Incentives offered to concessionaires with sustainable management

JAKARTA (JP): Minister of Forestry Djamaloedin Soeryohadikoesoemo is offering incentives to attract forest concessionaires so that they manage their concessions in sustainable ways to guarantee preservation.

"Concessionaires which manage forests sustainably will receive a recommendation to generate funds through the capital market as well as an export certificate from the Indonesian Ecolabelling Institute (LBI) to support their exports," Djamaloedin told reporters here yesterday after opening a meeting of the Indonesian Wood Panel Association (Apkindo).

He said a recommendation to go public will be given to a company as soon as it can prove that it has fulfilled all the requirements for sustainable management.

A recommendation from the Minister of Forestry is required by a forest concessionaire before entering a stock exchange. The ministry has held up a recommendation for PT Artika Optima Inti (AOI), a wood-based panel board manufacturer affiliated with the Djajanti Group, to enter the stock exchange because it failed to fulfill its forest concession obligations in Irian Jaya.

AOI, which processes wood on Seram Island, Maluku, for example, has not met a requirement to build a wood processing plant in Irian Jaya, where it cuts most of its logs.

Up until now, there are only two wood-based companies listed on the stock market. PT Barito Pacific, a company controlled by businessmen Prajogo Pangestu, is listed on the Jakarta and Surabaya stock exchanges and its subsidiary, PT Sumalindo Lestari Jaya, is listed on the Jakarta stock exchange.

Supply

Djamaloedin said that to guarantee the continuous supply of raw materials, a concessionaire should have a sound management plan.

"If they want to get cheap investment from the stock market, they have to fulfill the requirements to manage their concession areas according to the basic rules that guarantee forest preservation," the minister said.

He said an ecolabelling certificate will be needed by the year 2000, when importers require that wood products traded on international markets should be from forests that care about preservation.

If a company fails to get such a certificate from the LBI, they can not market their products internationally at that time. (yns)