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Timber Smuggling Could Eliminate Senegalese Forests In Two Years

Timber Smuggling Could Eliminate Senegalese Forests In Two Years | Timberland Investment | Scoop.it
Illegal timber smuggling is devastating the lush Casamance region of Senegal and could strip it completely within two years.

That’s the predication of Senegalese environmentalist and former minister Haidar El Ali.

Casamance in southern Senegal contains the country’s last remaining forests, an area of 74,000 acres that could be depleted by 2018 as smugglers feed the demand for rosewood furniture in China, said El Ali.

Exporting timber from Senegal is illegal, so traffickers smuggle it to neighboring Gambia for shipping to China.

Gambian exports of rosewood to China totaled $238.5 million between 2010-2015, the second highest in West Africa after Nigeria, he said. Gambia has only 4,000 hectares of forests.

“This unacceptable trafficking is devastating for our forests and it has to stop,” Haidar told a news conference.
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Is Asia-Pacific Timberland a Growth Sector?

Is Asia-Pacific Timberland a Growth Sector? | Timberland Investment | Scoop.it
Expansion within the asset class, the firm said, “is expected to come from emerging and intermediate forestry markets, such as those of Europe, Latin America, Asia and Africa.” Because of the risks—environmental, social, corporate governance and others—presented by some parts of Latin America and the developing economies in Asia and Africa, “emerging forestry markets must meet investor risk-adjusted returns that are as much as two to three times the returns sought for U.S. forestry investments.”


That said, TIMOs are looking for ways to expand, and many of them, “already well diversified within North America,” are looking outside the U.S. to do so. New Forests’ Tropical Asia Forest Fund, which closed in 2013, represents the firm’s expansion across the Asia-Pacific region. Campbell Global, which is U.S.-based, this year announced an expansion into new markets with a global fund that will invest in Latin America and Australasia. The report said that among the top 30 TIMOs globally, seven are operating in Asia and eight in Australia and New Zealand as they increasingly diversify into additional regions.

Transactions, meanwhile, have revealed downward pressure on discount rates on both softwood and hardwood assets in Australia and New Zealand. The report said that “there may be continued pressure on investors to keep discount rates low to secure assets” since “the New Zealand and Australia timberland market is now maturing with more active investment managers competing on deals.”

However, such a fate may not await investors, since “[i]t could also be argued that discount rates in Australia and New Zealand may converge with those in the U.S. market given the comparable political and business risk environment, higher tree growth rates, and exposure to the important Asian markets.”

Asia and Africa are on the “emerging edge of forestry investment,” according to the report. As yet there isn’t much institutional investment in forests in either region, and both have relatively high discount rates. In Indonesia and Malaysia, for example, the report said that real discount rates range from 9–15 percent. In addition, local forestry companies can have an advantage over foreign investors because of their access to lower discount rates or lower-cost debt financing.

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Researcher links Ebola to forests

Researcher links Ebola to forests | Timberland Investment | Scoop.it
A University of Minnesota researcher’s recent work may have found a link between deforestation and the ongoing Ebola epidemic.
As large corporations have spent the past two decades cutting down large forested areas in West Africa to make room for plantations, displaced bats — some of which can carry Ebola — have begun moving to those plantations. The people who work on them are then exposed to the disease.
Though researchers disagree on exactly which species of bat was displaced, reports analyzed by University researcher Robert Wallace show that major policy changes in West African countries can promote the emergence of infectious diseases.
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Phaunos Timber Fund notes investee acquisition

Phaunos Timber Fund notes investee acquisition | Timberland Investment | Scoop.it

Phaunos Timber Fund [LON:PTF], the Authorised Closed ended investment scheme established to invest in timberland and timber related assets on a global basis, has today been notified that Green Resources, in which the Company holds a minority stake, has signed an agreement to acquire the Global Solidarity Forest Fund. 

GSFF is the leading forestry company in Mozambique, with assets that are adjacent to Green Resources' operations. 

Under the terms of the deal, Green Resources will issue 17.8 million new shares at $5.90 (NOK 35) per share to acquire the assets and outstanding cash of GSFF. As at 31 December 2013, Phaunos held Green Resources shares in its accounts at a value of $4.27 per share. The new shares will represent 28.8% of the post-transaction shares in issue. As a result of the new share issue Phaunos' holding in Green Resources will be diluted to 18.9% from 26.6%. It is envisaged that the acquisition will create significant scale and operating synergies for Green Resources. The combined company will have 40,000 hectares of standing forest and significant industrial operations in Mozambique, Tanzania and Uganda.

Completion of the deal is contingent on a vote of approval at an Extraordinary General Meeting of Green Resources, currently scheduled for 13 May 2014.

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Coming To America (to launder his millions?)

Coming To America (to launder his millions?) | Timberland Investment | Scoop.it

Question: how did an African politician, on an official salary of roughly $6,000 a month, manage to acquire the lifestyle of a Hollywood billionaire, partying at the Playboy mansion, travelling in private jets, and living at a $30m Malibu mansion...

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Answer: simple. First, that politician was lucky enough to be Teodoro Nguema Obiang, heir apparent to the autocratic dictator of Equatorial Guinea, a tiny country in West Africa...

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That, at least, is the claim made in an extraordinary 118-page lawsuit filed this week by the US Department of Justice (DOJ), which is attempting to persuade a judge to confiscate some of Obiang’s most treasured possessions...

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The document sheds unprecedented detail on the alleged schemes by which Obiang used his role as Forestry Minister in his father’s government for personal enrichment. And it unpicks the dubious steps his lawyers then took to, in the words of the DOJ, “defraud” a string of US banks into providing a safe haven for that illegally-acquired wealth.

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The legal complaint tells how Obiang’s father appointed him to his cabinet in 1998. He swiftly began forcing large timber companies – including ABM, Agroforestal and Isoroy - wishing to exploit the country’s publicly-owned forests, to pay millions of dollars in bribes and kickbacks, it claims. They were allegedly told to stump up fees to access forestry, fees to operate there, and fees to export their product. He personally received roughly ten percent of the value of wood harvested.


At one point, Obiang announced an overnight export “tax” of $27 per log, to be applied on every timber shipment out of the country. The money was paid directly into a private commercial bank account in Equatorial Guinea, which he had personal control over, the lawsuit alleges.

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Quantum Global backs Angolan timber with $50mln

Quantum Global backs Angolan timber with $50mln | Timberland Investment | Scoop.it
In a deal with the Government of Angola, Quantum Global is leasing over 80,000 hectares to develop large-scale wood fiber plantations in the country’s Planalto region. As part of the 60-year concession, Quantum aims to invest $50 million over the next 5 years in establishing new plantations, infrastructure and wood processing industries.

Through this acquisition, Quantum Global aims to realize risk-adjusted returns for the timberland asset class, whilst implementing sustainable forestry practices and facilitating conservation protection on the investments. The Planalto region has large areas of fertile land that are currently underutilized, low population pressure limited natural forests. These factors, combined with sufficient water resources and access to transport infrastructure are suitable for the development of large-scale wood fiber plantations.
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Angola’s Sovereign Wealth Fund Targets Mine, Timber Investments

Angola’s Sovereign Wealth Fund Targets Mine, Timber Investments | Timberland Investment | Scoop.it
Angola’s $5 billion sovereign wealth fund is seeking investments in mining, timber, health and agriculture as it seeks to diversify its asset base and increase returns.
“A large portion of the portfolio is invested in international securities,” Jose Filomeno dos Santos, the fund’s chairman, said in an interview with Bloomberg Television in Cape Town on Thursday. “We are looking at several opportunities. We wouldn’t want to give away these opportunities by disclosing what they are before they are completely settled.”
The fund, which is managed by Zug, Switzerland-based Quantum Global Investment Management Ltd., was established to invest surplus state funds and promote development in Africa’s largest crude oil producer after Nigeria. It has allocated $1.1 billion toward investing in toll roads, ports and other infrastructure projects and $500 million toward hotels. It also plans to spend about $250 million on agriculture projects.
“We are really long-term investors and not looking for quick wins,” Dos Santos said. “All of our funds have a 10-year horizon. What we find in our region of the world, in Africa, particularly in Angola, is that the safest way to invest is as the project starts. That’s when potential mistakes regarding the viability assessments of such projects can be made and when more care should be taken regarding the implementation.”
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Forestry companies with operations in Mozambique merge

Forestry companies with operations in Mozambique merge | Timberland Investment | Scoop.it

The merger of the Global Solidarity Forest Fund (GSFF) with Green Resources (GR), including all assets in Mozambique, has created the biggest forestry company on the continent outside of South Africa, according to an official statement.


The new company, which was created by issuing 17.78 million new shares to be handed over to GSFF shareholders, now has over 40,000 hectares of standing forest in Mozambique, where both countries had operations, in Tanzania and in Uganda.

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Green Resources is one of the largest forestry companies in Africa and is one of the main wood production companies. It was founded in 1995 as a private company in Norway and it has invested over US$125 million in its operations in Africa.


Green Resources, whose two main shareholders are the Phaunos Timber Fund with 27 percent and NewAfrica with 19 percent, has plantations in Mozambique’s Niassa and Nampula provinces.


Global Solidarity Forest Fund AB was an investment company particularly focused on Mozambican forestry sector companies. It was founded in 2006 in Hallstahammar, Sweden.


According to information taken from the Internet Global Solidarity Forest Fund’s shareholders were the Netherland’s state worker pension fund (54.5 percent), a number of Swedish and Norwegian religious organisations and US fund Diversified International Timber Holdings.

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Dolat Ventures to Enter African Timber Sector

Dolat Ventures to Enter African Timber Sector | Timberland Investment | Scoop.it

Dolat Ventures Inc. DOLV -0.43% announced today that its it is expected to enter into a timber operation located in the Kono district of Sierra Leone. The Company is currently investigating a 45k acre project which is expected to produce up to $150,000 to $200,000 a month once in operation. The license has already been issued and DOLV is currently in negotiations to begin operations upon complete due diligence.


The government of Sierra Leone is distributing a few exclusive licenses to cut timber for export. DOLV intends to have access for operations to a private forest of about 45,000 acres to utilize the license. The advantage of a private forest as opposed to a public forest is that DOLV will have direct access to a variety of African hardwood timber which are in high demand for export without the need for a government lease. DOLV is projecting that once underway, the project may generate up to $500,000 a month and progress to $2,000,000 a month. The projections depend on the size of the DOLV operation over the next three quarters. Additional information on the DOLV timber project will be released over the next month.

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