SSRN Id4249469

Discussion Paper 103
DATE 2022
Series ISSN 2206-303X
Papua New Guinea’s forests back in the spotlight
Colin Filer
Abstract
The political economy of forest management in Papua New Guinea (PNG) is once again a
focus of international attention because private investors and aid agencies are showing a
renewed interest in the potential of ‘natural (or nature-based) climate solutions’ to the
problem of mitigating the negative impacts of climate change. There is a risk that
newcomers to PNG’s forest policy process will fail to appreciate some of the key aspects
of the political and economic landscape with which they have decided to engage. This
paper aims to combine a summary of the evidence relating to the management of PNG’s
native forests with an assessment of the balance of power between the different actors in
the forest policy space, the nature of their interests, and the institutions through which
those interests are translated into action. The paper also draws attention to some of the
key episodes in the history of the policy process that help to explain where it might now
be heading. Particular attention is paid to the problems of transparency, corruption and
illegality that have been central to debate between the different actors engaged in the
process.
The Development Policy Centre is part of Crawford School of Public

Policy at The Australian National University. We undertake research
and promote discussion on Australian aid, Papua New Guinea and the
Pacific and global development policy.
Electronic copy available at: https://ssrn.com/abstract=4249469
Colin Filer
Colin Filer1 is an Honorary Professor at the Crawford School of Public

Policy, The Australian National University.
Filer, C., 2022. ‘Papua New Guinea’s forests back in the spotlight’, Development Policy
Centre Discussion Paper 103, Crawford School of Public Policy, The Australian
National University, Canberra.
The Development Policy Centre is a research unit at the Crawford School

of Public Policy, The Australian National University. The discussion
paper series is intended to facilitate academic and policy discussion. Use
and dissemination of this discussion paper is encouraged; however,
reproduced copies may not be used for commercial purposes.
The views expressed in discussion papers are those of the authors and
should not be attributed to any organisation with which the authors
might be affiliated.
For more information on the Development Policy Centre, visit

devpolicy.crawford.anu.edu.au
1This paper has taken account of insights and comments provided by a number of individuals, including
Bryant Allen, Andrea Babon, Jim Barber, Paul Barker, Peter Dam, Gae Gowae, Polly Hemming, David
Mitchell, Mark Pilon, Lester Seri, Bob Tate and Ruth Turia. None of them should be held responsible for the
overall argument or the conclusions that have been reached.

Contents
1 Introduction .................................................................................................. 3
2 Papua New Guinea’s rural landscape.............................................................. 4
2.1 Partial alienation of customary land rights ......................................................... 5
2.2 Commercial logging concessions ........................................................................ 9
2.3 Deforestation and forest degradation .............................................................. 14
3 Actors, interests, and institutions ..................................................................18
3.1 The private sector ........................................................................................... 19
3.2 The public sector ............................................................................................. 23
3.3 Landowning communities ................................................................................ 32
3.4 National civil society ....................................................................................... 36
3.5 The donor community ..................................................................................... 37
3.6 Gender inequality............................................................................................ 39
4 Power dynamics in the field of forest policy ..................................................41
4.1 The donor-funded reform process, 1990–2002 ................................................. 41
4.2 The reassertion of national sovereignty, 2002–2011 ......................................... 44
4.3 Shifting sectoral sands, 2011–2019 .................................................................. 47
4.4 Another swipe at foreign capital ...................................................................... 49
5 Arguments about illegality and corruption ....................................................51
5.1 Findings of the Independent Forestry Review Team, 2000–2004 ....................... 52
5.2 Subsequent assessments of the nature and extent of illegal logging ................. 53
5.3 Current evidence of failure in the institutions of governance ............................ 56
6 Conclusion ....................................................................................................58
References ..........................................................................................................65

1 Introduction
The main reason why the native forests of Papua New Guinea (PNG) are the focus of a
new wave of international attention is that the parties to UN Framework Convention on
Climate Change have agreed to place greater emphasis on the conservation of native
forests, and a reduction in the rate at which such forests are destroyed or degraded, as a
‘natural solution’ to the problem of climate change mitigation, and one that can be turned
into a market solution through the development of new ways to sell the carbon credits or
carbon offsets that arise from such activities. While Article 5 of the Convention has
allowed developing countries to receive payments from developed countries for engaging
in such activities, Article 6 now enables countries with high levels of greenhouse gas
emissions to ‘offset’ some of their contributions to climate change through the purchase
of carbon credits from countries that contain a surplus quantity of forest carbon available
for storage at the right price.
The PNG Government has long been convinced that PNG contains a very large surplus
quantity of forest carbon. In September 2021, Prime Minister James Marape told the UN
General Assembly that PNG contained 13 per cent of the world’s tropical forests, and that
these forests were absorbing ten times more carbon dioxide from the atmosphere than
his country was contributing to emissions from other sources (Anon. 2021a). Nor is PNG
a newcomer to the carbon trading business. In 2005, Prime Minister Michael Somare
called for the establishment of an inter-governmental body to be called the Coalition for
Rainforest Nations, and his son Arthur, then national planning minister, announced that
the government had entered into a deal with a company called Pacific Capital Limited to
trade PNG’s carbon credits on the London Stock Exchange (Huafolo 2005). Between 2008
and 2010, PNG’s forests became the subject of speculation by a collection of so-called
‘carbon cowboys’ whose activities attracted a good deal of adverse comment, to which
the government responded by promising a new legal and policy framework that would
set things right (Howes 2009; Melick 2010; Filer and Wood 2012; Babon et al. 2014). The
process of constructing this framework, which is still a work in progress, has now been
interrupted by the parallel global process through which Article 6 has attracted a new

wave of enthusiasm for the commercialisation of PNG’s forest carbon assets. And this in
turn has stoked a recurrence of the political controversy that surrounded the previous
wave of speculation (Lang 2020; Lo 2021; Hemming and Babon 2022).
PNG’s stock of surplus forest carbon has not only attracted the interest of private
investors. It has also attracted the interest of multilateral and bilateral aid agencies
searching for ‘nature-based’ solutions to the problem of climate change mitigation (Miles
et al. 2021). There is a separate political debate about the feasibility of such ‘solutions’,
especially those that involve the sequestration of forest carbon (Anon 2021b).
Furthermore, the interest of the aid industry is not entirely altruistic, since the
governments of developed countries, or countries with high levels of greenhouse gas
emissions, have an economic interest in the acquisition of carbon credits under Article 6
as a means to reduce their ‘nationally determined contributions’ to the process of
mitigation. So what might appear to be programs and projects designed to improve the
quality of forest governance in PNG might also have beneficial spin-offs for the foreign
governments that invest in them.
The purpose of this paper is not to delve much further into the motivations of the foreign
actors or agencies that are either interested in developing new markets for PNG’s native
forest carbon or developing the capacity of the PNG Government to manage the forests
that contain this substance. My main purpose is to reflect on the nature of the physical,
economic and political environment in which such investments are being made. That is
because it appears that many of the actors or agencies making these investments have a
somewhat limited knowledge of the beach on which their waves are breaking, and even
those with a previous record of engagement are liable to suffer some degree of
institutional amnesia. As a result, there is a risk that their investments may have all sorts
of unintended consequences in a country sometimes known as ‘The Land of the
Unexpected’.
2 Papua New Guinea’s rural landscape
Much of the debate about forest management or forest governance in PNG is based on
assumptions that misrepresent the measurable features of PNG’s rural landscape or fail
to recognise that some of these features can actually be measured. An assessment of this

quantitative evidence should constitute the starting point for any attempt to move this
debate in a positive direction and hence arrive at a better understanding of future policy
options. The metrics in question can be arranged under three headings. The first is a set
of measures that can be applied to what I call the partial alienation of customary land
rights. The second is a set of facts and figures that apply to one specific form of partial
alienation, which involves the transfer of timber harvesting or forest management rights.
The third involves the application of numbers to the processes of deforestation and forest
degradation and the identification of the factors responsible for one or both of these two
processes. Taken together, these are the key dimensions of the space in which political
contests over forest management are conducted. They can also be regarded as a set of
foundational geographical factors that reflect and constrain the behaviour of the actors
involved in such contests.
2.1 Partial alienation of customary land rights
It is often said that 97 per cent of the nation’s land is held under customary tenure while
only 3 per cent has been alienated, and that these proportions have not changed since the
country became independent in 1975 (GPNG 2007a). These figures are based on the fact
that roughly 2.8 per cent of the total land area (TLA) had been purchased from its
customary owners at that time and the government has not been able to purchase more
or exercise its powers of compulsory acquisition since then (Filer 2014). However, there
are several ways in which customary rights over large areas of land have been partially
alienated since 1975. Table 1 shows the areas covered by each of the four main forms of
partial alienation. The numbers in this table cannot be added up to yield a total amount
of customary land that has been partially alienated because some areas have been subject
to more than one form of alienation or have even been subject to the same form of partial
alienation on more than one occasion. In each case, the customary owners of the land in
question have been compensated or rewarded with a benefit package, the value of which
reflects the value of the resource that is being exploited or the rights that they have
surrendered. The value of the package tends to determine the intensity of disputes over
the way that it should be distributed between the customary owners.

Table 1: Areas covered by partial alienation of customary land rights since 1975
Form of alienation Area (million hectares) Per cent of total land area
Logging concessions 11.0–11.5 24–26
Special agricultural and business leases 5.0–5.5 11–12
Terrestrial protected areas 1.7–1.8 4
Extractive industry development licences 0.4–0.5 1
About 380,000 hectares (ha) of customary land is covered by the development licences
issued for oil and gas projects, but the surface area that has actually been used for the
construction of wells, pipelines, and processing facilities is only a tiny fraction of this area.
There is no significant diminution of customary rights in the rest of it—only an
entitlement on the part of the customary owners to receive a share of the benefits derived
from the extraction of hydrocarbons located underneath their land. A much smaller
area—probably less than 100,000 ha altogether—has been covered by development
licences issued to mining companies, but there are greater limits on the exercise of
customary rights within this area. The Mining Act 1992 and the Oil and Gas Act 1998 both
make provision for the negotiation of benefit-sharing agreements through an institution
known as the ‘development forum’ (Filer 2008). A very substantial proportion of the TLA
is covered by mining or petroleum exploration licences at any one time, but exploration
has a minimal impact on customary rights to use the land, so the area covered by
exploration licences is not shown in Table 1.
At the opposite end of the value spectrum, with much smaller benefit packages, is the
terrestrial protected area network, which is currently thought to include about 1.8
million hectares (mha) of customary land (GPNG 2019a). In this case, the rights that have
been alienated are primarily hunting rights. This is because more than 70 per cent of the
customary land in the network is protected under a piece of colonial legislation—the
Fauna (Protection and Control) Act 1966—that was intended to restrict the use of
shotguns by rural villagers (Filer 2011). Although customary hunting rights are
supposedly restricted in the ‘wildlife management areas’ established under this
legislation, local landowners are responsible for the enforcement of these restrictions, so
their rights have only been partially alienated to local management committees that have
very limited powers (Eaton 1997; King and Hughes 1998). As a result, there is very weak

compliance with the rules that they impose. At the same time, there is nothing to prevent
the customary owners of wildlife management areas from deciding to engage in one of
the other forms of partial alienation shown in Table 1 (USAID 2020). A stronger form of
protection, and a higher degree of alienation, is afforded by the Conservation Areas Act
1978, which only came into effect in 2004. So far, two large protected areas with a
combined area of 436,000 ha have been established under this legislation (Erickson-
Davis 2017; Dabek and Wells 2020). These areas are both subject to a degree of support
and oversight from the Conservation and Environment Protection Authority (CEPA).
Responsibility for the grant of all types of logging concession is vested in the PNG Forest
Authority (PNGFA) under the terms of the Forestry Act 1991. Where these concessions
are granted over areas of customary land, which is normally the case, they entail the
temporary transfer of timber harvesting or forest management rights from the
landowners to the government or a private company while leaving other customary
rights intact. The most recent draft of the National Forest Plan to which I have gained
access calculated that 11 mha (almost 25 per cent of the TLA) had already been acquired
from local landowners and allocated to selective (or rotational) logging concessions, but
some of the relevant agreements had expired, so the area still covered by active
concessions was more like 8.5 mha (GPNG 2012a, 10). No new large-scale selective
logging concessions have been issued since 2010. That is mainly because of the
complexity of the regulations that have been applied to the practice of ‘sustainable forest
management’ since the forest policy reforms of the early 1990s. Instead, there has been a
substantial increase in the area covered by forest conversion (or clear-felling)
concessions, known in the Forestry Act as ‘forest clearing authorities’ (FCAs). The total
area that has been covered by such concessions since 2007 is difficult to calculate since
the PNGFA does not publish any figures on this subject; it is probably about 2 mha.
However, many of these concessions have already expired, and a few have been
suspended or revoked, so the area covered in any one year would be a good deal smaller.
Some of the areas covered by FCAs are areas formerly covered by a selective logging
concession that has expired, where the timber harvesting rights have reverted to the
customary owners.
Some of the areas covered by FCAs have previously been subject to another form of
partial alienation, which is sometimes known as the ‘lease-leaseback scheme’. This was

invented in 1979 as a way to compensate for the absence of any legal mechanism that
would allow customary groups to register titles to their customary land (Filer 2014). The
idea was that they could lease their land to the government, which would then register a
title over it and lease it back to them. With title in hand, they could then sublease the land
to an investor of their choice (Hulme 1983). The scheme was given a legal foundation
when the Land Act was amended in 1996, but an allowance was now made for a Special
Agricultural and Business Lease (SABL) to be granted to any person or corporate body to
whom the landowners agreed that it should be granted. The maximum period of such a
lease was to be 99 years, and all customary rights to the land were to be extinguished for
the period of the lease unless they were protected under the terms of the agreement
between the landowners and the government. Like other legal instruments issued by the
Department of Lands and Physical Planning (DLPP), SABLs had to be gazetted, so it is
possible to calculate the number and size of the SABLs issued since 1996 and identify the
persons or corporate bodies to whom they have been granted.
Almost 1,000 SABLs were gazetted between 1997 and 2012, with a combined area of
between 5 and 5.5 mha (11–12 per cent of the TLA). The vast majority covered areas of
less than 100 ha, but more than 50 covered areas of more than 10,000 ha. It was these
bigger leases that attracted the attention of a judicial inquiry established to investigate
the question of landowner consent (Mirou 2013; Numapo 2013). These bigger leases
were commonly associated with proposals to secure FCAs from the PNGFA and convert
large areas of native forest into large-scale agricultural projects (Gabriel et al. 2017).
Some of these proposals were successful, so there is a fairly large area of land—about 1.7
mha altogether—that has been covered by an SABL and then covered by an FCA. The
lease-leaseback scheme was effectively suspended in 2012, so no SABLs have been
granted since that time, although the relevant provisions of the Land Act remain in force.
Another form of partial alienation was made possible by amendments to the Land
Registration Act that came into effect in 2012. Registered groups of customary
landowners were given the right to register titles to their land and then to grant
‘derivative rights and interests’ in the form of leases to a third party that also had to be
registered with the DLPP. The land ceases to be subject to ‘customary law’ except insofar
as custom still applies to the transmission of rights to be members of the group holding
the title (Chand 2017). This legal mechanism should have made the lease-leaseback

scheme redundant. However, the area covered by registered group titles has been
growing at an average of less than 40,000 ha a year since 2013, which means that the
total area is still quite small (Filer 2019).
Timber harvesting and other customary rights can also now be alienated through project
agreements authorised by the Climate Change and Development Authority (CCDA) under
the terms of the Climate Change (Management) Act 2015. The areas covered by such
agreements would fall somewhere in the space between protected areas and commercial
logging concessions since the point of such agreements would be to secure an income
from the reduction of greenhouse gas emissions from deforestation and forest
degradation (REDD). However, despite the interest shown by several foreign investors,
no benefit-sharing agreements had been finalised by the end of 2021. There is a process
currently under way to determine the size of the benefit package to which the landowners
should be entitled.
While large areas of customary land have been partially alienated in several different
ways and for different periods of time, customary rights have been reasserted over the
small—and even diminishing—area that still counts as state land or private land. This
area of ‘fully alienated’ land includes some forest plantations (with a combined area of
less than 30,000 ha) and a handful of national parks (with a combined area of only 8,000
ha). The reassertion of customary rights is accepted by state actors because they share a
national or post-colonial ‘ideology of landownership’ that rejects the validity of the
process whereby the land was alienated during the colonial period (Turia 2005; Filer
2014). This means that any increase in the value of alienated land is normally
accompanied by demands that some of the increase be shared with the descendants of
the customary owners (Filer 2019). The primacy of customary rights is not only asserted
in numerous pieces of legislation but also maintained in the belief of most automatic
(indigenous) citizens that the possession of such rights is a hallmark of true citizenship.
2.2 Commercial logging concessions
There are five types of commercial logging concessions granted over areas of customary
land. The annual volume of round log exports from each concession, and each type of
concession, is documented in the annual reports of the local subsidiary of Swiss company

Société Generale du Surveillance (SGS). SGS PNG Ltd has been engaged by the PNGFA to
monitor log exports since 1996 and report the volumes to PNG’s Internal Revenue
Commission as part of the country’s log export tax regime. The SGS reports are not
published but are circulated to several national stakeholders.2
The SGS reports do not contain any maps, nor do they specify the areas covered by each
of the concessions from which logs are exported. Most of the large-scale selective logging
concessions that have made an appearance in the SGS reports since 1996 were already
shown on the maps contained in the first National Forest Plan (GPNG 1996). Additional
information on each concession is contained in a succession of unpublished concession
lists produced by the PNGFA since 1993, but these are not entirely consistent with each
other. To avoid confusion, the 2012 draft National Forest Plan (GPNG 2012a) has been
selected as the main source of information about the areas covered by different types of
concession, even though this draft has never been officially endorsed or published. The
PNGFA has more recently developed a geospatial database, currently known as the Forest
Resource Information Management System (FRIMS), which specifies the boundaries of
all large-scale selective logging concessions that fall within the category of ‘production
forests’ (Turia et al. 2019). This is an updated version of the Forest Inventory Mapping
System that was established with support from the Australian aid program in the 1990s
(McAlpine and Quigley 1998). The complete dataset has not been placed in the public
domain.
At the time of independence in 1975, the Department of Forests had purchased timber
rights over more than a million hectares of customary land in various parts of the country
under the terms of Section 8 of the Forestry Act (Amalgamated) 1973. This was done by
means of Timber Rights Purchase (TRP) agreements between the state and ‘clan agents’
representing the customary owners, followed by the grant of a Timber Permit by the
state, normally for a period of 10 years in the first instance. The permits were commonly
granted to so-called landowner companies that then transferred the timber harvesting
rights to foreign logging companies, but the government retained the right to monitor
2 A concession-level spreadsheet based on these reports has been assembled by the author of the current
study, and is available on request. A simplified version of this spreadsheet can also be accessed at
https//pngiforests.org.
10

compliance with the permit conditions. Various legal devices have been used to extend
the validity of the permits granted on the basis of TRP agreements since the old Forestry
Act was repealed in 1992. Although there is no obvious legal mechanism for extending
the TRP agreements themselves, ‘current’ TRP concessions were still said to cover 2.8
mha in 2011 (GPNG 2012a), and several are still yielding round log exports.
The Forestry (Private Dealings) Ordinance of 1971 allowed landowner companies to enter
into a Logging and Marketing Agreement with a logging company of their own choice,
under the terms of a Dealings Agreement that required the assent of the forests minister,
but which otherwise allowed the contractor to operate with minimal government
supervision. The concessions covered by such agreements are generally known as ‘local
forest areas’ (LFAs). When the Private Dealings Act was repealed in 1992, LFA
concessions, like TRP concessions, were provisionally ‘saved’ under Section 137 of the
new Forestry Act. The area covered by ‘current’ LFA concessions in 2011 was said to be
743,000 ha (GPNG 2012a). Like some of the old TRP concessions, some of these LFA
concessions are still yielding round log exports.
A large number of TRP and LFA concessions were approved by the forests minister during
the period between the passage of the new Forestry Act in 1991 and its certification in
1992. The new Act established a complex bureaucratic process by which the newly
established PNGFA would henceforth acquire forest management rights from customary
landowners under the terms of a Forest Management Agreement (FMA), and an equally
complex process by which it would allocate the timber harvesting rights to a logging
company by means of a Timber Permit. The process of acquisition and allocation was
spelled out more fully in the National Forestry Development Guidelines of 1993 (GPNG
1993). Among other things, the Guidelines required that an FMA should cover an area
containing at least 100,000 ha of ‘commercially manageable forest’ that could sustain an
annual harvest of 70,000 cubic metres (m3) of timber over a 35–40-year period if the logs
were going to be exported, or 30,000 m3 if they were going to be processed onshore. The
FMA itself should last for 50 years so that the forest has time to regenerate before a new
agreement and a second harvest can be contemplated. This was meant to be a guarantee
of ‘sustainable forest management.’ By 2011, there were said to be 34 FMAs covering 5
mha (GPNG 2012a). Some of these FMAs did not meet the criteria specified in the
Guidelines, and some have not yet been converted into logging concessions, while others
11

have been amalgamated to form the basis of a single concession that does meet the
criteria specified in the Guidelines.
Sections 87–89 of the new Forestry Act made provision for the grant of Timber
Authorities (TAs) for what were meant to be small-scale harvesting operations of limited
duration. These sections of the Act have been amended on several occasions, partly to
prevent this type of concession from being used as a loophole to evade the bureaucratic
complexities associated with FMA concessions (Bird et al. 2007a, 2007b; Scheyvens and
Lopez-Casero 2013). While TA concessions require the formal approval of the National
Forest Board (NFB), the process of negotiating agreements with the customary
landowners is left to Provincial Forest Management Committees (PFMCs). The PNGFA
does not maintain a systematic record of the number of TAs that have been issued, the
area that they cover, or even their location within each province. The TAs that formerly
covered some small forest plantation areas over the past decade, in apparent
contravention of the 1993 Guidelines.
It was amendments made to the Forestry Act in 2000 that introduced five new sections
(90A–E) that made provision for the grant of FCAs. These amendments were initially
meant to close the loopholes that had allowed TAs to be used for large-scale logging
operations, and they prescribed a bureaucratic process that was almost as complex as the
one associated with FMA concessions. However, further amendments made in 2005 and
2007 appear to have made it easier for logging companies to acquire this new type of
concession. By 2011, 18 FCAs had been issued by the NFB with a combined area of
879,000 ha (GPNG 2012a). To judge by the licence numbers in the SGS reports, more than
60 FCA concessions have been granted since 2007, and two-thirds of them have produced
some log exports while they have been operational. The periods for which they have been
granted vary from three to 25 years, but a period of 10 years is fairly typical. The licences
have occasionally been suspended, but some have been renewed and some licence areas
have been subdivided for the purpose of renewal. It is not clear whether the boundaries
of FCA concessions are included in the FRIMS database, but they have certainly not been
placed in the public domain. Like TA concessions, they may simply be regarded as areas
of forest that have been removed from the domain of sustainable forest management
(Turia 2020).
12

Figure 1 shows the volume of round log exports from each of the five types of commercial
logging concession since 2007. Here it can be seen that old TRP concessions still account
for a larger volume of exports than any of the other four types of concession. The recent
decline in the volume of exports from all concessions is partly due to the coronavirus
epidemic and partly due to recent changes in national government policy (Turia 2020;
Honey 2021).
Figure 1: Log export volumes (in cubic metres) by type of concession, 2007–2021
4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
-
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
TRP LFA FMA FCA TA
The SGS reports do not contain any information about the volume of the local timber
harvest that is processed onshore before being exported or used within PNG. Despite
government policies intended to promote local processing and reduce the volume of
round log exports, the number of commercial processing facilities appears to have
declined in step with the fall in log export volumes—from roughly 40 at the beginning of
2020 to 25 or even 20 at the end of 2021 (Bob Tate, personal communication, February
2022). Therefore, it seems that the proportion of the total log harvest that is consumed
by such facilities is still less than 10 per cent (Turia 2020). The Bank of PNG estimates
that processed forest product exports accounted for less than 3 per cent of the total value
of forest product exports in 2020 (BPNG 2021).
Under the terms of the Forestry Act, local landowners are not compensated for the
environmental damage caused by commercial logging operations in proportion to the
13

damage that is actually caused. Instead, they receive a range of benefits, the value of
which is calculated as a sum applied to each cubic metre of timber that is harvested. There
is a bewildering variety of benefit streams, some of which are specific to the development
agreements for individual concessions (Groome Poyry 1998; Turia 2020). There are two
main landowner benefit streams derived from all five types of concession. Timber royalty
rates are determined by the minister under Section 120 of the Forestry Act and are
distributed to the customary owners of the trees that have been harvested after
deduction of a 5 per cent withholding tax. There is some variation in the rates applied to
different tree species, but the average rate is currently about 23 PNG Kina (PGK) per cubic
metre. A second benefit stream known as the Project Development Benefit is determined
under Section 121 of the Act and is worth PGK 13/m3. This benefit stream is meant to be
divided into two parts, with 40 per cent being paid in cash to all the landowners in each
concession area and the rest being invested in the development of local infrastructure. In
FMA concessions, several additional levies with a combined value of PGK 25/m 3 are paid
to landowner representative bodies, including the management committees that are
responsible for the investments in local infrastructure (Ruth Turia, personal
communication, February 2022). It is not clear how many of these additional levies are
imposed on other types of logging concession. The distribution of benefits to
representative bodies, including area management committees and landowner
companies, has been a lasting bone of contention between different groups of landowners
in each concession area, with frequent accusations that the money has been
misappropriated. A recent ministerial decision to reduce the level of disputes by paying
the whole of the Project Development Benefit to landowners in cash has annoyed the
logging companies, as they have been charged with distributing these cash payments at
extra cost to themselves (Honey 2021).
2.3 Deforestation and forest degradation
Scientists have made several attempts to measure the extent and the quality of natural
forest cover in PNG since the country became independent in 1975 (Hammermaster and
Saunders 1995; McAlpine and Quigley 1998; Shearman et al. 2008; UNFAO 2014). The
figures are not directly comparable because different estimates have been based on
different definitions of what counts as a ‘forest’, as well as on different methods of
assessment (Filer et al. 2009). Current official estimates are based on the definition
14

adopted by the International Panel on Climate Change, which is itself subject to periodic
modification. An assessment of ‘forest and land use change’ from 2000 to 2015 has been
incorporated into the FRIMS database (Turia et al. 2019). This latest assessment was
supported by experts from the UN’s Food and Agriculture Organization operating under
the rubric of the UN-REDD program (GPNG 2019b; Turia et al. 2022).
According to this assessment, native forests covered about 35.9 mha, or 78 per cent of
the TLA, in 2015 (GPNG 2019a: 43). Plantation forests covered a very small area—less
than 50,000 ha—and have not been included in estimates of the rate of deforestation and
forest degradation (DFD). A total of 253,847 ha of native forest is said to have
disappeared between 2000 and 2015. This represents 0.7 per cent of the forested area
that had existed in 2000. More than 99 per cent of this former forest was supposedly
converted to ‘cropland’, and subsistence agriculture is said to have accounted for 64 per
cent of this loss (ibid.: 53). Of the forest that remained in 2015, about 2.4 mha (almost 7
per cent) is said to have been degraded or disturbed over the previous 15 years. Selective
logging operations are held responsible for 92 per cent of this degradation, while
subsistence agriculture is held responsible for most of the rest (ibid.: 56–8).
These figures need to be treated with caution. That is because the deforestation caused
by subsistence agriculture is normally a temporary, not a permanent, conversion of
‘forest’ to ‘cropland’. Most village farmers in PNG practice some form of swidden farming
in which forest clearance is followed by a period of regrowth or regeneration in which
the fallow vegetation turns back into forest before it is cleared again. A detailed field
survey undertaken in the late 1990s identified 287 of these indigenous agricultural
systems, using the fallow period and the type of fallow vegetation as two of the six criteria
that distinguished one system from another (Allen et al. 1995; 2002). The starting point
for this survey was an observation previously made by an earlier survey that the area of
land occupied or used by these systems at the time of independence was 10.9 mha, or
23.5 per cent of the TLA (Saunders 1993). The new field survey found that the area
occupied by these systems had barely changed between 1975 and 2000, so village
farmers had hardly begun to encroach on areas of primary forest that they had never
previously cleared to make their gardens (Allen and Bourke 2009). Instead, they found
that 50 per cent of the land used for shifting cultivation was left in fallow for periods of
more than 15 years, while another 43 per cent was fallowed for periods of 5–15 years,
15

and only 7 per cent was fallowed for less than 5 years (Allen et al. 2001). When the land
was left in fallow for more than 15 years, it typically turned into what they called a ‘tall
secondary forest’ before it was cleared and cultivated again.
To count each act of forest clearance by swidden farmers as an act of deforestation,

without considering the extent to which clearance is followed by forest regrowth, is
clearly to overestimate the net contribution that these farmers are making to the loss of
forest cover (Filer et al. 2009; Allen and Filer 2015; Bryan and Shearman 2015; USAID
2020; Tetra Tech 2020). In other countries, this kind of miscalculation has been used as
a pretext for the dispossession of swidden farmers and the suppression of their farming
systems (Cairns 2015). Such perverse outcomes are rarely possible in PNG because of the
primacy assigned to customary land rights. However, the miscalculation can lead to
pointless policies and programs designed to modify the behaviour of local villagers in
order to reduce the carbon dioxide emissions that are supposedly derived from
indigenous farming practices (GPNG 2017a). Swidden farming systems with forest
fallows are probably carbon-neutral, or even carbon-positive, over the full cycle of
clearance and regrowth, but studies of PNG’s carbon stocks and flows have not paid much
attention to this issue (Filer et al. 2009; Fox et al. 2010; Peck et al. 2017; Tetra Tech 2020).
This is not to deny that village agriculture has made some contribution to the process of
DFD since 1975, and it is quite likely that this contribution has accelerated with the rapid
growth of the rural village population. Village farmers may have taken advantage of the
degradation caused by selective logging operations in some areas of primary forest to
clear new gardens, and hence to expand the total area of agricultural land use. However,
they are more likely to have ‘intensified’ their farming systems in order to extract more
goods and services from the land already in use (Bourke 2001; McAlpine and Freyne
2001; Ningal et al. 2008). A reduction of the fallow period is one form of intensification.
The authors of the survey conducted in the 1990s estimated that 110,000 ha (or 1.6 per
cent) of the area covered by tall secondary forest was at risk of degradation (to the status
of low secondary forest) or deforestation (by conversion to scrub, cane grasses, or short
grasses) after the next round of cultivation. This area may well have increased over the
past 20 years, especially in parts of the country with high rural population densities and
relatively poor soil quality (Hanson et al. 2001). However, it is hard to measure the extent
of such changes by means of satellite imagery alone.
16

There is very little evidence of a significant expansion in the area that smallholders
planted with cash crops over the period from 2000 to 2015 (Bourke and Harwood 2009).
If it is true that the latest official figures tend to overestimate the contribution of village
agriculture to deforestation, then it must also be true that they have underestimated the
contribution made by the wholesale, permanent, or irreversible clearance of native
forests to make way for the large-scale agricultural schemes (mostly oil palm schemes)
known in PNG as ‘agroforestry projects’ (Nelson et al. 2014; Gabriel et al. 2017). The
official figures do indicate an increase in the rate of clearance for this purpose between
2010 and 2015 (Turia et al. 2019: 53), and this would no doubt have continued as more
FCAs have been issued by the PNGFA.
An assessment of different forms of forest degradation also requires a combination of

remote sensing techniques with observations at a local scale (Fox et al. 2011; Yosi et al.
2011; Testolin et al. 2016; Hoover et al. 2017; Kumne and Samanta 2019). Uncertainty
about the causes of degradation might explain why the same methods, applied to the
same dataset, are said to have shown that selective logging operations could be
responsible for 98 per cent or 92 per cent of the degradation that took place between
2000 and 2015 (GPNG 2017a; GPNG 2019b). In either case, it does seem reasonable to
attribute the bulk of PNG’s GHG emissions to this source, mainly because of the collateral
damage that they cause to native forests (Cameron and Vigus 1993; Fox et al. 2011; Yosi
et al. 2011; GPNG 2017a; Tetra Tech 2020). What is not so clear is the reason for
discounting the contribution made by the clearance of native forests for large-scale
agricultural projects. The problem here is that much of the area covered by FCAs issued
since 2007 appears to involve multiple forms of degradation and not just the substitution
of cash crops for native forest.
It is hard to establish the current trajectory of the DFD process because of the uncertainty
that surrounds the future of large-scale commercial logging concessions, including FCAs
(Raschio et al. 2016). The threat posed by the expansion of the national road network
may be exaggerated (Alamgir et al. 2019). While there are two provinces (West Sepik and
East New Britain) where new road construction has been linked to forest clearance for
new oil palm schemes, this sort of activity will not be sufficient to meet the target set in
the current Medium-Term Development Plan (GPNG 2018a) to increase the overall
length of the national road network from 8,700 kilometres (km) in 2016 to 12,000 km by
17

2022, let alone to meet the bigger targets set in the National Road Network Strategy
(GPNG 2018b). Other targets in the current national development plan appear to be
equally unrealistic, and even inconsistent with each other. One target anticipates a
reduction in the annual ‘primary forest depletion rate’ from 9 per cent in 2016 to 5 per
cent in 2022, coupled with an increase in the value of ‘forestry product exports’ from PGK
1,093 million to PGK 2,500 million, and an expansion of the protected area network from
4 per cent to 18 per cent of the TLA over the same period. International aid agencies have
been funding the maintenance of the existing road network for some time, and that is
because the rate at which existing roads fall into disrepair is generally higher than the
rate at which new ones can be built with government funding (Allen and Lowe 2006;
Slattery et al. 2018). Even in East New Britain, where the provincial government takes
pride in the fact that 292,000 ha of native forest have been cleared since PNG’s
independence and the protected area network only covers 8,000 ha, the total length of
the new roads built in partnership with logging companies is only 250 km (Scales 2010;
Walton 2019; Larme 2020). In 2021, the Australian government announced that it would
contribute PGK 190 million to what is now known as the Connect PNG Road Initiative, but
some of this money will also be spent on an upgrade of roads that already exist.
3 Actors, interests, and institutions
In a previous study of ‘policy that works for forests and people in PNG’, I argued that the
policy process should be conceived as a social drama featuring six groups of actors—
private companies, aid agencies, politicians, bureaucrats, non-governmental
organisations and local resource owners (Filer and Sekhran 1998: 7–8). I went on to
argue that foreign logging companies and foreign aid agencies were engaged in a struggle
to influence the behaviour of the other four groups of actors and hence to influence
decisions about the conservation or exploitation of PNG’s native forests. That was 25
years ago. My current inclination is to treat PNG’s politicians and bureaucrats as members
of a single group of state actors, not because they share a common set of interests but
because the contest between ministries and agencies now seems to be more salient than
the former contest between ministers and public servants.
In this section of the paper, I provide a brief summary of what I would now conceive to
be factors affecting the distribution of power and influence between five groups of actors
18

in the field of forest and land management, without assuming that any one of these five
groups has a common set of interests. My aim here is to establish the foundational
political factors at work in this field and the ‘rules of the game’ as it is currently being
played. In each case, I seek to identify the main actors in each group, the nature of their
interest in the field of forest management, the formal and informal institutions through
which they exercise their influence, and the way that these institutions are related to
customary land rights and local community dynamics. I conclude this section with some
brief remarks on the question of gender equality, or the lack of it, since it is all too easy to
assume that all the main actors in this policy space are men.
3.1 The private sector
There is no doubt that PNG has a resource-dependent economy, but one that is heavily
weighted towards the two extractive industry sectors. In the past three years, minerals
and hydrocarbons have accounted for 82 per cent of the total value of exports, whereas
round logs have accounted for just over 3 per cent (BPNG 2021). Contrast this with
neighbouring Solomon Islands, where round logs have accounted for almost two-thirds
of total export values over the same period. This means that forest industry actors have
played a far more significant role in shaping the political institutions of Solomon Islands
than they have played in PNG, despite the accusations levelled against foreign logging
companies in both countries.
3.1.1 Foreign investors in the forest industries
‘Forest industry participants’ are registered under Part IV of the Forestry Act. They
include all companies with licences to export round logs or processed forest products, all
applicants for commercial logging concessions (including FCAs), and any other persons
acting as their ‘agents’ or ‘consultants’. A list of these registered participants should be
available on the PNGFA website, but the website only provides advice about applications
for registration. Nearly all of the companies that export round logs or own substantial
processing facilities have foreign shareholders, although some include PNG citizens
among their directors. The extent of foreign ownership and control can be verified by
searching out a company’s name on the website of PNG’s Investment Promotion
Authority (IPA). Most of these companies are members of the industry peak body, the
19

Forest Industries Association (FIA), and a list of members can be found on the FIA
website.
There is a widespread public perception that the logging industry is dominated or

controlled by one Malaysian company, Rimbunan Hijau (RH). This perception is partly
due to the number of reports that have targeted this particular company when engaging
in criticism of the industry as a whole (Greenpeace 2004; CELCOR and ACF 2006; Winn
2012; Gabriel and Wood 2015; Mousseau 2015, 2018; Global Witness 2017, 2018, 2021;
Rewcastle-Brown 2020). However, the SGS reports show that the share of log exports
from PNG produced by RH and its subsidiaries has fallen from almost 29 per cent in 2011
to just 4 per cent in 2021, when the company suspended most of its logging operations in
PNG. Figure 2 displays the relative shares of round log exports by four prominent
exporting companies in PNG. Since no one has mapped the relationship between PNG’s
logging companies since the mid-1990s, substantial forensic work on the company
records would be required to paint a more complete picture than the one shown in Figure
2.
Figure 2: Per cent shares of round log exports by four prominent exporting
companies, 2011–2021
60.0
50.0
40.0
30.0
20.0
10.0
0.0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
RH group WTK affiliates Vanimo Jaya KK Connections
Although RH also operates some of the bigger timber processing facilities in PNG, it
suspended operations at two of these facilities in 2021 (Honey 2021). It is also true that
20

RH has employed Kanawi Pouru, who was managing director of the PNGFA from 2007 to
2015, and that may signify a greater capacity to influence decisions of the NFB (Pouru
2020). However, it has been evident for many years that RH, unlike other foreign logging
companies, has embarked on a long-term strategy to diversify its investment portfolio in
PNG (Filer 2010; Mousseau 2016, 2018; Rewcastle-Brown 2020). Its influence over the
decisions of the PNG government is therefore not so much due to its position as a
dominant player in the logging industry but to the fact that all its other investments in
several sectors of the national economy (such as media, retail, transport and property
development) have made it the largest private sector employer in PNG.
It is difficult to track the extent of overlap between the ownership of different logging
companies. The SGS reports identify subsidiary companies based on their postal
addresses and not through any forensic investigation of the company records held by the
IPA (Bruce Telfer, personal communication, October 2019). Even from the SGS reports, it
is evident that changes of ownership have been fairly common. Most companies (or
groups of companies) confine their operations to one or two of PNG’s 21 provinces, and
there is little evidence to indicate the existence of a broader cartel that binds them
together.
The logging industry has generally been unwilling to subscribe to international standards
of corporate social responsibility (CSR), such as certification by the Forest Stewardship
Council, because the round logs exported from PNG are nearly all destined for countries
where the consumers have no interest in the imposition of such standards, 3 and because
the exporting companies have no institutional shareholders with a corresponding
interest. The only exporters that currently seek to comply with specific CSR standards are
a handful of companies whose exports are sourced from plantations rather than from
native forests (Peter Dam, personal communication, February 2022).
SGS can be regarded as a foreign investor in PNG’s forestry sector, but it clearly occupies
a very particular role in the forest policy process. The nature of the company’s contract
with PNGFA means that it has an interest in the continuation of round log exports;
3China alone has consumed 86 per cent of PNG’s log exports over the past six years, while most of the
balance has been divided between Vietnam, India, South Korea, Japan, Taiwan and Malaysia.
21

otherwise it would be redundant. If the government were to terminate the contract, or if
the company were no longer able to make a financial return on its operations, a lot less
would be known about the log export business and more space would be created for
logging companies to evade the rules and regulations to which they are currently subject.
3.1.2 Other foreign investors
There are other foreign companies with major investments in PNG that have an interest
in forest management that puts them at odds with the logging industry. The most obvious
occupants of this space are the two long-established producers and exporters of palm oil,
New Britain Palm Oil Limited (NBPOL) and Hargy Oil Palms Limited (HOPL). NBPOL is a
subsidiary of Malaysian company Sime Darby, while HOPL is a subsidiary of Belgian
company SIPEF. NBPOL currently operates five different oil palm schemes across five
provinces, while HOPL only operates one scheme in West New Britain. Both companies
are members of the Roundtable on Sustainable Palm Oil, which means they are
committed to avoiding deforestation in the areas in which they operate. Most of the palm
oil that they produce is sold into the European market, which is why they are committed
to CSR standards. They have taken a rather dim view of the emergence of the new
generation of oil palm schemes developed under the cover of FCAs because of the threat
posed to their own corporate reputations as producers based in PNG (Filer 2012). Their
concerns would only have been amplified by recent evidence that palm oil from some of
these new schemes—including the one that is operated by RH in East New Britain
Province—has been finding its way into European supply chains (Global Witness 2021).
The other companies with a similar interest are located in the extractive industry sectors.
While most of these companies have adopted the performance standards of the
International Finance Corporation, their more specific interest is to demonstrate that
forests are not being unnecessarily damaged or destroyed by the extraction of minerals
or hydrocarbons. The operators of PNG’s existing oil and gas projects have been funding
forest conservation activities or biodiversity offset schemes in their development licence
areas since 1993. Mining companies have been less active in this space, mainly because
their licence areas are much smaller and their operations cause a lot more environmental
damage within these areas. Nevertheless, one foreign mining company (Barrick Niugini)
is listed as a partner in the current Global Environment Facility (GEF) project to improve
22

the financing of PNG’s protected area network. NBPOL is also listed as a partner in this
project.
3.1.3 Nationally owned companies
Logging companies appear to have fewer nationally owned companies in their supply
chains than foreign companies operating in the extractive industry sectors. Those
nationally owned companies that can be identified are mostly very small companies like
those engaged in the production of environmental impact statements or other reports
required by government regulations. Few appear to be involved in the supply of things
like catering, transport or security services. Some members of the FIA appear to be
nationally owned, but they mainly operate in the timber processing business, which is
also very small. If it were possible to access the list of forest industry participants
registered with the PNGFA, it would be possible to count the number of nationally owned
companies on the list and specify the nature of their business from the company records
kept by the IPA. There is at least one example of a nationally owned company operating
in partnership with one of the developers of the new oil palm schemes based on FCAs in
East New Britain (Global Witness 2021), but no survey has been undertaken to identify
the frequency of such partnerships across the forestry sector as a whole. The nationally
owned companies that have contractual relationships with logging companies are mostly
so-called landowner companies, whose position in the sector deserves separate
consideration because these companies purport to represent the interests of the resource
owners (see Section 3.3.2).
3.2 The public sector
Like many other countries, PNG is subject to a narrative of post-colonial decline in the
effectiveness of state institutions. While the institutions of parliamentary democracy
have proven to be quite resilient and public servants have continued to make additions
to a national legal and policy framework that looks fairly coherent, the capacity of
government agencies to turn policy into practice and maintain the delivery of public
goods and services has deteriorated over the past 30 years (May 2003, 2017; Pieper
2004; Reilly et al. 2015). Political parties consist of groups of individuals (nearly all male)
aligned behind leaders who jostle for power on the national political stage, government
23

ministers treat their departments as instruments for the accumulation of their own
political power, and some MPs have successfully sought to increase their own control
over the delivery of public goods and services to avoid the high chance that they will not
retain their seats at the next national election (Standish 2007; Filer et al. 2021). The
politicisation of the public service has therefore entailed a kind of bureaucratic
fragmentation in which it has become increasingly difficult for government agencies to
collaborate or function as coherent state actors in their own right.
3.2.1 The PNG Forest Authority
The current Forestry Act describes the PNGFA as a combination of two entities: the NFB,
which has oversight of its operation as a statutory authority, and the National Forest
Service (NFS), which consists of the public servants responsible for implementation. The
executive head of the NFS sits on the NFB as managing director and is appointed
(normally for a period four years) by the same bureaucratic process that is applied to the
appointment of the heads of other statutory bodies. The NFB has more influence over the
appointment process than the minister does, but the balance of power between the
minister and the managing director is inherently unstable, given the frequency with
which both are liable to be accused of corrupt or illegal behaviour.
Section 10 of the Act (as currently amended) prescribes the full membership of the NFB.
Two positions are reserved for the executive heads of two other national government
agencies: the Department of National Planning and Monitoring (DNPM) and the CEPA.
There two seats reserved for the presidents of the FIA and the Association of Foresters,
or their respective nominees. There is one member nominated directly by the minister
and another four who are appointed by the National Executive Council (NEC) acting on
advice from the minister. These four consist of one provincial administrator, a community
representative, a landowner representative, and a women’s representative. The
minister’s power to influence decisions of the NFB is mainly due to the fact that he has a
say in the appointment of half of the members. The NFB elects its chair from amongst the
members, but the managing director and the FIA representative are not allowed to
occupy this position. In 2021, the chairman was the minister’s nominee.
In 2007, the NFS had a staff of 464, of whom 130 were based in provincial forestry offices
(ITTO 2007). Staff numbers have probably declined since then as a result of budgetary
24

constraints.4 The Forestry Act was amended in 2019 to fund the operations of the NFS by
the imposition of a new management levy on the logging industry, but the amendment
was successfully challenged in court, so further legislation will be required to overcome
this obstacle. Provincial forestry officials provide support to PFMCs and are otherwise
responsible for monitoring the compliance of logging companies with national standards
of good practice (GPNG 1995a, 1995b), as well as project-specific permit conditions, and
ensuring that landowners receive the benefits to which they are entitled. The inability of
provincial officials to ensure the timely production of Provincial Forest Plans—at least in
some provinces—is the main reason why headquarters staff have only been able to
publish one edition of the National Forest Plan (GPNG 1996) since the new Act came into
effect (Filer and Sekhran 1998; Bird et al. 2007b). The Act requires the National Forest
Plan to be updated every five years to guarantee that the annual log harvest meets
specified criteria of sustainability (USAID 2020).
3.2.2 Other national government agencies
There are two other statutory authorities whose mandates clearly place them in the
forest policy domain: the CEPA and the CCDA. Both are accountable to the Minister for
Environment, Conservation and Climate Change.
The CEPA has two main branches. The conservation branch is concerned with the
maintenance and expansion of PNG’s protected area network and is therefore
responsible for the implementation of PNG’s Biodiversity Strategy and Action Plan (GPNG
2007a) and the subsequent Policy on Protected Areas (GPNG 2014a). This policy should
by now have been given a legal foundation through the passage of the Protected Areas Act,
but the passage of this legislation has been delayed by arguments about control of the
trust fund that is meant to finance the process of expansion (David Mitchell and Lester
Seri, personal communications, February 2022). This has made it impossible to establish
the complex institutional arrangements envisaged by the policy.
4 The relevant figures should be available in the agency’s latest corporate plan (GPNG 2021), but this is one
of the many documents that have not yet found their way onto the agency’s website.
25

The environmental branch of CEPA operates under the terms of the Environment Act
2000. It is concerned with the grant of Environment Permits (EPs) for large-scale
development projects that are likely to cause environmental damage, including the
‘agroforestry’ projects based on FCAs. The Environment Act prescribes a process of expert
evaluation before recommendations are made to the minister and requires that
environmental impact statements be placed in the public domain. However, staff of the
environmental branch treat impact statements like state secrets, which makes it hard to
determine whether these documents have been properly assessed and meet basic quality
standards. The staff in both branches of CEPA are almost entirely confined to
headquarters, which means that they have very little capacity to actually support the
management of protected areas or monitor the compliance of forestry projects with
conditions laid down in the EPs. This latter task has sometimes been assumed by
provincial forestry officials who are much closer to the scene of the action (ITTO 2007).
The CCDA was established under the terms of the Climate Change (Management) Act
2015, but previously operated as an ‘office’ within the same ministry. It is the agency
through which the PNG government reports to the UN Framework Convention on Climate
Change. It has a broad mandate for activities relating to both mitigation and adaptation,
but one of its branches is specifically responsible for REDD policies, programs, and
projects. This branch has produced several policies and guidelines, including the REDD+
Project Guidelines (GPNG 2012b) and the National REDD+ Strategy (GPNG 2017a). This
last strategy was developed with support from the same group of foreign experts who
helped the PNGFA to measure the rate of DFD between 2000 and 2015 (GPNG 2019b), so
it also holds village farmers responsible for more than 60 per cent of the deforestation
that took place during that period.
While staff in this branch of CCDA, like those in the conservation branch of CEPA, have
devoted a lot of time and energy to the production of policy documents, they also share a
lack of capacity to negotiate with landowning communities, or even with subnational
levels of government. Thus, while the legal and policy framework does make provision
for CCDA to impose its own levies on commercial logging concessions, establish a trust
fund from which benefits can be distributed, and authorise new REDD projects that might
even be financed from the voluntary carbon market, no REDD project agreements had
actually been finalised and implemented by the end of 2021. In recent years, three project
26

proposals have been submitted to the Voluntary Carbon Standard (EP Carbon 2020;
FORCERT 2021; KMS 2021). One of them (the NIHT REDD+ Topaiyo Project) has been
formally accepted and even subject to a memorandum of agreement between the
proponents and the New Ireland Provincial Government, despite arguments about the
degree of landowner consent (Gavara-Nanu 2020; Lang 2020; Philip 2022). However, in
March 2022, Minister Wera Mori announced a moratorium on voluntary projects,
insisting that all carbon offset payments should be channelled through the national
government’s trust accounts (Mori 2022). However, this does not seem to have
discouraged the formulation of additional project proposals that may or may not have
been approved by the CCDA.
Other national government agencies have a more tangential relationship to the forest
policy process. The DNPM has a seat on the NFB because it is responsible for ensuring
that sectoral plans and strategies, as well as donor-funded programs and projects, are
consistent with the national plans and strategies for which it is itself responsible. The
DNPM is also responsible for monitoring PNG’s compliance with the UN’s Sustainable
Development Goals, which include commitments to sustainable forest management and
climate change mitigation.
The Department of Agriculture and Livestock (DAL) is required to approve agricultural

development proposals that entail the grant of FCAs by the NFB. Provincial agricultural
officials are expected to conduct the ‘public hearings’ that secure landowner consent to
these proposals; however, these provincial officials are not employed by the national
department and the DAL has no proven capacity to evaluate the financial and technical
feasibility of the proposals that it is expected to approve, so it just functions as a rubber
stamp.
The DLPP has a branch responsible for the registration of incorporated land groups
(ILGs) and another branch responsible for the registration of land titles, including any
titles awarded to these groups. The capacity of the DLPP to vet the authenticity of these
applications does not seem to have improved since the behaviour of its officials was
subject to critical scrutiny by the judicial inquiry into SABLs (Filer 2019). That is partly
because land administration, like agricultural extension, is a function shared between the
27

national government and different provincial governments, so officials at the national
level have very limited contact with local communities.
The DLPP has another branch that operates under the terms of the Physical Planning Act
1989 and is therefore responsible for the implementation of the National Sustainable
Land Use Policy (NSLUP). This is currently the only part of the national legal and policy
framework that makes provision for the design and implementation of integrated land
use plans in different parts of the country, and these plans could, in theory, allocate
different areas to different ‘development options’ such as ‘timber production, climate
change and carbon trade, conservation areas, and agriculture development activities’
(GPNG 2014b: 8). The latest iteration of the NSLUP pays homage to a number of other
recent government policy statements that relate to this kind of choice (GPNG 2022).
However, this kind of integration requires the existence of Physical Planning Boards at
the subnational level. These entities do not exist in many provinces or districts and,
where they do exist, they have mainly concerned themselves with town planning. In its
earlier version, the policy was mainly concerned with the ‘mobilisation’ of customary
land for urban development, which places it squarely in the domain of land policy rather
than forest policy, and it is not clear how the latest version might have any effect on the
way that commercial logging concessions are granted, or the way that protected areas are
established, in different parts of the country.
There is a variety of other national government agencies that are responsible for
regulating various aspects of the forest industry, but only because they have a wider
responsibility for the regulation of all forms of foreign investment or all sectors of the
national economy. The country’s judicial system, including the independent Ombudsman
Commission, deals with numerous disputes and complaints about the behaviour of
different actors in the forest sector as part of its wider remit.
3.2.3 Provincial, district, and local authorities
The powers and responsibilities of provincial governments (PGs) and local-level

governments (LLGs) are set out in the Organic Law on Provincial Governments and Local-
Level Governments (OLPGLLG), which was originally passed in 1995 but has since been
amended many times. Provinces contain a variable number of districts: Manus has only
28

one, whereas Morobe has nine. The OLPGLLG originally said that there should not be
more than three rural LLGs in any one district, but some districts now have more.
Section 98 of the OLPGLLG requires the developers of natural resources to pay

‘development levies’ to PGs and LLGs. The PG hosting a concession currently receives PGK
2/m3 while the LLGs (of which there may be more than one) share receipt of the same
amount. The value of these benefit streams is much smaller than the value of the benefits
obtained by the landowners in each concession, which means that PGs and LLGs do not
have a significant financial interest in the continuation of logging operations.
Section 42 of the OLPGLLG says that PGs can pass their own laws about ‘forestry and
agroforestry’, but these laws have to be consistent with national legislation, and since the
Forestry Act is so prescriptive, they do not have much room in which to move (Bird et al.
2007b). Section 44 allows LLGs to make their own by-laws about the ‘local environment’,
subject to the approval of the minister for inter-governmental affairs, and this could be
taken to mean that they have the power to legislate for new protected areas. However,
the latest Policy on Protected Areas (GPNG 2014a) promises to reserve this power for the
national government.
Section 115 of the OLPGLLG requires a process of consultation between the national
government and the relevant PGs and LLGs about the development of natural resources
and requires all three levels of government to consult with the relevant landowners. In
the forestry sector, the PFMC functions as the vehicle for such consultation. Each PFMC is
meant to be chaired by a senior officer of the relevant PG. Its other members include an
officer of the NFS, the president of an LLG affected by commercial logging operations, a
civil society representative, and two landowner representatives. Two additional
landowner representatives from a forest area under consideration for grant or renewal
of a concession are entitled to attend the relevant PFMC meeting but not to vote. It is not
clear how they are selected.
The relevant sections of the Forestry Act treat PFMCs as sub-committees of the NFB, and
there is some uncertainty about the power of the NFB to control or ignore their decisions.
Aside from deliberating on the allocation of logging concessions, PFMCs are meant to play
a role in the distribution of landowner benefits, the resolution of landowner disputes, and
the provision of advice to PGs on the production of Provincial Forest Plans. The capacity
29

of PFMCs to perform the functions assigned to them appears to vary a great deal from one
province to another. This is partly a function of variation in the intensity of logging
operations, as measured by dividing the volume of round log exports by the surface area
of the province (see Table 2). However, it is also a function of variation in the overall
quality of provincial administration.
Table 2: Distribution of round log exports between regions and provinces, 2019–
2021
Region Province Exports (m3) TLA (km2) Intensity
Southern Western 700,560 98,189 7.1
Southern Gulf 221,656 34,472 6.4
Southern Central 585,176 29,998 19.5
Southern Milne Bay 205,293 14,345 14.3
Southern Oro 160,589 22,735 7.1
Highlands (Seven provinces) 0 63,657 0.0
Momase Morobe 492,873 33,705 14.6
Momase Madang 299,748 28,886 10.4
Momase East Sepik 276,033 43,426 6.4
Momase West Sepik 1,426,259 35,820 39.8
Islands Manus 54,181 2,000 27.1
Islands New Ireland 1,360,154 9,557 142.3
Islands East New Britain 1,719,971 15,274 112.6
Islands West New Britain 1,959,278 20,387 96.1
Islands Bougainville 0 9,384 0.0
Aside from their representation on PFMCs, LLGs play a marginal role in forest
management decisions. Under Section 235 of the 1998 Forestry Regulations, landowners
have the option to nominate an LLG to manage the distribution of timber royalties and
other landowner benefits from logging concessions, but there is no known case in which
they have done so (Bird et al. 2007b). This is hardly surprising when the boundaries of
forestry concessions and their component logging coupes bear no relationship to the
boundaries of LLGs and their component council wards. The perception that local
government has been the weakest of the three main tiers of government in PNG
30

throughout the period since Independence has recently led to calls from some MPs and
senior public servants for LLGs to be abolished altogether (see Section 4.4).
These suggestions have partly been prompted by the passage of the District Development
Authority Act 2014. This legislation was meant to place more power in the hands of
district-level (‘open’) MPs who already wielded considerable power over the LLGs in
their respective electorates (Walton 2019). The actual powers and responsibilities of
District Development Authorities (DDAs) are still a matter of debate, partly because
national ministers can decide whether to delegate some of their own powers and
responsibilities to the MPs who control them (Reilly et al. 2015; Duncan et al. 2017).
However, the open MPs and their DDAs have an independent source of income in the form
of an annual allocation of PGK 10 million through the District Services Improvement
Program. DDAs should also be the recipients of the Log Export Development Levy (LEDL),
worth PGK 13/m3, which means that local MPs have a greater financial interest in the
continuation of log export operations than do PGs or LLGs. However, the distribution of
these funds, like the distribution of some landowner benefits, has been shrouded in
controversy for many years, and it is not clear what MPs actually do with the LEDL money
if they can get their hands on it.
The District Development Plans for which DDAs are responsible can include plans for
road construction or other forms of infrastructural development, but cannot currently
include any forest management plans. Indeed, the Forestry Act currently provides no
formal role for open MPs in the resource acquisition and allocation process. This means
that they can only influence this process informally through their personal relationships
with the forests minister, members of the NFB, or members of the relevant PFMC.
Most open MPs have no vested interest in the logging industry for the simple reason that
there are no commercial logging concessions in their electorates. There are currently only
25 out of a total of 85 partially rural districts that contain active concessions, and only 15
or so where these concessions count as a significant component of the local economy. The
forests minister may or may not be one of the MPs who does have this kind of vested
interest, but the absence of a vested interest has not proven to be a guarantee of better
ministerial decision-making.
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3.3 Landowning communities
Members of PNG’s educated elite are commonly inclined to treat all of PNG’s rural or
village communities as if they were fundamentally similar, partly because of their shared
experience of colonial rule and partly because of a desire to foster a sense of national
identity (Jacobsen 1995; Otto 1997). The assumption of a fundamental similarity also
makes it easier for policy-makers to imagine that rural development policies will be
equally effective in all parts of the country. This assumption is linked to the ‘ideology of
landownership’ that posits the existence of a single kind of customary group that is also
a group of customary landowners (Filer 1997, 2014). However, this legal fiction or
figment of the national imagination is belied by an enormous range of variation in the
livelihoods and practices of the people who actually live in what were traditionally
several thousand autonomous political communities, and whose separate identities are
still salient features of the country’s political system. It is therefore impossible to say that
landowning communities share a common interest, except perhaps in their desire for
some form of ‘development’—whatever that might mean. Nevertheless, the articulation
of their different interests is still mediated by several common institutions that have been
established for this purpose.
3.3.1 Incorporated land groups
National policy-makers have been inclined to regard ILGs as customary groups

(sometimes called ‘clans’) with a clearly defined membership and with customary rights
over a relatively small area of land (no more than a few hundred hectares) (GPNG 2008).
This means that their territories would not normally be expected to range beyond the
boundaries of one of PNG’s rural council wards, of which there are approximately 6,200.
However, some of the ILGs registered under the current legislation have been claiming
ownership of much larger areas, and some of these claims have been accepted by the
DLPP (Filer 2019).
A process of land group incorporation has only been required (or strongly
recommended) as a mechanism of landowner consent to FMAs and not to the agreements
that underpin other types of commercial logging concession. Once the new Forestry Act
had come into effect and the PNGFA had been established, officials in the NFS were
32

trained in the practice of land group incorporation by consultants working on the Forest
Management and Planning Project, which was funded by the World Bank between 1993
and 1998 as part of the wider program of forest policy reform (FMPP 1995; Power 1995).
About 5,000 ILGs were registered to sign FMAs between 1995 and 2010 (Filer 2019). A
much smaller number of ILGs have been registered in other types of concession areas,
but it is hard to identify and count them based on the application notices published in the
National Gazette. ILGs still function as vehicles for the distribution of royalties and other
landowner benefits in some of the FMA concession areas, but it is hard to tell how many
have remained active since they were first incorporated because NFS field staff have not
been able to monitor their activities or deal with disputes about their membership (Bird
et al. 2007b).
The amendments to the Land Groups Incorporation Act that came into effect in 2012
include several provisions that were meant to improve the level of transparency and
accountability in the management of ILGs. All the ILGs that had been incorporated under
the previous version of the Act were initially given five years in which to reincorporate
themselves under the amended legislation—otherwise, they would be deregistered.
Since very few of them did so, the lands minister granted them another five years in which
to comply with this directive. This could mean that hundreds of ILGs in logging concession
areas will lose their legal identities before the end of 2022. NFS staff have not been
directed to revisit and reincorporate these groups, nor would they now have the capacity
and resources to undertake such a task. Knowing this to be the case, they advised the land
group executives to make their own arrangements (Ruth Turia and Andrew Aopo,
personal communications, October 2019), but this advice has only been followed in one
or two concessions where the logging companies were prepared to provide assistance.
The formation of ILGs is treated as an option, but not a requirement, for landowners to
grant consent to FCA concessions under the terms of the Forestry Act, and it is treated in
the same way in the REDD+ Project Guidelines (GPNG 2012b). ILGs, however, are not
mentioned at all in the Policy on Protected Areas (GPNG 2014a), despite the complexity
of the institutional arrangements envisaged in that policy.
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3.3.2 Landowner companies and business groups
The Companies Act does not contain a clear legal definition of what counts as a landowner
company, but their existence is recognised in some of PNG’s sectoral policy frameworks,
including the Forestry Act and its associated regulations. Some of them have ILGs as their
shareholders, while others have individual shareholders who claim to be acting as
trustees for the landowners in a particular area. In the mining and petroleum sectors,
landowner companies proliferate in a competition to supply specific goods and services
to foreign investors. In the forestry sector, they have tended to play a more limited role,
primarily as the collectors of resource rents from logging concessions (Filer 2014). Their
performance in this regard has been subject to a good deal of criticism since the judicial
inquiry that led to the forest policy reforms of the 1990s (Barnett 1992; Whimp 1995;
Holzknecht 1998; Bird et al. 2007b).
Those reforms were partly intended to limit the capacity of landowner company directors
to betray the interests of the landowners they claimed to represent through their ‘private
dealings’ with predatory logging companies, which is why the Forestry Act requires that
ILGs, not landowner companies, should be the entities that grant consent to FMAs.
However, the judicial inquiry into SABLs found that they had regained some of their
capacity to betray these interests through the negotiation of faulty sublease agreements
with the developers of so-called agroforestry projects (Mirou 2013; Numapo 2013). This
inquiry also found that SABLs were sometimes being issued to landowner companies that
did not represent all of the landowners in the area covered by the lease, and that other
groups of landowners in the same area were represented by other landowner companies
allied with other potential developers.
Under the current Forestry Act, landowner companies can also play a role in the
distribution of royalty payments if landowners nominate them as representative bodies
under Section 235 of the Forestry Regulations (Bird et al. 2007b). This may be one reason
for the apparent lack of interest in the reincorporation of ILGs in some FMA concession
areas. In areas where landowner companies do play this role, officers of the NFS do not
appear to monitor their compliance with the government’s registration and reporting
standards before making the payments (IFRT 2004). Experience from other economic
sectors suggests that landowner companies are not likely to improve their performance
34

without substantial assistance from a larger corporate partner with which they have an
ongoing contractual relationship. However, even in these cases, the experience has been
mixed and is not well documented.
Customary landowners can also conduct business under the terms of the Business Groups
Incorporation Act 1974. This act was designed to complement the Land Groups
Incorporation Act by providing a simple legal mechanism by which registered ILGs or
other ‘customary groups’ could carry on a business without being subject to government
supervision through the reporting provisions of the Companies Act. A business group can
do nearly all the things that any private company can do, like dealing in alienated land
titles or entering into contracts with foreign investors, but it cannot distribute profits to
anyone who is not an automatic citizen. Thousands of business groups have been
registered with the IPA, but most have had a limited lifespan. In the forest sector, they are
most likely to be family businesses that operate small-scale eco-forestry enterprises (as
the holders of TAs) or small-scale eco-tourism enterprises.
3.3.3 Landowner associations and community-based organisations
As in the case of the Companies Act, there is nothing in the Associations Incorporation Act
that allows for a clear legal distinction between a landowner association and any other
kind of local association or community-based organisation. The difference can only be
inferred from the stated purpose or object of the association when it is registered with
the IPA. In general terms, the Act requires that an association be formed for ‘promoting
objects useful to the community’, that it must apply its revenues to the pursuit of these
goals, and that it cannot pay dividends to its members (Whimp 1995).
Community-based organisations with an environmental interest that pitches them either

in opposition to foreign logging companies or in support of biodiversity conservation
projects do not represent the full spectrum of landowner associations, even in areas
allocated to large-scale commercial logging concessions. Some landowner associations
are allied with the landowner companies that collect and distribute the resource rents
derived from these concessions. Like landowner companies, landowner associations are
also liable to engage in competition for the support of any external organisations that take
an interest in the exploitation, management, or conservation of native forests. One of the
reasons why government officials are reluctant to get involved in the business of
35

arbitrating these competing claims is because they are commonly seen as part of the
political contest for votes in national elections, and this means that sitting MPs will
eventually decide in favour of their own supporters. Given the high proportion of MPs
who lose their seats at each national election, it makes sense for public servants to hedge
their bets on the question of local representation.
3.4 National civil society
National civil society actors in the forest sector are primarily united by their hostility to
the logging industry and a belief that this industry has been responsible for the
corruption of state institutions, especially the PNGFA. Otherwise, they are something of a
mixed bunch (Babon et al. 2014). They include national non-governmental organisations
(NGOs), such as Partners with Melanesians or the Centre for Environmental Law and
Community Rights, which advocate for the rights of local landowners or lend material
support to landowners attempting to establish new protected areas. They also include
the local branches of international NGOs (such as Transparency International), when
these operate with relative autonomy from their foreign headquarters, and individual
Papua New Guineans employed by international environmental NGOs (such as the
Wildlife Conservation Society) whose local branches have less in the way of local
autonomy. They even include some registered companies, which may or may not be in
the business of making a profit and hence liable to income tax, since ‘not-for-profits’ have
no special status under the Companies Act. They also include some of the mainstream
churches, although church engagement in the forest policy process mainly takes place at
a provincial level in provinces with a high level of logging intensity (see Table 2).
Attempts have previously been made to establish a peak body that would represent a
number of these civil society actors and therefore claim a right to represent them on the
NFB or on PFMCs. The first of these was the National Alliance of Non-Government
Organisations, which was established as part of the forest policy reform process in the
1990s (Mayers and Peutalo 1995). Its successor was the Eco-Forestry Forum, whose
name designated the more specific nature of its interests. For many years, there was no
such body; instead, a convening role was sometimes assumed by the Institute of National
Affairs, which is essentially a civil society think-tank.
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Several civil society actors attended the Forestry Summit convened by the PNGFA in
October 2019, where they were treated as a distinctive group of stakeholders and
encouraged to articulate their own ‘position statement’ in response to the government’s
proposal to implement a log export ban (GPNG 2020). This position statement was
expanded at a separate civil society workshop convened in August 2021, which was not
simply concerned with the banning of log exports but also with other aspects of national
forest policy that were under consideration in a wholesale review of the Forestry Act
(Mitchell and Sangga 2021). Among other things, the new position statement called for
the establishment of a new peak body to be known as the PNG Environmental Alliance.
This was registered as an association in 2022.
3.5 The donor community
The UN Development Programme has functioned as a sort of peak body for donor
interventions in PNG’s forest sector over the past decade because it has been the
implementing agency for the national UN-REDD Program, which was initiated in 2011,
and for a sequence of biodiversity conservation projects partially funded by the Global
Environment Facility (GEF).
The UN-REDD Program was initially meant to last three years, but its lifespan was
extended by contributions from various bilateral and multilateral donors, so it continued
until 2021. Some components of the program, like the production of the National REDD+
Strategy and the assessment of forest and land use change, have been completed (GPNG
2017a, 2019b). Others, like the production of a new National Forest Inventory, are still
incomplete because the external funding (in this case from the European Union) proved
to be insufficient when the government failed to make its own contribution (Turia et al.
2022). The review of the Forestry Act was also initiated under the mandate of the UN-
REDD Program and funded by the Forest Carbon Partnership Facility, and does appear to
have been completed—at least to the extent that drafting instructions have been
prepared for submission to the NEC. Establishment of the new FRIMS database was
funded directly by the Japanese aid program (Turia et al. 2019, but was meant to be an
integral part of this package of reforms.
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While projects in the UN-REDD Program have mainly been intended to strengthen the
relevant branches of the PNGFA and the CCDA, the three projects funded by the GEF
(known locally as GEF 4, 5 and 6) have been directed toward the conservation branch of
CEPA and other actors engaged in the development of PNG’s protected area network. The
current project (GEF 6) was initiated in 2019 and is meant to last for seven years. It
intends to establish new institutional mechanisms to finance the expansion of the
protected area network but has been somewhat constrained by arguments about the
control of the trust fund envisaged in the Protected Areas Bill. The project is co-financed
by the Australian aid program and the Forest Carbon Partnership Facility, as well as some
private sector and civil society organisations.
The principal US aid agency (USAID) has funded three initiatives in the forest policy
space. The first, known as the Lukautim Graun (or ‘Caring for Country’) Program (LGP),
was initiated in 2019. The second, currently known as the Sustainable Landscapes
Activity (SLA), is due to commence towards the end of 2022. The third is directed towards
the empowerment of women in the forestry sector, but is still in the design stage and is
unlikely to commence until 2023. The relationship between the LGP and the SLA is not
unlike the relationship between the projects funded by the GEF and the UN-REDD
Program. The overall aim of the LGP is ‘to create an environment and facilitate
mechanisms through which communities, the private sector, and government work in
partnership for the common goals of conservation and sustainable development; in
which customary owners have the skills, knowledge, and incentives to sustainably
manage their lands to reduce the threats to biodiversity; and each level of government
has the capacity and political will to create an enabling environment supporting
biodiversity conservation’. The overall aim of the SLA is to ‘improve forest governance;
increase the environmental sustainability of the forest industry; and protect the land and
resource rights of communities to reduce GHGs, enhance carbon sequestration, and
increase the sustainability of [natural resource management]’.
The LGP’s presence in the forest policy space is evident from the fact that it sponsored
the civil society workshop held in August 2021 (Mitchell and Sangga 2021). One of the
participants in that workshop was a representative from the US Forest Service, which has
been designing its own Forest Governance, Transparency, and Capacity-Building Project
for PNG as part of the overall program of American aid to PNG. This project is mainly
38

intended to strengthen community-level institutions and improve the quality of
environmental monitoring in large-scale logging concessions.
Other bilateral aid agencies are currently making their own interventions in PNG’s forest
sector. The Japanese aid agency has recently begun to implement a project that aims to
strengthen the application of PNG’s Logging Code of Practice (GPNG 1995a) in order to
reduce the volume of GHG emissions from the process of forest degradation. The British
aid agency has funded the construction of a ‘forest-sector economic, social, and
environmental diagnostic model’ for PNG under the terms of the UK’s Forest Governance
Markets and Climate Program. The Australian aid program has identified PNG as a key
partner in the expansion of what it calls the Indo-Pacific Carbon Offsets Scheme, but it is
not yet clear how money allocated to this scheme might actually be spent in PNG. The
European Union’s ambassador to PNG announced a substantial new round of grant
funding for ‘forestry, climate change and biodiversity’ programs in April 2022 (Anon
2022a), but further details have yet to be revealed.
It should be noted that a good deal of the donor funding that finds its way into PNG’s
forest sector is channelled through international and national NGOs and does not involve
any formal partnership with government institutions like the PNGFA, CCDA, or CEPA. No
attempt is here made to identify the sources or the amounts of such additional funding.
3.6 Gender inequality
The logging industry employs between 8,000 and 9,000 workers, nearly all of whom are
men. This makes it the most masculine industry in the national economy. Even the
extractive industries have been making significant efforts to recruit and promote more
female employees, but the logging industry has not followed suit. Women do occupy
senior positions in the government agencies that are directly involved in forest
management, including the PNGFA, but none has ever been appointed to the top position
in any of these agencies. There are also numerous women amongst the civil society actors
engaged with the forest sector, but women’s organisations do not feature as collective
actors in this space. The statutory requirement for the NFB to include one women’s
representative is not matched in the membership of PFMCs. Under the current legislation,
39

two of the ten executive members of a newly registered ILG must be women. No
assessment has been made of their influence over group decisions.
At the community level, evidence for the gendered impact of large-scale logging
operations in PNG is almost entirely anecdotal. The cutting of trees is traditionally
regarded as a man’s job, so men are inclined to regard the benefits derived from
commercial logging concessions as a masculine form of income. What this means, in
practice, is that men are liable to control most of these benefits while women bear most
of the environmental costs. A recent study of this issue in the neighbouring Solomon
Islands reached conclusions that are probably valid for PNG as well: ‘By structurally
excluding women and girls from decision-making and benefit-sharing, by undermining
subsistence livelihoods, and by facilitating excessive alcohol consumption and sexual
exploitation, the logging sector increases already alarming gender disparities’ (Minter
2021: 6). It is sometimes argued that these negative impacts are not so severe in
matrilineal societies because women in these societies ‘own the land’. But matrilineal
inheritance does not appear to reduce the control that men exercise over the distribution
of land or the revenues derived from the exploitation of natural resources, either in
Solomon Islands or in PNG (Macintyre 2003; Maetala 2008). A study of gender inequality
in PNG logging concession areas that was commissioned by the World Bank (but has
apparently been lost) found that women are more likely to take leadership roles in ILGs,
landowner companies, or landowner associations when they are not living in their own
natal communities but have married into other communities where they may not even be
regarded as ‘landowners’ (Ruth Turia, personal communication, February 2022).
In a broader sense, gender inequality remains a striking feature of PNG’s entire political
system and therefore constrains the ability of women to exert much influence over any
national policy domain. There were no women amongst the 111 members of the last
national parliament and only two have been elected to what will now be 118 seats in the
new national parliament. The creation of ‘reserved seats’ for women has been a matter of
political debate for several years, but it has never been possible to assemble a majority of
male MPs to vote for the necessary legislation. When women have occasionally been
elected to parliament in the past, the only ministry to which they have normally been
appointed is the one responsible for ‘community affairs’, which is held to encompass
40

‘women’s affairs’. Only one woman has ever been appointed to a senior ministry, and that
was more than 40 years ago.
4 Power dynamics in the field of forest policy
Twenty-five years ago, I suggested that the actors or characters in the forest policy
process could exercise four different types of power in order to influence the direction of
this process. These were distinguished as capacities to secure the sympathy and support
of other actors, to extract resources or concessions from them, to meet their needs and
demands, or to control their productive activities (Filer and Sekhran 1998: 325–6). I do
not propose to revisit the question of typology at this juncture. Instead, I adopt a historical
lens in order to outline some broad ways in which the power dynamics in this sector have
changed over the past 30 years. I aim to consider which specific changes to the legal and
policy framework reflect changes in this balance of power and what was gained and what
was lost in each of the main periods in the history of national policy reform. In doing so,
I shall briefly consider the lessons that can be learned from the success or failure of
previous efforts to improve the quality of forest management and what recent changes to
the legal and policy framework tell us about the current direction in which the policy
process is moving. The key milestones in this history are shown in Table 3.
4.1 The donor-funded reform process, 1990–2002
The starting point for the donor-funded reform process of the 1990s was the Tropical
Forest Action Plan Roundtable convened by the World Bank and the PNG government in
1990 (World Bank 1990). The government had specifically asked the World Bank to help
design the reform process in response to the findings of a judicial inquiry into corrupt
practices in the forestry sector (Barnett 1992). Many of the institutional changes made as
part of this process, including the provisions of the new Forestry Act, were intended to
implement the recommendations of this inquiry, and many were prefigured in the
National Forest Policy that was primarily drafted by national actors, including some who
represented the forest industry at the time (GPNG 1991).
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Table 3: National forest policy milestones
Year Milestone
1990 Tropical Forest Action Plan Roundtable
1991 National Forest Policy
1991 National Forestry and Conservation Action Program initiated
1991 Forestry Act passed
1992 Forestry Act certified
1993 PNG Forest Authority established
1993 Forestry Act amended on advice from World Bank
1993 National Forestry Development Guidelines
1995 Logging Code of Practice
1996 National Forest Plan
1998 Forestry Regulations
2000 Forestry and Conservation Project initiated
2000 Independent Forestry Review Team established
2003 Forestry and Conservation Project suspended
2005 Forestry and Conservation Project cancelled
2005 Coalition for Rainforest Nations established
2005 Forestry Act amended
2007 National Biodiversity Strategy and Action Plan
2007 Forestry (Timber Permits Validation) Act passed
2009 National Forestry Development Guidelines revised
2011 UN-REDD Program initiated
2012 National REDD+ Project Guidelines
2012 National Forest Plan revised in draft form
2014 National Strategy for Responsible Sustainable Development
2014 National Policy on Protected Areas
2015 Climate Change (Management) Act
2017 National REDD+ Strategy
2019 National Forestry Summit
2020 Logging Code of Practice revised
2020 National Downstream Processing Strategies for Forest Produce
2020 National Reforestation and Afforestation Strategies
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The World Bank played an active role in persuading other members of the donor
community to make specific contributions to what came to be known as the National
Forestry and Conservation Action Program. The UN Development Programme also
played a coordinating role, especially on the conservation side of the program, which had
a particular focus on the design and implementation of integrated conservation and
development projects. There have been numerous reviews of the National Forestry and
Conservation Action Program and its various component projects that do not need to be
cited here. The key point about the power dynamics of the reform process is that the
process soon turned into a struggle between the donor community (led by the Bank) and
the logging industry (then led by RH) to influence the behaviour of the relevant state
actors by demonstrating their capacity to protect or advance the interests of local
landowning communities.
As other members of the donor community completed their projects and departed the
scene of the action, the World Bank became more reliant on its alliance with national and
international environmental NGOs, which the logging industry regarded as an unholy
alliance of actors opposed to the country’s economic interests (ITS Global 2006a). But
this was not a very reliable alliance, because some civil society actors accused the World
Bank of planning to attack customary land rights through its support for a parallel
process of land policy reform that had little or nothing to do with the forest policy process
(Lakau 1997; Filer et al. 2000).
The power of the World Bank during this period was exercised through its leverage over
the government’s finances. This involved the attachment of forest policy conditions to a
pair of structural adjustment loans, the first in 1995 and the second in 2000. The trouble
with these instruments of conditionality is that they required a level of ‘borrower
ownership’ that would last beyond the point at which the second tranche of an
adjustment loan had been delivered to the government. The conditions attached to the
first loan (known as the Economic Recovery Program Loan) did indeed prevent the
government from unwinding some of the reforms that had already been put in place,
especially those embedded in the legislation (Dubash and Filer 2000; Filer et al. 2000).
The conditions attached to the second loan (known as the Governance Promotion
Adjustment Loan) included an agreement to borrow additional money from the World
Bank for something called the Forestry and Conservation Project (FCP), and that
43

agreement was itself a condition for the release of GEF money to a trust fund that would
finance the consolidation and expansion of the protected area network. The government
of Mekere Morauta (2000–2002) accepted these conditions, but the next government, led
by Michael Somare, could not see the point of borrowing more money to constrain a
logging industry that made a substantial contribution to government revenues and it was
not particularly bothered by the loss of GEF funds that would have financed the activities
of national NGOs whose members simply wanted the industry to disappear (Filer 2004;
Bird et al. 2007a). The FCP was suspended in 2003 and finally cancelled in 2005.
4.2 The reassertion of national sovereignty, 2002–2011
While the cancellation of the FCP might be taken as a sign that the World Bank had lost
its battle with the logging industry, this does not necessarily mean that the logging
industry had won the battle for control of PNG state institutions. The governments led by
Michael Somare between 2002 and 2011 adopted multiple policies and strategies that
were meant to signal a reassertion of national sovereignty against any form of foreign
interference. Most notable was the 40-year plan known as Vision 2050, which was
created in the office of the prime minister himself (GPNG 2009a), and the 20-year
Development Strategic Plan drafted by the DNPM (GPNG 2010).
In the forestry sector, the prime minister followed the advice of Kevin Conrad, an
American whose missionary parents had been friends of the Somare family in the 1960s.
In 2005, Conrad persuaded Somare to announce that PNG would be one of the founders
of the Coalition for Rainforest Nations and would henceforth seek compensation from the
international community for a reduction of GHG emissions from commercial logging
concessions. This pursuit of what later came to be known as a REDD agenda was quite
controversial, as many civil society actors were suspicious of Conrad’s influence over the
government (Filer and Wood 2012; Babon and Gowae 2013; Babon et al. 2014). But
nationalists in the government could still argue that it was better to be paid for taking
action to control the logging industry than to take World Bank loans to achieve the same
result. In any case, the revenues that the government secured from a booming extractive
industry sector enabled it to escape the need for any more adjustment loans from the
World Bank that might have had forestry strings attached to them.
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Some civil society actors were rather relieved by the World Bank’s removal from the
sector, even though it meant that they could no longer access the money that the GEF
would have placed in a conservation trust fund. They no longer had to debate the merits
of a partnership with the World Bank and they were still able to access funds from other
sources to continue their activities. One report has estimated that conservation
organisations received as much as PGK 200 million (or USD 70 million) from overseas
sources between 2000 and 2011 for activities in PNG (ITS Global 2013), but since the
report was commissioned by RH, this figure may not be reliable. If RH had been secure in
the knowledge that it had triumphed over the unholy alliance, then it might not have
bothered to commission a sequence of reports from the same Australian consulting
company attacking its enemies and trumpeting the national benefits of the log export
industry (ITS Global 2006a, 2006b, 2006c, 2006d, 2007). Civil society actors returned fire
by claiming that there was ‘a complete power imbalance between giant transnational
timber companies on the one side and local communities, government agencies, and
politicians on the other’ (NFC 2009: 13).
The removal of the World Bank did enable the Somare government to speed up the
allocation of several new FMA concessions that might otherwise have been tied up in red
tape. Passage of the Forestry (Timber Permits Validation) Act 2007 cast a new cloak of
legality over the renewal of Timber Permits that had originally been granted before the
new Forestry Act came into effect and also sought to loosen the legal requirement for a
National Forest Plan to determine the allocation and renewal of logging concessions. In
that same year, amendments to Sections 90A–E of the Forestry Act, which had first been
introduced on advice from the World Bank in 2000, made it easier for logging companies
to obtain FCAs from the NFB.
However, other changes made to the forestry sector’s legal and policy framework during
this period were not so obviously favourable to the logging industry. Continual
adjustments were made to the forest revenue system as the government tried to enlarge
the size of the benefit stream flowing to local communities without losing too much of its
own revenues. The PNGFA came up with draft reforestation policies that would impose a
greater obligation on the operators of new concessions to establish forest plantations in
the wake of selective logging operations if they were unwilling to pay the reforestation
45

levy imposed by the government (Bird et al. 2007c), and there were louder demands for
more downstream processing of the timber harvested from all large-scale concessions.
These demands culminated in a new version of the National Forestry Development

Guidelines, sponsored by Forests Minister Belden Namah, which proclaimed that all
Timber Permits granted from the start of 2010 would be for logging operations with ‘100
per cent processing only’ (GPNG 2009b: 15). This was consistent with the forecast made
in the Development Strategic Plan that the share of processed timber exports in the value
of total forest product exports would increase to 80 per cent by 2030 (GPNG 2010: 94),
and this is certainly one of the factors that persuaded the industry to apply for FCAs that
would not have this condition attached to them (Filer 2010; Tetra Tech 2020). These
moves were consistent with government plans for the expansion of large-scale
agricultural projects (GPNG 2007b), and that in turn was part of the motivation for the
grant of SABLs over large areas of customary land.
The strange thing was that the scale of this ‘land grab’ (as discussed in Section 2.1)
escaped the notice of the national actors engaged in the parallel process of land policy
reform, from which the donor community and the logging industry were both excluded,
because their attention was primarily directed to the problem of how to ‘mobilise’ more
customary land for urban development (GPNG 2007c; Levantis and Yala 2008; Yala
2010). It was only in 2009 or 2010 that some of them began to see the connection (Filer
2017).
The judicial inquiry into SABLs revealed another change that was taking place during this
period, which might best be described as a kind of bureaucratic paralysis in the national
government agencies involved in the land and forest policy domains. When amendments
were made to the Forestry Act in 2005, much of the public debate was concerned with the
way that they threatened to disempower PFMCs, local communities, and even local MPs
(Holzknecht and Golman 2009). However, it can equally be argued that public servants at
the national level were losing their capacity to regulate the behaviour of other actors,
including their own ministers, since they were unable to figure out what was actually
happening at a subnational level.
This detachment from reality was rather neatly expressed by DAL Secretary Anton
Benjamin in testimony to one of the early hearings of the inquiry into SABLs:
46

There are proposals or projects that have come directly to the Department but where
the investors have consulted the landowners—and we are not aware of the manner
in which this was done—and so they come with landowners to us to assist them. And
there are cases where landowners have their differences. There are people in the
community or in the village who are not party to that, who have not been consulted,
and this is where the problem is. After the endorsement is being given by the
Department, we get letters from the landowners to us advising us that they have not
been consulted, they are not party to this one, and they want the project stopped until
it is [sic] all been reviewed. So these are some of the issues that arise from the projects
when investors are actually dealing with the landowners themselves without coming
to the Department and so those are issues that we are not aware of until after we have
given approval, then we start to see this problem arise. (Numapo et al. 2011: 24)
If the inquiry had been given a mandate to investigate the behaviour of national
politicians as well as public servants, the scope of these remarks could well have been
enlarged.
4.3 Shifting sectoral sands, 2011–2019
The changes that took place in the land and forest policy domains after Peter O’Neill
displaced Michael Somare as prime minister in 2011 were not the result of innovations
made by the new regime. They represented the continuation of processes that had
already been initiated before the change of government.
The judicial inquiry into SABLs had been initiated in the dying days of the Somare
government. Belden Namah, who was appointed as O’Neill’s deputy but was also the
minister for forests and climate change, wanted to put a stop to it since he had been
instrumental in arranging several SABLs in his own electorate, but he was overruled.
When two of the commissioners submitted their final reports in 2013 (Mirou 2013;
Numapo 2013), O’Neill promised to implement their recommendations, including those
that called for the revocation or renegotiation of a number of the leases that had been
investigated. Further action proved difficult for many reasons. One of the three
commissioners failed to produce a final report, so nothing could be done about the 25
leases that he had investigated in detail. In the other 49 cases, there were concerns that
the holders of subleases, including those who had since acquired FCAs from the NFB,
would sue the government for breach of contract if they lost their entitlements. In 2014,
the NEC ordered the NFB to stop granting FCAs over areas already covered by SABLs and
the NFB seems to have complied despite a court ruling that the NEC did not have the
47

power to issue such a directive (Filer and Numapo 2017). In the same year, the NEC
resolved to repeal the sections of the Land Act that allowed for the grant of SABLs on the
grounds that ILGs could now register titles to their own land. However, nothing was done
to implement this resolution, even though the DLPP stopped granting new SABLs (Filer
2019). By 2019, the net result was a sort of stalemate in which the lease-leaseback
scheme was effectively dead, but civil society actors were still making a lot of noise about
the government’s failure to keep its promises.
The question of what to do about the lease-leaseback scheme got tangled up with the
question of whether amendments to the Land Groups Incorporation Act and Land
Registration Act had the desired effect of providing an alternative legal avenue for the
‘mobilisation’ of customary land. Here again, the initiative had been taken when the
legislation was amended in 2009, during Somare’s term in office, but was not brought
into effect until O’Neill had taken over. Recognition of the need to pursue a range of
additional reforms to the institutions responsible for land administration and the
settlement of land disputes prompted the design of a National Land Development
Program whose first phase was to be implemented from 2011 to 2015 (Filer 2019). But
by 2019 it was clear that the reforms would not enable the government to meet the target
set in its most recent Medium-Term Development Plan, for the proportion of ‘bankable
land’ in the ‘formal market’ to grow from less than 5 per cent in 2016 to 20 per cent by
2022 (GPNG 2018a: 25–6). Mounting impatience with the progress of these reforms
prompted Lands Minister Justin Tkatchenko to institute a nationwide process of public
consultations that culminated in a National Land Summit in May 2019. Participants in the
summit agreed that the whole legal and policy framework, including the lease-leaseback
scheme, would have to be reviewed and revised (GPNG 2019c).
Foreign investors and the donor community were still largely excluded from the land
policy process because of fears that civil society actors would mount a campaign against
foreign interference. But members of the donor community returned to the forest policy
process under the auspices of the UN-REDD Program and a succession of conservation
projects funded by the GEF. Many of their activities were of a technical nature and
avoided contentious policy issues like the allocation of commercial logging concessions
or changes to the forest revenue system. In any case, domestic debate on these matters
was less intense than it had been in the previous period, and there was not much change
48

in the balance of power between the different actors. The O’Neill government did try to
impose additional levies on the industry in 2017, but the industry mounted a successful
legal challenge to some of the new impositions (Mousseau 2018; Honey 2021).
4.4 Another swipe at foreign capital
The National Land Summit was actually held just after James Marape had ousted Peter
O’Neill from the leadership of the national government, but Marape and his ministers
were happy enough to endorse the recommendations of the participants. Little more has
been heard of the review that they recommended. Marape has sought to distinguish his
own policies from those of his predecessor by claiming that he aims to ‘take back PNG’
from the foreign investors with whom O’Neill was thought to be too friendly. The primary
targets of Marape’s version of resource nationalism were mining and petroleum
companies that were thought to be taking unfair advantage of the existing national policy
regime. One large-scale mining operation was closed down and the negotiation of
agreements for the development of new projects in both sectors was delayed by demands
for a larger national share of the resource rents.
In the forestry sector, the ‘taking back’ consisted of a new round of demands that formed
the basis for the National Forestry Summit convened in October 2019. The aims of the
summit, as articulated by Forests Minister Solan Mirisim, were to figure out how to
reduce the volume of round log exports from native forests to 50 per cent of the total log
harvest by 2025, while rapidly expanding the area of forest plantations, increasing the
participation of provincial governments and landowners in the decision-making process,
and reducing GHG emissions from the sector. None of these were new demands, and some
had been articulated in the Vision 2050 plan (GPNG 2009a). However, it did seem that
the government was now less inclined to backtrack in the face of pressure from the
logging industry.
Industry representatives and independent experts made the usual arguments about the
economic, technical, and bureaucratic constraints on the further development of
processing facilities in remote forest areas (Pouru 2020). They also argued that these
constraints can only be overcome if the raw material consists of one or two tree species
cultivated in large plantations, but plantation expansion cannot take place on customary
49

land if the landowners are unwilling to wait for many years before they can earn an
income from the harvest. It was noted that the domestic market could not absorb a
substantial increase in the volume of processed timber, while overseas consumers would
impose quality controls that most local suppliers could not meet. It was also noted that
the actual number of processing facilities, as well as the area covered by forest
plantations, had actually fallen substantially over the previous decade, so the
government’s plans were once again deemed to be unrealistic.
However, the government was not deterred. In August 2021, the next forests minister,
Walter Schnaubelt, doubled down on the demands made by his predecessor and also
announced a new set of taxes to be imposed on the industry (Mauludu 2021). By this time,
RH had suspended most of its logging operations, which explains the dramatic fall in its
share of the country’s round log exports (see Figure 2). It is not clear if this signalled the
company’s intention to exit the sector altogether or if it was using its corporate muscle to
pressure a cash-strapped government into submission.
Civil society actors do not trust the national government to hold the line against pressure
from the logging industry, given the past record of occasional capitulation, but they do
now see an opportunity to enlarge the coalition of actors that will ‘take back PNG’ by
limiting the powers of the forests minister and the PNGFA at the same time that they
reduce the political influence of the industry itself. They mostly seem to agree that
decentralisation of decision-making powers to provinces and communities is the best
way to proceed, and they aim to secure the support of the donor community in making
this change (Mitchell and Sangga 2021).
However, the future form of decentralisation is itself a matter of huge uncertainty. Ten
years ago, the national government ordered a review of the OLPGLLG on the grounds that
it had become an obstacle to the improvement in government service delivery. The
review recommended that it be repealed and replaced by a new Organic Law on
Decentralisation that would totally transform the nature of subnational government
institutions. The NEC approved this recommendation in 2015. In 2020, Prime Minister
Marape announced that the new law would shortly be presented to the national
parliament. This had still not been done by the time of the latest national elections. This
is not so much evidence of bureaucratic paralysis as evidence of political paralysis.
50

It is not yet possible to predict how the new Marape government will deal with what
appears to be something of a stalemate in the field of forest policy. The prospect of
significant new investments in the forest sector by different members of the donor
community could have a range of effects on power dynamics in the sector, some of which
may be unintended. Some national government agencies—or parts of those agencies,
including the PNGFA, CEPA and CCDA—are already showing signs of reaching the limits
of their absorptive capacity. The logging industry might be able to mount a rearguard
action against the proposed log export ban on familiar economic grounds, but may be able
to avoid such a battle with the government by simply ensuring that the ban will not apply
to the grant of new FCAs. In that case, this issue will become the primary point of
contention between the industry and its opponents in civil society. The formation of new
alliances between donor agencies and civil society actors may produce positive outcomes
in some parts of the country, but it is also likely to encounter the sort of political
opposition that led to the cancellation of the FCP in 2005.
5 Arguments about illegality and corruption
Arguments about the nature and extent of illegal and corrupt behaviour in the forestry
sector have been going on throughout the period covered in the previous section. These
arguments are important for one simple reason: if actors do not comply with current
laws, or if the laws are not enforced, then further changes in the law, like those that might
emerge from the latest review of the Forestry Act, may not have much effect on the
behaviour of the actors.
There are some forms of illegal behaviour that are significant in other countries but not
in PNG. The presence of SGS field staff, as well as NFS field staff, has ensured that there is
very little smuggling of timber across international borders, and has also minimised the
export of species like ebony or rosewood that can only be exported once they have been
processed, since species identification is part of the export monitoring process. Satellite
imagery also shows very little evidence of industrial logging outside concession
boundaries, with the possible exception of some TAs.
That said, it is possible to consider what other evidence has been provided in support of
different arguments about the extent of illegal or corrupt behaviour in the forest
51

industries or in government agencies responsible for the regulation of these industries.
This leads to consideration of the specific forms of illegal or corrupt behaviour that can
be identified and an assessment of their relative impact on the rights and livelihoods of
landowning communities. The section concludes with some remarks on what are
currently the most obvious failures in the institutions of forest governance.
5.1 Findings of the Independent Forestry Review Team, 2000–2004
In 2000, the government of Mekere Morauta agreed with the World Bank’s proposal to
establish an Independent Forestry Review Team (IFRT), indirectly funded by the
Australian aid program, to examine the compliance of existing and proposed logging
concessions with existing laws and regulations. In its first round of inquiries (2000–
2001), the IFRT investigated 32 ‘forest harvesting projects being developed towards a
Timber Permit or Timber Authority’ (IFRT 2001). In the second round (2003–2004), it
investigated six ‘disputed timber permits and permit extensions’, reviewed 14 ‘current
logging projects’, and conducted six ‘compliance audits’ on projects that were either in
operation or under development (IFRT 2004). The team’s findings were later
summarised in a two-volume publication (Forest Trends 2006). This was the last time
that PNG’s commercial logging concessions were subject to any kind of systematic audit.
The IFRT found two cases (the Kiunga-Aiambak project in Western Province and the
Simbali project in East New Britain) in which a logging company had managed to secure
a TA under Section 87 of the Forestry Act, and had then proceeded to harvest a volume
hugely above the 5000 m3 per annum allowed under that section. Both operations were
blatantly illegal. All other large-scale logging projects still operating during the period of
the IFRT reviews were based on Timber Permits that had been saved and renewed under
Section 137. The legality of the 14 ‘current projects’ investigated in the second round of
reviews was assessed against several criteria:
The concessions assessed covered 3.2 million hectares and together were
responsible for 65% of log exports in 2004. The review examined, inter alia: whether
the concessions had been legally issued; whether the free, prior informed consent of
local landowners had been obtained; whether harvesting regulations…were being
complied with; whether all necessary taxes were being paid; whether valid
Environmental Plans were in place; and whether contractually required
infrastructure and processing facilities had been built. None of the 14 concessions
52

was found to be in compliance with all of the key legality criteria assessed, and only
one met more than half of the criteria. (Lawson 2014: 21)
In its earlier review of 30 FMA areas where Timber Permits had not yet been allocated,
the IFRT found numerous instances of failure to comply with the resource acquisition
procedures specified by the current Forestry Act, which was also taken to indicate a high
degree of irregularity or illegality (Bird et al. 2007a).
5.2 Subsequent assessments of the nature and extent of illegal logging
Subsequent assessments of the extent of illegal logging in PNG have approached the
question from several different angles, which is why there is no general agreement about
the proportion of commercial concessions that fail the test.
One general approach argues that all the old TRP and LFA concessions are illegal because
the Timber Permits should never have been extended or renewed after the new Forestry
Act came into effect in 1992. It was this argument that the government sought to nullify
by passage of the Forestry (Timber Permits Validation) Act 2007. The same general
approach argued that new concessions are illegal if they have been issued in the absence
of an updated National Forest Plan and National Forest Inventory since these are
required to demonstrate the ‘sustainability’ of the forest management regime
(Greenpeace 2004; Bird et al. 2007b; Avosa and Rungol 2011). The National Forest Plan
is indeed meant to determine the ‘sustainable annual allowable cut’, and the actual log
harvest appears to have exceeded this level for many years (Turia 2020). This might help
to explain why no new version of the National Forest Plan has been published since 1996.
The absence of ‘sustainability’ would be even more remarkable if the growing harvest of
logs from FCAs were included in the calculations.
A more specific approach to this issue follows the lead of the IFRT by examining the extent
to which all the rules and regulations that apply to the process of resource acquisition
and allocation have actually been followed in each commercial logging concession. These
include the rules and regulations that apply to the grant of FCAs under Sections 90A–E of
the Forestry Act, as well as those that apply to other types of concession. This approach
can be extended to other rules and regulations, like those that apply to the actual process
of logging or the export of round logs (Bird et al. 2007b; ITTO 2007; Avosa and Rungol
53

2011; Lawson 2014). It is not too hard to find evidence of irregularities in this space
because of the complexity of the regulations (Scheyvens and Lopez-Casero 2013).
Satellite imagery has been used to detect breaches of the Logging Code of Practice in some
concessions (Global Witness 2018), which raises some interesting questions about the
capacity of the PNGFA to make the same discovery through the imagery that underpins
the FRIMS (Turia et al. 2019). NFS field staff can recommend the prosecution of logging
companies that breach environmental rules and regulations, but they have hardly ever
done so (Bird et al. 2007b). In the few cases where the PNGFA has suspended logging
operations on these grounds, it has done so in response to complaints or legal challenges
made by local landowners and their allies in civil society (Lawson 2014).
A quite different approach does not focus on the rules and regulations that apply to the
forest industry, but charges logging companies with human rights abuses (CELCOR and
ACF 2006). These charges have taken two main forms. One is concerned with the practice
of engaging members of PNG’s regular police force to abuse dissident landowners (Winn
2012). Police commissioners have occasionally denounced this practice, and it does seem
rather odd that logging companies prefer to pay special ‘allowances’ to the police to do
the work that would normally be done by private security guards, but the practice seems
to have continued in various parts of the country. The other type of human rights abuse
for which the companies have been held accountable consists of breaches of the country’s
labour laws, especially those relating to health and safety (Global Witness 2021). Both
types of allegation have given rise to suggestions that the PNG government should
establish a Human Rights Commission (Bird et al. 2007b), but this has not eventuated.
The incidence of transfer pricing in the export of round logs has been a matter of debate
since the time of the judicial inquiry that prompted the process of forest policy reform in
the 1990s. Two measures were taken to combat this practice: One was the establishment
of a legal mechanism that enables the PNGFA to purchase some of the logs harvested from
particular concessions and then find out what they are really worth; the other was the
engagement of SGS to check whether different timber species are correctly identified and
valued at the point of shipment. The State Purchase Option has not been exercised in a
way that would achieve the intended result, while SGS cannot check the level of
discrepancy between the value of exports at the point of shipment and the prices paid at
54

the other end of the supply chain. The problem of transfer pricing was investigated in
some detail by a Forest Revenue Review Team that worked alongside the IFRT (FRRT
2002). The practice has since been investigated in several other studies (Bird et al. 2007c;
Lawson 2014; Mousseau 2015, 2018; Walton and Dinnen 2019; Global Witness 2021).
One of these studies concluded that the loss of revenue to the national government,
through the taxes levied on the value of log exports, could amount to as much as USD 100
million a year (Mousseau 2015). If PNG’s log export industry is guilty of this practice, it is
certainly not alone. It is a form of tax avoidance or tax evasion that is a well-established
feature of the global economy, and it is not necessarily illegal.
Another charge levelled against foreign logging companies, especially by civil society
actors, is that they have been guilty of bribing politicians and public servants to gain a
variety of special favours (Avosa and Rungol 2011; Harris 2019; Global Witness 2021).
They have often been accused of bankrolling the campaigns of successful candidates in
national elections, especially in those electorates where they hold concessions. However,
this kind of ‘political donation’ by private companies is a common practice in many
democratic countries, and politicians are not always the subordinate party in the
relationship. The same point applies to public servants who demand bribes rather than
simply accepting them. Of greater concern would be the sort of ‘unholy alliance’ between
foreign logging companies and members of the national political and business elite that
counts as a form of organised crime because it involves practices like money laundering
and drug trafficking (UNODC 2016; Walton and Dinnen 2019). There is currently a lack
of substantial evidence on the extent to which PNG’s logging industry has been implicated
in this kind of criminal network, but it may be noted that PNG is a member of the Asia-
Pacific Group on Money Laundering and it does have a Financial Intelligence Unit,
supported by the Australian aid program, that is charged with the investigation of such
matters. Parliament has recently passed a bill to establish an Independent Commission
Against Corruption. An Unexplained Wealth Bill has also been drafted.
One final form of illegality, at the opposite end of the power spectrum, has received very
little attention because foreign logging companies have little or nothing to do with it.
Lawson (2014) used a wood balance analysis to estimate the extent of the discrepancy
between the actual log harvest and the harvest that was officially recorded as being
legally produced. The size of the discrepancy led him to conclude that local landowners
55

may be responsible for selling a lot of timber in the domestic market, and this would be
illegal if they had not been granted a TA since the Forestry Act only allows them to harvest
timber for their own consumption in the absence of an official licence.
5.3 Current evidence of failure in the institutions of governance
Over the past decade, attempts have been made to counter some forms of illegality in
PNG’s forestry sector through the development of a national Timber Legality Standard
(TLS) that would be acceptable to a wide range of actors, including the logging industry
and some of its civil society critics (GPNG 2013; Scheyvens and Lopez-Casero 2013). After
a lengthy process of consultation, the current version of the TLS was finalised in 2019
(GPNG 2019d, 2019e). What remains unclear is how the TLS will actually be applied to
existing logging concessions as well as those that have yet to be granted, since the current
proposal requires concession holders to pay for third party certification, and very few of
them will be keen to do that.
The nature of the current legal and policy framework means that the only large-scale
concessions likely to be granted in the near future will be FCAs. Although civil society and
industry representatives both lobbied for substantial amendment or total repeal of
Sections 90A–E of the Forestry Act, Minister Schnaubelt apparently resisted these
demands, and it is not yet known whether or how these sections will be modified when
the next set of amendments are presented to parliament. What does seem quite clear is
that this type of concession has been allowed to escape from many of the other rules and
regulations that apply to the forestry sector. It is therefore imperative that evidence of
irregularity or illegality be sought through an examination of the way that Sections 90A–
E have actually been interpreted and applied by the different government agencies
involved in the process of resource acquisition and allocation. Demands for the
revocation of SABLs are of no help here. A different kind of investigation is needed, and
the need is all the greater because of the almost total lack of transparency that surrounds
the decision-making process.
A rather different question can be raised about the continued operation of TRP and LFA
concessions. Figure 3 shows that almost two-thirds of the round logs exported from TRP
concessions over the past three years have come from concessions in which the original
56

TRP agreement between the government and the local landowners has already expired.
All of the original agreements that authorised LFA concessions have also expired. Since
there is nothing in the current legislation that provides for an extension of these
agreements, as opposed to the renewal of the Timber Permits that sit on top of them, it
would appear that these operations are now illegal. The renewal of these agreements
without landowner consent or consultation would constitute a breach of Section 53 of the
National Constitution (‘Protection from Unjust Deprivation of Property’).
Figure 3: Log exports from TRP concessions, 2019–2021
10%
Agreement already expired

27%
Agreement expiring 2027-2037
63%
Agreement expiry date unknown
A previous study has suggested that the NFB decided to allow for the extension of TRP
agreements based on a Supreme Court decision made in 2017 (Global Witness 2018: 8).
No copy of this judgment has yet been sighted. Another source claims that the decision to
allow such extensions was made by a previous forests minister without reference to the
NFB on the grounds that TRP agreements were ‘civil contracts’ that could be extended for
any period of time if both parties consented to the extension (Bob Tate, personal
communication, February 2022). The East New Britain Provincial Government seems to
agree with this interpretation of the law since it claims to have ‘reactivated’ multiple TRP
agreements that had already expired (Larme 2020). These decisions make a mockery of
the legal and policy framework established by the reform process of the 1990s and
demand closer scrutiny. Legal advice provided to the PNGFA by the State Solicitor in 2017
came to much the same conclusion (GPNG 2017b).
57

6 Conclusion
In January 2022, Forests Minister Walter Schnaubelt, who had just been relieved of his
ministry, announced an agreement between the PNGFA and an Australian company called
Mayur Resources Ltd to convert an existing FMA area into a ‘forest carbon concession’.
The area in question was said to cover 800,000 hectares, and the deal was said to have
been endorsed by the CCDA and CEPA, the relevant provincial government, and local
landowner representatives (Anon. 2022b). It soon transpired that the area in question
was the Kamula Doso forest area in Western Province, where the National Court had
previously revoked an FMA signed in 1998 on the grounds that some of the local
landowners had not been properly consulted. In 2010, a proposal to dedicate this area to
the cause of forest carbon sequestration went nowhere, partly because of the national
government’s refusal to authorise voluntary carbon trading agreements (Filer and Wood
2012; Wood 2015). Despite this record of past failure, Mayur Resources treated the latest
agreement as the basis for a ‘strategic partnership’ with Santos, now a major player in
PNG’s oil and gas sector, whereby Santos would fund ‘ongoing detailed feasibility and
landowner consent work’ on the project (Mayur Resources 2022). That announcement
was made in June 2022. A month later, the National Forest Board announced that the
Carbon Permits issued to Mayur Renewables (PNG) Ltd had been cancelled because they
were in breach of the Forestry Act and because the company was not registered as a forest
industry participant (Anon. 2022c). Whereupon the company threatened to sue the
PNGFA for breach of contract (Anon. 2022d).
It is hard to know what to make of this story. It does appear that a new FMA was signed
towards the end of 2020 (Ruth Turia, personal communication, July 2022), but there is
no evidence to indicate that the landowner representatives who signed it were
consenting to a forest carbon concession rather than a selective logging concession. No
public comments have yet been aired by representatives of the landowners, the Fly River
Provincial Government, or the other national government agencies that have supposedly
agreed to the whole idea. Like other forest carbon projects that are currently under
discussion, this one has an unpredictable future. It would therefore seem that the regional
and global forest carbon market, as currently constructed, does not offer a clear-cut
solution to the problem of DFD in PNG. Those actors who believe that this problem
58

demands some kind of solution must therefore confront a few key questions about the
direction of the national forest policy process. What is predictable? What is feasible?
What will make a difference? Who will make a positive contribution? How will outcomes
be achieved and measured? And in what geographical or institutional locations will the
problem-solving effort yield the best results?
Those members of the donor community who are now engaged in PNG’s forest policy
process all share an assumption that DFD is a real problem to which they can offer a
feasible solution. But there are many other actors in the forest policy space who do not
share this assumption. Aside from the logging industry, there is a wide array of state
actors, both politicians and public servants, at both national and subnational levels of
political organisation, who are more inclined to regard DFD as a price that has to be paid
for ‘development’. And their view reflects that of the many local landowners who agree
to have their forests logged or cleared if the reward seems reasonable. This feature of the
institutional landscape is somewhat unpredictable because state actors, especially
politicians, may not remain in the same roles, with the same powers, for very long, and
the same goes for the individuals who represent (or claim to represent) the interests of
landowning communities. Aid agencies can hedge against the risk that some actors will
refuse to cooperate with a strategy to reduce the rate of DFD by ensuring that the strategy
can be pursued with a range of potential partners, at either a national or a subnational
level, and in one part of the country rather than another. However, this kind of flexibility
is not easily achieved by aid agencies or project managers accustomed to the formulation
and implementation of detailed plans of action (Ramalingan 2013).
For those actors who do agree that DFD is a problem in need of a solution, there is still
scope for disagreement about the relative significance of the factors driving the process,
and that in turn may lead to disagreement about the best way to limit or reverse the
damage. The contribution of local farming practices may have been overestimated, but
even if it is still significant, or growing in significance, attempts to modify these practices
may not be feasible or successful. That is especially the case if they are framed as attempts
to persuade villagers to stop clearing and burning patches of secondary forest in order to
plant new food gardens or expand the area planted to cash crops. Nor are there many
villagers who would welcome the idea that road construction is a threat to their
livelihoods because it is liable to increase the rate of forest clearance. No candidate
59

standing for election to the national parliament is going to be elected on the basis of a
promise to stop building new roads that will connect rural villages to the wider world.
And no government minister or ministry is going to stand in the way of plans to expand
the national road network, even if these plans have proven difficult to implement. So
there are good political reasons to treat the problem of DFD as a problem that is primarily
created by the grant of commercial logging concessions, and which therefore needs to be
solved, if it can be solved, by making changes to the way that these concessions are
regulated.
The question of how to improve the regulation of the logging industry is not a new one,
and different groups of actors have been seeking answers to this question for the past
three decades. This means that key aspects of the question have been continually
revisited to the point where they are recognised as intractable problems in their own
right. These include the problems of landowner representation, community participation,
benefit distribution, dispute resolution, transparency, corruption and illegality. If many
past attempts to solve these problems have had limited success, one might predict that
fresh attempts will have a high risk of failure. However, this does not mean that the future
direction of the forest policy process is entirely predictable, or that the process is bound
to go round in familiar circles. That is because the cast of actors or characters in this social
drama has changed over time, as has the balance of power between them, and it may well
shift again with the formation of a new government. If members of the donor community
wish to make a positive contribution to the policy process, they should be mindful of the
lessons to be learned from previous interventions but also consider how the current
balance of power between different groups of actors will affect their chances of success.
Consider the problems of transparency, corruption and illegality. The current lack of
transparency in the grant of forest conversion concessions (FCAs) and the ‘reactivation’
of old selective logging concessions (based on TRPs and LFAs) is clearly a big problem for
actors aiming to reduce the rate of DFD and improve the overall quality of forest
governance. For many civil society actors, the lack of transparency is itself proof of
corrupt or illegal collusion between state actors and the logging companies whose
behaviour they are meant to regulate. Some state actors, and even logging industry
representatives, will agree that something is amiss, but will then say that they do not have
the power to rectify the situation because there are too many other actors, including local
60

landowners or their representatives, who prefer to keep these dealings out of the public
domain, whether or not they are based on corrupt or illegal behaviour.
So where is the solution to such problems? One solution advocated by civil society actors
is to change the law in order to lift the shroud of secrecy, prohibit the relevant decisions,
or make it easier for landowners to have the decisions revoked by the courts. Recent
efforts to have the Forestry Act amended for this purpose began with an extensive process
of consultation, at both national and provincial levels, but the process of drafting the
amendments has since been shrouded in secrecy, so the actors who were consulted do
not know what the result will be or when they will find out. While failure to strengthen
the legislation has commonly been blamed on successive forests ministers and their allies
or cronies, it must also be noted that some provincial governments, like the one in East
New Britain, are quite content to exploit the loopholes that currently exist. Faith in the
power of legal reform might also be misplaced for another reason, which is that some of
the decisions made by government ministers or agencies appear to be in breach of the
law as it already stands. If powerful actors do not comply with current laws, or if the laws
are not enforced, then further changes to those laws may not have much effect on the
behaviour of these actors.
An audit of problematic concessions might sound like a good idea, since it would not only
serve the cause of transparency but also enable a distinction to be drawn between those
that do and do not have the support of a majority of local landowners. However, a
nationwide audit of the kind undertaken by the IFRT would require a substantial level of
investment, even if it had the support of the forests minister and the prime minister. In
the absence of the World Bank, it is unclear that any aid agency would have the resources
or the courage to propose such an exercise. With limited resources, it would make more
sense to undertake such an audit in a couple of provinces, aside from East New Britain,
that contain a range of concession types and where provincial governors would support
such an exercise. Provincial governors certainly have the power to do this under the
terms of the OLPGLLG. The forests minister and the NFB would find it hard to justify a
refusal to allow NFS officials to participate in such an exercise at the provincial level,
especially if it is framed as the first step in an improvement of provincial forest planning
and decision-making institutions. There is at least one provincial governor, Gary Juffa in
Oro Province, who has been willing to address the problem of illegality in a very public
61

way, but it is not clear whether other provincial governors will follow his lead in this next
term of the national parliament.
Despite the long history of attempts to improve the quality of forest planning, or the
integration of land use planning more generally, the chances of success still seem very
poor. That is partly because of the primacy assigned to customary land rights and partly
because of the difficulty of securing greater cooperation between relevant national
government agencies or between any one of these agencies and its subnational
counterparts. And if the state has an abiding tendency to fall apart, there is even less scope
for activities that require collaboration between state actors, industry actors, and civil
society actors in the forest policy space.
There is general agreement among civil society actors that members of local communities
need to know more about their rights under the terms of the Forestry Act and other laws
that apply to the management of forest resources. This is especially the case when they
have no knowledge of the agreements by which their rights have been alienated. There is
currently only one civil society organisation, the Centre for Environmental Law and
Community Rights, which is mainly dedicated to the provision of legal aid to landowners
who believe that their rights have been infringed, and it does not have the resources to
deal with all the cases that are brought to its attention. Members of the donor community
might regard this as a fairly obvious avenue for additional investment, but the results
might be disappointing when the country’s judicial system itself is under so much
pressure that the time taken to adjudicate civil cases is constantly increasing. Some civil
society actors, and even some state actors, have called for an alternative institutional
form of dispute resolution to deal with this challenge, but there is as yet no consensus
about what it should look like or how it should be funded (Bird et al. 2007b; Mitchell and
Sangga 2021).
There is a deeper issue here, which revolves around questions of scale. In some logging
concessions, especially large ones, disputes between different groups of landowners
make it difficult for the members of any one group to assert their rights without being
subject to attack by the members of other groups. This issue is not confined to the forestry
sector, but extends to all land use plans that require the partial alienation of large areas
of customary land. Put very simply, and as a general rule, the larger the number of
62

customary landowners whose consent is required for any act of partial alienation, the
harder it will be to secure a general consensus about what should be done with the forests
or other natural resources contained within that area. This point was clearly revealed in
the hearings of the judicial inquiry into SABLs in 2011 and 2012 (Mirou 2013; Numapo
2013). The larger the lease area, the more likely it was that local landowners would be
divided in their allegiance to different landowner companies or other representative
bodies.
To understand why this should be the case, one must remember that the 6,200 rural
council wards that currently sit on the lowest rung of the political ladder are the vestiges
of what were once thousands of autonomous political communities. This means that the
average amount of customary land that belongs to each of these groups of people is
somewhere between 7,000 and 8,000 hectares. Of course, the size of these communal
territories varies a great deal, and they tend to be much larger in those parts of the
country, like Western Province, that have very low population densities and
correspondingly large areas of primary forest waiting to be protected or exploited. But it
is hard to imagine that an area of 100,000 hectares, let alone 800,000 hectares, will have
a collection of customary landowners who will readily agree on what should be done with
it.
The donor-funded forest policy reform process of the 1990s was clearly based on the
assumption that big areas produce better results. The size of commercial logging
concessions should be enlarged for the sake of sustainable forest management, just as the
size of protected areas should be enlarged for the sake of biodiversity conservation.
However, this assumption was continually challenged by civil society actors and
academic commentators who thought that state actors would not have the capacity to
manage the organisation of consent or the distribution of benefits between large and
diverse groups of customary landowners. Some of these arguments were directed at the
PNGFA (Brunton 1996; Henderson 1997; Taylor 1997; Chatterton et al. 2000; Montagu
2001), while others were aimed at the integrated conservation and development projects
that were being supported by the former Department of Environment and Conservation
and a number of international NGOs (Alcorn 1993; McCallum and Sekhran 1997; van
Helden 2001; Filer 2005; West 2006).
63

The question of scale is still a bone of contention amongst the civil society actors who
occupy the forest policy space (Mitchell and Sanga 2021). Some are still prepared to
negotiate with state actors or private investors whose aim is to protect or manage large
areas of native forest. Negotiation of the new Timber Legality Standard exemplifies this
approach to the process of policy reform. Others regard the failures of the last 30 years
as proof that most state actors and private investors have come to inhabit a den of iniquity
that can only be reformed by a radical decentralisation of decision-making power. The
arrival of a new set of private investors looking to make a profit from the sequestration
of forest carbon, and the renewed interest of aid agencies in funding programs and
projects that will make a measurable difference to the state of the nation’s forests, have
only served to accentuate the gap between principles of scientific management and public
sector reform and the disparate practices and desires of so many customary landowners
and local community leaders.
64

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Discussion Paper 103

Papua New Guinea’s forests back in the spotlight

The Development Policy Centre is part of Crawford School of Public

Colin Filer1 is an Honorary Professor at the Crawford School of Public

The Development Policy Centre is a research unit at the Crawford School

For more information on the Development Policy Centre, visit

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2 Papua New Guinea’s rural landscape.............................................................. 4

2.1 Partial alienation of customary land rights ......................................................... 5

2.2 Commercial logging concessions ........................................................................ 9

2.3 Deforestation and forest degradation .............................................................. 14

3 Actors, interests, and institutions ..................................................................18

3.1 The private sector ........................................................................................... 19

3.2 The public sector ............................................................................................. 23

3.3 Landowning communities ................................................................................ 32

3.4 National civil society ....................................................................................... 36

3.5 The donor community ..................................................................................... 37

3.6 Gender inequality............................................................................................ 39

4 Power dynamics in the field of forest policy ..................................................41

4.1 The donor-funded reform process, 1990–2002 ................................................. 41

4.2 The reassertion of national sovereignty, 2002–2011 ......................................... 44

4.3 Shifting sectoral sands, 2011–2019 .................................................................. 47

4.4 Another swipe at foreign capital ...................................................................... 49

5 Arguments about illegality and corruption ....................................................51

5.1 Findings of the Independent Forestry Review Team, 2000–2004 ....................... 52

5.3 Current evidence of failure in the institutions of governance ............................ 56

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2 Papua New Guinea’s rural landscape

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2.1 Partial alienation of customary land rights

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2.2 Commercial logging concessions

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TRP LFA FMA FCA TA

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2.3 Deforestation and forest degradation

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To count each act of forest clearance by swidden farmers as an act of deforestation,

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An assessment of different forms of forest degradation also requires a combination of

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3 Actors, interests, and institutions

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3.1 The private sector

3.1.1 Foreign investors in the forest industries

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There is a widespread public perception that the logging industry is dominated or

RH group WTK affiliates Vanimo Jaya KK Connections

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3.1.2 Other foreign investors