This report is an output of the project Hardwood Plantations in the Tropics and Subtropics (GCP/INT/628/UK), funded by the United Kingdom and executed by FAO. The overall aim of this project was to contribute to regional and global planning of timber (specifically hardwood timber) supplies in the medium-term. This study covered the case study of hardwood plantations in Fiji, Papua New Guinea and Solomon Islands.
Fiji has had the most aggressive plantation establishment policy of any of the Pacific Islands. The main hardwood species are mahogany (Swietenia macrophylla) and teak (Tectona grandis). The study considered three case studies of plantations grown for hardwood sawlogs, and in particular factors which impacted on investment decisions related to this type of forest. The study looked primarily at Fijis mahogany dominated plantations, and to a lesser extent, hardwood plantations in Papua New Guinea (PNG) and in the Solomon Islands
Several key points were identified as common to all three case studies and indeed to many other plantation projects around the tropics. These included involvement of Government agencies; land tenure issues and perceptions; involvement of local people in the decision making and employment opportunities; and quality and consistency of forest management. The development of cash economies created expectations in areas where these did not previously exist. There was apparent need for tax concessions or similar incentives from governments to make the initial plantation establishment attractive as an investment option. There appeared to be almost unconstrained market potential for high value hardwood logs. Funding uncertainties could lead to inconsistent forest establishment and tending. Plantations established in rural areas could be used to encourage local entrepreneurs contracting to the government or forest owner. This was a social issue which the government must consider.
Several recommendations were given: It was suggested that a range of private investors - both current and potential - be surveyed to determine what is preventing them from becoming involved in hardwood plantation establishment. If issues such as land tenure and security, time before a return is received and security are identified as key responses, then the issue needs to be examined more closely to determine how and why investors differentiate between hardwood and softwood plantations that are grown primarily for saw and veneer logs. It appeared that there were funds invested in softwoods but not in hardwoods. When developing proposals for plantations consideration needs to be given to the requirement to even out the demands for labour and hence the work availability for local communities. When considering the development of hardwood plantations governments may need to consider their role as one of establishing a resource to be later sold to private investors, rather than trying to attract investors. Agencies such as governments and international NGOs are assumed to contribute to the success of any hardwood plantation venture by assisting with advice as well as incentives. A considerable body of technical knowledge exists in various formats that could assist investors if it were more readily available. This could help to avoid costly or even disastrous mistakes in species choice, provenance choice, establishment and tending regimes.A similar process of advice and assistance regarding the social and cultural environment the investor is entering will also provide good returns.