Govt plans to impose export quota on logs

JAKARTA (JP): The government plans to impose a quota on exports of logs to guarantee a sufficient supply for domestic demand, a minister has said.

Minister of Forestry and Plantations Muslimin Nasution said Friday the export quota would not contravene the government's reform program agreed to with the International Monetary Fund (IMF) because it did not constitute a ban on exports of the commodity.

"Timber companies will be allowed to export after the supply of logs can meet domestic demand for a minimum three months."

He did not specify the amount of the quota but said his ministry and the Ministry of Industry and Trade were working out the plan.

The government imposed a 200 percent export tax on logs in recent years before easing it early this year to meet the program agreed on with the IMF.

Muslimin said no local timber companies had exported their logs overseas because the reference export prices -- set by the Ministry of Industry and Trade as the basis in collecting the export tax -- were still too high.

But he said the export quota system was still needed to anticipate growing demand from overseas, particularly Malaysia, Japan, South Korea and China.

In accordance with economic reform programs signed Jan. 15 with the IMF, the government agreed to reduce export taxes on logs, sawn timber and rattan to 30 percent by the end of June, 20 percent by the end of December this year, 15 percent by the end of December 1999 and 10 percent by December 2000.

It also stipulated the government would eliminate all other types of export restrictions, such as quotas, in three years. The only exceptions would be for restrictions imposed for health and security reasons and temporary measures introduced in the event of occasional domestic shortages. (gis)