GREEN GOLD

Prof. Dr. Julio Cesar Centeno

The (Canadian) Forestry Chronicle
March/April 1999, Vol.75, No. 2
p. 320 - 321


This book methodically recounts the technical, legal, political and ethical aspects of a teak plantation established in Costa Rica by the Dutch company "Flor y Fauna", and its astonishing sequel of events.

The largest environmental groups in the world, the World Wide Fund for Nature (WWF), and one of the largest insurance and banking companies in the Netherlands, OHRA, soon became partners in the business. This seemingly odd trio went on to promoted investments in the project as green and ethical, while making a parallel with investments in "Green Gold" due to its unusually high financial returns.

The returns offered to investors were based on "scientifically sound" and "conservative" production estimates of over one thousand (1.000) cubic meters of commercial timber per hectare at the age of 20 years. Such figures, it was assured, were further based on "local experience".

In a presentation in a court of law, Flor y Fauna insisted: "A timber yield of 1.057 m3 per hectare...should be easily attainable". This statement was supported by a written declaration by a forestry official from the Ministry of Agriculture, who considered these projections so conservative that they could be surpassed by a factor of two.

The Rainforest Alliance later on endorsed the company's projections, reporting: "Based on interviews, field work and research data collected in Costa Rica, we did not find that Flor y Fauna's projections on growth and yields were inaccurate". But it refused to provide or identify one single piece of evidence when questioned on the validity of such a statement.

Thousands of unaware citizens were convinced by the unparalleled investment campaign and the credibility derived by the endorsement ofthe project by the World Wide Fund for Nature (WWF, known in North America as the World Wildlife Fund), the participation of the insurance company OHRA, and the subsequent endorsement of the project by the Rainforest Alliance and the Forest Stewardship Council. "WWF has ascertained that, in ecological and financial terms, the Flor y Fauna plantations set a worldwide example", read one of Flor y Fauna's advertisements.

Millions of dollars quickly poured into the project. The case was brought to the attention of the Dutch parliament, with statements of support by the Minister of Agriculture and the Minister of International Cooperation of the Netherlands. The project was referred to by OHRA as an example of "modern development aid" and as a means to enhance forest conservation in Costa Rica. According to OHRA, such a view was shared by the President of Costa Rica.

The project became certified by the Rainforest Alliance as "well managed", based on the principles of forest management subscribed by the Forest Stewardship Council (FSC), while WWF proclaimed the FSC as "the only credible initiative in the field of forest certification". The project was so appealing that the FSC publicly endorsed the certificate issued by the Rainforest Alliance, even though this organization had not yet been accredited as an official FSC certifier for plantations at the time. The Rainforest Alliance referred to the project as "...an impressive combination of social responsibility and economic viability".

A notorious public campaign was launched to incorrectly inform the public that the project had been "certified by the FSC", an organization supported by a wide variety of environmental groups, and better known to the Dutch public than the Rainforest Alliance. Investments in the project continued to rise. It was later ruled by the Dutch Advertising Standards Committee that claims made in public ads were "misleading".

Dozens of similar Dutch plantation initiatives soon followed suit, most of them in Costa Rica, in attempts to cash in the overwhelming receptivity of the public for such visionary, exemplary, green and profitable investments. A dream come true.

But the dream was soon shattered. At the end of 1995, a couple of investigation reporters from the most reputable news commentary program on Dutch television, NOVA, dug out a confidential report on the project, commissioned a couple of years earlier by the head office of the World Wide Fund for Nature (WWF-International) to clarify the business arrangement between WWF-Netherlands, OHRA and Flor y Fauna. Among the report's astonishing conclusions were the following:

  • "WWF seems involved in a commercial operation with questionable technical, financial and ethical implications".

  • "It would be convenient to clarify if making exaggerated claims such as those referred to in this report is considered a violation of laws in the Netherlands".

  • Expected yields "...exceed by a factor of four (4) what are considered high yields for teak on good soil"

  • "This may be considered fraud"

An additional and shocking embarrassment came when it was also exposed that WWF would be 'compensated' for its endorsement of the project with an estimated payment of 86 million dollars, "5% of the turnover of plantation section Teakwood VI", according to WWF-Netherlands. Teakwood VI refers only to the portion of the plantation established in 1993 alone: 750 hectares. Later on WWF also endorsed Teakwood VII and VIII, an additional area of 820 hectares, with alleged proportional 'compensations'. The total area planted by Flor y Fauna in Costa Rica exceeds 3.000 hectares.

The broadcast of a television program on the contradictions and speculations involving the project generated a wave of public outrage and media attention. In consecutive attempts to justify the unjustifiable, Flor y Fauna, OHRA, WWF and the Rainforest Alliance each time modified their previous position and arguments, falling in increasing contradictions, undermining their own position and credibility, and consistently molding "the truth" to fit the arguments of the time. Facts, or "truth", became variables, to be adjusted to the needs or intentions of those most seriously mired by the scandalous nature of the case. Therefrom the subtitle of the book: "On variations of truth in plantation forestry".

Investments in the project quickly came to a halt, while it was subject to the scrutiny of courts of law. Amongst those most seriously damaged from the exposure of the speculative and fraudulent internalities of the case were the World Wide Fund for Nature (WWF), individual investors, the credibility of both the Forest Stewardship Council (FSC) and the Rainforest Alliance, the reputation of the forestry profession in the Netherlands, and the reliability of forest investments in the tropics.

GREEN GOLD attempts to settle the record straight on the multiple points of view and interpretations on a case that may be only the first of a series involving speculative investments in teak plantations in Costa Rica. The book comes with a CD packed with documented evidence to support its arguments. Recommended reading for anyone interested in plantation forestry and certification anywhere.

Author: Dr. P. Romeijn

Julio Cesar Centeno is a forestry specialist from Venezuela from whom WWF requested an economic analysis of Flor & Fauna's teak plantations in 1993. He was one of the key negotiators of the International Tropical Timber Agreement, UNCTAD, Geneva, serving as spokesman for tropical countries. He served as forestry advisor to the Secretariat of the United Nations Conference for Environment and Development [UNCED 92], and as Director of the Latin-American Forestry Institute between 1980 and 1990. He was invested by Prince Bernhard of The Netherlands with the Golden Ark Award for his work in the forestry sector. He serves as a member of the Governing Board of SGS-Forestry in Oxford, United Kingdom, and as acting Vice-Chairman of the TROPENBOS Foundation in The Netherlands. Julio Cesar Centeno is a former member of the Board of Directors of the Forest Stewardship Council (FSC) and one of the organization's founding members; former member of the Governing Board of the SGS-Qualifor forest certification program; former member of the Board of Advisors of the Rainforest Alliance Smartwood Program.

JULIO CESAR CENTENO, PhD, Las Tapias, Edif. Carreto, Pent House 2, PO BOX 750, MERIDA - VENEZUELA.