Governments in tropical countries often feel that exploitation of natural resources is an opportunity for economic development and a solution to socioeconomic problems. In this they are usually mistaken. Foreign companies reap many of the profits, pay low taxes, and let the country clean up the mess. Thus, forests or other natural resources pay the price for ignorance, corruption, exploitation, and inadequate protection. But it is much more complicated than that. Government policies – in both developed and developing countries – virtually mandate unsustainable development. Economic policies are made without regard for the environmental consequences. Tax and fiscal incentives, marketing policies, resettlement schemes, trade policies – all exacerbate resource depletion. Policymakers frequently disregard environmental issues or assume that the resources are infinite, replenishable, or replaceable by new technologies. Some feel that the environment should be freely available for exploitation to support the market. Others are simply unaware of the consequences of the incentive systems which they are constructing.

Governments in countries under land pressure may sponsor “development” projects, in which they offer forest land to the impoverished. Indonesia in the past sponsored a transmigration scheme (transmigrasi) of moving people from overcrowded places such as Bali and Java to Sumatra, Borneo (Kalimantan) and New Guinea. These people were given little assistance, so they cut down rainforest for agricultural land. Although governments think that policies such as this are a cheap way of dealing with land shortages, overpopulation, and poverty, in fact they have been quite disastrous. The poor soils in rainforests can usually support agriculture for only three to five years; then the fields became infertile, forcing people to move into and cut down more primary forest (or to leave). Such schemes are ultimately futile, and do not contribute to anyone’s long-term benefit. Rice production in Malaysia has been reduced by more than 25% because of erosion, a decrease in rainfall, and other consequences of deforestation (Sponsel, Bailey and Headland, 1996). Similarly, governments (Brazil’s, for example) often encourage landless peasants to move into and colonize “unowned” forest land, which may have been opened up by logging roads. This relieves some of the economic and political pressures on the government. (For additional examples, see the case studies of Malaysia, Brazil, and others, (see Part IV).

Governments frequently build roads into wilderness areas to encourage forest exploitation for logging or for small-scale agriculture, and offer subsidies and tax breaks as well as imposing legal requirements that land must be logged to be registered. Logging concessions are usually short-term, and although these agreements may contain certain minimal requirements relating to permissible tree diameter and harvesting volumes, there are few incentives for timber companies to log carefully or to reforest (or to adhere to the conditions of the contract, for that matter). On the contrary, since the fees for logging concessions are based on land area, there is definite advantage to the company to remove as much timber as possible, so as to recoup investments in equipment and, especially, roads. The government often stipulates that logging roads be durable so that they may be used in the national road system, which leads to permanent inroads into the forest.

Even where some effort is made to control timbering, the government usually has very weak enforcement capabilities. Moreover, governments obtain revenue from logging, and they are highly subject to pressures from the wealthy and the well connected. Threats of violence are quite frequent as well. So there are many incentives to establish government policies favoring special interests (often the officials’ friends and relatives). In actual fact, the timber concessionaires are often military or government leaders and politicians.

It is unlikely that governments in tropical countries will give up short-term gains for long-term conservation goals. Their populations are rising too rapidly, they lack resources, and there are powerful (and often corrupt) interests which are closely linked to the government or government officials.