CHINA'S HUGE APPETITE FOR PAPER IS FUELING PULP MILL EXPANSIONS AND ACCELERATING THE LOSS OF FORESTS IN COUNTRIES SUCH AS INDONESIA, A GLOBAL RESEARCH INSTITUTE SAID ON THURSDAY, ACCORDING TO REUTERS. DAVID KAIMOWITZ, DIRECTOR GENERAL FOR THE CENTER FOR INTERNATIONAL FORESTRY RESEARCH, TOLD REUTERS LARGE PULP MILLS WERE BEING BUILT WITHOUT LENDERS SUCH AS THE WORLD BANK CHECKING THAT THE PROPOSED MILLS HAD ENOUGH RAW MATERIAL. THAT OFTEN LED TO THE DESTRUCTION OF VIRGIN FORESTS AS NEW MILLS SOUGHT CHEAP SUPPLY SOURCES TO MEET PRODUCTION TARGETS. "IT'S REALLY SHOCKING HOW LITTLE PEOPLE HAVE BEEN LOOKING INTO THE WOOD SUPPLY ISSUE," HE SAID FROM INDONESIA AS CIFOR RELEASED AN EIGHT-YEAR STUDY INTO THE WORLD PULP INDUSTRY (HTTP:/WWW.CIFOR.CGIAR.ORG/DOCS/_REF/MEDIA/RELEASE/2006/PULP/INDEX.HTM). THE WORLD BANK'S PRIVATE FUNDING ARM, THE INTERNATIONAL FINANCE CORPORATION, TOOK ISSUE WITH THE COMMENTS, SAYING IT DID NOT FINANCE PROJECTS WITHOUT AN ENVIRONMENTAL AND SOCIAL IMPACT STUDY. THE STUDY LOOKED INTO 67 PULP MILL PROJECTS AS CIFOR EXPECTED INVESTMENT OF $50 BILLION TO $60 BILLION IN THE SECTOR IN THE NEXT 10 TO 15 YEARS AFTER ABOUT $40 BILLION WAS SPENT IN THE PAST 10 TO 15 YEARS. "THE CHINESE MARKET IS DRIVING A LOT OF GROWTH IN GLOBAL PULP AND PAPER. AND AFTER CHINA -- 10 TO 15 YEARS DOWN THE LINE -- WE CAN SEE INDIA MAY BE A SIMILAR STORY," KAIMOWITZ SAID. THE STUDY SAID PULP MILLS, SUCH AS ASIA PULP AND PAPER (APP) AND ASIA PACIFIC RESOURCES INTERNATIONAL LTD. (APRIL) FROM INDONESIA, OFTEN OVERESTIMATE WHAT WAS AVAILABLE FROM TIMBER PLANTATIONS. BOTH APRIL AND APP DENIED ANY WRONGDOING. "THE COMPANY IS A FULLY SUSTAINABLE OPERATION," APRIL PRESIDENT A.J. DEVANESAN SAID IN A STATEMENT. --MORE
