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Date: Wed, 26 May 1999 12:30:56 -0500 (CDT)
From: "Agent Smiley" <smiley_777@hotmail.com>
Subject: Chile: Business interests battle over resources
Organization: ?
Article: 65551
To: undisclosed-recipients:;
Message-ID: <bulk.9220.19990527181530@chumbly.math.missouri.edu>

Date: Sun, 23 May 1999 06:11:30 -0700
From: Pat Rasmussen <prasmussen@igc.org>
Sender: owner-forest-americas@igc.org
Subject: Under Chile's Volcanoes, a Blurring of Boundaries

Under Chile's Volcanoes, a Blurring of Boundaries

By Clifford Krauss, New York Times
16 May 1999

PUERTO MONTT, Chile -- It used to be easy to draw a political map of Chile and readily identify the friends and foes of American corporations: When President Salvador Allende seized copper mines from Kennecott and Anaconda, the Nixon administration worked to undermine him.

After he was overthrown in 1973 by Gen. Augusto Pinochet, the latter's free-market policies became the toast of Wall Street.

Joining environmental activists in opposing a planned Boise Cascacde factory in Ilqeu is the management of Patagonia Salmon Farming.

It's not so easy anymore. The fight over a $150 million industrial project proposed by Boise Cascade, the American forest-products giant, is blurring the old political fault lines and helping to draw new ones that thread their way more subtly among the competing pressures of economic development, environmental protection, international trade and global competition.

Instead of the old, predictable split between left and right, have and have-not, the dispute over the proposed plant pits powerful economic interests against one another and has created some unlikely alliances.

On the shore of a shimmering Patagonian bay beneath snow-capped volcanoes, Boise Cascade wants to build a factory to process lumber chips into wood panels used in construction in much the same way as plywood.

The company says the project would create 200 well-paying jobs and include a port that hundreds of local landowners could use to deliver wood chips to the plant by boat. Cheering the plan are local officials allied with the center-left Chilean government, labor leaders and organizers of the unemployed.

But the proposal has run into determined opposition -- not just from environmentalists and their political allies but also from two important local industries that contend the plant and the stepped-up logging it would promote threaten their survival. Opponents have thrown legal hurdles in the project's path: An approval won from a local environmental commission by Boise Cascade and its Chilean partner, Maderas Condor, has been blocked by a court injunction pending an appeal.

Similar tactics have delayed or killed other forest-related projects in southern Chile, including a $1.3 billion pulp mill proposed by a Chilean concern part-owned by International Paper and a $200 million lumber project planned by Trillium.

Each side has run radio and television advertising campaigns and sponsored marches to help build local political support and to influence the three major candidates running for president of Chile. For some, "No more chips!" has replaced "Yankee go home!" as the rallying cry of the day.

Rene Barriga, a logger, and his wife, Zenobia Almonacid, support the factory. "We need to rationalize the use of the forest, and that's a dilemma," said Jaime Sanz Bahamonde, president of the Puerto Montt Chamber of Construction, who sees the project as a way to make this impoverished region the wood processing center for the Southern Cone of South America and fears losing the development to a rival region.

"What's to stop Boise Cascade from crossing the border and putting its chip plant in Argentina?" he said, calling opponents shortsighted. "This isn't about politics, but about distinct visions of the future."

The striking change in the political landscape was visible in May Day celebrations here in Puerto Montt, the political and economic center of Chile's lake region. Members of a leftist union federation that supported Allende to the end carried banners in favor of Boise Cascade's project, as leaders of the local construction industry applauded.

On the other side, joining Chile's increasingly influential environmental activists were the salmon industry, hoteliers and the Green Caucus, an informal grouping of members of Congress ranging from socialists to conservatives.

The twist in the traditional class struggle is seen in Rene Barriga, a logger and one of Boise Cascade's staunchest local supporters. "Those who oppose the project are the people who have big houses and four or five cars," said Barriga, who lives with his family in Ilque, the town where the plant would be built, in a small shack that has no water, electricity or telephone.

On equally unaccustomed political ground are opponents like Joachim Wessel Vinz, manager of Patagonia Salmon Farming, which operates a salmon farm in Ilque Bay. Salmon farms often draw environmental criticism because of the way the caged fish cover bay bottoms with excrement and sometimes breed disease.

But Vinz is making common cause with environmentalists in opposing Boise Cascade's plant. "Native forests are a filter to keep our waters clean," Vinz said. "That's what makes Chile the second-largest producer of salmon in the world, after Norway."

Boise Cascade and its local partner say the only way to halt the steady destruction of the Patagonian forest is to give loggers like Barriga, who now chop down trees for firewood and to clear grazing land, more incentive to protect and replant the woodlands.

"We have no doubt there will be more trees in the years to come than there are now," said Douglas Bartels, a spokesman for Boise Cascade, who added that the two companies plan to distribute tree seedlings at cost to local landowners and to teach them conservation techniques.

But opponents, including environmentalists in the United States, say the project is designed to sidestep Chile's weak environmental laws and will speed the destruction of native forests. The environmental impact statement filed for the project covers only the plant and port, the critics say, and takes no account of what the landowners who will supply the plant with wood chips will do to their land.

Scores of plant and animal species are unique to the area, including the alerce tree, which can live 4,000 years, and the pudu, the world's smallest deer, at 15 inches high.

Local environmental groups also dispute assertions that the project will bring economic progress, arguing that the salmon and tourism industries that have boomed over the last 10 years still have great potential for growth and could employ many more people than the wood panel plant.

"Tourism uses the lakes and forests without consuming them," said Sara Larrain, director of the Sustainable Chile Program, an activist group. "But once you cut the forest, you have consumed our natural capital."

That kind of thinking is music to the ears of Felix Oyarzo Grimm, a local hotel owner with strong right-wing views who was an engineer in Pinochet's air force.

"All we have to offer is our waterfalls and crystal lakes," said Grimm, who has joined with the mostly left-leaning environmentalists against Boise Cascade. "I'm very capitalist. More than that, I'm a Pinochetista. I know that a lot of environmentalists resent my ideas. But ecology has nothing to do with politics. We all want the people to unite."

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