Research and Advocacy organization ACT NOW! and Jubilee Australia Research Centre have welcomed a report that the bank accounts of 30 logging companies operating in Papua New Guinea (PNG) have been closed.
The report ‘Logging High Risk industry’ outlined concerns by the PNG Forest Industry Association, a group representing commercial logging interest that Bank South Pacific(BSP) has closed the logging company bank accounts due to its anti-money laundering best practices.
ACT NOW Campaign Manager, Eddie Tanago said ACT Now welcomes the report stating the move by the banks in PNG will restrict financing in the logging sector as identified by the Bank of PNG.
“Over the past decades, ACT NOW! and its partners have detailed numerous examples of illegal activity in the sector which have led to the theft of vital forest resources from customary landowners. When banks provide services to logging companies, they help to prop up this destructive industry,” said Mr. Tanago.
The move by BSP to close the accounts of logging companies places the spotlight on PNG’s second largest bank, Kina Bank. Kina has yet to confirm if it is taking action to exit its logging company customers to rule out offering its services to new logging clients, added Tanago.
ACT NOW! and Jubilee Australia’s 2021 research identified that the remaining two commercial banks operating in PNG – Westpac and ANZ had policies or practices that restricted their financing to the logging sector.
A December 2021 report by ACT NOW! and Jubilee Australia, ‘The Money Behind the Chainsaw’ detailed how PNG’s commercial banks have provided at least K300million (AUS$144million) since 2000 in available credit to the country’s five largest exporters of tropical logs.
The report highlighted evidence of illegal activity and human rights abuse in the sector.
“We call on all banks to ensure that they do not bring on new customers involved in tropical forest logging and take steps to close the accounts of existing customers in this sector,” said Mr Tanago.
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