According to the Sydney Morning Herald, Australia’s Westpac Bank is financing some of the Pacific’s most unsustainable and destructive logging operations and has provided loans to companies in the Solomon Islands linked to illegal tree felling. Sources: Brisbane Times, Sydney Morning Herald
These loans were to companies in the Solomon Islands that have been linked to illegal tree felling, suspected hiring of illegal workers, trespass and causing environmental and social problems including violence.
The operations are part of a logging industry considered so unsustainable that the Solomon Islands Finance Ministry has warned of its exhaustion by 2015.
The nation has the highest percentage loss of forest in the Pacific according to a United Nations emission reduction program. The World Bank says in one month in 2010, 50,000 logs were exported.
Researchers have also linked the industry to community conflict and the exploitation of women and children while Australian advisers say officials lack the resources to police loggers.
Westpac has confirmed nine per cent of its loans in the islands relate to the logging industry, with a spokesman telling the Sydney Morning Herald that the loans had been reduced from 35 per cent in 2009, as part of a ”strategy to reduce exposure”.
The Sydney Morning Herald had found direct loans and long business relationships between at least five of the country’s major logging interests and the bank.
In one case, a manager for loggers Success Company Limited confirmed it had received a Westpac loan as recently as this year.
The Success manager John Parsad said the loan was represented to the bank as being for earth moving but would be used for logging as the earth moving machines cut logging roads through the forest.
The same company, which is part-owned by the Solomons’ former forestry minister Bodo Dettke, was issued an injunction in 2010 to stop logging on Kolombangara Island after it was alleged to be trying to log above 400 metres, threatening rare cloud forest without appropriate approvals. It is fighting the injunction.
Another prominent logging business owner, Hii Yii Ging, has confirmed one of his Solomon Island logging-related businesses has a Westpac loan.
Another of his logging interests has been named in a court dispute over alleged non-payment of compensation relating to alleged illegal logging. He has denied any illegality and says his operations have provided jobs, infrastructure and aid to remote communities.
The bank declined to comment on specific loans for privacy and confidentiality reasons.