Britain rejects RI plywood over illegal timber issue

Britain rejects RI plywood over illegal timber issue

Rendi A. Witular, The Jakarta Post, Jakarta

In another blow to Indonesia's ailing forestry-based industry,
British buyers have rejected Indonesian plywood over a report
that the logs used for the plywood were felled illegally.

Forestry Industry Revitalization Agency (BRIK) chairwoman
Soewarni said the rejection came following a report by Greenpeace
which alleged that about 80 percent of Indonesian plywood
exported to Britain was made of illegally cut timber.

"Greenpeace's report is very detrimental to our plywood
industry. The report is an exaggeration," said Soewarni on
Wednesday.

Greenpeace is a global non-governmental organization dealing
with environmental issues.

Soewarni said the buyers were afraid of accepting the plywood
because the British government had signed an agreement with the
Indonesian government two years ago to reject all forestry-based
products suspected of being produced from illegally cut logs.

She said that British buyers began rejecting Indonesian
plywood three months ago.

"The buyers want a legal statement from the Indonesian
government over the legality of the plywood or else they will
continue to reject the plywood," she said.

Soewarni said the rejected plywood had passed an
administrative inspection by the agency to ensure the legality
and origin of the timber.

The plywood cannot be exported if the agency finds the timber
used to make the plywood was felled illegally, she said.

According to the agency, at least 17 local companies have been
harmed by the rejection, with the volume of refused plywood
reaching an estimated 300,000 cubic meters.

Indonesia exported five million tons of plywood in 2002,
generating revenue of US$441 million, according to government
data.

BRIK was set up by the Ministry of Forestry and the Ministry
of Trade and Industry to prevent companies from using illegally
cut logs and to help resolve industry-wide problems.

Minister of Forestry M. Prakosa said that in response to the
move by the British buyers, his ministry would issue a notice to
be attached on all forestry-based products exported to Britain,
stating that the products were made from legally cut logs.

"We will issue a legal statement to British buyers that all
forestry-based products endorsed by the agency are by definition
legal," said Prakosa to reporters on Wednesday.

The country's plywood industry has been in the doldrums after
the government launched efforts to restructure the industry
several years ago. The government has cut logging quotas to save
what little remains of country's natural forests and prevent them
from being further overexploited by the industry.

At the same time, companies which use legally cut logs are
also facing a drop in exports, as the market is flooded with
plywood from producers who use illegally cut logs.

The government has thus far been far from successful in
cracking down on illegal logging.

The plywood industry has several times complained to the
government about the smuggling of illegally cut logs to Malaysia
and China, which has enabled the plywood industries of both
countries to eclipse Indonesian companies.

Painting a bleak picture of Indonesia's forestry-related
industry, the Indonesia Employers' Association recently said
between 500,000 and 600,000 workers in the industry, including at
plywood companies, would lose their jobs this year.