Resigned minister made felling volume decision without industry proposals
The State Forest Management Center (RMK) and the Forest and Wood Industry Association have said a last-minute decision by former Minister of the Environment Tõnis Mölder (Center) to reduce felling volumes deprived Estonia of some €230 million.
Tõnis Mölder resigned on Wednesday morning last week, citing personal and family reasons. His authority and previous decisions made as minister were still valid, however. He admitted later in the week that he had a passion for betting on sporting results, one which is now under control having sought professional intervention.
On the same day, the Ministry of the Environment completed a five-year regeneration cut plan. Ministry chancellor Meelis Münt signed the plan, which determines the optimal area for regeneration felling in state forests just before lunch. For the regulation to come into force, Mölder signed the plan on 10.10 p.m. Tuesday evening.
The Forest and Wood Industry Association said on Wednesday that the decision to reduce the area of state forest regeneration cut by nearly 13 percent will slash €342 million off the added value of the Estonian forest and timber sector, while the state will lose €230 million in budget revenue as a result.
According to the industry body, in a situation where gaps in the state budget need to be bridged and a message about the need to start a tax debate is sent to society, a significant proportion of income is lightly abandoned without analyzing the substantive effects and informing businesses.
The association argues that the decision changes the bases for determining cutting volumes of state forests from forestry/substantive to political, which will increase uncertainty for companies about future decisions.
The plan sees felling volumes reduced significantly. While different types of wood can be gathered from a total of 11,276 state forest hectares this year, that number will fall 12.4 percent to 9,880 hectares next year. The reduction rate of felling in state forests is to come down in a similar rate over the entire five-year plan.
Usually, optimal felling volumes are coordinated with the State Forest Management Center (RMK), but Mölder did not wait for their proposal this time around.
RMK board chair Aigar Kallas said they had presented their proposals to the Environment Agency in August, but they did not receive a response in time to present the proposal to the environment ministry.
Forest and Wood Industry Association manager Henrik Välja echoed Kallas' statements and said the industrial sector as the main customer of state forests was not involved in the making of the decision.
"It is reprehensible to make such decisions in the late hours of the night without informing the affected party in advance. Estonian companies need a clear and predictable business environment to compete successfully in international markets and to grow in the value chain," Välja said.
According to the association, the decision will also cripple Estonia's transition to a bio-economy and increase its continued dependence on fossil resources, including Russian gas.
Limiting the cutting volume will bring difficulties for the local timber industry and cause an increase in the price of local wooden products, which in turn will lead to more products being imported or the consumer choosing a cheaper but less environmentally friendly alternative because of price pressures, Välja added.
Mölder: I did not rush a decision
Former environment minister Tõnis Mölder said he did not rush signing the plan. He said he calculated that if 2.5 million cubic meters of wood are currently removed during regeneration felling, that rate could go down by 20 percent - 2 million cubic meters a year.
"We are moving on schedule toward 2 million cubic meters and that is important for us to have stability and for our forest reserves to increase.
Mölder was not too eager to respond to a question about if he signed the plan on Wednesday, knowing that his successor Erki Savisaar (Center) would not sign it. "Whether or not the new minister would have made the decision or not, you would have to ask him. But it seems to me that we did not have such a conflict on this matter;" Mölder noted.
"The decision was not one made in a day. This decision was prepared for months. It has been a long process, based on the coalition agreement, state budget negotiations, draft laws sent on coordination rounds, but also what our felling area should be next year," the former minister said.
Mölder said the general societal expectation is toward reducing felling volumes and that is what he did. "A majority of society expects RMK's patterns to change. For our forests to have more trees, for it to be protected and for there to be less economic activity than RMK's operating policy has been in previous years. So I think the step taken was more consistent with society and societal expectations," the former minister said.
Although the amount of wood gathered through regeneration felling could reduce considerably, Mölder said there are other ways to compensate for it. Sanitary and maintenance felling will continue, as will deforestation near four-lane roads and under the Rail Baltic route.
RMK plans to reduce activity
"For RMK, the reduction of felling areas in the regulation means lower dividend expectations, lower workloads, less timber and fewer planted trees in the future. Since the prices of timber are currently rather high, it will not initially bring along a need to reduce the volume of nature conservation. We will be able to continue conducting maintenance and development works for hiking trails, however," RMK board chair Aigar Kallas noted.
He said the amount of timber stocked and sold will go down by 300,000 cubic meters. "We will still have to decide which regions we will reduce felling in," Kallas added.
He said RMK will also make a decision on which types of trees to eliminate from felling plans. "But it is likely that we will reduce the amounts of pine wood, since pine forests grow longer and they are less affected by pests than spruces or birches," Kallas said.
In order to draw the government's attention to the situation and prevent negative consequences for the industry, the association has directed public appeals to Prime Minister Kaja Kallas, Minister of the Environment Erki Savisaar, Minister of Economic Affairs and Infrastructure Taavi Aas and Minister of Finance Keit Pentus-Rosimannus.
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Editor: Kristjan Kallaste