Chinese timber companies in Zambia: few jobs, but more outlets for local loggers

Wood produced by small pitsaw is ready to be sold to merchants from Lusaka near Sesheke district.

BOGOR, Indonesia — Basic research methods such as employment surveys fail to explore the complex social impact of China’s deepening involvement in the African timber sector, a recent article on Chinese logging companies in Zambia shows.

“When studying the benefits of logging to the people, you have to look at the different dimensions that affect them on the scale of a country, a company and a household,” said Louis Putzel, a CIFOR senior scientist participating in a multi-year research project on Chinese trade and investment in Africa.

“One that is often looked at is jobs: how many, how much they are paid… But another important topic is the economic opportunity the Chinese market represents to smaller businesses and informal timber traders.” Of course, such opportunities need to be considered against the ecological and social costs of logging in fragile environments and places where resource governance isn’t strong enough.

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Philippe Asanzi, a doctoral graduate from Stellenbosch University in South Africa and lead author of the article, led a team that conducted field research into the impact of the Chinese timber trade in Zambia’s Western Province. He interviewed local authorities, managers of logging companies, retired workers and heads of villages in 25 communities near the concessions of four logging companies — two Chinese-owned, one Zambian and one South African.

“Non-Chinese companies tend to employ more workers, but they do not seem to have relations with small local timber companies,” Asanzi said. By contrast, the perception of local observers showed that Chinese-owned companies created fewer jobs and offered less attractive working conditions — in health and safety measures as well as pay.

MIND THE GAP

The paper offers possible explanations for this gap ranging from “the corporate culture of Chinese companies,” which previous studies have found to be less favorable to labor, to their low profitability in Zambia — a land-locked country that produces less timber than its neighbors.

“These companies were started by Chinese migrants with their personal savings: they have smaller means than larger, government-backed Chinese [companies], and they struggle to make a profit because of the transport costs from Zambia to China,” Asanzi said.

Yet they do not only export timber extracted from their own concessions and “provide relatively significant markets for local timber producers operating in proximity to [their] logging concessions,” the scientists wrote. Local “pit sawyers” were found to have more options to sell their products thanks to growing demand from Chinese companies in the area. In fact, even the large Zambian company among the four targeted in the study sold some of its production to Chinese traders.

Although the sample they studied was small, Putzel and Asanzi said their observations meshed with other research on the Chinese timber trade in Africa. “In other African countries, such as Cameroon and Mozambique, Chinese companies buy timber from local producers too,” Asanzi said.

This wider understanding of Chinese and non-Chinese timber companies’ impact on local livelihoods is important because their other contributions to local communities were found to be insignificant. “None of the logging companies in our sample provide significant services or infrastructure to rural communities,” the scientists wrote. Researchers found that the schools or churches promised by the various companies were often hard to find, and local corruption was a serious concern regardless of the national origin of companies operating in the field.

Corporate ownership did not seem to affect competition and conflict for access to forest resources, either. Local residents complained of concession encroachment and restricted access to forest products such as honey and mushrooms only in those areas where a high population density put pressure on space and resources, whether the concession holder was Chinese or not.

‘SURGE IN DEMAND’

Although China’s presence in Zambia’s timber market is comparatively small, it represents an overwhelming majority of exports in neighboring countries such as Mozambique. Zambia has large stocks of rosewood, which is in high demand among Chinese furniture manufacturers.

“The global expansion of the rosewood market, of which China is the center, has resulted in a surge in demand from the southern African continental timber market,” Putzel said. “Better monitoring of the timber traffic across the Zambia-Mozambique border and towards the coast is needed, to ensure that Zambia is getting its fair share of revenues.”

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He said he hopes the research he has been coordinating will help understand these concerns better. “We’re trying to add depth to these studies. There has been much written in the press and by environmental NGOs about Chinese timber demand, but there is still a need for more scientific research on the social and ecological effects of logging and trade to inform policy,” he said.

The findings of CIFOR’s China-Africa research project are intended for African decision-makers, such as government ministries in charge of land management and social welfare — but not only.

“China, too, has been trying to address its international resource governance,” said Putzel, though he pointed out that most measures have so far mostly targeted large, government-controlled companies.

“We’d like to increase China’s curiosity on the variety of ways [that] Chinese companies access resources. We have been invited to present at many events in China, and the people we have interacted with have expressed interest in the way we have been breaking down this complex market in great detail in our studies.”

For more information about the topics of this research, please contact Louis Putzel at l.putzel@cgiar.org.

This research forms part of the CGIAR Research Program on Forests, Trees and Agroforestry.