At the height of the war, the government took up reform... forestry. Why would this be?
“Carpathian forests are being cut down in hectares.” Every Ukrainian who wanted could verify the veracity of this hackneyed statement with his own eyes when he got to the West of Ukraine. But even these scales of deforestation, which seemed unacceptable, may increase further. And not only in the Carpathians, but throughout the whole country. Such an alarming warning was issued by the public organizations “Ecology-Right-Human” and “Ukrainian Environmental Group”.
Last year, at the height of the war, the Cabinet of Ministers unexpectedly took up the reform of... forestry. Its essence is this: a state unitary commercial enterprise “Forests of Ukraine” is being created, which will absorb all state forestry enterprises in the country. Until now, these have been profitable structures, but according to the reform they will lose the status of legal entities.
The State Enterprise “Forests of Ukraine” was created bypassing parliament, and subsequently it should become a joint-stock company. In the Verkhovna Rada, this idea was not supported by deputies who dealt with the topic of the forest fund: they saw it as a threat already at the start and named it as a key lobbyist - Deputy Chairman of the Office of the President Rostislav Shurma.
Indeed, already in the spring of 2023, it was Shurma who held a meeting on how to reform the timber industry. The first point of the “reform” is a multiple increase in wood products, the second is the soothing “improvement of the forest fund and planting new forests,” and the third and last is the mechanization of harvesting. And this, in fact, is synonymous with accelerating mass logging and making quick money.
But in order to carry out these massive fellings and make money, new laws are needed. And here the necessary bill appears (9516) from the representative of the mono-majority Alexander Matusevich. Together with him, other people’s deputies “Servant of the People” and Irina Kostankevich (“For the Future”) became co-authors of the initiative. Matusevich claims that Shurma had nothing to do with his initiative. He actually submitted a similar project before.
Why was “Forests of Ukraine” created?
People's Deputy from the EU Vladimir Aryev, who helped the community of Kyiv and the Kiev region with the protection of the Belichansky forest, explains the intrigue of creating the State Enterprise “Forests of Ukraine” this way: it was important for the initiators of the reform to bypass the Verkhovna Rada and here’s why. “There is a battle between two yokozuna - between Shurma and the “servant of the people” Daniil Getmantsev, who heads the Parliamentary Committee on Financial and Tax Policy. They have long been locked in a battle for control over tax and customs, which Shurma wants to take away from Getmantsev. Therefore, any “reform” from the Shurma sphere through parliament may end up in a trap. Hetmantsev has influence on the Servant of the People faction. Since the things that need to be done are selfish, it will be difficult to carry them out under the patronage of the president. So we have an attempt to bypass parliament and do everything through the Cabinet of Ministers.”
The government, for its part, spelled out a key point in its resolution: the state-owned enterprise will eventually turn into a joint-stock enterprise.
We have already done this with Ukrposhta, which, after the proposal of the Ministry of Infrastructure in 2015, became a private joint-stock company. And now Ukrposhta registers its property as private and sells it, and the state has no influence on this, although it is the owner of the company’s shares. Obviously, such a plan is also being implemented for the forest fund, which is being transferred under the jurisdiction of the joint-stock company.
Similar cases reached the Supreme Court, and even the Grand Chamber could not decide unanimously who in such cases would be the owner of the property - the state or the joint-stock company. The fact is that the explanations of the Ministry of Justice literally allow manual mode. In one case, the property may be private, and in the other, state-owned. Was it beneficial for someone to write a flexible explanation like this?
Moreover, if the State Enterprise “Forests of Ukraine” becomes a joint-stock company, as provided for by the government decree, then the state may not have time to register the right of permanent use for all forests. It takes several years to prepare the appropriate documents and draw the boundaries of forests. According to the Forest Code, if this does not happen, then the joint-stock company will not be able to document its right to permanent use of such forests over time.
The newly created state enterprise, for its part, urges not to create panic. “Corporatization provides that 100% of the company’s shares will belong to the state. Important! JSC "Forests of Ukraine", like the state enterprise, will be a forest user; the state remains the owner of forest lands. This is important to understand. Privatization of forests is a fake. Why is corporatization needed? This is greater transparency of management (supervisory board, reporting, etc.), this is a form that is understandable to international partners and donors,” says the response of the State Enterprise “Forests of Ukraine” to the request of the author of the material.
But the deputies, in whose districts powerful forestry enterprises operate, have a completely different vision of the consequences of the announced reforms. People's Deputy of the Servant of the People Olga Vasilevskaya-Smaglyuk even resigned from the board of the State Forestry Agency precisely because she did not agree with the creation of Forests of Ukraine. “This is the path to corporatization, and then, possibly, to privatization. If we take Naftogaz, Ukrspirt and a number of other enterprises, they are ineffectively managed. Salaries are in the millions, procurement expenses are in the billions. These are unsuccessful examples of managing state assets and high dependence on the integrity of management,” Vasilevskaya-Smaglyuk explains the risks.
“During the reform, we killed timber processing. The forestry departments rented it out. And not through tenders, but handed over to dummies and managed informally. Processors are completely dependent on branch managers. If the state made money from this, then I’m for it. But, as a rule, this is the benefit of specific individuals. It’s too early to draw conclusions, perhaps the adherents of the reform are laying something out so cleverly that later, using the example of “Forests of Ukraine,” we will see a miracle,” the people’s deputy sneers.
Meanwhile, society is already raising questions about the activities of “Forests of Ukraine”. After Yuriy Bolokhovets, the former head of the State Agency for Forest Resources, was appointed to the position of head of the new enterprise, the state enterprise announced tenders and stated that it was willing to pay 14.5 million UAH for creating a strategy for its enterprise, and another 5 million for PR. In particular , in the terms of the tender it was about making a 1-minute cartoon about how wood saves you from the enemy in war conditions. The cartoon was supposed to cost almost 600 thousand. This “original” idea was abandoned after being made public.
But this did not stop Shurma from actively promoting forest “reform” in the media. It is described in such a way as to get a positive response from as many Ukrainians as possible. The Deputy Head of the Presidential Office convinces us that we will surpass both Russia and Belarus as timber producers.
When asked to comment on whether Shurma supervises their work, the State Enterprise “Forests of Ukraine” responded that the management team is appointed by the government, and regional managers are appointed by the general director. That is, they simply listed everything that is in the regulatory framework.
“Forests of Ukraine” is also already reporting on the construction of new roads in forests. In the top 5 priorities: “Every kilometer of a new road is plus several tens of hectares of forest under construction and, accordingly, millions of hryvnias in income.”
Well, Bolokhovets himself reports on the results of work in the first half of 2023. The main thing now for forests is net profit and profitability.
Biologist of the Ukrainian Environmental Group Egor Grinik warns: you should not believe such victorious reports. “Reform according to a simplified formula means cutting and selling more. And it doesn’t matter that the most expensive forests will fall under the ax. You have to earn money. If we talk about reform, it should be the protection of biodiversity, support for climate and other functions of forests. And only then felling. Those that do not threaten forests,” explains Grinik.
People's Deputy Matusevich, for his part, assures: he submitted his bill (9516) regardless of the plans of any officials on Bankova. “I spoke about the need for these changes back when Shurma was not there. I came into politics from this industry and said: there are two things that need to be streamlined. The first is the norm for the quiet season (the ban on holding events that cause increased noise during the breeding season of animals - “Glavkom”), we have already streamlined this. During the period of martial law, the rule regarding the quiet season is suspended. And the second is an assessment of the environmental impact during sanitary logging. When there is a fire or a hurricane, the negative impact has already occurred and there is no need to wait six months for an assessment to be made. Because wood that can be used is lost. In six months it will be firewood. Local budgets may receive less money. Industrial wood costs 25 times more than firewood. The losses are obvious,” explains the deputy.
It is worth noting here that Matusevich actually submitted a bill to abolish environmental impact assessments earlier, in 2021 (5408). In the conclusion to this project, the Main Scientific and Expert Directorate noted then: this will contribute to massive deforestation, in particular in the Carpathians, and creates corruption risks.
Chairman of the Environmental Committee Oleg Bondarenko (“Servant of the People”) notes that several years ago there were indeed large-scale fires in the Kiev, Zhytomyr and Luhansk regions, and then the procedure for assessing the impact on the environment was much more complicated. But from the end of this year, when the new law that Parliament passed in the summer (3227-IX) comes into force, the time to obtain an assessment will decrease from seven to two months.
Who is bothered by environmental impact assessment?
Matusevich notes that he proposes to cancel the environmental impact assessment when fires or hurricanes occur, but this essentially applies to clear sanitary felling and at the same time it is proposed to lift the logging area limit of 1 hectare, which is currently in force.
Assessments are carried out to determine whether it is even worthwhile to cut something down. The fact is that in conclusion there may be significant restrictions: do not cut down where species listed in the Red Book are found, or after fires, first cut down completely burned forests, and where there are still living trees, leave them so that they can produce seeds and the like. Therefore, for foresters, every conclusion of an environmental impact assessment is a potential limitation, reduction in logging volumes and loss of funds. This procedure takes place publicly, the public has the opportunity to provide comments, and the final decision is made by the Ministry of Natural Resources.
It is noteworthy that since the beginning of the year, a working group has been operating on the basis of the Environmental Committee of the Verkhovna Rada, which is studying legislative initiatives to assess the impact on the environment. And they created it even before Matusevich’s bill (9516) appeared, since similar proposals had already been received, as already noted, before.
“Firms that conduct environmental impact assessments are usually pocket-sized - ministerial. Registered unknown where. They don’t know that in those areas in respect of which they give their assessment, the procedure for obtaining an assessment only washes away funds from the state budget,” says deputy Vasilevskaya-Smaglyuk, who was a co-author of one of the initiatives to cancel the assessment.
Chairman of the Environmental Committee of the Parliament Oleg Bondarenko believes that right now it is necessary to resolve only those problems in assessing the impact on the environment that relate to fires and the consequences of hurricanes: “I hope that based on the results of the work of the working group in the Committee, we will be able to find a solution to these issues. As for the simplification or abolition of assessment in other cases of forestry activities, we will see how the new law (already adopted 3227-IX) works, which reduces the time frame and simplifies the procedure for assessing the impact on the environment. Perhaps nothing will need to be changed further. But all this must go in conjunction with compliance with our European integration obligations and must be agreed upon with the public.”
The mentioned working group also involved ecologists, in particular Petr Testov, head of the expert department of the NGO “Ukrainian Environmental Group”. Testov believes that environmental impact assessment should be preserved: “The assessment reduces the opportunity for foresters to abuse sanitary felling. Because some of them are done illegally, and some are completely inappropriate. If it is cancelled, there will be much more multi-hectare logging in the Carpathians and other forests.”
Regarding the Carpathians, Matusevich, who before becoming a deputy was the director of the Vygodsky forestry enterprise, explains his vision of the situation as follows: “In the Carpathians there are about 250 thousand hectares of forests that do not grow in their own type of forest. They were planted here and they disappear. They are destroyed by the bark beetle. These are destructive plantings that dry out and break. By the way, this is a fire-hazardous story. I understand that you will write “Matusevich wants to cut down all the Carpathians.” But we are talking about field forest stands (artificially planted forests that do not grow in their own conditions - “Glavkom”). This is how forestry is conducted in the Czech Republic, Poland, and Slovakia. Derivative stands are cut down and new ones that are resistant to climate change are planted. I’m not going to cut down trees, I want to streamline legislation so that the forest can be managed logically, in a balanced way and with the best economic effect.”
People's Deputy Yulia Ovchinnikova ("Servant of the People"), who co-chairs the working group studying legislative initiatives on environmental impact assessment, asked the government whether it supports the abolition of the environmental impact assessment proposed by People's Deputy Matusevich.
The Ministry of Natural Resources, for its part, proposed making some changes to Matusevich’s legislative initiative. According to public organizations “Ecology-Right-Human” and “Ukrainian Environmental Group”, the government’s proposals can improve the bill. But even so, compared to the current legislation, the situation will worsen.
“As far as we know, the bill received a positive response from the Ministry of Natural Resources. The proposed changes will speed up the implementation of reforestation activities, increase revenues to budgets of all levels, and minimize manifestations of corruption,” noted the State Enterprise “Forests of Ukraine,” generally supporting Matusevich’s arguments.
Deputy Ovchinnikova focuses on the fact that the public and environmental inspectors are now recording sanitary logging with violations: “In fact, now commercial timber harvesting is often carried out under their guise. True, on areas up to 1 hectare. What stands in the way is environmental impact assessment. Removing this assessment for sanitary clear-cutting will lead to an increase in the scale of logging. And this is, first of all, the Carpathians! And the arguments about the need to cancel due to the drying out of forests do not stand up to the test of numbers, because official data show that the area of drying out is decreasing every year.”
The Special Environmental Prosecutor's Office, in response to a request from the Ukrainian Environmental Group, reported that over the past few years, in those cases that were sent to court and related to clear sanitary logging without assessing the impact on the environment, in total there was almost 90 million UAH of damage caused to the environment . Ecologists of this public organization note that the assessment has a preventive effect and if it is removed altogether, the scale of damage to the environment will be many times greater.
Will the control function be taken away from the Ministry of Natural Resources?
The logging that is currently permitted should occur exclusively under the control of the Ministry of Natural Resources. The department coordinates plans for such logging for 10 years. Lawmakers propose to transfer these powers to the State Forestry Agency. That is, foresters will approve most of the cuttings themselves. In this case, the Ministry of Natural Resources will no longer influence the situation. And this worries environmentalists.
“Recently, the State Forestry Agency submitted for approval its logging plan for the Skolev branch of the State Enterprise “Forests of Ukraine”. Only there they wanted to cut down almost 330 hectares, which is 1,000 truckloads of wood from natural Carpathian forests. The Ministry of Natural Resources did not approve these plans. If bill 9516 is adopted, the coordination function will be taken away from the ministry. And for almost all types of felling, foresters will independently decide what, where and how to cut,” explains the danger, biologist of the Ukrainian Environmental Group Egor Hrynik.
And here are the statistics for this year, how many approvals were blocked by the Ministry of Natural Resources as of October.
Representatives of the organizations “Ecology-Right-Human” and “Ukrainian Environmental Group” convince: the idea of legislative changes came to foresters after this year, under public pressure, the Ministry of Natural Resources did not agree with foresters on several logging plans that were catastrophic for forests in the Carpathians. If they were agreed upon, it would have a detrimental effect on the environment.
In essence, if the control function is taken away from the Ministry of Natural Resources, then citizens will only have the right to protest. Ecology-Pravo-Human analyst Bogdan Kuchenko notes: “If Matusevich’s project is supported by the Verkhovna Rada, this will simplify the logging procedure. The only party that will be able to oppose their implementation will be the public, but it will not have enough tools to resist it. Moreover, the scale may be such that the public sector and local activists simply cannot protect the forests.”
At the same time, the Ministry of Natural Resources in its response to Yulia Ovchinnikova noted that it supports Matusevich’s position to take away their authority to approve part of the planned logging.
“As for the idea of transferring authority to approve forest management materials from the Ministry of Natural Resources to the State Forestry Agency, this will lead to the disappearance of any independent control over the design of fellings. We already have an example with clear-cutting of open forests, which are illegal, but despite this they are planned en masse,” sums up Ovchinnikova, co-chair of the working group.
Representatives of environmental organizations will inform the public about the progress of the working group's meetings. They are convinced: the state and society cannot allow, under any circumstances, the creation of the joint-stock company “Forests of Ukraine”. This is a prerequisite for the loss of state control over forests.
