Russia, home to one-fifth of the world's forests, supplies about half of China's fast-growing raw timber imports - more than the next twelve suppliers combined. China now trails only the United States as a wood consumer. It has surpassed Japan as the biggest consumer of Russian wood and its appetite for forestry products is expected to continue growing rapidly. With at least half of Russia's timber production illegal, the environmental impact is expected to worsen dramatically, without concerted action by the two governments.

The destructive practices have an impact far beyond Siberia, as the forest fires and deforestation stemming from the area's poor logging practices are suspected of being one of the factors contributing to global warming.

Experts say Russian forests will only be saved if Chinese buyers could be induced to adopt the sort of timber certification programs that are being developed in other countries, such as those adopted in the US and Britain.

These programs are designed to ensure wood comes from environmentally sustainable logging operations.

Without intervention from Beijing or a boycott by western consumers of Chinese furniture, the chances of this happening appear remote.

Although it is difficult to measure the exact size of the illegal trade, some 20-50 per cent of all Russian timber is illegally logged, according to estimates by various environmental groups, including the World Wide Fund for Nature (WWF).

Timber importers in China have turned northward for low-priced timber, making Russia the biggest supplier of logs to China, according to veteran forest expert Anatoly Lebedev and the WWF.

According to wood trade figures quoted by a United States-based group Pacific Environment, Russia exported 15 million cubic meters of timber to China in 2003, roughly half of the mainland's log imports.

However, the figure could be higher as smuggled timber entering the country through small customs points may not be included in the statistics.

``We somehow have to regulate'' the trade, Lebedev, who is the chairman of Vladivostok-based NGO Bureau for Regional Campaigns.

China banned logging in large areas of the country following devastating floods in 1998 that were blamed on rampant logging. Although the ban has improved forestry management in China, it has accelerated timber poaching throughout Southeast Asia, especially Indonesia, and in Russia.

China's domestic timber production has fallen while imports have skyrocketed. Imports of industrial wood, used in construction, furniture-making and pulp mills, have more than tripled since 1993.

According to the WWF, China's demand for imported industrial wood - including timber, paper and pulp - will grow by 33 per cent, from the current annual 94 million cubic meters to 125 million cubic meters within five years.

One of the major contributors for the growth is construction and its-related sectors, said Zhu Chunquan, forest program director of the WWF based in Beijing.

Under a housing reform package set out in 1998, China was to construct five billion square meters of new housing and two billion square meters of renovated housing by 2005.

This initiative is part of the country's urbanization policy that aims at increasing living space and quality of the increasingly crowded Chinese cities.

As new homes are built and old buildings repaired, wood is needed for remodeling, paneling and window and door frames, as well asflooring. As people's incomes and wealth rise, they also replaced furniture more often. Moreover, the construction of cement buildings requires forests of plywood molds.

The flourishing construction and furnishing sectors consumed 90 million cubic meters of timber in 2003, or 65 percent of the total consumption of 138 million cubic meters, according to the WWF report, co-authored by Zhu Chunquan.

About 10 years ago, Lebedev said, numerous timber-related companies were set up in Heilongjiang and Jilin provinces to meet burgeoning wood demand on the mainland.

While many are involved in legitimate trade, some look to the cheaper wood cut by illegal loggers in protected areas.

While managers are sent directly to Russian markets to get wood, they circumvent layers of bureaucracy by bribing local officials whenever they are intercepted, Lebedev said.

Often, the Chinese businessmen enter the area with bundles of cash and carry untaxed logs away through land gates with China with forged customs declarations and other documents.

Others build saw mills to process the logs at the source, all without official registration. ``They look like legitimate businesses,'' he said.

Despite a raft of agreements signed by the governments on both sides - including one signed between former premier Zhu and Russian President Vladimir Putin in 2000 - China's increasingly liberal trade pattern will make it harder to curb the illegal business, the WWF's Zhu Chunquan said.

Lebedev said the Russian federal government has failed to do its job as it has limited clout over local governments in the Far East.

``They [Moscow] are Europe, we [Vladivostok] are Asia,'' he said.

But not all environmentalists are pessimistic.

Zhu, who is lobbying Chinese sourcing companies to join the China Forest and Trade Network, a business-environment partnership for certified wood, said China's entry to the World Trade Organization (WTO) and the Asia-Pacific Economic Cooperation (APEC) may encourage importers to use certified wood as tariffs are lowered.

The network aims to encourage wood products companies to use certified wood produced from well-managed forests.

Besides China, the network has covered about 30 producer and consumer nations throughout Europe, Asia, Africa, and the America. But without a strong consumer movement or serious government support, the chances of getting China's often cash-strapped companies to show much concern for Siberian forests looks a long way off.

dennis.chong@singtaonewscorp.com