Monday, 2 June 2008 7:29 AM

Forestry Minister Clarifies Determined Value Schedule for Export Logs

The Minister of Forestry, Sir Allan Kemakeza clarified a number of issues relating to the recent increase in the Determined Value Schedule (DVS) for export logs.

Sir Allan made the clarification following accusations made by supporters of logging companies that the DVS increase was not appropriate and that the DVS is being used incorrectly by his Ministry to hold up shipments of logs.

The Minister said it is important for all stakeholders, including industry and resource owners, to understand that the recent increase in DVS was done after a long period where there was no increase.

The Determined Value Schedule is a list providing values of round logs for various species and sizes and is used by the Government as the basis for the collection of export duty which is currently paid at a rate of 25%. The recent change to the DVS means that average values of logs exported have increased by USD$7 per cubic meter from USD$78 to USD$85."

"The DVS system aims to ensure Solomon Islands resource owners and government gets a fair return for their logs as per CNURA government policy," Sir Allan said. "The DVS is based on reliable information gathered from our major trading partners with regards to logs - China and Japan."

"The recent high increases in the volume of logs being exported from the Solomon Islands and the reported prices being paid in our export markets show us that we need to ensure we do not allow this important resource to be sold too cheaply," Sir Allan said.

Sir Allan said all resources owners and exporters must consider the information provided in the DVS when they are discussing the sale of logs. If they are being offered lower prices than those in the DVS they should ask questions.

"Even though I believe the DVS represents some of the best technical information that is available... showing what our logs are actually worth in the marketplace," Sir Allan said.
Sir Allan said that the current DVS will be in place until the end of September where a review will be undertaken to ensure that any further adjustment is fair to all parties.

"This review will be overseen by respected independent authorities such as the Central Bank and the Civil Society and will include participation by industry and resource owner representatives."

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