3 million hectares of forest will be auctioned to public<\/p>\n
JAKARTA (JP): The government will auction to the public next
\nmonth a number of concession rights to carry out logging
\nactivities in three million hectares of the country's forests, a
\nsenior official of the ministry of forestry and plantations has
\nsaid.<\/p>\n
Director General of the Utilization of Production Forests
\nWaskito Soerjodibroto said the ministry will also give another
\nthree million hectares to cooperatives and small scale
\nbusinesses.<\/p>\n
\"Insya Allah (God willing), the auction will be held in
\nJanuary. We are currently preparing the names of the timber
\ncompanies and cooperatives which qualified to participate in the
\nauction,\" he said after a breaking the fast gathering on
\nWednesday.<\/p>\n
He said that the logging rights on offer would be those which
\nformerly belonged to companies whose licenses had not been
\nextended after expiry or those that had been suspended for
\nbreaching logging regulations and failing to manage their
\nconcessions in a sustainable fashion.<\/p>\n
Waskito said that the auction would mark a change in the
\ngovernment's policy in granting forest concession rights to
\ninvestors. At present companies those which are allowed to carry
\nout logging operations are directly appointed by the government.<\/p>\n
Under the new regulation, each concessionaire would be limited
\nto a maximum of 100,000 hectares of forest in a province.<\/p>\n
Concessionaires will be allowed to manage other forest areas
\nin other provinces, but the total area under their management
\ncould not exceed 400,000 hectares.<\/p>\n
Waskito said that the ministry has calculated that there will
\nbe around nine million hectares of forests whose logging
\ncontracts have expired or been suspended as of next year.<\/p>\n
However, he said, the government's initial assessment showed
\nthat only 6 million hectares are still operable.<\/p>\n
\"So, there will be three million hectares to be offered to the
\ngeneral public through auction, while the remaining three million
\nhectares will be granted to cooperatives and small scale
\ncompanies,\" he said.<\/p>\n
Waskito said that the forest area to be granted to each
\ncooperative and small scale business would be limited to 50,000
\nhectares, while those to be auctioned will range between 50,000
\nand 100,000 hectares each.<\/p>\n
Logging contracts for areas below 10,000 hectares will be
\ngiven to cooperatives and small scale firms by the governor of
\nthe particular province as part of the government's effort to
\ngive local administrations greater autonomy in managing the
\ncountry's forest assets, he added.<\/p>\n
\"Local cooperatives which apply for a logging contract should
\nhold a recommendation from the governor,\" he said.<\/p>\n
Waskito said that the bidding prices of the logging contracts
\nwill be dependent on each area's yield potential.<\/p>\n
Waskito said that some of the forest areas controlled by big
\ntimber groups such as Kayu Lapis Indonesia (KLI), Barito Pacific
\nGroup, Kalimanis Group and Djajanti would be included among those
\noffered to the public.<\/p>\n
According to the minister's data, the KLI Group owned by
\nHunawan Widjajanto is the largest forest concession holder. It
\nowns 3.5 million hectares of forest concession areas in the
\ncountry, followed by Burhan Uray's Djajanti Group with 2.9
\nmillion hectares, Prajogo Pangestu's Barito Pacific with 2.7
\nmillion hectares and Mohamad \"Bob\" Hasan's Kalimanis with 1.6
\nmillion hectares.<\/p>\n
Indonesia earlier planned to introduce the auction system for
\nforest concessions by the end of July to comply with reform
\nagenda agreed with the International Monetary Fund (IMF).<\/p>\n
But the plan was rescheduled until the end of this year.<\/p>\n
The government first began to award forest concessions to
\nprivate companies in 1971 under the auspices of the Forestry Law
\nwhich grants concession holders the sole right to cultivate and
\nexploit the forest in their concession areas.<\/p>\n
The move has led to a concentration of the country's forest
\nassets in the hands of a small number of business groups.<\/p>\n
At least 421 private companies are currently involved in
\nlogging activities on 51.5 million hectares. But most of the
\ncompanies are operating under just 33 leading business groups.<\/p>\n
Meanwhile, Minister of Forestry and Plantations Muslimin
\nNasution said separately on Wednesday that his office was facing
\ndifficulties in fully enforcing the new regulation.<\/p>\n
He said the logging contracts owned by several timber
\ncompanies under these leading business groups have allegedly been
\nextended before their expiry date. (gis)<\/p>",
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