Indonesian company seeks huge Cambodian timber deal

Indonesian company seeks huge Cambodian timber deal

PHNOM PENH (Reuter): Indonesia's Panin Group is negotiating for a logging concession covering 1.5 million hectares of Cambodia's dwindling forests despite a ban on log exports, officials and diplomats said.

"I have not signed the contract...we are just discussing," said Agriculture Minister Tao Seng Hour. Any deal would be twice as large as the controversial 800,000 hectare concession awarded to Malaysia's Samling Corporation last year.

The minister refused to say how much land was involved but an Indonesian diplomat with his mission's Economic Department said it covered 1.5 million hectares.

"The contract has not been agreed on both sides," he said.

The location of the concession area was not given but it would covers eight per cent of the total land area of Cambodia and 20 percent of the remaining forest cover, according to environmentalists.

The biggest

It would be the biggest concession awarded by the coalition government in its two-year tenure.

The negotiations between Panin and the government come amid a ban on log exports that was imposed from May 1. Environmentalists and King Norodom Sihanouk have warned that the country could be turned into a wasteland by rampant logging.

The agriculture minister would not say if other deals were being discussed but a report in Phnom Penh Post said companies from Malaysia, Taiwan, South Korea, Singapore, Japan and Australia had applied for logging licenses.

"It is clear that after a brief pause in legal logging following the...ban, millions of hectares of Cambodian forest are being earmarked for logging," the Post said.

The government says fresh logging contracts will only go to companies that carry out selective cutting, replanting and environmental protection.