Ancient Forest Alliance highlights China Investment Corp.'s proposed C$100M purchase of 12.5% stake in Island Timberlands, claims deal could negatively impact old-growth forest protection, forestry jobs, rights of First Nations in British Columbia

Wendy Lisney

VICTORIA, British Columbia , December 13, 2012 (Ancient Forest Alliance) – Conservationists with the Ancient Forest Alliance (AFA) are raising the alarm that the potential ownership of vast tracts of British Columbia’s private forest lands by the Chinese government could negatively impact BC’s environmental laws, forestry jobs, and the rights of First Nations in light of the proposed Canada-China Foreign Investment Promotion and Protection Agreement (FIPA). Island Timberlands is BC’s second largest private landowner, with over 254,000 hectares of private forest lands on Vancouver Island and the Sunshine Coast. The company is expected to close a $100 million deal soon with the China Investment Corporation (CIC), one of the world’s largest sovereign wealth funds owned by the Chinese government. The deal will see the CIC own a 12.5% stake in Island Timberlands (see the article: http://www.scmp.com/news/world/article/1099267/tiny-cortes-island-girds-battle-chinas-huge-cic-wealth-fund).

“The Communist Party of China is about to become one of the biggest landowners in British Columbia if this deal goes through. In light of the proposed Canada-China investment treaty, this could be at the expense of BC’s environment, forestry workers and First Nations,” stated Ken Wu, executive director of the Ancient Forest Alliance. “Chairman Harper seems to be channelling Chairman Mao’s spirit these days, as it’s hard to see how this proposed agreement will be a net benefit to Canadians.”

The Canada-China FIPA would allow Chinese investors in Canada to sue the federal government for lost profits due to new regulations, taxes, and environmental laws enacted federally, provincially, or municipally. This would undercut the ability of future governments to enact new regulations or policies that might result in a lawsuit by Chinese companies which are accountable to the Chinese government. Any disputes under FIPA would go for arbitration in tribunals outside of Canadian courts and mostly outside of any court. These tribunals are not independent, open, and procedurally fair in the manner of other international courts and tribunals. The agreement’s stipulations would last for a minimum of 31 years even if the Canadian government in the future opts out of the agreement at the earliest opportunity, which is after a 15-year minimum term. The federal government has yet to ratify FIPA, possibly as a result of major public opposition including within Conservative party constituencies. See more info at: http://www.desmogblog.com/2012/10/15/china-canada-investment-treaty-designed-be-straight-jacket-canada-exclusive-interview-trade-investment-lawyer-gus-van

“Not only could the Chinese government’s ownership of our forests under FIPA obstruct future measures to protect our endangered ecosystems, BC wood processing jobs, and First Nations land use plans, but it could result in Canadian taxpayers owing tens of millions of dollars to the Chinese government for protecting the interests of our own citizens,” stated Wu.

Measures to protect the environment, labour, and First Nations rights that could be negatively affected by the Canada-China FIPA and the CIC buying a stake in Island Timberlands include:

- Obstructions against new regulations or taxes to curtail unprocessed “raw” logs from being exported from BC to sawmills in China and abroad. Island Timberlands is one of BC’s largest exporters of raw, unprocessed logs to foreign mills in China, the US, and other countries. Public pressure is strong to curtail raw log exports in order to ensure a guaranteed log supply for BC’s wood manufacturing sector. “This trade agreement with China could provide an unfettered conduit for the free flow of unprocessed raw logs from BC’s forests to Chinese sawmills,” stated Wu.

- Undermining stronger Forest Practices regulations on private forest lands. Conservationists are calling for stronger regulations on Private Managed Forest Lands to protect salmon streams with wider forested“buffers”, to protect drinking watersheds, old-growth forests, and endangered species against industrial logging, and to enact controls on the unsustainable rate of overcutting. In 2004 the BC Liberal government removed 88,000 hectares of private forest lands now owned by Island Timberlands from the Tree Farm Licenses that once regulated them with stronger forest practices regulations with the same standards on public lands.

- Frustrating the establishment of a “Forest Land Reserve”, similar to the existing “Agricultural Land Reserve”, that would prohibit real estate subdivisions and suburban sprawl on private forest lands zoned for forestry use.

- Obstructing the implementation of First Nations land-use plans and shared decision-making measures that may require legally-binding orders from the BC government to protect sacred sites, important cultural use sites, and natural resource areas. Most of Island Timberlands’ lands are also unceded by First Nations where no treaties were signed that relinquished First Nations title to them. Many BC First Nations are pushing for increased legal control over their unceded territories and to implement their own land use visions even before treaties are settled, which in most cases are still many years away.

Island Timberlands is entangled in battles with communities across Vancouver Island and the Sunshine Coast who are upset by the company’s plans to log old-growth forests and sensitive ecosystems (see a list of contentious areas and beautiful photos at: http://www.ancientforestalliance.org/news-item.php?ID=519).

On Cortes Island (see beautiful photos at: http://www.ancientforestalliance.org/photos.php?gID=12), local residents repeatedly protested and blocked Island Timberlands’ attempts to log earlier this month. Last week the company temporarily pulled out its logging crews from Cortes Island and postponed its pursuit of a court injunction against the protesters, with Island residents currently waiting for the company to meet with them to resume negotiations.

The Ancient Forest Alliance is calling on Island Timberlands back off from logging its contentious “forest hotspots” across the coast until conservation funding can be secured for their purchase, and to log on Cortes Island according to community, ecosystem-based forestry standards.

In addition to strengthening environmental regulations on private forest lands, the AFA is also calling on the provincial government to establish a $40 million annual BC park acquisition fund to purchase and protect endangered ecosystems on private lands. The last time the provincial government had a dedicated park acquisition fund was in the 2008 budget.

“While private land trusts are vital for conservation, they simply don’t have the capacity to quickly raise the tens of millions of dollars needed each year to protect most endangered private lands before they are logged or developed —only governments have such funds,” stated TJ Watt, Ancient Forest Alliance campaigner and photographer. “More than ever, considering the potential future difficulties to strengthen environmental laws on private lands under FIPA, the BC government must fund the purchase of the last endangered old-growth forests on private lands before they are logged.”

A battle over private forest lands on Salt Spring Island over a decade ago between local residents and a logging/development company was resolved when the federal, provincial and regional governments provided over $16 million in funding, along with $1 million raised by local citizens, to purchase over 1000 hectares of private forest lands on Mount Maxwell and around Burgoyne Bay – an area similar in size to Island Timberlands’ holdings on Cortes Island. Currently, Cortes Island residents are working to raise funds to purchase and protect the 250 hectare “Children’s Forest” from Island Timberlands, constituting about 25% of the company’s private lands on Cortes.

The transfer of lands from private corporate ownership to public ownership would also open up greater possibilities for First Nations shared decision-making and cultural uses on those lands. Other provincial funds could also be put forward to purchase private forest lands for conversion to Community Forests for ecosystem-based forestry operations controlled by local communities.

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