Forestry ministry to auction logging rights next month
Forestry ministry to auction logging rights next month
JAKARTA (JP): Minister of Forestry and Plantations Muslimin
Nasution said on Friday that his office will auction next month
concession rights to carry out logging activities in a number of
forest blocks in the country.
Muslimin said the logging rights on offer would be those which
formerly belonged to companies which had been suspended for
breaching logging regulations and failing to manage their
concessions in a sustainable manner.
"My team is still preparing the names of the timber companies
and cooperatives which qualified to participate in the auction.
We will be ready to hold the auction next month," he was quoted
as saying by Antara news agency.
He said that the auction would mark a change in the
government' policy in granting forest concession rights to
investors. At present, companies which are allowed to carry out
logging operations, are directly appointed by the government.
Under the new regulation, each concessionaire would be limited
to owning a maximum of 100,000 hectares of forest in a province.
Concessionaires will be allowed to manage other forest areas
in other provinces, but the total area under their management
could not exceed 400,000 hectares.
Plantation companies, except sugar cane plantations, would not
be allowed to manage more than a total of 100,000 hectares of
land, with a limit of 20,000 hectares in each province.
Muslimin said that the timber companies which obtain the
contracts through the open bidding system would be obliged to
give a one-year guarantee bond to ensure that the forests will be
managed in a sustainable manner.
"If they fail to manage the forests in a sustainable manner,
their logging contracts will be revoked," he said.
Indonesia earlier planned to introduce the auction system for
forest concessions by the end of July to comply with reform
agenda agreed with the International Monetary Fund (IMF).
But the plan was rescheduled until the end of this year.
The government first began to award forest concessions to
private companies in 1971 under the auspices of the Forestry Law
which grants concession holders the sole right to cultivate and
exploit the forest in their concession areas.
The move has led to a concentration of the country's forest
assets in the hands of a small number of business groups.
At least 422 private companies are currently involved in
logging activities on 51.5 million hectares. But most of the
companies are operating under just 14 leading business groups.
(gis)