The future involvement of foreign-owned investment funds in the expansion of Ireland’s forestry sector looks in serious doubt this week, after the Government and Coillte indicated that other options were now being considered.
Taoiseach Leo Varadkar and Tánaiste Micheál Martin confirmed separately that the purchase of Irish lands by international investment funds was not the Government’s “preferred model” of afforestation.
The Government leaders reiterated that the purchase of land for planting by State bodies was viewed as a better option. The move follows furious opposition to a deal involving Coillte and UK-headquartered asset management firm Gresham House.
There was also a marked shift in position by Coillte, which told the Irish Farmers Journal that “there are no other private investment agreements being considered at this time to deliver afforestation”.
Nonetheless, the Government’s €25m seed capital for the Coillte-Gresham House deal looks locked in, and Coillte has signed up for a five-year joint venture
The move comes less than a month after Coillte and Gresham House announced the establishment of the Irish Strategic Forestry Fund to invest €200m in the purchase of 12,000ha of standing forests and bare land for planting.
This deal was strongly defended by the State forestry body up to last week, with senior staff pointing out that up to €2bn could be required to finance land purchases if the organisation was to meet its target of planting 100,000ha by 2050.
The Taoiseach told the Irish Farmers Journal on Tuesday that the “preferred model for us is Coillte planting forests on State land and above all, the Irish farmers, who are the main landowners in the State getting into forestry on some or part of their land.”
Similar sentiments were expressed by Tánaiste Martin in the Dáil on Tuesday.
Nonetheless, the Government’s €25m seed capital for the Coillte-Gresham House deal looks locked in, and Coillte has signed up for a five-year joint venture that looks set to continue regardless of the public outcry.