Indonesia fails to curtail forestry industry

Indonesia fails to curtail forestry industry

Deutsche Presse Agentur Jakarta

Indonesia on Tuesday called on its major donors to stop importing illegally cut timber or associated products from the country, but failed to put into place constraints on its own booming forestry industry.

"Asking one country to combat illegal logging while at the same time receiving or importing illegal logs of course does not support efforts to combat these forest crimes," Indonesian Forestry Minister Muhammad Prakosa told an annual gathering of the country's leading international and country donors.

Indonesia last year signs agreements with China, the U.K. and Northern Ireland to cooperate in halting the import of illegal timber or timber products in an effort to stem the rampant deforestation taking place in the Indonesia, which is losing about 2 million hectares of forest land each year, much of it to illegal logging.

Prakosa said that Indonesia was working on similar cooperative agreements on illegal timber import bans with the U.S., Japan and the European Union.

Indonesia's repeated failure to curb illegal logging, much of it conducted with the collusion of government officials, has been raised as a serious issue at the Consultative Group for Indonesia (CGI), a group of some 30 donors who have been financing the country's budget deficits for the past four years, but the government failed to respond to policy suggestions.

The World Bank and IMF, hosting the CGI meeting, have this year put pressure on the Indonesian Bank Restructuring Agency (IBRA) to slow its sale of bad debts owed to banks by the forestry sector in an effort to let more forestry companies go under.

"There was essentially no response on the IBRA issue," said Thomas Walton, the World Bank's lead environmentalist expert in Indonesian. "The results on the ground have been very small."

The World Bank and many environmentalists argue that most of Indonesia's illegal logging is the result of the huge domestic demand from local forestry industries such as pulp and paper, plywood and furniture.

Indonesia's giant pulp an paper industry, with a capacity to consume 25 million cubic metres of wood per year, is deemed the major single source of deforestation in the country, and yet the government has made no effort to curb production.

Although forestry minister Prakosa threw his support behind the World Bank and environmentalists' proposal to let some of the ailing forestry companies go under to decrease the industry's capacity, but neither IBRA nor the finance ministry endorsed the plan.

"If we lose the momentum and do not close down these forest companies, it will be politically difficult to close them down later on," warned the minister.