The transfer of plantation forest progressed very well with the finalization of two further forestry lease transactions. The leases with Amathole in Eastern Cape and Mountain To Ocean (MTO) in respect state forest land situated in Southern and Western Cape adds to the two leases which the State already entered into with Singisi and Siyaqhubeka during 2001. These lease transactions are part of the restructuring of the South African Forestry Company Ltd (SAFCOL) which it is anticipated, will be finalised during 2005/6 with the conclusion of the Komatiland forestry lease, which has been delayed while the proposed transaction is being considered by the competition commission.

A consequence of the MTO lease transaction was the re-incorporation of approximately 13 000 ha of State forest land under management of the Department. This land was previously managed by SAFCOL and had been clear-felled in accordance with the decision to phase out plantation forestry in the Southern and Western Cape in terms of the Cape Conversion Program. SAFCOL has however, been appointed under delegation to assist the Department to manage these residual areas for a period of two years, at which time they are scheduled together with the adjacent mountains catchment, for release back to the Department of Public works as it they are no longer required for forestry purposes. Good progress has been made in discussions with Western Cape conservation authorities and SanParks, about allocating the management of these areas to them, as part of consolidating the longer term management control over former forestry areas, under more appropriate agencies. The Department will continue to support the initiatives of the Cape conversion program until the end of the delegation with SAFCOL, where after the process will be managed as part of its ongoing lease administration obligations towards MTO.

The transfer of the Departments remaining plantations has not progressed due to a number of challenges posed by the need to reach agreement with key stakeholders. The plantations must be disposed of in a manner that recognises the role of the rightful owners of the land on which the forests have been established.

The plantations have been re-grouped into management clusters reflecting their forestry potential in the context of their transfers to communities. Steps are being taken to complement the Department’s capacity to actively manage its current activities in the interim, until it can be transferred to rightful communities. These assets represent an important opportunity to strengthening and re-generating local economies and to achieve the objectives of Broad Based Black Economic Empowerment (BBBEE).