Comparison of Russian and Chinese forest economies in transition

Abstract

These economic considerations in Russia and China illustrate the potential growth of regional markets and the consequences this may have on international trade in tropical timber. Introduction China and Russia, the two largest "transitional economies", illustrate two different approaches to transition: Russia used the "shock therapy" method, white China adopted gradual transition rather than radical changes. The contrasting outcomes of the reforms are obvious: from 1992 to 1997, GDP in the Russian Federation fell by 40%, industrial production halved its capacity, and agricultural production fell by 35%. Meanwhile, China has achieved nearly 10% average growth over the past two decades. Despite many studies, China's economic phenomenon is still a puzzle for economists since it cannot be explained by mainstream economics. Forest economies during transition Table I presents some basic facts about Russia and China. Russian forests account for almost one fifth of world forest resources (22%), and the country is the world's richest in boreal forests. Comparatively, China is deficient in forest resources and its forests are unevenly distributed: natural forests, mostly secondary growth, are located in the northeast and southwest areas. Only 1.8% of the natural forests are intact virgin forests. Forest plantations are mostly located in south and southeast China and play an important rote. The transitional changes in forest economies are significant for both countries (Table II). In Russia, timber removal in 1988 reached 325 million m3, while in 1997 total cuts accounted for 88 million m3, far less then the post war rates (146 million m3 in 1946). Annual allowable cut has not been met for many years in any of the members of the Russian Federation. Forest industries have been experiencing a severe crisis since 1990. Timber removals, industrial roundwood and sawnwood production decreased almost 4 fold during the period 1989-1996. The slump in the pulp and paper industry as well as in the production of panels is almost 3 fold. Current economic reforms in Russia have caused destruction comparable with the devastation after World War One followed by the October Revolution in 1917 and civil war (1918-1924) then World WarTwo (Table III). (Résumé d'auteur)