Govt ups logging quota to meet demand

Rendi A. Witular, The Jakarta Post, Jakarta

The country's ailing forestry-based industry is likely to revive following the government's plan to increase its logging quota this year, to meet the local industry's capacity and help create employment opportunities.

Minister of Forestry Malam Sambat Kaban said on Thursday the ministry would soon propose to the House of Representatives the revision of this year's logging quota from 5.45 million cubic meters to between 20 and 30 million m3.

"Reducing the logging quota is not a wise way to curb illegal logging. The low quota has prompted most forestry-based companies to seek illegal timber to meet their demand," he said.

At present, the forestry-based industry has an installed capacity of about 42 million m3 per year, but the industry is flooded with illegal timber from already depleted natural forests.

The great discrepancy between the demand and the available logging quota has been cited as a key contributor to widespread illegal logging across the country.

"The quota reduction has made less raw materials available and caused higher production costs for the industry, leading to the shutdown of companies. At the same time, illegal timber still continues to flood the market," the minister said.

The quota increase is expected to boost the industry's contribution to the country's coffer to about US$9 billion in foreign exchange revenue this year, from an estimated $7.8 billion last year.

The ministry also hopes to reap more taxes from industry activities and fees from timber sold, for forest rehabilitation.

Kaban said the ministry would set up a special division to supervise the industry so that the industry could use the quota "sufficiently and efficiently" as well as to stop receiving illegal timber.

The planned division will be supported by an audit from state- owned assessor PT Surveyor Indonesia and PT Sucofindo to determine an annual timber volume for each company and help verify the legality of the timber it acquires.

To create sustainable forest management following the quota increase, the ministry will also intensify its efforts to rehabilitate destroyed natural forests by allocating between Rp 4 trillion and Rp 5 trillion to replant some one million hectares of destroyed forests.

The gradual quota decrease was part of the previous government's efforts to protect Indonesia's rapidly diminishing natural forests, due to the privileges given to companies under the New Order regime.

To cope with the shortage in legal timber supply, the government has urged the industry to lower their collective reserve capacity to 20 million m3 per year and to import logs or procure them from industrial plantations.

For various reasons, most forestry-based companies have refused to follow the instruction and prefer to use illegal timber instead. Those companies that refused to use illegal timber have, for the most part, ceased operations.

According to the Association of Indonesian Wood Panel Producers (Apkindo), the policy has forced 35 plywood companies to close down, leaving only 70 still in operation as of last year.

About 2.6 million hectares of land is deforested here every year, threatening the remaining 40 million hectares of natural forest.