Auction opens for forestry concessions<\/p>\n
JAKARTA (JP): After several delays, the government finally
\nopened the long-awaited auction for obtaining concession rights
\nto carry out logging activities in the country.<\/p>\n
Director General of Forest Utilization Waskito Soerjodibroto
\nsaid on Tuesday the auction, the first open bidding system to
\naward forest concession rights to investors, would be made for
\n170,000 hectares of forest blocks in Central Kalimantan and Irian
\nJaya.<\/p>\n
\"The concessions to be offered are 70,000 hectares of forest
\nin Central Kalimantan and 100,000 hectares in Irian Jaya,\" he
\nsaid, adding that prospective bidders must submit their
\napplication letter before June 8.<\/p>\n
Waskito said the logging rights on offer were those which
\nformerly belonged to companies which had been suspended after
\nfailing to meet administrative requirements.<\/p>\n
He guaranteed the concessions to be auctioned still possessed
\nvirgin forests and productive logged-over areas.<\/p>\n
\"The bidder's application should provide important
\ninformation, including the technique it will use in managing the
\nforests, investment plans and development plans for people in
\nnearby villages...\"<\/p>\n
He said bidders must also employ forestry expert staff, be
\nfinancially sound and be active in agribusiness or the forestry
\nbusiness. They also must open their headquarters in the province
\nwhere the concessions areas are located.<\/p>\n
\"The applications will be processed within seven days. After
\nannouncing the names of the bidders who meet our requirements, we
\nwill brief them on the mechanisms of the auction and then we will
\nshow them the concession areas. After that, those taking part in
\nthe auction must submit their bidding prices.<\/p>\n
\"The bidding prices, together with the technical proposal,
\nmust be received by the tendering committee within 60 days after
\nthe briefing day,\" he said.<\/p>\n
The prospective bidders are also obliged to submit auction
\ncosts, which is 10 percent of the projected net profit in their
\nproposals.<\/p>\n
The successful companies must pay the government at least 10
\npercent of their annual net profit gained from exploiting the
\nconcessions areas. The payment of the contribution together with
\nother forestry fees such as reforestation fees, royalty resource
\ntax and concession fees are requirements to obtain an annual
\nworking plan.<\/p>\n
Waskito said the tender committee would assess the bidding
\nprices proposed by the companies and would then select three
\ncandidates for each concession to the minister of forestry.<\/p>\n
\"The minister will then choose the winner for each concession
\nand the director general of forest utilization will publicly
\nannounce their names within seven working days,\" he said.<\/p>\n
Waskito, whose office is under the forestry and plantation
\nministry, said auctions would be open to all cooperatives and
\nprivate or state timber companies, which met the stipulated
\nrequirements.<\/p>\n
He said the government would pay more attention to technical
\nfactors, such as the companies' ability to manage the forest in a
\nsustainable manner, rather than just financial issues.<\/p>\n
The auction is a marked shift from the government's customary
\npolicy of granting forest concessions without a competitive
\ntender.<\/p>\n
The government earlier planned to introduce the auction system
\nby the end of July last year in compliance with the reform agenda
\nagreed to with the International Monetary Fund.<\/p>\n
It was repeatedly rescheduled to the end of 1998, and finally
\nto the first quarter of this year.<\/p>\n
The government first began to award forest concessions to
\nprivate companies in 1971 under the Forestry Law, which grants
\nconcession holders the sole right to cultivate and exploit the
\nforest in their concession areas.<\/p>\n
The move led to a concentration of the country's forestry
\nassets in the hands of a small number of business groups.<\/p>\n
Waskito said at least 291 private companies are actively
\ninvolved in logging activities on 33.9 million hectares of
\nforests. (gis)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/auction-opens-for-forestry-concessions-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}