43 timber firms seek licenses to export logs
43 timber firms seek licenses to export logs
JAKARTA (JP): Forty three timber companies have applied to the
Ministry of Forestry and Plantations for licenses to export logs
as a result of weak demand on the domestic market, an official
said on Tuesday.
The director for forest supervision at the ministry, Wolter
Nababan, said the 43 companies planned to export a total of 1.6
million cubic meters of logs.
However, the ministry has thus far issued licenses to only 12
companies which will allow them to export a total 600,000 cubic
meters of logs, Nababan was quoted by Antara as saying.
In June, as part of an agreement reached with the
International Monetary Fund (IMF), the Indonesian government
replaced a technical ban on log exports with a 30 percent export
tax and has said it will cut this tax to 20 percent by the end of
the year.
Nababan said the 12 timber companies which had received log
export licenses included Djajanti Group and Mudjur Timber.
Djajanti has shipped 12,000 cubic meters of logs to India,
while Mudjur has not yet made use of its license, despite having
obtained it before Djajanti.
Djajanti, owned by Burhan Uray, is the country's second
largest forest concessionaire. Together with its sister company
Budhi Nusa Group, the company controls 2.95 million hectares of
forest in Irian Jaya, Maluku and Central Kalimantan.
Nababan believed there was not a big demand for Indonesian
logs on the export market because of doubts over the continuity
of supply from the country.
Foreign buyers believe that Indonesian log exports will be of
a temporary nature given the current weak demand on the domestic
market as a result of the economic crisis. They believe exports
will dry up once the country's economy returns to normal and the
timber industry here revives.
"There are currently a lot of unsold logs in Indonesia and
it's better to export them rather than leave them to rot here,"
Nababan said.
"After all, the exports generate foreign exchange earnings
which Indonesia needs very much under the present circumstances,"
Nababan said, adding that about 5 million cubic meters of logs
could be exported in the current 1998/99 fiscal year.
Nababan said log exports would only be used as a short term
emergency measure during the crisis, adding that the government
had no intention of promoting the trade in the long term. (jsk)