Government gives concessionaires year-end deadline
Rendi A. Witular, The Jakarta Post, Jakarta
The Ministry of Forestry has given all forest concessionaires until the end of this year to put their house in order, warning that any companies found to have failed to develop their forest areas sustainably next year will have their licenses revoked.
The ministry said that, starting on Jan. 1 next year, it would send 12 independent companies, selected by the ministry, to assess the operations of the concessionaires.
Based on the results of the assessment, the government would decide whether to revoke the concessionaires' licenses or allow them to continue their operations.
Director general for the development of forest production Suhariyanto said the new policy was aimed at preventing further destruction of the country's forests.
"We must give our forests a break. They badly need to be rehabilitated. Any concessionaires who have failed to meet our requirements for sustainable production will have their licenses revoked," Suhariyanto told The Jakarta Post over the weekend.
According to the ministry, deforestation had affected 40.26 million hectares of the country's total natural forest, which amounts to 119.7 million hectares.
The ministry also said that some 43 percent of the country's forest concession areas were either in a critical state or no longer productive.
As a matter of fact, Suharyanto said, the 12 assessment companies would start work this month, analyzing 116 concessionaires whose licenses had expired this year and had applied for extensions.
Next year, the 12 companies would analyze the other 296 concessionaires who still had effective licenses.
The 12 assessment companies will check if the concessionaires have applied sustainable development principles to their operations: that they have not sought trees outside their contract area or felled immature trees in their contract areas as raw material for their pulp and paper or plywood plants, or sawmills.
Under the existing regulations, concessionaires are only allowed to cut trees that have a diameter of more than 50 centimeters.
If a concessionaire is unable to meet sustainable development principles, its license will be revoked and auctioned off.
If no one is interested in buying the license, the ministry will take over the concession to rehabilitate the area concerned.
The rehabilitation will be financed by the reforestation fund collected from concessionaires, which, this year, is projected to reach Rp 810 billion (US$92 million).
Spokesman for the Association of Indonesian Forest Concessionnaires (APHI) who also heads the advocacy division at the association, Riza Suarga, voiced criticism of the policy, warning that it would result in massive layoffs in the forestry industry.
"The government has the right to revoke the licenses. But, has it considered any solution to the impact of the revocation?
Some 4 million workers, from upstream to downstream companies, depend for their livelihood on this business," Riza warned over the weekend.
Riza feared that massive layoffs caused by the new policy would lead to an increase in illegal logging, as the laid-off employees would resort to illegal activities in their struggle to survive.
Riza added that other sectors of the industry, such as plywood, pulp and paper and sawmill companies, would also be severely hit by the ruling due to a lack of raw material.
However, Suhariyanto dismissed the notion that the new ruling should be blamed for the shortage of raw material.
"What we are going to do is to close concessions that no longer have any more trees suitable for felling.
"If the policy causes a shortage of raw materials, that means the concessionaires have carried out illegal logging," he said.
The Association of Indonesian Wood Panel Producers (Apkindo) said earlier that the ruling would cause about 75 percent of existing plywood companies to close down, rendering at least 500,000 people jobless.