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Analysis: Romanian forests, a business of over 2.5 billion euros
Business in the field of forest exploitation and wood processing will reach the highest level ever in 2019, while the over 6,000 firms activating in this sector will record business estimated at 2.5 billion euros , 100 million euros more than last year, an analysis made by the consulting company Frames shows.
Recent statistics released by Greenpeace, estimate that Romania loses over 3 hectares of forest every hour.
“In the absence of laws limiting the disappearance of “green gold”, with authorities preoccupied by the state of forests only in declarations, massive legal or illegal afforestation has increased of late,” Frames analysts show.
They say that business is simple and with insufficient regulations, that forests attract more and more investors preoccupied by felling more trees more rapidly, looking for profits with many figures.
“Thus the number of companies active in the field of forest exploitation has grown significantly since 2010 to the present, from 3,937 to 6,189 companies in 2018,” they added.
According to Frames, company businesses in the field reached 11.43 billion lei (2.4 billion euros) on the overall in 2018, on the rise by 800 million lei compared to the same period of the previous year and double the level of 2010 (5.48 billion lei). The profit of the sector followed the same tendency, growing from 480.1 million lei in 2010 to 678.1 million lei in 2018.
According to Frames data, 3,305 companies with 15,480 employees were active in the field of forest exploitation in 2018. They ended the year with businesses of 3.68 billion lei and a total profit of 320.8 million lei.
“After 30 years of capitalism, Romania has become a country reaped of resources. From crude to gas, mineral waters, gold and forests, the authorities sold the country's resources for low royalties. Forests have become a successful business in a country very little interested in ecology, resource sustainability, clean air, the future,”said Adrian Negrescu, Frames manager.
According to data from the National Forest Inventory, 38.6 million cubic meters of wood are felled in Romania annually. Of that, only 18.5 million cu.m represent legal felling for which taxes are paid, the rest of 20 million cu.m being trees extracted without any legal forms, mostly from private forests.
Frames analyses show that the situation in forest exploitation and wood processing tends to worsen every year, while the wood export demand from Romania grows significantly and authorities are late in taking necessary measures to fight illegal felling.
The analysis made by Frames was based on a business study devoted companies in the fields of forest exploitation and wood processing. Processed data were obtained from the Trade Registrar and the Finance Ministry based on public data declared by companies.