Where’s the billions in forest royalties?

Despite the billions derived from logging,
oil and gas royalties, Sarawakian natives
have remained poor with minimal infrastructure.

By Joseph Tawie

KUCHING: Where has the RM14.4 billion in forest royalties derived from logging Sarawak’s rainforest since 1980 gone?

Posing this question in the current sitting of the Sarawak State Legislative Assembly, assemblyman See Chee How said the revenue seemed not to have filtered down to the masses, as the state was still grappling with poverty.

“What has happened to all the forest royalties that the state received from all the trees chopped down since 1980?

“The state government likes to claim that logging [and now oil palm] has brought development to the rural people. But, if so, why is there still so much poverty and deprivation in Sarawak?

“Why is there so much growing inequality? Where did it all go?” asked See, the Batu Lintang assemblyman.

See said the official statistics indicated that between 1981 and 2009, the Sarawak state government collected RM14.4 billion in forest royalties (for the years 1981-2003, and 2009).

“This cumulative figure, which does not include the 2004 to 2008 figures, constitutes revenue from forest royalty alone and does not include cumulative income from other revenue streams like forest premium, hill timber premium, timber premium, and various other timber and timber industry tariffs.

“If these figures are included, it is likely that the cumulative revenues from timber would amount to over RM15 billion.

“However, in May 2011, a consultant with the United Nations, Philip Khoo, estimated that forest royalties alone collected in Sarawak from 1980-2006 amounted to about RM19 billion.

“If this is the case, why is Sarawak still lacking in basic infrastructure? Why is there still so much poverty and growing inequality in Sarawak even as the forests have disappeared before our very eyes?” asked See, who is also Sarawak PKR vice-chairman.

Poor infrastructure

See said that much of rural Sarawak still subsists on dangerous logging roads, and has little telephone coverage. Electricity connectivity from the state grid is poor and fresh piped water remains a pipe dream for thousands.

He said schools are provided by the federal government, and although there is a fairly generous number of rural primary schools, secondary schools remain a different story altogether with 12-year-old kids having to go to towns as boarders to be in secondary schools.

Hospitals are also provided by the federal government, but in the interior of Sarawak — Ba’Kelalan, Batu Danau, Telang Usan, Kemena, Kakus, Belaga — there are no hospitals, despite promises made 15 years ago.

“And we have not even begun talking about the need for improved hospitals in Sri Aman and other parts of the state.”

“So, where have all the forest royalties gone to? Does not the continued existence of poverty [estimated at between 5% and 30% by experts) and inequality in large swathes of the rural and Bumiputera population of Sarawak point towards huge leakages of state funds that have only enriched certain quarters?

“And if all that cumulative forest royalties are unable to solve the state’s poverty and inequality problems, how can we expect the promotion of oil palm plantations to do so when the average daily wage in plantations averages a mere RM20 per day?

“Is ‘development’ — courtesy of logging and oil palm plantations — a mere ruse by the state government to ensure natives of Sarawak remain underdeveloped?’ he asked.

He said that another point to note is the oil and gas royalties which is also least discussed.

“Official sources note that between 1992 and 1999, Sarawak derived a cumulative total of RM1.534 billion from petroleum royalties.

“This figure has been rising annually. Available data shows the state deriving about RM582 million in 2002, and increasing annually to RM1,326 in 2008, from oil and gas.

“Yet we are still poor. Given this unsatisfactory state of affairs, the state government has to come clean with details of the exact amount of oil and petroleum income it has received since 1980 and explain where these royalties have gone,” he said.