21 March 2006

Uganda: Minting Cash in Timber Market

Kampala — On Sundays, Rev. Abel Nuwamanya conducts services in Bushenyi District.

The fulltime pastor of Greater Church implores the congregation to leave Satan's ways and turn to Christ.

But my recent encounter with Rev. Nuwamanya was not anywhere near the church aisles. It was deep in Kalinzu Central Reserve. And he had not gone there to look for lost sheep but to buy timber. Yes, the clergy does not only win souls for Christ but also engages in timber trade.

On January 27, when we first met, Rev. Nuwamanya was among the 40 clients who had turned up for the National Forestry Authority's (NFA) first auction of logs in Kalinzu. A total of 200 cubic metres were up for sale and like the rest, he had come to compete and buy.

"I got into timber business 10 years ago to supplement my income as a clergy," he explains. "That is how I have been able to educate my children," adds the father of five, two of whom are at university as private students.

Though Jesus' father was a carpenter, the timber business is not always as divine as you might think. Sometimes people acquire some of it illegally and end up undercutting those who follow the right procedure like Rev. Nuwamanya. And that is his biggest challenge.

"For people who live by God's grace, illegal timber is a big problem.

Otherwise, making furniture and saving souls is all serving God's people," says the furniture workshop owner and pitsawyer.

However, the National Forestry Authority (NFA) has been trying hard to eliminate illegalities in the timber market so that those who follow the right procedure can make a profit.

In 2004, the Authority introduced a competitive bidding process through which saw millers can be given licences to harvest timber. This replaced the old system where saw millers were required to apply for concessions from the Forest Department; a system that was not transparent enough.

The competitive bidding system is used both in plantations where harvesting coupes are sold and in natural forests where trees are felled, cross-cut and sold as logs. This is in accordance with the Public Procurement and Disposal of Public Assets Act 2003 that spells out the requirements for selling public assets.

The new system has been successful. For example, during the financial year 2004/05, harvesting licences worth Shs5.4 billion were given out in plantations whereas 48,000 cubic metres was harvested. This is up from Shs1.2 billion the year before NFA was launched in April 2004.

The market price for trees in plantations also went up from a fixed price of Shs28,000 to more than Shs60,000 per cubic metres.

This is a big leap towards sustainable management of Uganda's receding forest cover considering the fact that the mature timber plantations in the country today is less than 3,000 hectares with about 700,000 cubic metres of standing volume.

Similarly, timber prices in Kampala have been stabilising. According to a survey by NFA's Forest Harvesting and Utilisation Unit, a 12x1x14 Maesopis spp timber was selling at Shs10,000 throughout most of last year until it dropped by Shs1,000 in December.

Aningelia spp of the same size cost Shs34,000 from April only for the price to fall by Shs4,000 in December due to increased supply of illegal timber on the market.

However, though timber dealers acknowledge that the bidding process is transparent, they say it has pushed the price too high. According to the Master Wood Works Managing Director, Mr Willy Kamunyu Byandusya, the bidding process where the price is a major determinant on who wins, encourages speculators. The speculators, he says, push the prices too high for genuine buyers and eventually make the timber business unprofitable.

In Mbarara, Mr Fred Kimbareeba, who has been in the timber business for 30 years had thought that the divestiture of the former Forest Department would mean the closure of his business but two years later, his business is still up and running. He says that he hopes to make money when NFA fully eliminates illegal timber from the market.

Kimbareeba's wish is actually NFA goal. The Authority has set up a unit to monitor illegal forest produce (timber, charcoal etc) on the market in order to protect those engaged in legal trade.

This Unit, which has the blessing of the minister of Water, Lands and Environment, impounds illegal forest produce, which is later disposed off in an auction. This measure is to act as a deterrent so that one-day even monks can engage in timber trade with a clean conscience. And that should be sooner than later!

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