Prof. Georgi Kostov is an expert in forest resources and forest management, former Deputy Minister of Agriculture and Food with the department "Forests, Science and Education", lecturer at the Forestry University. In the podcast on the site ESGnews.bg "Our planet is important" he spoke in detail about the state and management of the Bulgarian forests.
You recently made a claim that the conversion of forestry from state-owned enterprises to sole proprietorships would lead to bankruptcies. What is this danger? And in fact, shouldn't forestry have different functions - ecological and social?
For historical reasons, the majority of Bulgaria's forests are state-owned. It is about almost 77-78% of the forests - they are state, about 10% are municipal and the rest are private. They all perform the same functions – social, economic and environmental. The current Forest Act, which dates back to 2011, is equally restrictive to ensure the performance of these important functions. For example, game in a private forest does not belong to the owner. Underground resources belong to the state, not to the forest managers. This is a traditional attitude in Europe, where the social and economic elements are taken into account. In this sense, Bulgaria's forests, purely legally and normatively, are protected, especially since the aforementioned law was adopted in 2011, when Bulgaria was already a member of the European Union and all European norms were respected.
As for the state forests and the danger of them being privatized and turned into sole proprietorships - here it is clear that in a joint stock company the owners of the shares are in command. By law, the state cannot sell off its forests, or at least such a step would not be easy at all. But if the current state-owned enterprises registered under the Commercial Law become single-member joint-stock companies, then the form of management must lead only and only to profit for the joint-stock company. The capital of the company will include a small number of fixed assets - for example, cars, farm buildings. That is, the capital will be low, which will lead to the fact that all forest care activities that will be loss-making - afforestation, fire protection care, construction of forest roads, game care, maintenance of tourist sites - will be abandoned. Or all that on which the ecological and social functions of forests rest. The possibility to sell firewood at social prices will also disappear. This is because the goal of a joint-stock company is one - for the shareholders to receive maximum income.
When there are not enough funds for such activities, it is expected that the company must increase its capital. And this means that there is an extremely high risk of foreign investors entering the companies through the sale of additional shares. In such a case, it is completely realistic that at some point Bulgaria's forests will start to be managed by such external shareholders. And that would be perfectly legal. Bulgaria will be deprived of any reaction, even within the European Union.
It is very important to understand and know because Bulgaria has to manage its own forests. They currently cover the carbon footprint of our agriculture. However, if the forests are managed by outside shareholders, then they will have a say in which emissions will be covered.
I also want to emphasize that the pressure to turn the forests into sole proprietorships, which has appeared in the last few months, is not sufficiently justified. I have before me the report of the Ministry of Agriculture, prepared jointly with the Ministry of Economy. It was found there that the structure of forest management in many EU countries is similar to that in Bulgaria - it is about Germany, Estonia, Lithuania, Norway, Poland, Romania, Slovakia, Finland and the Czech Republic. Also Serbia, which is not part of the EU. In countries where forests represent a large part of the country's economy, such as Sweden and Austria, there are indeed joint-stock companies. But here we must also clarify that our forests have more important social and ecological than production functions, as is the case with these countries.
What are the losses and missed benefits from the inefficient use of Bulgaria's forest resources?
Bulgaria's forests can really provide a greater wood resource for use. According to official data, as of 1960, Bulgaria had roughly 244 million cubic meters of wood in its forests. By 2020, wood will already be 719 million cubic meters. Or an increase of 3 times. Therefore, for this entire period - from 1960 to 2020 - 23 years, forests have improved and the presence of wood has increased. In practice, current growth has been increasing continuously since 1960, with one exception - it is the period 2010 - 2015, when it reaches its maximum. At the moment, our forests have reached such a stage of maturity that growth is already greatly reduced. Which means that in order to maintain high forest growth, we need to normalize their age structure. They are currently aging. All this shows that we are not using our forests very well. To explain it scientifically - if as much wood is used annually as the forest produces - it will look the same.
Our country enjoyed about 140% of the increase in the 1960s, that is, more was cut down than the forest produced. This has been unsustainable governance. After 1975, when we started importing wood from Komi, our forests normalized and we started to use wood within the increment or even below it. The use of 75-80% of the increase is typical for all countries of the European Union. By 1990, Bulgaria used about 75% and a gradual decline to 65% of the increase was registered. However, after that, in the last two and a half decades, we rarely use more than 50-55%. There are also years, for example 2010 and 2020, when less than 50% of the increase is used.
This wood cannot continue to accumulate in the forests ad infinitum. There are huge amounts of accumulated overgrowth in our forests. It creates huge problems - danger of fires, tree diseases, reduces the vitality of forests. And to overcome climate change, a forest must be vibrant. This is the first danger of poor use and management of forests - their vitality and the long-term performance of their functions.
Of course, we also have to look at things from a business perspective. The forest-timber chain begins with the forests, their management, but then passes through a great number of sectors. We do not realize that in our everyday life we are surrounded by products that come from the forest - paper, furniture, without understanding where this material that we want in our homes comes from. It is characteristic of developed countries in the European Union, which do not have environmental problems, to use a high percentage of the increase. Let's say Belgium - there it reaches 80%. Austria uses 85-90%. Our forests are better than the Belgian ones, and we stand at 50-55%. This is bad for both business and forests.
What else can you hear in the conversation with Prof. Georgi Kostov:
- How did Bulgaria cut down its beech forests to pay reparations to Great Britain for World War II?
- Are Bulgaria's forests a national treasure?
- What should be the state policy of Bulgaria regarding forests?
- Is "mining" a dirty word?
- What are the good examples and practices from Europe that we could apply in Bulgaria?
- What should be the state policy of Bulgaria regarding forests?
- What are the new technologies used in forest management? Are similar technologies used in Bulgaria?
Listen to the entire conversation with Associate Professor Georgi Kostov in the audio file: