Smartwood's Certification of the Forest Industry Organisation in Thailand: Why FSC Should Revoke the Certificate
Thailand, November 2002
A report written by Chris Lang(*) for the World Rainforest Movement.

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2. FIO'S HISTORY

Thailand's Forest Industry Organisation was established in January 1947 as a state-owned forestry enterprise. Operating under the Ministry of Agriculture and Cooperatives, FIO was established to carry out three main activities: logging in concession areas; logging in non-concession areas including the sites of proposed reservoirs and dams; and the use or sale of confiscated wood either illegally cut or illegally imported into Thailand.

Until the January 1989 government ban on inland timber concessions in Thailand, 80 per cent of FIO's income came from logging (Suphaphan 1994). In 1988, the organisation had a total income of US$37 million with profits for the year of about US$4 million.

Thailand's forests were simply mined. Timber production peaked at 4.5 million cubic metres in 1968, and by the mid-1980s the country became a net importer of timber. The area of forest declined from 274,000 square kilometres in 1961 to 143,000 square kilometres in 1989.

The 1989 logging ban deprived the FIO of logging opportunities in inland forests (logging concessions continued in mangrove areas) and "everything collapsed overnight" according to Chittiwat Silapat of FIO. The organisation survived by selling timber stockpiled in its yards, and by running up debts. "If we were a private company, I think we would be bankrupt" said Chittiwat (Chittiwat 2000). By early 2001, the agency had accumulated debts of about US$11.5 million.

In July 1997, the director of the FIO, Narong Sukree, was transferred to an inactive post at the Ministry of Agriculture and Cooperatives, after failing to tackle the FIO's financial problems. Deputy Agriculture Minister, Pravat Utamok, who authorised the transfer, told the Bangkok Post "I have not heard of any progress in the assignments I gave Mr Narong in the past six months. Everyone in the FIO administration committee agrees he deserves it" (Bangkok Post 18 July 1997).

In September 1998, the government passed a Cabinet resolution which required FIO to streamline its operations and to privatise some of its businesses. Two years later, the Agriculture Ministry asked the Cabinet to consider postponing repayment of two FIO loans. FIO was required to pay two debts before the end of the year 2000: US$6.9 million to Krung Thai Bank and US$4.6 million to the FIO Pension Fund. The loan granted by the Pension Fund had already been extended for more than one year (The Nation 2 February 1999).

FIO's 1999 Annual Report, reveals the precarious nature of the organisation's finances. In 1999, the company's total expenditure was 920 million baht (US$21.9 million). Total income was 902 million baht (US$21.5 million). To make up the loss, FIO sold land valued at 150 million baht (US$3.6 million). The previous year, FIO had made a loss of 226 million baht (US$6.3 million) (FIO Annual Reports, cited in SCC Natura 2001: 5).

In 1999, a despairing Col M.R. Aduladej, then FIO's managing director, told the Bangkok Post, "All of our money-making channels seem to be closed. I see no reason why the FIO should stay" (Uamdao 1999).

Today, the FIO's main activities are commercial tree plantations timber processing and auctioning of illegal timber. The organisation has a total of 144,000 hectares of tree plantations, mainly of teak, rubber, and eucalyptus. The FIO has four sawmills for processing timber and for producing furniture, doors and windows for the local market. The FIO is also the majority shareholder in the Thai Plywood Company, which is a separate company set up under the FIO to undertake wood production. In 1996, the FIO processed 104,980 cubic metres of teak and 176,180 cubic metres of other tree species including eucalyptus.

Until recently, FIO's teak plantations have only produced small-diameter timber from thinning operations. However, many of the plantations were established 30 years ago and the trees are now reaching the size where they can be marketed. In its Final Report for the Swedish-funded FIO Organisational Development project, SCC Natura's consultant Tomas Jonsson states: "FIO's plantations produce wood from thinning operations but within the next years mature timber will be available from clearfelling operations" (SCC Natura 2001: 5).

FIO's record provides a good indication of its likely future performance barring a major restructuring of the organisation and a complete overhaul of the organisation's thinking and operations. The impact of FIO's "management" on Thailand's forests, and the way the organisation deals with local people have caused many NGOs in Thailand to question the role, if any, that FIO should play in the future.

To highlight some of the basic, structural problems within FIO, some of the controversies in which FIO has been involved are outlined below.

Ban Wat Chan

The example of the FIO's activities in the Ban Wat Chan forest in northern Thailand illustrates how the interests of the FIO and those of villagers are often contradictory.

Since the mid-1908s, FIO has had plans to clearcut an area of 24,000 hectares of old-growth pine forests in Ban Wat Chan in Chiang Mai province. The operation was eventually cancelled after strong opposition by Karen communities who were concerned about the impacts on their livelihoods from the logging of their forests.

FIO received considerable international backing for its logging plans in Ban Wat Chan. In 1984, the Finnish forestry consultants, Jaakko Pöyry, produced a feasibility study for the "Ban Wat Chan Forestry Project". In 1990, FIO reached a funding agreement with the Nordic Investment Bank, set up a sawmill and prepared to start logging operations. The following year, Jaakko Pöyry produced another study, this time funded by the Nordic Project Export Fund and entitled "Preparation of a plan for integrated rural development".

Karen villagers living in the area questioned the "science" behind the project, particularly the idea of cutting trees over 200 centimetres diameter, which FIO claimed to be "old and dying". Karen villagers pointed out that old trees formed an important part of the ecosystem and contributed to the biodiversity of the forest. Unlike FIO and their consultants, Karen villagers see more than a supply of timber in the forest. A village representative explained: "More than 4,000 village people live in 15 Karen villages and depend on the Ban Wat Chan pine forest that is habitat for plants and herbs used by the communities" (Watershed 2000: 49).

In 1998, FIO returned to Ban Wat Chan, this time wanting to remove 2,000 "dead trees" from the pine forest. An FIO official said, "the trees should be removed and sold to make money. Leaving the trees to decompose where they are is completely useless" (Watershed 2000: 49). Villagers again rejected FIO plans, forcing FIO to withdraw from Ban Wat Chan once again. Villagers pointed out that large areas of forests would be damaged, "since the trees are scattered over a 24,000 hectare area and cannot be removed without roads" (Watershed 2000: 50).

Despite the fact that the FIO's logging plans have twice been stopped by local opposition, FIO has recently made further attempts to involve itself in Ban Wat Chan's forests. A recent FIO management plan proposes that FIO enters the ecotourism business. Again FIO is seeking international funding, in this case from the Japanese Bank for International Cooperation.

In cooperation with the Thailand Authority on Tourism, FIO has begun construction of four ecotourism centres costing US$3.3 million each, one of which will be located in the Ban Wat Chan forest. Local communities have voiced concerns that the ecotourism plans threaten the Ban Wat Chan watershed forest. Villagers have stated that the expansion of roads in the hilly and forested terrain is increasing soil erosion and forest degradation.

"The FIO's ecotourism project continues to pose a major threat to the Wat Chan pine forest and the livelihoods of local communities," said Hataishanok Intharakhamhaeng of Project for Ecological Recovery (Watershed 2000: 51).

Pulp plantations

Since the 1980s, Thailand's local communities have opposed large-scale tree plantations, particularly of eucalyptus. Plantations have forced villagers from their farmlands, replaced community forests and commons, and lead to water scarcity and soil erosion.

In several instances in Thailand, villagers have successfully regenerated their community forests on land previously planted with eucalyptus. In the early 1990s, in Nong Yak village in Surin province, eight communities grouped together to re-establish community forest on land reclaimed from an FIO eucalyptus plantation. The forest has regenerated and today provides many services and products to villagers. Sa-ad Koonchat, spokesperson of Nong Yak village's Community Forest Recovery Committee, summed up the problem people in his village faced in an interview with Watershed magazine:

We began to protest when we realised that a eucalyptus plantation is not a forest. Before, the natural forest was very important for us. We gathered mushrooms, bamboo shoots, insects and herbs for food. There was water, and there were animals and birds. The forest was cool and peaceful. Eucalyptus plantations gave us no benefits, there was nothing to eat.

For fifteen years, we lived with the eucalyptus, protesting against it. We went to the subdistrict council, to the district chief, to the provincial government, and then to Bangkok. We told them the problems. They said they understood the problems, but couldn't see a solution. They said they would solve the problems, then they did nothing. For 15 years we had this problem. I wondered, were they stupid? They could not see simple solutions.

If there is no forest, we can't live. Three years ago we decided to solve the problem by ourselves. We cut down the FIO's eucalyptus trees on 35 rai [5.6 hectares] of land. The police tried to arrest us, but they couldn't - there were too many of us (Watershed 1998: 35).

Since 1996, several other communities in northeastern Thailand have succeeded in forcing the government to remove the eucalyptus trees and return the lands for village farming and recovery of community forests.

In the early 1990s, FIO planned a US$168 million joint venture pulp mill in Si Sa Ket in northeast Thailand. Siam Cement Group and Advance Agro, two Thai pulp and paper companies, were to have held a majority share in the project, with a 10 per cent share held by the Industrial Finance Corporation of Thailand.

A wide range of villagers and environmental organisations opposed the proposed project. Villagers wrote letters to the FIO, the Science Ministry, the Office of the Prime Minister's Secretariat and to the province's nine MPs, asking for the plan to be reconsidered (Walakkamon 1995). In April 1994, about 200 villagers from Kanthararom district in Si Sa Ket province rallied in front of the provincial hall in protest at the proposed pulp mill (Bangkok Post 19 April 1994). The project was eventually shelved as a result of the local opposition.

FIO's Chittiwat Silapat dismissed the villager's complaints, in a view which typifies FIO's technocratic approach to forestry. He said, "Once the pulp mill had been established it would have benefited the local people and they could have had more jobs, and at the same time can create more forest cover. Even if it was eucalyptus" (Chittiwat 2000).

Recently, the Chinese government has offered FIO the possibility of getting involved in another pulp mill project. Four years of talks between the Thai and Chinese governments to establish a US$1 billion plantation and pulp project have come to nothing, and in 2001 Thai newspapers reported that the Chinese government was looking at FIO's plantations as a source of raw material for the proposed pulp mill (Ploenpote 2001) (The Nation 28 August 2001). The pulp would be exported to China.

The proposal once again brought the FIO into opposition with NGOs and local communities. Pakphum Withantiwat, an advisor to the Assembly of the Poor, Pornpana Kuaycharoen of Project for Ecological Recovery, Surapon Duangkhae of Wildlife Fund Thailand and Daycha Siripat, an advisor to the Alternative Farming Network have all given press interviews opposing the project. NGOs have also organised seminars to discuss the possible impacts of the project.

Illegal logging

FIO has been implicated in several scandals concerning illegal logging in Thailand. In 1994, police investigating logs found in the Salween National Park discovered that the wood belonged to FIO, and brought charges against the organisation, alleging that it was involved in illegal logging practices. The amount of logs imported from Burma appeared to exceed a quota agreed to between the FIO and the military dictatorship in Burma.

In 1997, FIO was associated with another illegal logging operation in the Salween National Park. Trees were illegally cut down in Thailand, shipped across the Salween River to Burma, and stamped as Burmese timber which was then imported by Thai companies. A forestry official exposed the scam and revealed that FIO officers were involved (The Nation 14 March 1997).

One of FIO's most controversial roles is that of auctioning illegally logged timber. In February 1998, Senator Meechai Ruchupan announced that FIO was partly to blame for the destruction of forests in the Salween area. Meechai argued that FIO auctions of seized logs simply encouraged further illegal felling, since operators could buy back the timber at auction, after which the timber becomes legal (Bangkok Post 18 February 1998).

Surapon Duangkhae, secretary general of Wildlife Fund Thailand, agrees that FIO's auctions of illegally felled timber provide a "loophole" in the logging ban. He said,

In many cases, in the area that the company had a logging concession, after the logging ban they still do cutting. The forest department, the Forest Industry Organisation and the company, they are friends. The company sends workers into the forest to cut the trees, cutting huge areas, like in Salween, and then they ask the forest officer to arrest them. But when the forest officer gets to the area there are no workers, just logs. So they arrest the logs! And then FIO holds an auction and then the company that's behind the scenes comes back and they win auction. It's quite cheap from those auctions. This is a loophole (Surapon 2002).

The amount that FIO earns from sales of illegal timber is significant, and plays a key role in ensuring the survival of the organisation, as the figures below indicate:

• Between 1990 and 1995, FIO auctioned 133,200 cubic metres of confiscated teak logs. According to FIO's 1995 annual report, this raised a total of about US$52 million (The Nation 3 January 1998).

• Between October 1997 and January 1998, FIO auctioned 5,350 cubic metres of timber, most of which was confiscated from national parks (not including logs confiscated from the Salween National Park).

• In 1999, FIO earned 567 million baht (US$13.5 million) from timber sales (including illegally logged timber). Of this total, FIO earned 235 million baht (US$5.5 million) from sales of teak and 116 million baht (US$2.7 million) from sales of other species giving a total of 351 million baht (US$8.3 million) (SCC Natura 2001: 25). If the remaining earnings came from illegally felled timber, FIO earned 216 million baht (US$5.1 million) from sales of illegally felled timber.

Illegal logging has also been reported in FIO's own plantations. According to a 1998 report in the Bangkok Post, huge volumes of illegal logs have been sent to sawmills and furniture factories in several northern provinces of Thailand. The timber was cut in FIO plantations by well organised groups, including armed men guarding the logging trucks (Bangkok Post 15 March 1998).

Surapon Duangkhae commented,

The Forest Industry Organisation is facing problems in many areas; this is what I've heard. In Lampang, I've visited many times, and even in Phrae, timber from teak plantations has been stolen by people, just like in the forest area. FIO cannot afford to pay for a watchman to watch their plantations. And they found that it's impossible to stop poaching within their plantations. It means that in the future I don't think they will benefit from what they do with their plantations. The people around there will cut it. If a lot of people live there and they form groups or gangs, they see that they can work the area and take the logs, because they know that the Royal Forest Department or the Forest Industry Organisation cannot afford to protect it all the time (Surapon 2002).

FIO's forest villages

Since 1967, FIO has established a series of "forest villages", the first of which was at Mae Moh in northern Thailand (Kuechli 1997: 167). The "forest village" approach uses a system based on the taungya system developed by the British in colonial Burma during the 19th century. Under the taungya system, Karen villagers provided labour for clearing, planting and weeding of tree plantations, in return for being allowed to grow crops for the first few years between the growing trees. When the trees grew, villagers moved to a new site and repeated the process.

A 1978 report by anthropologist Peter Kunstadter compared FIO reforestation projects with the swidden systems of Lua' and Karen villagers. Kunstadter concluded that Lua' and Karen swidden systems supported six to seven times the number of people for a given area compared to the FIO's "forest village" scheme (Chapman 1980).

The system of forestry that FIO is still practising was out of date more than 20 years ago. At a conference in Chiang Mai, academic Ted Chapman stated,

Taungya reforestation, as it is now practiced in Thailand, is clearly out of step with recent recommendations by FAO, IUCN, and other organizations concerned with the welfare of dwellers on the forest margins. At its Bandung meeting in 1974 IUCN issued guidelines for 'Land Use Policy and Allocation of Land to Various Uses' which recommended inter alia that 'planning of the resource use should involve as far as possible consultation at local, regional and national levels with those people who are likely to be affected by the forestry operations' (Chapman 1980).

FIO's reforestation amounted to little more than the confiscation of land which villagers already used. Villagers have no say in the management of the plantations, and receive no income from the trees in the plantations, which in any case were planned to be cut after 60 years (Chapman 1980).

FIO's plantation at Thong Pha Phum covers an area of 3,008 hectares, of which about 2,500 hectares is managed for timber production. More than 60 per cent is teak and 14 per cent is eucalyptus. SmartWood's Public Summary notes that before the plantation was established in 1978, the land was used by Karen, Mon and Thai villagers (SmartWood 2001: 4). FIO moved about 50 families who were living in six villages to a "forest village" adjacent to the plantation. Villagers were offered plots of land to build their houses. FIO also built a school and Buddhist temple (Janssen 2000).

FIO's Khao Kra Yang plantation covers 2,420 hectares, of which about 2,000 hectares is managed for timber production. Teak trees account for 80 per cent of the total area, with dipterocarp and eucalyptus making up the rest of the plantation. The RFD granted a "Permission to Establish Forest Plantation" at Khao Kra Yang to FIO in 1967 (SmartWood 2001: 4) and the plantation was established the following year according to SCC Natura (Berlekom 2000: 2). SmartWood's Public Summary again points out that the land was in use by local farmers before it became a plantation. FIO established a "forest village" and villagers were allowed to grow crops between the young trees. According to SmartWood, however, since 1984 when the plantation was fully established, no agriculture has been carried out in the plantation (SmartWood 2001: 5).

Villagers did not receive land titles under the "forest village" scheme. In October 2000, Chittiwat Silapat explained that this is because "the area of the plantation is forest reserve land and is under the control of the Royal Forest Department." He added, "They can live there, they can work there and they can pass their rights to their children. But we cannot give land titles to them" (Chittiwat 2000).

Noi, who today works in a forest village at Khao Kra Yang, described the forest village system,

We came to live here as members of the forest village. They gave us a place for our house and work as labour. In those days they never gave us cash, they would give us some compensation every year, like clothes, but not cash. We could use the land to plant the crops while planting teak for them. After three or four years we have to move. We still had to look after their trees but we had to move our cultivation area to another one of their plots and start planting. We have to work every day the whole year. The kind of work is to prepare the area for planting the teak saplings, applying fertilizer, weeding, and taking care of the plot, then cutting it when it is grown.

Recently, FIO has promised to give land to villagers and she said that earlier this year FIO started to divide up an area of land near Khao Kra Yang. However, Noi said she still has no official land title. She said the wages she received are very low, and she planted cash crops to make money to buy rice. FIO has helped the forest village by building roads and schools. "Recently they are helping with village sports, sports equipment, a place for sports activities and a place for youth and children to have a place to play," she said.

In the case of the first forest village at Mae Moh, the Electricity Generating Authority of Thailand claimed a large tract of land for a lignite mine to fuel the Mae Moh power station. As a result, there is no cleared land available for villagers' crops. Villagers have to make their living by working in the plantation and by producing teak seedlings for other plantations in the region (Kuechli 1997: 170).

Many other forest villages face similar problems of land shortage. As a result, FIO has halved the growth cycle to 30 years - for the FIO this has the added benefit of giving FIO profits today rather than having to wait another 30 years as previously planned.

Virawat Dheeraprasert, chairperson of Foundation for Ecological Recovery (FER), a Thai NGO, explained that the forest villages failed to prevent forest destruction, since much of the labour that FIO used in their forest villages came from outside the area. He said,

The system was there to halt the extension of shifting agriculture. But the labour used by the FIO in their forest villages system, was mostly from outside the area, for example from northeast Thailand, and not the local people in the area. So the halting of the expansion of shifting agriculture is irrelevant in the local areas, because FIO is basically hiring outsiders, who then come and clear forest areas. . . . Because rotational farming does not expand, rotational farming doesn't expand the agriculture area. But it's quite efficient, in its use of farming area, except in situations where the local practice or culture has problems with influx of outsiders (Virawat 2002a).

3. THE BACKGROUND TO THE CERTIFICATION:
SCC NATURA AND THE SWEDISH CONNECTION

The idea of certifying FIO's plantations was not developed from an analysis of Thailand's forest problems, nor was it the result of a "consultation" process involving a wide-range of "stakeholders", nor was it the outcome of a debate about forests among villagers' organisations and NGOs in Thailand.

Instead, the FSC process arose as a result of a Swedish government-funded project which ran from 1993 to 2001, entitled "Organisational Development of the Forest Industry Organisation". The project resulted from a meeting in 1992 between Carl Mossberg, a consultant working in Laos for Swedforest, a Swedish forestry consulting firm, and Chittiwat Silapat, who was then head of wood products sales at FIO. At the time Chittiwat was considering ways for FIO to survive in post-logging ban Thailand. He asked Mossberg whether there was "any possibility for us to have some help from Sweden" (Chittiwat 2000). Chittiwat visited Sweden in November 1992, discussed the project with officials at the Board for Investment and Technical Support (BITS), and once back in Bangkok started on a proposal. He submitted the proposal in 1993 and BITS subsequently agreed to fund the project (Chittiwat 2000).

Not surprisingly, Swedforest won the contract to run the project. Tomas Jonsson, the project manager for the project, said Swedforest won the project "In an open bidding process" (Jonsson 2001). However, FIO's funding proposal states, "The project will be carried out in close cooperation between FIO and Doman through Swedforest International AB of Sweden" (FIO 1993: 4). At the time Swedforest was part of the Doman Group, the Swedish state forest enterprise. Part of the justification for the project was that Doman, like FIO, was a state-owned institution, and FIO wanted to learn from Doman's experience.

Swedforest is no longer part of the Doman Group and since 1998 has been called Scandiaconsult Natura (see Box: SCC Natura).

SCC Natura

The Swedish forestry board founded the company now called SCC Natura in 1973. The company was set up under the name Swedforest with the aim of transferring Swedish forestry expertise to the South (Usher 1994). Swedforest was part of the Doman Konsult AB, which in turn was part of the Doman Group, Sweden's state-owned forestry enterprise. The Doman Group was Sweden's largest forest owner, with 3.4 million hectares of forest land.

In December 1993, Doman merged with Assi, one of Sweden's largest forest product companies. Assi was one of Doman's biggest customers, buying 37 per cent of its timber from Doman (PPI 1993). AssiDoman, the company resulting from the merger, is a private company. The Swedish state is the company's largest shareholder, with approximately 30 per cent of the shares (Sivander 2001).

AssiDoman later sold Swedforest along with its other consultancy operations in order to concentrate on its core business of producing packaging, timber and forest ownership.

In 1998 Swedforest was renamed as Scandiaconsult Natura (SCC Natura) and today is fully owned by Scandiaconsult. Scandiaconsult is one of Scandinavia's largest consulting companies, employing more than 2,000 people (SCC Natura www 1).

SCC Natura employs 25 core staff, around 25 long-term contract staff abroad, and has offices in Bolivia, the Dominican Republic, India, Laos, Lesotho and Vietnam (SCC Natura www 1). Over the years, SCC Natura has benefited from contracts from, among others, the World Bank, the Asian Development Bank, Sida, the International Finance Corporation, UNDP, FAO, and the Nordic Investment Fund (SCC Natura www 1). The company has worked in a wide range of countries including Laos, Thailand, Vietnam, Nicaragua, Bolivia, Indonesia, Tanzania, Chile, Ukraine and Sweden.

Although in its publicity material SCC Natura makes claims stressing the importance of "local empowerment" and "sustainable development", its work areas include industrial forestry: saw mills, pulp mills, plantations and logging operations.

SCC Natura is not accredited as an FSC assessor but, through a partnership with Scientific Certification Systems, SCC Natura performs FSC assessments in Sweden. Through this arrangement, SCC Natura has assessed and certified Stora Enso's four million hectares of forestry operations in Sweden. According to a report in Sveriges Natur, the Swedish Society for Nature Conservation magazine, SCC Natura's annual revisions of Stora Enso's operations are carried out without making any checks in the field. In the six days allocated for the annual check, SCC Natura's representative "stops at the district offices, reads the environmental audit report and talks with the staff" (Klefbom and Olsson no date).

The Swedish-funded FIO project ran in three phases: Phase I from November 1993 to February 1994; Phase II from November 1994 to March 1998; and Phase III from March 1998 to February 2001 (SCC Natura 2001: 5).

In what Carl Mossberg described as "finding a new life for FIO" (Mossberg 2000), the project aimed to help FIO change focus. FIO would throw off its old role as a debt-ridden organisation with a reputation for destructive logging and would evolve into an organisation practising sustainable forest management. One of SCC Natura's project reports went as far as suggesting that FIO could set up local credit schemes for villagers, run rural development projects in association with NGOs, carry out joint forest management projects, set up grazing schemes with villagers, while quietly going about increasing its plantation area (von Walter 2000).

One part of the project involved SCC Natura preparing FIO for assessment for compliance with FSC's principles. SCC Natura and FIO chose to bring two plantations up to FSC standards: Thong Pha Phum in Kanchanaburi and Khao Kra Yang in Pitsanulok. The total area of the plantations is approximately 5,000 hectares and the main species in both is teak.

SCC Natura carried out an evaluation of the two plantations, which was supposed to indicate which "management aspects were in line with the criteria - and for what aspects there was scope for improvement" (SCC Natura 2000: 19) According to SCC Natura's final report on the FIO project:

The FSC approach to FIO's forest management development has been most useful. The FSC criteria represent a contemporary view of forestry which combines various legitimate requirements of forestry (economic, social and environmental). Thus the initial analysis of FIO's practices in the field clarified what FIO had to improve. . . . In the social field SCC Natura and FIO have increased the company's overall awareness of the importance of working and collaborating with local communities and organisations. There has [sic] also been positive but minor adjustments made by FIO on worker relationships" (SCC Natura 2001: 19).

SCC Natura claimed that the FSC preparation was a success: "In two test plantations management practices have been improved and FSC certification is within close reach - as the first in Thailand" (SCC Natura 2001: 4).

As a result of the project, SCC Natura reports that FIO has "become a FSC competence centre in Thailand" (SCC Natura 2001: 21) and FIO staff have been invited to give presentations on FSC and "sustainable forest plantations management" at various international conferences. FIO's Chittiwat Silapat now lists on his Curriculum Vitae, attendance at training seminars, workshops and study tours in Finland, Sweden, The Netherlands, Belgium, Germany, France, Switzerland, Yugoslavia, Canada, USA, Japan, Taiwan and Austria.

However, SCC Natura's preparation of FIO to meet FSC standards was a technocratic process, involving little or no discussion with Thai civil society. NGOs in Thailand working on forest issues were unaware that SCC Natura was preparing FIO for FSC certification. Yet, in a 1997 request to Sida for further funding of the project, FIO claimed, "A process has been started, with FIO as lead agent, to develop national criteria for sustainable management of forests in Thailand" (FIO 1997: 6).

Tomas Jonsson of SCC Natura, wrote in the project Final Report (2001),

As part of FIO's improved management principles the company has instituted a so-called FSC reference group which consists of representatives from the forest industry, RFD [Royal Forestry Department], TISI [Thai Industrial Standards Institute, Ministry of Industry], environmental and social organisations. The purpose of the reference group is to offer information on FIO certification development and seek advice from the participants on how to improve forest management. In the eyes of the consultant this reference group can be seen as an embryo to a true working group for the development of national (FSC) criteria for forest management. The four meetings which have taken place over the last 18 months has improved mutual trust among the participants and created a forum for exchange of information - in this way the group can be the foundation for future criteria development (SCC Natura 2001: 10-11).

It is revealing that Jonsson does not name any of the "environmental and social organisations" involved. The reality is that this "FSC reference group" excluded the vast majority of Thai NGOs. For example, Surapon Duangkae, secretary general of Wildlife Fund Thailand, when asked whether SCC Natura or FIO had ever contacted his organisation about certification, replied,

I heard about it I think about 10 years ago: at that time, a letter came to us from the Forest Stewardship Council. They explained about their programmes and said they might be coming to Thailand to see whether there are any companies or industry which might request certification. At that time I remember they mentioned sustainable cutting, in plantations, not forest. After that I haven't had information at all about what goes on, it's quiet (Surapon 2002).

The Regional Community Forestry Training Centre (RECOFTC) is a very well known organisation, both internationally and in Thailand. When SmartWood came to Thailand to assess FIO, they hired RECOFTC's Pearmsak Makarabhirom as a member of their assessment team. However, when asked about SCC Natura and FIO's attempts to set up a discussion on certification, Pearmsak said,

I didn't hear anything. But when I ask Chittiwat [Silapat of FIO], he said they discussed it with their partner agencies, for example the FAO, some of the standards management organisations within the Ministry of Industry, the Thailand Environment Institute and the Royal Forest Department. PER, TERRA or RECOFTC were not invited (Pearmsak 2002).

SCC Natura's Tomas Jonsson, writing elsewhere in the FIO project Final Report admitted that in fact SCC Natura and FIO had made little or no progress in setting up an FSC Standards Working Group:

Within the framework of FSC, which is the system favoured by FIO, no committee for criteria development is established in Thailand to date. FIO and the project has explored the interest among forest sector actors in getting involved in this type of work but so far no committee (in the FSC terminology working group for standard development is the more common word) is formed (SCC Natura 2001: 22).

However, Jonsson refused to take any blame for this. Instead, he argued that the problem lies with the fact that NGOs in Thailand are simply not interested in certification:

In most countries or regions where as a matter of fact FSC working groups have been set up the initiative has commonly come from prominent NGOs. World Wide Fund for Nature (WWF) has taken a strong lead globally and locally. The project has interacted with WWF in this matter but in Thailand WWF prioritises other issues.

It is not realistic to believe that a state owned forest company like FIO - with a past history of forest management which is not necessarily acceptable to all stakeholders - take the lead in forming a FSC working group. But the consultant is of the opinion that the projects reference group has been a positive initiative to get stakeholders together. It is an attempt to share ideas and information. Four reference group meetings have been held with 6 to 10 external organisation taking part at the meetings (SCC Natura 2001: 22-23).

In reality, however, the whole exercise appears to have been more to do with FIO's public relations than a real debate on the role of the FIO, certification and sustainable forest management in Thailand. In a section of SCC Natura's Final Report entitled "Reflections by the consultant" Jonsson wrote: "FIO has been open to exchange information with stakeholder groups and have started to interact more with NGOs. This contributes to improve FIO's image" (SCC Natura 2001: 26).

4. THE CERTIFICATION PROCESS: ENTER SMARTWOOD

In June 2000, after five years of preparation under the guidance of SCC Natura, FIO called for bids from certifying bodies for the certification assessment. FIO informed SmartWood of their successful bid in August and on 6 September 2000 SmartWood circulated a "Public Briefing Paper" which announced that they would be carrying out an assessment of FIO's two plantations at Thong Pha Phum and Khao Kra Yang from 1-7 October 2000.

In countries where no national standard exists, such as Thailand, certifying bodies should produce an 'interim standard' before the assessment takes place. SmartWood's Public Briefing explained that "SmartWood will also capitalize, as a reference, on draft standards and checklists that have been developed for Thailand by other parties" (SmartWood 2000b). However, as SmartWood's Jeffrey Hayward later admitted, when SmartWood's consultants arrived in Thailand they realised that "there were no draft standards for forest management in Thailand" (Hayward 2001b).

According to Motion 29, passed at the 1999 FSC General Assembly, "Identified stakeholders must be informed at least one month prior to the main assessment evaluation taking place of procedures for developing the 'interim standard' (modified standards checklist developed from certifier generic standards)". As SmartWood's briefing was only circulated 24 days before the assessment started, and referred to non-existent "draft standards and checklists", SmartWood is clearly in breach of this FSC Motion.

Further, Motion 29 continues, the 'interim standard' "must be finalised and circulated to stakeholders at least one month prior to the certification decision". SmartWood failed to do circulate any standards and simply used the SmartWood "Generic Guidelines for Assessing Forest Management".

SmartWood's Public Briefing contains little information about FSC or what certification actually means. The briefing was not translated into Thai or distributed to communities living near the plantations to be certified. SmartWood's Jeffrey Hayward commented, "Unfortunately there was not time for us to do that" (Hayward 2001a). He explained that the briefing paper "is just a start. It has to be followed up through more personal communications - that can put a human touch on what certification is, who SmartWood is, where the FSC is coming from, what the certification could mean, why the assessment team is interested in different viewpoints on the operation under assessment" (Hayward 2001a).

SmartWood's Jeffrey Hayward returned to Thailand after the assessment "to meet with stakeholders who are concerned about FIO management and the political implications of certification in Thailand." One of the people that Hayward met while he was in Thailand was Witoon Permpongsacharoen, then-director of TERRA.

Witoon described the "consultation" as follows,

When he called me, I think he called from Jakarta, I asked him, how are you planning to deal with the Thai NGO movement and the fact that there is a logging ban in Thailand? I pointed out that what you are doing is to reopen the logging ban. This is not a technical issue this is a political issue in Thailand, so how are you dealing with this? This was my main question to him. Later he came to the office. We had a long talk with him. But it seemed to me like the process was already finished (Witoon 2002).

In August 2001, Richard Donovan of Rainforest Alliance and Jeffrey Hayward of SmartWood wrote,

We are criticized . . . for not doing more national level consultation with NGOs. We had limited resources during the assessment. We could not stage national level forums to bring together stakeholders in the number or level of intensity that TERRA would have liked. However we took other measures to actively consult. We contacted NGOs (including TERRA and the other contacts they suggested, plus others), we spoke to academics, we contacted various forestry, social and environmental institutes in the country. We had numerous informal meetings with individual and multiple stakeholders (Donovan and Hayward 2001).

However, a closer examination of the organisations with which SmartWood contacted reveals further problems with SmartWood's national level consultation. SmartWood's public summary includes a list of "Agencies & Persons Contacted & Consulted By the Assessment Team". Under the category, "Other stakeholders" (i.e. national level organisations other than staff at FIO) is a list of nine people, from seven organisations (SmartWood 2001: 34). Two of the "stakeholders" work with RECOFTC, the same organisation as Pearmsak Makarabhirom, one of SmartWood's assessors. Other organisations consulted included:

• a United Nations agency: the Food and Agriculture Organisation;

• two state organisations: the Office of Rubber Replanting Aid Fund and the Royal Forestry Department; and

• two NGOs: Thailand Environmental Institute and the Kanchanaburi Conservation Chamber.

Top of the list of "Other stakeholders" is Noel Rajesh, who SmartWood described as "Journalist - Mekong Watershed Journal" from an organisation called "People's Forum on Ecology". In fact, Rajesh works for TERRA, a Thai NGO which publishes a magazine called Watershed: People's Forum on Ecology.

Further, Noel Rajesh was not "contacted and consulted" by the SmartWood team. He interviewed Jay Blakeney, one of SmartWood's assessors, on 10 October 2000 in the coffee shop of Don Muang, the international airport in Bangkok. The interview was for an article he was writing in Watershed. During the interview, Blakeney said, with a straight face, that TERRA was one of the NGOs SmartWood was consulting as part of the assessment. This was the first that anyone in TERRA knew of such "consultation".

On 21 August 2001, Rajesh wrote to Richard Donovan of Rainforest Alliance (with copies to Richard Hayward and Jay Blakeney of SmartWood):

I find it very disturbing that SmartWood would refer to the interview as "consultation". Neither Mr. Jay Blakeney nor any member of SmartWood made any attempt to contact Watershed. In fact, we did not receive from SmartWood any formal information of the assessment process, or of SmartWood's involvement, or Mr. Blakeney's visit to Thailand. We learnt of the certification process from a newspaper report, managed to get Mr. Blakeney's number and contacted him by leaving several messages at his hotel. Finally when we spoke, the only time he said that he had available was just before his flight. So we met at the airport before Mr. Blakeney's departure from Thailand and did the interview that lasted less than an hour. I am not sure how SmartWood can classify this as "consultation" (Rajesh 2001b).

Rajesh requested that SmartWood remove his name from the list of people "consulted". Richard Donovan replied, "We will honor your request to remove your name from the stakeholder list" (Donovan 2001). More than one year later, however, Rajesh's name was still there, at the top of the list of SmartWood's "Other stakeholders".

Pearmsak Makarabhirom, one of SmartWood's assessors, works at RECOFTC and is well known in the Thai NGO movement. He has been actively involved in many debates about people and forests in Thailand. When asked why SmartWood consulted so few NGOs, he replied,

I think that we divided the work into many parts. I said I won't call them, because they are all my friends, so you had better do it. I gave them the addresses and contacts and I said Jay or Jeff, you take care of it. I send them all, even NGOs in Kanchanaburi, Kanchanaburi Conservation Group, PER [Project for Ecological Recovery], NGO-Cord [Thai NGO Coordinating Committee] and other NGOs in the provinces (Pearmsak 2002).

Sakorn Songma, works with an NGO in Pitsanulok called the Centre for Building Local Organisations for Ecological Recovery. Although the NGO is small, it works with a network of more than 64 villages which meet once a month. He first heard about FIO last year, from Virawat Dheeraprasert, of FER. He said,

We wondered whether this is going to be different from the normal plantation, but in fact it's not different, they're just going to cut as usual and sell. I still insist that what FIO has done is wrong. They brought in something we don't know about with a stamp to say it's sustainable, so that FIO can export timber from the country. These are areas that were planted under the logging concession. I don't know the law, but I don't agree with this project. I don't know about the FSC" (Sakorn 2002).

In August 2001, SmartWood's Jeffrey Hayward wrote to TERRA:

I appreciate Terra and Watershed's concerns about building greater stakeholder participation at the national level. As certification is an ongoing, and not a static process, we hope that future audits, monitoring visits, and other opportunities to be in Thailand will permit greater interactions related to the FIO certification or to others that may arise (Hayward 2001).

Yet, in August 2002, Sakorn's NGO in Pitsanulok, TERRA, PER and Wildlife Fund Thailand were unaware that Hayward had visited Thailand again in May 2002 as part of SmartWood's first year audit. SmartWood's Public Summary of the audit was only posted on SmartWood's web-site in October 2002.

When faced with criticism that national level consultation with NGOs and civil society in Thailand was inadequate, Richard Donovan of Rainforest Alliance and SmartWood's Jeffrey Hayward responded,

We felt that we needed to aggressively consult with local stakeholders and we did so, not just during the assessment but in subsequent pre-certification visits to Thailand by SmartWood staff. . . . our consultation prioritized those people who live in and around the plantations, or who work there. . . . In the course of the assessment visit and the precondition audit, SmartWood assessors interviewed nearly 200 people (Donovan and Hayward 2001).

SmartWood's Generic Guidelines for Assessing Forest Management also emphasise the importance that SmartWood puts on consultation during its assessments:

Team members also meet independently with stakeholders. All assessments solicit and incorporate input (confidential and/or open) from as many directly affected and/or knowledgeable stakeholders as possible, including local communities, adjoining landowners, local forest industry, environmental organizations, government agencies, and scientific researchers. During these consultations, assessment team members explain the assessment process, solicit opinions, and gather impressions about the field performance of the operation being assessed (SmartWood 2000a: 4).

Yet, villagers living near the two plantations, interviewed in August 2002 for this report, had never heard of either FSC or SmartWood. Somsak Ratanawaraha, the village head man of Ban Nam Tok Poi, a village near the Khao Kra Yang plantation, is listed as "consulted" in SmartWood's Public Summary. When asked about the consultation process, however, he said, "We didn't talk about anything, they only asked me questions. They didn't talk about FSC. They didn't talk about certification at all. They were talking about the plantation and what benefits are coming" (Somsak 2002).

Surapong Supkai, president of the council of the Tambon Administration Organisation (TAO), Huay Kayeng subdistrict, near the Thong Pha Phum plantation, had also never heard of either SmartWood or FSC. SmartWood's public summary lists Sing Prai, a member of TAO as one of the villagers "consulted during stakeholder meetings" at Thong Pha Phum. Surapong knows Sing Prai and added that his second name is Pungbansanee. Surapong did not know that he had been consulted, and Sing Prai had never mentioned it to him. "It's wrong, because the TAO was not consulted. It's wrong to say that we were consulted," said Surapong (Surapong 2002).

Soonan Nawan is the former head of Ban Wang Nam Khieo, another village near FIO's Thong Pha Phum plantation. Soonan worked in the FIO's forest village for 20 years, until he left four years ago because the wages were "very, very low". When asked whether he had heard of FSC or SmartWood, he said that SmartWood had visited the area, but added, "They are received in the FIO office and they are taken around by the FIO. They never come to talk to the villagers. The FIO people talk with them. They have never come and said we want information from the villagers" (Soonan 2002).

In August 2001, Noel Rajesh, a forest researcher with TERRA, visited Ban Prajam Mai and Ban Paak Kok, two villages near to the Thong Pha Phum plantation. Neither of the villages are FIO forest villages and villagers receive few if any benefits from the plantations. Villagers in both Ban Paak Kok and Ban Prajam Mai said they have never heard of SmartWood or the certification and had never been visited by any representative from SmartWood (Rajesh 2001c).

Virawat Dheeraprasert, chairperson of FER, commented,

Local people have so far been totally unaware of the SmartWood process and the certification. There has been absolutely no local participation, which means in effect that FSC is supporting a process that violates the very basic principles of Thailand's constitution (Virawat 2002b).

FIO plans to extend certification to all of its 138 tree plantations in the next five years. Although SmartWood's assessment in October 2000 only looked at two plantations, the assessment prepared the ground for future certification. Jeffrey Hayward of SmartWood explained:

The assessment is designed so that FIO's management system is being assessed. Specifically it is addressed at the unit level. If the FIO management system is being used throughout their 140,000 hectare holdings, with little variation, then in the future, if we are evaluating additional districts, those that meet the certification standards can be incorporated into the group of FIO certified units. Meaning, that eventually, this certification can operate as a group certification (Hayward 2001a).

In May 2002, SmartWood came back to Thailand, to carry out a first year audit of the two certified plantations. FIO hoped that SmartWood's first year audit would also include an assessment of five more plantations for potential inclusion in the FSC certificate. However, SmartWood recommended that one of the plantations, Ta Pla, should "not be considered as a potential entrant to the certified pool" on the grounds that "there were land tenure issues" which "would pose a high risk for non-compliance with [FSC's] Principle 2" (SmartWood 2002: 32-33). FIO duly withdrew this plantation from the assessment and SmartWood assessed the remaining four. After a whirlwind six day tour of Thailand, including visits to five plantations, SmartWood concluded that "Regretably, during the on-site audit visits, there were substantive areas that need to be improved to be in compliance with FSC Principles 2, 3, and 5" (SmartWood 2002: 35). Further explanation is only available in the "confidential section" of SmartWood's audit report.

In August 2002, Chittiwat Silapat said, "Now we're going to have four more certified plantations, maybe within this month. Another four teak plantations" (Chittiwat 2002). However, Chittiwat did not mention that SmartWood had already assessed these plantations and found that they did not conform to FSC Principles. Chittiwat said, "I just got a draft report, I haven't had time to read through yet" (Chittiwat 2002).

SmartWood's assessment of FIO effectively continues the process started by Swedforest in 1993 - a process that has involved little discussion with NGOs and no facilitation of public debate about the role of FIO since the logging ban.

FIO's ahistorical, apolitical, technocratic approach attempts to side-step issues such as land rights and communities' rights to manage their own resources. SmartWood's consultants appear to be supporting FIO in glossing over these issues. Asked whether controversies and scandals relating to the FIO's previous logging and plantation projects would figure in the assessment, Jay Blakeney, the leader of SmartWood's October 2000 assessment team, said: "SmartWood assessment is usually focused at the forestry management unit. The system of assessment doesn't look at the historical and other institutional mistakes" (Watershed 2000: 52).

Richard Donovan of Rainforest Alliance and Jeffrey Hayward of SmartWood echoed Blakeney when they wrote in August 2001:

Certainly the most egregious past cases mentioned in articles about FIO (e.g. the Ban Wat Chan watershed) naturally were of concern to SmartWood, but we were not evaluating those areas or incidences within the scope of this certification. FSC certification is a tool for improving forest management - be that natural forest or plantation. FIO made a decision on its own that it wanted to improve. What we evaluated were the improvements taking place (or required to happen before certification could be granted) on two forest units. FIO was able to demonstrate to us that they are managing differently from the past on these units. FIO also indicated to us that the certified units represent a starting point for change in their system (Donovan and Hayward 2001).

In response to a letter from Green World Foundation, a Thai NGO, Jeffrey Hayward of SmartWood said, "Certification is a way for any forestry operation to demonstrate that it has changed and is changing for the better. We are solution oriented. The past is a vital part of history and development, but how does it impact the present and future?" (Hayward 2000).

SmartWood's assessment thus ignores the fact that they are partly determining FIO's "right to be around" by ignoring the reality of social opposition to its very existence. In describing SmartWood as "solution oriented" in this context, Hayward is looking for solutions for FIO. The following section indicates just how far SmartWood is prepared to go to find solutions for FIO.

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