Monday, 2 June 2008 7:49 AM

Responsible logger

I noticed that the Government is adamant and set to commence the new determined price of exported log on 1 June 2008. Well done servants, you have been firm despite strong pressures from logging companies. The new determined price will increase the tax and probably the royalty portion of an export value of log; an advantage that may favor the government and the landowners. Conversely, the logging companies will receive less than they used to in the old determined price. This will be in millions so quite a shock which will trigger various cost cutting decisions.

The down side as anticipated is that government revenue, export and employment may severely be affected if the companies react in a retaliatory manner. But I should think that as the decision to review the determined price by month is fair to all parties, logging companies should respond ethically. If they do, the effects of the new determined price can be managed by the government, the landowners, and the companies alike. Further to this, all party should adopt responsible investment decisions, and a shift in strategy.

The new Medium Term Fiscal Strategy launched early this month by the acting Minister of Finance Hon Gordon Lilo Darcy pave the way and is a positive signal to redirect investment on a sustainable path. Rather than pressing for a return to a lower determined price, logging companies should support the Government in this commitment by investing in other areas. The tide has slowly turned from logging to more friendly investments. This is also recognized by the global trend that moves towards sustainable resource management, environmental concern and climate change issues. Along this line governments including Solomon Islands have tightened and enforced relevant regulations such as the environment act.

These are the beacons logging companies should see in its business environment and consider shifting investment strategically. Rather than dwell in a campaign for an industry that has been very controversial and going towards sun set, they should take advantage of the positive policies introduced by the Government, and invest in sustainable businesses. Available investment incentives could be considered for loggers if it would help rehabilitate them into more meaningful activities.

Logging companies should consider returning to the areas they operate or once operated and develop the reefs, the waves, the beaches and the mountains (if any attraction remains and if disputes they help create are resolved).

Disclaimer: The views and opinions expressed in this letter/article are those of Harry Degruit and do not necessarily reflect the official policy or position of Solomon Times Online.

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