resources”, had already been adopted by the Georgian government! And he did not understand why the Forestry Department should wait for the adoption of the Forest policy, strategy and implementation Action Plan[9].
The newly promoted ministry concept claims that as “the forest policy is almost ready, and in some regions the inventory is also finished”, this gives the possibility to the State Forestry Department to announce the auction for long term usage (up to 20 years) in areas where the inventory has been done almost ten years ago (in 1997)[10].
According to the auction call by the ministry in late December 2005, the winner is not required to present a management plan prior to the starting of works (as is required by the law) and this gives the winner the possibility to conduct work for at least one year without presenting a management plan. Furthermore, according to the Head of department, in order to please investors the “State should request from the investor only the things that would be presented in the management plan. While how and what methods would be used for its implementation is up to the investor… It is very easy the Forest International Association[11] has standards that certifies the forest and gives the entrepreneur the possibility to export goods on the international market”. The fact that standards should be developed nationally for Forestry certification under any scheme (Forest Stewardship Council or any other known certified scheme) does not really bother the author of the above-quoted words.
World Bank Forestry Project and Georgian government know- how compliance
The WB-funded forestry project recognises the need to create a good governance model in the sector and underlines that, together with the arrival of the private sector in the forestry sector, state control should be strengthened.
Forest Code and the development of legislation
The Forest Code of Georgia envisages that forest owners can be “the State, Georgian Patriarchate as well as physical or legal entities of private law”[12]. This article was prepared and adopted during the preparation of the World Bank Georgia Forests Development Project. It underlines that in order to privatise state-owned forests a special law must be adopted.
Even though in 1998, when the Forestry Code was prepared, civil society, foreign experts hired by the WB and MPs actively participated in the process, there was a number of discrepancies between the Code and International environmental legislation. One of the main problems with the Forestry Code elaborated in 1998, and underlined by civil society, was the non-existence of Forest Policy agreed to by all stakeholders.
During the World Bank project implementation under component A, a number of sub-regulations for the Forest Code have been developed. However the lack of enforcement of these sub-regulations has always been acute.
Today the same situation exists when the Forest Policy does not exist while there is ongoing work on the new Forest Code that should be ready by mid-2007. It should be underlined that the preparation of the Forestry Code started without any involvement of the WB Forestry Project and WB specialists, not even to mention on the involvement of either the business or NGO sector, i.e., the main stakeholders in the forestry field. Further, during a meeting with NGOs on November 25, 2006, Mr Tkeshelashvili, Minister of Environment, assured NGOs that there is no work taking place on the New Forest Code. Meanwhile, a World Bank mission (November 20-December 5)[13] has found that the elaboration of the Forest Code is ongoing and is considering a financial contribution to support the elaboration of the new Forest Code through international expertise.