Concessionaires short timber provision

Concessionaires short timber provision

JAKARTA (JP): Minister of Forestry Djamaludin Suryohadikusumo
said yesterday forest concessionaires had provided only 36
percent of the timber they should have allocated to locals in
their concession areas.

Djamaludin said the government had expected the
concessionaires to give at least 990,000 cubic meters of timber,
assuming that concessionaires contributed 5 percent of their
production as stipulated by it.

"Only 25 percent, or a little over 100 concessionaires have
properly applied the regulation," he said after meeting about 50
concessionaires yesterday.

Ministerial Decree No. 12/1996 issued last May states that
each concession holder must allocate 5 percent of its timber to
locals.

The ruling was expected to guarantee locals' access to cheap
timber.

Djamaludin said that if concessionaires failed to comply with
the rule, his office would give three warnings before revoking
their licenses.

"A revocation will be made 60 days after a third warning," he
said, adding that no concessionaire had got a third warning.

Djamaludin was quoted by Antara as saying that concession
holders should be able to sell their timber to locals cheaply
through cross subsidies from their commercial sales to downstream
industries.

"The timber for locals need not be of the best quality. Cheap
timber has lower reforestation funds and forest royalties, which
should be the only components in the price structure of wood for
locals," he said.

Reforestation funds and forest royalties are part of timber's
price structure. Their amounts depend on wood types, so people
selling cheap wood will pay lower reforestation funds and forest
royalties.

It was reported that in September only 45 concessionaires had
complied with the ruling, providing 84,165 cubic meters of wood
to locals. (pwn)