Page last updated at 08:17 GMT, Thursday, 14 May 2009 09:17 UK

Liberia barcodes trees to log profits

A Liberfor worker stamps a bar code tag on to a tree in the Liberian rainforest
Liberfor workers stamp bar code tags on to the trees

By Richard Powell

Liberia is having its lumber trees tagged electronically as the government rushes to restart an industry overshadowed by market woes.

Liberfor, a consortium of European firms and Liberia's Forestry Development Authority, is working overtime to kick-start a national industry previously worth 60% of the country's GDP.

Thomas Pichet of SGS, Liberfor's logistics partner, explains: "The timber trade was halted by the UN six years ago after contractors were unable to demonstrate they had paid their taxes."

That is after the years of abuse Liberia's forests suffered under former rebel leader Charles Taylor, who funded his civil war effort by pillaging lumber and diamonds.

Bar-coded trees

The country's Finance Minister, Augustine Ngafuan, is certain revenues collected from lumber sales this time around will end up in the right hands.

Ex-combatants clear a section of forest so tagging can begin
I can't stress how important it is to keep ex-combatants busy
John Woods
Liberian forestry minister

"Our new system tags the trees and monitors their whereabouts from stump to port," she says.

"It will deliver 99% of the resulting revenues back to us."

British tracking company Helveta has already tagged 30,000 of a total 200,000 trees set aside for the first wave of exports to EU-approved buyers.

Its satellite mapping process works by scanning bar codes stamped on to trees with a PDA, creating an electronic paper trail that can pinpoint any trunk to within 25 metres of its location.

It is a process similar to checking out shopping at a supermarket.

When a tree is exported, the system uploads the data to its servers in Reading, near London, and invoices the contractor at the port according to the trunk's grade, species, size and quality.

Cash squeeze

However, the initiative has nearly run out of money before the first tree has been exported.

Liberfor's initial investor, USAid, has warned it will not fund the project any further than the $10m (£6.6m) it has already donated.

And other international donors, including the World Bank, are also refusing to commit to further financial support.

The teething troubles have meant Liberia has collected none of the $20m (£13.2m) it forecast it would receive from lumber exports in the first year.

To pay its set-up costs and become self-sufficient, Liberia needs to sell lumber from half a million hectares of dense and largely inaccessible rainforest.

At the same time, it must pay back $630m (£416m) it owes to the International Monetary Fund, while fending off the African Development Bank, with whom it is in arrears.

'No market'

Speaking on a concession in the equatorial rainforest, Ian Patterson, a 39-year-old British forest manager working with the Liberian logging company LTCC, says global market conditions and bureaucracy have hit his operation hard.

Ian Patterson, British forest manager
The global market for timber is non-existent at the moment
Ian Patterson
British forest manager in Liberia

"Our firm has already spent a couple of million dollars to get where we are now, and we haven't exported a log yet," he says.

"The Liberian government came to meet us to entice us to take a concession here, but the global market for timber is non-existent at the moment."

The electronic tagging system, however, has tightened the process up, Mr Patterson believes.

"It's a breath of fresh air using bar codes and GPS to pinpoint our product and leave what we can't export untouched," he says.

"Under good market conditions, we could expect to do very well."

Idle gun hands

Key to reinvigorating the country's logging industry is the creation of up to 40,000 jobs, which will help keep former fighters occupied and crime levels down, Forestry Minister John Woods says.

"I can't stress how important it is to keep ex-combatants busy - they make up much of the workforce in this sector," he explains.

Tens of thousands of fighters swapped their AK-47s for chainsaws after the war and began illegally lumbering trees, says Derek Charter of Helveta.

"Illegal loggers or 'pit-sawers' waste around 70% of each trunk when they try to cut planks from them with chainsaws," he points out.

"So the contractors are doing all the hard work, fixing the roads and bridges necessary to move the wood and the pit-sawers are using the same infrastructure to steal it from them."

'Missed opportunity'

Pamela White, Mission Director for USAid in Liberia, says logging companies have missed the best opportunity to profit from exports since the UN dropped its sanctions on lumber exports:

Liberia's largest slum, Westpoint
The World Bank believes the international community will stand by Liberia's efforts to rid itself of poverty

"Contractors thought the commissioning process would be faster than it was - but they're a good year behind.

"I don't think these companies ever realised how complicated it would be to follow all the rules and regulations.

"The sad thing is if they had sorted this out a year ago, the opportunity to make a profit on sales was about 100% better then than now. World demand for timber, like everything now, is not good."

Peter Lowe, the Forestry Co-ordinator for the World Bank - which returned to Liberia in 2003 after a 20-year hiatus - says the Liberian logging system will not be allowed to collapse because of the amount of international goodwill towards the country:

"We haven't made the commitment to prop it up. The Liberian government is going to have to work out how to sell this to their own people.

"There have been no exports so far because of a failure to implement their forestry reform process fast enough."

Tagging trees by satellite is already operating successfully under Helveta in Indonesia and has helped stop illegal logging in Cameroon, so when the market recovers, Liberia should know exactly where its lumber revenues are coming from.

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