Teak forest exploitation, South Sudan

Description

Newly-independent South Sudan is heavily reliant on oil as an income earner, which is why harvesting extensive teak forests, originally planted by the British in the 1940s, is seen as important in generating foreign exchange. Large land concessions have already been granted to foreign companies to harvest the teak. Of these, two of the largest are a 50,000 hectare natural forest concession to Central Equatoria Teak Company (CETC) and 18,640 hectares (1,319 hectares of which are under teak)[1] to Equatoria Teak Company (ETC). There have been years of local opposition to the deals, signed in 2007, because of a lack of consultation. Although there has not been displacement, there are reports that suggest the government wants people to be moved from forestry areas. The CETC agreement stipulates the payment of $200,000 into a social fund plus $155 per m^3 of teak exported. The ETC agreement also involves a $200,000 social fund amount (ETCs website, however, says under the terms of its concession agreement they have contributed $70,000) plus $110 per m^3 of teak exported. Government officials have expressed dissatisfaction with these amounts compared to the price that Sudanese teak, considered to be of the highest quality in Africa, earns on international markets[2]. The concessions have an interesting history involving the development department of the British and Finnish governments. As reported by the Oakland Institute, the Commonwealth Development Corporation (CDC), whose sole shareholder is the UK Department for International Development, and the Finnish Fund for Development Cooperation (Finnfund) held majority interests in Equatoria Teak Company and Central Equatoria Teak Company. They later sold their interests to unnamed investors, but as the Oakland Institute points out, the implication is that the Government of South Sudan entered into the investment because they believed CDC and Finnfund were responsible investors. Having divested, there is no guarantee that new investors are as committed to sustainable development. However, Oakland acknowledges some benefits, citing job creation (a Forest Stewardship Council report indicated ETC was employing 246 people, 98 percent of whom were from the local population) and that the wood is processed onsite. But there have also been complaints that expectations of large amounts of jobs have not been fulfilled and that existing jobs are poorly paid[3].

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Basic Data
NameTeak forest exploitation, South Sudan
CountrySouth Sudan
ProvinceWestern Equatoria
SiteNzara
Accuracy of LocationLOW country/state level
Source of Conflict
Type of Conflict (1st level)Biomass and Land Conflicts (Forests, Agriculture and Livestock Management)
Type of Conflict (2nd level)Deforestation
Land acquisition conflicts
Plantation conflicts (incl. Pulp
Specific CommoditiesTimber
Teak
Project Details and Actors
Project DetailsProcessed timber (teak) can retail at prices from $750 per cubic meter to $1,500 per cubic meter[1].

Project Area (in hectares)68600
Level of Investment (in USD)N/A
Type of PopulationRural
Potential Affected PopulationN/A
Start Date2007
Company Names or State EnterprisesEquatoria Teak Company from United Kingdom
Central Equatoria Teak Company from United Kingdom
Maris Capital from United Kingdom
Relevant government actorsMinistry of Commerce, Industry and Investment, Ministry of Agriculture and Forestry, Ministry of Environment
International and Financial InstitutionsDepartment for International Development (DFID) from United Kingdom
Finnfund
Forest Stewardship Council (FSC)
US Agency for International Development (USAID)
Environmental justice organisations and other supportersGeneration Agency for Development and Transformation-Pentagon (GADET- Pentagon), South Sudan Law Society (SSLS), Oakland Institute, Norwegian Peoples Aid
The Conflict and the Mobilization
Intensity of Conflict (at highest level)LOW (some local organising)
When did the mobilization beginIn REACTION to the implementation (during construction or operation)
Groups MobilizingIndigenous groups or traditional communities
International ejos
Local ejos
Local government/political parties
Forms of MobilizationDevelopment of a network/collective action
Involvement of national and international NGOs
Lawsuits, court cases, judicial activism
Official complaint letters and petitions
Impacts
Environmental ImpactsVisible: Deforestation and loss of vegetation cover
Potential: Biodiversity loss (wildlife, agro-diversity), Food insecurity (crop damage), Loss of landscape/aesthetic degradation, Soil erosion
Socio-economic ImpactsVisible: Lack of work security, labour absenteeism, firings, unemployment
Potential: Displacement, Loss of livelihood, Land dispossession, Loss of landscape/sense of place
Outcome
Project StatusIn operation
Pathways for conflict outcome / responseMigration/displacement
Strengthening of participation
New Environmental Impact Assessment/Study
Cancellation of the concession agreement.
Development of AlternativesTeaching local farmers agro-forestry, promoting afforestation and giving smallholder farmers equity in the venture have all been suggested as possibilities.
Do you consider this as a success?No
Why? Explain briefly.There are reports of dissatisfaction with the amount of money that South Sudan will get out of the deals, lack of consultation with the local community and poor wages and working conditions. Recently, the CETC project has lost its FSC certification but it is not clear what the reasons behind this were [4].
Sources and Materials
Legislations

Land Act (2009)

Draft Land Policy (2011)

The Local Government Act (2009)

Investment Promotion Act (2009)

References

[1] Ferrie, Jared (2013). South Sudan to Start Teak Exports to Cut Dependence on Oil. Available at: Accessed 10 February 2013.
[click to view]

[2] Norwegian Peoples Aid (2011). The New Frontier. Available at: Accessed 7 February 2013.
[click to view]

[3] Oakland Institute (2011). Understanding land investment deals in Africa: South Sudan. Available at: Accessed 13 February 2013.
[click to view]

Links

[4] Is All Well In The Teak Forests Of South Sudan? – By Aly Verjee
[click to view]

Media Links

Standard Group Kenya (2013). South Sudan to export teak tree. Available at: Accessed 14 February 2013.
[click to view]

UNMISTV (2011). UNcover Sudan Show 6 - Teak. Available at: Accessed 14 February 2013.
[click to view]

Flickr (2011). Ngari Norways Photostream. Available at: Accessed 14 February 2013.
[click to view]

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Meta Information
ContributorPatrick Burnett
Last update08/04/2014
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