Globalization and Forest Resources

While there appear to be equally strong arguments for and against globalization in industry and agriculture, the impact of an uninhibited market economy on tropical forests appears almost entirely negative. International lumber companies will buy timber first from countries that do not regulate or control logging, and therefore can sell it more cheaply. In effect, unrestricted trade imposes lower standards (Daly 1996). Competition among tropical countries for contracts with international companies results in give-away prices for a logging concession (Gillis and Repetto 1988). Since national governments receive little economic benefits from intact forests, there is little reluctance about letting the forests go for any meager price, since a low price is better than none at all.

Another negative aspect is that most forests in tropical countries are public lands and are controlled by the national government (Repetto 1988). The politicians grant logging concessions and the national government receives the proceeds from logging contracts. If the politicians are honest, the proceeds usually go towards payment of a national debt. Very little, if any, benefit goes to the people that live in and around the forest, or for environmental protection. The claim that deforestation creates local employment is bogus. The percentage of local inhabitants that are hired by logging companies is very small and the work is usually temporary. After the forest is gone, there are little or no resources to which these people can turn.

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