Face the Facts! 1 - Financial Crisis Fallout
How the Global Economy Harms People and the Environment
#1, Wednesday April 21, 1999
Financial Crisis Fallout
-
When the financial crisis hit
Indonesia, industrial pollution rose by 15%
while industrial production fell by
18%.*1
- The International Monetary Fund estimates that an additional 20 percent of the population in Indonesia and 12 percent in both South Korea and Thailand will fall into poverty due to the crisis.*2 Thus the crisis may generate over 50 million new poor, equal to the combined population of California and Texas.
- Crisis hit countries, Russia, Brazil and Indonesia rank, first, third and fifth, respectively, among the world's nations in terms of remaining frontier forests – totaling 47 percent of the world’s ancient forests *3:
- The financial crunch in Russia has been so severe that the Russian government is considering cutting Siberian old growth to raise cash. Until now, the Siberian forests were considered to be too remotely located to be commercially feasible for sale. *4
- In order to meet fiscal targets
set by the International Monetary Fund
(IMF), Brazilian government spending on
environmental programs has been slashed by
two-thirds *5. The result is an
environmental protection agency denied the
resources necessary to protect the
country’s environmental wealth that
includes the Amazon rainforest; *6
- "Under IMF pressure," the government of Indonesia lifted a log export ban and slashed the log export tax from 200 percent to 30 percent. "The country also plans to expand its plantations to 3.9 million hectares from 2.4 million by the end of this year, requiring large-scale deforestation."*7
*1 Shakeb Afsah, "Impact of Financial Crisis on Industrial Growth and Environmental Performance in Indonesia," US-Asia Environmental Partnership, July 1998.
*2 IMF, World Economic Outlook, October 1998.
*3 World Resources Institute, The Last Frontier Forests. Ecosystems & Economies on the Edge, 1997. The World Resources Institute defines frontier forests as "large, ecologically intact, and relatively undisturbed natural forests."
*4 "Preparing for the Landing of Chinese Lumberjacks," Vladivostok, February 26, 1999 and NGOs in Siberia.
*5 Diana Jean Schemo, "Brazil Slashes Money for Project Aimed at Protecting Amazon," New York Times, January 1, 1999.
*6 Roberto Smeraldi, Friends of the Earth – Amazonia Program.
*7 Bruce Gilley, "Sticker Shock," Far Eastern Economic Review, January 14, 1999.
For more information contact: (202)783-7400, Carol Welch ext. 237 or Matthew Siegel ext. 250
1025 Vermont Ave., NW, Suite 300, Washington, DC 20005
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