Kadin calls on govt for further help in forestry

Rendi A. Witular The Jakarta Post Jakarta

The Indonesian Chamber of Commerce and Industry (Kadin) has urged the government to immediately establish a special agency, comprising government and business representatives, to resolve problems faced by the forestry sector.

The deputy chairman for forestry and plantation affairs in Kadin, Soedjai Kartasasmita, said the Ministry of Industry and Trade and the Ministry of Forestry had agreed to set up an agency for revitalizing forestry and sustainable raw material by August of this year.

However, the agency has not been established yet, he said.

Soedjai criticized the Ministry of Forestry in particular for the delay, saying that it was reluctant to sign a decree on the agency's establishment, while the Ministry of Industry and Trade had long been ready to sign the decree.

"This shows that the Ministry of Forestry has had no willingness to solve the problems confronting the industry," he said.

The agency, which was the idea of Minister of Industry and Trade Rini Soewandi, aims to boost the export of the country's forestry products and resolve the raw material shortage faced by the industry.

The agency will also help find ways to prevent further deforestation and to protect the environment.

Spokesman for the Ministry of Forestry Koes Saparjadi denied that it had refused to cooperate, saying that the ministry and the businessmen involved in the making of the agency had yet to agree on the mission of the agency.

"We don't have any problem with the Ministry of Trade and Industry, but we do with the businessmen, and we want to have a common understanding with them over issues regarding the raw material supply before setting up the agency. We haven't been able to agree on that yet," Koes said.

He refused to name the businessmen involved.

Koes said the businessmen wanted the ministry to increase the log quota for 2003, saying that the 6.8 million cubic meter quota set by the ministry was too low compared to the industry's total installed capacity of 60 million cubic meters.

KADIN said the forestry industry was the largest contributor of foreign exchange earnings for the country in the non-oil and gas sector.

However, it said that annual export earnings from the industry had declined to US$4 billion during the period of 2000 to 2002 from between $7 billion and $8 billion from 1999 to 2000.

The government's nontaxable revenue from the industry is estimated at Rp 3 trillion ($333 million) this year and, under the 2003 state budget draft, the revenue is estimated to fall further to Rp 1 trillion next year.

Environmentalists blame the industry's woes on illegal loggers who have damaged most of the country's forests and smuggled logs out of the country. This has resulted in a shortage of raw material for local forest-based industries.

However, businessmen blame the raw material shortage on the government policy, which bars them from logging old growth forests.