CGI, government `failing' to fight illegal logging

CGI, government `failing' to fight illegal logging

The Jakarta Post, Jakarta

Indonesia and its donors grouped in the Consultative Group on
Indonesia (CGI) have not been doing enough to curb illegal
logging as the practice continues unabated, according to forestry
activists.

Bambang Setiono from the Center for International Forestry
Research (CIFOR) and Arbi Valentinus from the Telapak forestry
non-governmental organization criticized the CGI for its failure
to press the government to end ongoing rampant illegal logging,
despite the latter's detailed promises given after a CGI meeting
in 2001.

Worse still, the CGI this time agreed to extend new loans
totaling US$2.7 billion and failed to tie them to government
measures to curb illegal logging.

"The CGI should have been assured of the government's
seriousness in handling legal and court reforms as regards
forestry before extending new loans and grants," Bambang told The
Jakarta Post.

The government gave four commitments in the field of forestry
policy as part of the requirements for further CGI loans during a
meeting in 2001.

These were reducing capacity and restructuring forestry
companies in order to balance log supply and demand, closing down
those companies that could not repay loans, imposing a moratorium
on the exploitation of natural forests, and stopping illegal
logging.

To implement its promises, the government introduced a number
of policies on the moratorium, and issued a presidential decree
on illegal logging. But all of these efforts failed to work due
to weak law enforcement.

Nevertheless, the CGI and its Donor Forum on Forestry have
seemed to have turned a blind eye, and agreed to extend new loans
to Indonesia.

To make things worse, the CGI supported the government's moves
to bail out forestry companies, thus further endangering
Indonesia's forests, according to Arbi Valentinus from Telapak.

"The government and the CGI have used taxpayers' money and
loans from foreign donors to help the companies continue to
destroy forests illegally," he said

CIFOR and Telapak data show that the government has spent some
Rp 34 trillion in taxes and foreign loans to bail out 111
forestry-related companies so that they can continue exploiting
forests.

These companies are now under the control of the Indonesian
Bank Restructuring Agency (IBRA), and have a machine capacity
six-times higher than the amount of timber they are allowed to
fell.

They have a combined production capacity of some 37 million
cubic meters of timber. Meanwhile, the official estimate of the
timber available to them this year is only 3.5 million cubic
meters.

"This means that the remaining timber needed to meet their
demands comes from illegal loggers," CIFOR's Bambang said.

The government, he said, must no longer help companies that
have been proved to be supporting illegal logging.

According to an official forecast, illegal logging activities
produce 50.7 million cubic meters of timber annually, resulting
in financial losses to the state of at least Rp 30.42 trillion
(US$3.37 billion).

CIFOR also urged the government to delay the sale of loans
owed by forestry companies at a large discount as this would only
lead to further deforestation.

The sale of forestry company loans at a big discount would
allow their former owners or associates to buy them back and get
new loans so as to expand their forestry activities, thus
worsening illegal logging due to their huge demand for logs.

The total debt of the companies under IBRA control reached Rp
34 trillion, with almost half of this being owed by forestry
tycoon Mohamad "Bob" Hasan and the Sinar Mas Group.

Bob Hasan, who has been convicted of embezzling state funds
and is now imprisoned for corruption in Nusa Kambangan, Central
Java, owes some Rp 5.34 trillion while the Sinar Mas Group owes
Rp 9.23 trillion.

Both Bambang and Arbi called on the CGI and the government to
once again pay attention to the effort to protect Indonesia's
forests by curbing illegal logging.

The government, for its part, had to make a real effort to
overcome illegal logging, such as by establishing a team to
investigate legislators, and police and military officers who
were involved in illegal logging.

"The government must also conduct a regular review, and make
sure that there is transparency throughout all of the process
involved," Bambang said.

Meanwhile, the CGI needed to give technical and financial
support to the government.