Govt stops issuing plantation licenses

JAKARTA (JP): The government has stopped issuing new licenses to open up forests for plantation estates as most investors have neglected the projects.

Minister of Forestry and Plantations Muslimin Nasution said on Friday that only 1.4 million hectares (16.5 percent) had been realized from the nine million hectares of forests licensed for plantation estates since early 1990.

"Why should we open up more forest areas for plantation activities while we have seen that the areas are only being neglected by the plantation companies?" he said in a national conference on forestry.

Although he did not know why investors had failed to utilize the areas, he warned he would revoke their licenses if they did not start their projects within the next year.

"We will announce the names of the delinquent plantation companies and we will revoke their licenses."

Muslimin pledged to be tougher in the future. If it is necessary, he said, he would take the delinquent plantation companies to court for breaching the regulations.

He said lighter penalties of revoking licenses or imposing fines had so far proved ineffective.

"If they neglected the forest areas given to them it means that they caused a loss to the government because the areas were idle and unproductive."

Many oil palm investors have complained that they have not been able to realize their investment plans to open plantations due to the complex licensing procedure.

They said they received location permits from the provincial administration, but they could not start their projects because they lacked the so-called forest relinquishment permits from the Ministry of Forestry and Plantations. Both are required under law.

They urged the government to allow them to work on the projects on the basis of permits issued by the provincial administration.

Meanwhile, the ministry's head of its research and development agency, Toga Silitonga, said separately in Jakarta that the total oil palm plantation areas in the country should be limited to three million hectares to avoid a market glut of crude palm oil (CPO).

"The limitation is needed to prevent an oversupply. Otherwise the price of CPO will drastically fall due to the oversupply in the market," he said.

"Besides,if we continue to excessively expand oil palm plantations, it will lead to a further decline of our forests."

He said that Indonesia currently has 1.6 million hectares of oil palm plantations, producing 5.9 million tons of CPO a year. (gis)