Good forest management

Good forest management

Asia Pulp & Paper (APP), one of Indonesia's largest pulp and
paper producers, signed a cooperation agreement with the World
Wide Fund for Nature (WWF) last week that could become a model
for good forest management for wood-based manufacturing companies
in the country.

Under the agreement, APP will set aside almost 50 percent, or
58,500 hectares, of its forest concessions in Riau province as
conservation areas. It also has pledged to tighten procedures to
stop the supply of illegal logs to its pulp mill.

The subsidiary of the Sinar Mas Group also will prepare a
multiyear action plan on the sustainability of its forest
resources, the conservation of high-conservation-value forests,
the legality of its wood supply and the resolution of land
conflicts with local communities, all under the supervision of
the WWF.

Unilaterally setting a moratorium on logging in such a vast
portion of its forest concessions is a great sacrifice for APP,
which has about US$6.7 billion in debts, because the initiative
not only could slow production at its mill, but also could
increase the costs of its pulpwood procurement.

Even though the move partly reflects the change of attitude on
the part of APP toward environmental sustainability and social
responsibility, this concerted environmental effort should be
attributed largely to the combination of pressures from non-
governmental organizations and APP buyers, notably those in
Japan.

Pulp and paper companies, like plywood makers, in Indonesia,
have been coming increasingly under attack from NGOs for poor
forest management practices. The government's licensing of wood-
based industries, whose total manufacturing volume is way above
the sustainable support of forest resources, has caused concern
about the reckless felling of the country's natural forests.

The rapid expansion of pulp and paper industries, especially
in the early 1990s, made Indonesia one of the world's top
producers but forced companies to scramble for pulpwood to feed
their mills.

Environmentalists have long suspected that much of the wood
for the mills came from illegal logging. NGOs allege the pulp and
paper industry is one of the biggest threats to Indonesian
forests, especially now when pulp and paper companies are
groaning under mountains of foreign and domestic debt.

The problem should nonetheless not be blamed entirely on the
greed of the companies. Forestry regulations in the era of local
autonomy often make it extremely difficult for companies to
ascertain the source of the wood entering their mills. And
corruption among forestry officials, who are supposed to verify
the documents of every truck entering the mills, also contributes
to illegal logging.

The government's past policy of granting forest concessions
and land concessions to pulpwood plantations only after the pulp
mills were already in operation should also be blamed for the
mismanagement of the forest. This policy forced the government to
make some corrective measures, by allowing pulp companies to
clear-cut the natural forests they had been allotted for tree
plantations and to buy pulpwood from outside suppliers. These
cheap outside suppliers in turn often discouraged pulp companies
from immediately developing tree plantations, which require a
large investment.

Because the astronomical expansion of the pulp and paper
industry in Riau in the early 1990s coincided with the opening of
hundreds of thousands of hectares of oil palm plantations, the
government also forced pulp companies to buy wood cut on
plantation lands in a bid to prevent the use of fire to clear the
land.

There is indeed an urgent need for the government to
strengthen its administration of the forests. But one cannot
expect much improvement soon from this sector, especially during
the current learning period under local autonomy.

The APP-WWF joint endeavor seems a better alternative for
improving forest sustainability. This cooperation proves how
effective the combination of pressure from buyers, consumers and
credible NGOs can be in forcing companies to implement good
forest management practices.

Hopefully, similar pressure will be exerted on other pulp and
paper producers such as Kiani in Kalimantan and Riau Andalan Pulp
in Riau, as well as plywood makers.

True, the effectiveness of the APP initiative and the
seriousness of its commitment to good forest management has yet
to tested, which it will be over the next few months when the
joint projects are implemented.

We nevertheless are assured the WWF will not compromise its
reputation and credibility, and will therefore see to it that all
programs agreed on in the cooperation agreement will be properly
implemented.