Irian Jaya forests to help overcome timber shortage
Irian Jaya forests to help overcome timber shortage
JAKARTA (JP): Minister of Forestry Djamaludin Suryohadikusumo
says the government will encourage forest concessionaires in
Irian Jaya to step up operations in order to overcome the
shortage of timber facing plywood mills.
Djamaludin told reporters yesterday that Irian Jaya's forests
can provide plywood mills with the logs they need because there
are only a few wood-based industrial plants in the province.
Most of the plywood mills operating in Indonesia are located
in the western part of the country.
"The concessionaires in Irian Jaya are presently either
inactive or have had their licenses revoked," Djamaludin said
during a hearing with the House of Representatives Commission IV
for agricultural, forestry and transmigration affairs.
The minister said earlier this month that Indonesia might have
to import logs for plywood plants which cannot get timber
supplies from existing natural forests.
But President Soeharto said last week that importation was
unnecessary and that log shortages would ease when the current
rainy season ends.
Soeharto also said that log supplies would increase when the
government starts clearing peat moss in Central Kalimantan for
the establishment of one million hectares of rice fields.
Djamaludin said yesterday the giant rice field project, which
started earlier this month, would be able to bring in about six
million cubic meters of wood by the time the project ends in
1998.
But he pointed out that the most effective way of overcoming
the shortage is for timber estates and plywood mills to
restructure their industrial facilities.
"The idea of allowing the importation of logs is a test case
to see if plywood mills are ready to face globalization and the
free trade era...When the time comes, the log prices will be
determined strictly by the market and local mills will no longer
have a chance of getting cheap timber," he said.
Djamaludin said wood-based industries should not only pursue
benefits for themselves.
"If they don't invest in new machinery, they won't survive
globalization," he added.
Djamaludin, in yesterday's hearing, explained that the
Ministry of Forestry will allocate Rp 596 billion (US$260.26
million) from its collection of reforestation funds to finance a
possible deficit in the upcoming 1996/1997 state budget.
The same amount was allocated in the previous (1995/1996)
fiscal year.
Reforestation fees, together with forest royalties, are among
the mandatory fees that forest concessionaires must pay to the
government. The fees are determined by the volume and the species
of timber harvested.
Djamaludin said this year's reforestation funds are still
intact.
As of Dec. 31, 1995, unused funds collected by the ministry
reached Rp 2.6 trillion. Interest on the amount reached Rp 796
billion, of which Rp 500 billion will be used to fund the rice
field project in Central Kalimantan. (pwn)