Should environmentalists welcome the collapse of the Shanghai stock market?
The question is less ridiculous than it seems. Soaring consumption of agricultural products in China – fuelled by an economy that grew ten per cent a year for several decades – has been a major factor driving global deforestation. But now it is widely believed that the recent stock market slide is tied in with a long-term slowdown in China’s economic rate of growth.
If that means Chinese consumers have less money in their pockets to spend on agricultural products grown on newly-cleared forest land, the result could be lower levels of deforestation.
Sometime in the last decade, China overtook the European Union to become the world’s largest importer of “embedded deforestation” – i.e., of products such as palm oil, rubber, soy, sugar, beef and timber, grown or extracted by chopping down tropical forests.
Yet even before China’s boom turned to bust, there were signs of diminishing global enthusiasm for forest-destroying commodities. For example, the price of palm oil has halved since its record peak in early 2011 and the share price of Wilmar International, the largest palm oil trader, has dropped by nearly two thirds since early 2010.
Not all the economic pressures on the world’s forests are easing, however. Slowing exports of forest-risk products to places like China are to some extent offset by increased consumption of those products in the countries where they are grown. For instance, Indonesian palm oil is increasingly supplied as biofuel for the home market and small-scale logging for local use is increasing in Africa.