Dayak Besar takeover still in question

JAKARTA (JP): Minister of Forestry Djamaludin Suryohadikusumo has asserted that the question of who will take over the debt- burdened PT Dayak Besar Group (DBG) is not important as long as its forests are used to benefit the local people.

"The central issue is that forests are state assets. Forests should not be abandoned because they belong to the state. We will use every government regulation to take them into our care," Djamaludin said.

DBG, which controls around 200,000 hectares of forest concessions and a number of timber mills in East Kalimantan, was found earlier this year to have defaulted on loans worth an estimated Rp 350 billion (US$166 million).

Around Rp 200 billion of the debts were owed to the state- owned Bank Rakyat Indonesia and another Rp 150 billion to various private banks.

Businessman Probosutedjo, the chairman of the automotive Garmak group and a half-brother of President Soeharto, later stepped in, saying he was willing to take over the group, which was previously controlled by businessmen Yusuf Hamka.

Until April, the takeover was not yet final and Probosutedjo conceded that his company still needed several more months to determine how to repay DBG's large debt burden. He insisted that he would not retreat from the takeover.

Reliable sources in the forestry business, however, said that Probosutedjo, who is also chairman of the widely-diversified Mercu Buana Group, has backed away from the plan.

Djamaludin said yesterday he had yet to receive reports from a special team -- comprised of officials from the Ministry of Forestry and Bank Rakyat Indonesia -- which would decide the best way to save the state's assets.

He acknowledged that if it was considered necessary and no private investors were interested, DBG's concessionaires could be managed by state forestry firms.

He explained that DBG's concessionaires were inadequate to sustain the company's 11 lines of wood-based industries.

Yamdena

Djamaludin also met yesterday with the local people of Yamdena Island in Tanimbar, Southeast Maluku, who previously rejected logging operations in their area.

The 11 delegates, consisting of wood carvers, farmers, senior citizens of the local villages and government officials, acknowledged that they have decided to abide by government regulations and fully support the logging operations and wood- based industries managed by a joint venture between state-owned PT Inhutani I and PT Mohtra Agung Persada.

Previously, the local people -- led by the Association of Tanimbar Intellectuals -- opposed the concessionaires, saying that the logging would destroy Yamdena's forests and their unique flora and fauna.

Yamdena

Djamaludin, however, persisted in his decision to permit Inhutani and Mohtra Agung to operate in the region, saying that logging would not endanger the island as long as it was done under the principles of sustainable forest management.

Inhutani, the delegates said yesterday, conducted sound social approaches before starting operations in Yamdena. These included the holding of a sacred ceremony which allowed the Tanimbar tribe's traditional leaders to approve the logging operations.

The local people said they were also grateful for Inhutani's efforts to market their wood carvings, supervise settled farming and provide clean water.(pwn)