TED Case Studies

Siberia Logging



          CASE NUMBER:          63 
          CASE MNEMONIC:      SIBERIA
          CASE NAME:          Siberia Logging Controversy

A.        IDENTIFICATION

1.        The Issue

     Siberia's vast expanse of forested land, the taiga, is a
boreal forest approximately the size of the 48 contiguous
United States.  The land contains perhaps one-fifth of all the
world's trees and one-half of its coniferous trees.  The
forest's role in global warming and as a carbon sink is
unknown, but is suspected to be quite important given the
forest's size.  The Siberian forests are home to several
indigenous peoples, similar to the Lapps in Norway or the Inuit
of the United States and Canada in lifestyle.  The people and
their livelihoods depend on the land for hunting, fishing and
raising reindeer.  The controversy in this case results from
efforts by two ethnic groups, the Udegei and the Nanai, to
block a Russian-South Korean joint venture from logging trees
in their traditional lands.  Eventually, they won the right to
determine use of their lands.

2.        Description

     The Siberian forest has been logged since the 1950s as
part of Soviet efforts to industrialize Siberia.  With
perestroika's economic and political changes in the former
Soviet Union and Russia, foreign construction and logging
companies are embarking on extensive, long-term timber cutting
projects.  How much damage has already been done by logging is
still being debated.  The question is difficult to resolve
because many logging projects are privately negotiated and
little reliable data exists as to how much has been logged, how
much can be harvested from a region, and so forth. 
Nevertheless, many environmentalists fear that Siberia may
repeat the history of the Amazon rain forest and other areas
deforested for development (see BRAZIL case).

     Svetlaya, a Russian-South Korean joint venture with
backing from Hyundai, a Korean conglomerate with holdings in
the construction industry, applied to the Primorskii regional
administration for a license to increase the land along the
Bikin River valley available for logging.  Svetlaya already had
access to 370,000 cubic meters of timber, but needed the
additional area -- 500,000 cubic meters along the Bikin River -
- to maintain profitable operations.  A local administrator
approved the transferral of logging rights to this additional
land to Svetlaya and its joint venture partner, Hyundai.

     After five months of pressure from the Socio-Ecological
Union and Udegei and Nanai peoples, the Primorskii regional
council voted to overturn the decree granting Svetlaya the
extra logging rights in the Bikin River valley.  Svetlaya,
which feared bankruptcy, appealed the decision to the
Primorskii Regional Court.  The court ruled the council had
exceeded its authority in overturning the administrator's
decree granting Svetlaya additional logging rights.  The case
then went to the Russian Supreme Court which upheld the
council's law.  The basis for the court's decision was Russian
President Yeltsin's April 1992 order that gave indigenous
peoples to right of formal consent for any infringement on
their traditional lands; in the Hyundai case, the court found
that consent had not been obtained.  Because there was no
consent, the administrator could not transfer logging rights to
Svetlaya.

     The Supreme Court's decision was further supported by a
commission investigating events in Primorskii Krai; the
commission concluded that a ban on logging in the Bikin River
valley was appropriate.  However, the Primorskii regional
government is still attempting to find a way to allow Hyundai
to log along the Bikin River valley; hence, the case may soon
end up back in the courts.

3.        Related Cases

     NEMATODE case
     MALAY case
     ITALYBAG case
     DUTCHWD case
     INDONES case
     THAILOG case
     SOLOMON case

     Keyword Clusters         

     (1): Trade Product            = WOOD
     (2): Bio-geography            = COOL
     (3): Environmental Problem    = DEFORestation

4.        Draft Author: Lisel Heeter

B.        LEGAL Clusters

5.        Discourse and Status:  DISagreement and COMPlete

     This is a unilateral decision by the Russian Supreme Court
(the Russian government).

6.        Forum and Scope:  RUSSia and UNILATeral

     The Russian Supreme Court is the forum.

7.        Decision Breadth: 2 (Russia and Korea)

     The Russian Supreme Court made a unilateral ruling in this
case.  The parties are the Socio-Ecological Union, the Udegei,
the Nanai, Svetlaya and Hyundai.

8.        Legal Standing: LAW

C.        GEOGRAPHIC Clusters

9.        Geographic Locations

     a.   Geographic Domain : ASIA
     b.   Geographic Site   : SIBERia
     c.   Geographic Impact : RUSSIA

10.       Sub-National Factors:  YES

     At the heart of the dispute was the question of 
jurisdiction between national, sub-national and local
authorities (see ONTARIO, DUTCHWD and ITALYBAG cases).

11.       Type of Habitat:  COOL

     Siberia is a cool weather area, forested by pine and other
trees.  "The Bikin is one of the last pristine river valleys in
Ussuriland, a wild 600,000-acre watershed that drains the
western slopes of the Sikhote-Alin."(1)

D.        TRADE Clusters

12.       Type of Measure: Regulatory Standard [REGSTD] 

     The Russian Supreme Court ruled that the transfer of
logging rights to Svetlaya/Hyundai along the Bikin River was
legally canceled by the Primorskii regional council.  This
action has set an important precedent in Russian law. 
Indigenous peoples of Siberia and the Far East are being given
long-term lease allocations of land for their exclusive use,
including the right to use the land for business purposes.  As
a result of these lease allocations, a logging production unit
in the Khutu River valley shut down; in the Koppi River valley,
Weyerhaeuser Company (an American logging firm) has lost access
to some forests; and in Khabarovskii Krai, a commercial logging
firm was asked by the governor to withdraw.

     However, enforcement of environmental laws in the former
Soviet Union has traditionally been quite lax; it is probable
the demand for hard currency and current economic difficulties
will result in a continuation of logging, despite legal bans
(see TAIGA case).

13.       Direct vs. Indirect Impacts: INDirect

     The impact on trade is indirect because the court upheld a
ban on logging inside Russia.  No ban exists on the export of
timber, unfinished lumber, or wood products.  The Russian
logging industry includes foreign firms and joint ventures
involving foreign and domestic firms.  By banning logging in
the upper Bikin Valley, the ruling reduces, on paper at least,
the quantities of timber and wood products leaving the country.

14.       Relation of Measure to Environmental Impact

     a.  Directly Related     : YES  WOOD
     b.  Indirectly Related   : NO
     c.  Not Related          : NO
     d.  Process Related      : YES  DEFORestation

15.       Trade Product Identification:  WOOD

     Hyundai/Svetlaya were interested in access to
approximately 300,000 hectares of forest along the Bikin River. 
This would work out to cutting one million cubic meters of wood
each year for 30 years.(2)  

16.       Economic Data

     Logging in 1991 accounted for 2.6 percent of the former
Soviet Union's total foreign trade.  Current economic problems
coupled with the need for foreign currency is likely to
increase pressure to log.  At present, the foreign partner in a
joint venture often receives payment in kind or other goods or
has not yet been paid, so it is difficult to estimate exports,
especially from only one logging region.

17.       Impact of Measure on Trade Competitiveness: BAN 

     The court's ruling is that the Udegei and Nanai have
control of the land which Hyundai and Svetlaya had planned to
log.  The two indigenous peoples wanted to end the practice of
granting extra logging licenses.  Thus, the ban effectively
ends logging in the upper region of the Bikin River valley. 
However, Svetlaya and Hyundai retain logging licenses to other
parts of the river valley.  Also, the Primorskii regional
administration, source of the original permission, continues to
work at permitting logging in this area.

18.       Industry Sector:  WOOD

19.       Exporter and Importer:  RUSSIA and KOREA

     South Korea is one of the world's largest importers of
wood, especially tropical hardwoods.  However, these supplies
are now becoming limited so that Russia represents a new
supplier.  South Korea's forests were largely destroyed during
the Korean War and now are under protection.

E.        ENVIRONMENT Clusters

20.       Environmental Problem Type:  DEFORestation

21.       Name, Type, and Diversity of Species 

     Name:          Boreal Conifers
     Type:          Plant/Coniferae
     Diversity:     150 higher plants per
                    10,000 km/sq (former
                    USSR)

     There are few tree species found in boreal forests; the
Siberian forest is comprised of primarily spruce, larch, and
fir.  These trees are quite vulnerable and require a growth
period two to three times longer than elsewhere in Russia's Far
East because of the sub-arctic climate; additionally, mature,
centuries-old trees average only 20-30 centimeters in
diameter.(3)  Hyundai signed a 30 year joint venture agreement,
but by 1992 had already largely logged the area.  The animal
species that are home to this area are found all over Asia and
Europe, with the exception of the Ussurian or Siberian tiger,
which is endangered.  Only some these tigers remain (see TIGER
case).(4)

22.       Resource Impact and Effect:  LOW and PRODuct

     The ban on logging will allow Siberian natives to retain
their traditional lifestyles by guarding their hunting and
fishing grounds.  Also, logging techniques (primarily under the
Soviets) have led to topsoil loss in an already fragile
ecosystem; such soil damage inhibits tree regeneration, and
damages fisheries and the economies based on fishing.  For the
moment, the impact is low.

23.       Urgency and Lifetime:  LONG and 100s of years

24.       Substitutes:  RECYCling

     Softwood timber products are easily recyclable in paper
and paper products.

VI.       OTHER Factors

25.       Culture:  YES

     The native peoples' ancestral rights to the land have been
part of the issue and part of the reason for the ultimate
decree.  The loss of forest and the larger habitat would
greatly diminish the culture.  "Having watched other Udegi
settlements die out as their river watersheds were logged, the
people of Krasny Yar have threatened to shoot at any logging
trucks trying to get past their village...Udegi hunters have
been arrested for removing markers from trees slated for
cutting."(5)

26.       Trans-Border: NO

27.       Human Rights:  YES

     The ownership of lands is part of the question and whether
that is set at a local or national level by native people with
legitimate claims to lands.  The original decision to log the
area was made without their consent or permission.  

28.       Relevant Literature

Gusewell, C.W.  "Siberia on the Brink."  American Forests
     98 (May-June 1992): 17-20
Petrof, Divish.  "Siberian Forests Under Threat."  The
Ecologist
     22/6 (1992): 267-70.
Rosencranz, Amin and Antony Scott.  "Siberia's Threatened
     Forests."  Nature 355 (January 23, 1992): 293-294.
"Update on Hyundai Case."  Surviving Together (Spring 1993):
32.
Winestock, Geoff.  "Russian Supreme Court Rules Against Hyundai
     Logging Operation."  Moscow Times (November 30,
     1992).

                          References

(1)  Kevin Schafer and Martha Hill, "The Logger and the Tiger,"
Wildlife Conservation 96/3, 28.

(2)  Amin Rosencranz and Anthony Scott, "Siberia's Threatened
Forests," Nature, 355 (23 January 1993), 293.

(3)  Rosencranz and Scott, "Siberia's Threatened Forests," 293.

(4)  Divish Petrof, "Siberian Forests Under Threat", The
Ecologist 22/6 (1992), 267.

(5)  Schafer and Hill, "The Logger and the Tiger," 28.



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