Legislators protest plan to close down forestry firms

Legislators protest plan to close down forestry firms

Rendi A. Witular, The Jakarta Post, Jakarta

Lawmakers have opposed a plan by the Ministry of Forestry to
close down five ailing state-owned forestry companies, saying the
move would only further damage the country's forests.

Disapproval of the plan was voiced during a hearing on Monday
between the House of Representatives Commission III on forestry
and agriculture and Minister of Forestry Mohamad Prakosa.

Prakosa had proposed earlier that forestry firms Inhutani I
through V be liquidated because they were not profitable enough
and they had failed to rehabilitate forests abandoned by forest
concessionaires.

Under the plan, forests under the Inhutani firms would be
partly surrendered to local villagers and some would be auctioned
off to private investors to turn the areas into plantations.

The ministry is currently awaiting the approval of President
Megawati Soekarnoputri.

But legislators said that transferring the forests to private
parties would only worsen the condition of the country's forests.

Legislator Ja'far Sidiq said the Ministry of Forestry should
focus on restructuring the Inhutani firms or merge them into one
unit to take care of forests.

"The government should not liquidate the firms and sell off
the forests at cheap prices to private firms. Such a move would
be irresponsible," he said.

He claimed that forest concessions under the Inhutani firms
were in far better condition than those managed by private
companies.

He said that most private companies were careless in
protecting the forest as their main aim was profit.

But Prakosa said that his office had thoroughly studied the
matter and had concluded that the performance of the Inhutani
firms in terms of finance and forest rehabilitation had been
disappointing.

"We have studied the matter in depth, and we do not see any
other option other than closing down the firms," said Prakosa.

On the sidelines of the meeting Prakosa said that his office
did not need approval from the Office of the State Minister of
State Enterprises to close down the Inhutani firms because his
ministry had the right to revoke forest concessions from any
company, be it state-owned or privately owned.

Thus far, the five Inhutani firms control 99 concessions in
natural forests covering some 6.5 hectares and 27 industrial
estate plantations covering about 2.4 hectares.

Govt to revoke 14 HPHs

The government will soon revoke the forest utilization
licenses (HPHs) of 14 companies that have failed to sustain their
forest areas.

Minister of Forestry Mohamad Prakosa said that according to
the results of the first round of independent audits, 14 out of
27 companies had failed to sustain their natural forest
concession areas as required.

"These concessionaires will be forced to stop their
operations," Prakosa said.

The audits are being carried out by the newly established
Independent Verification Institute (LPI).

Prakosa refused to provide further details about the move,
saying that a ministerial decree had yet to be issued.

The decision by the Ministry of Forestry to revoke the HPHs of
errant concessionaires is part of an overall effort to
restructure the country's natural forests, which are being
threatened by illegal logging and overexploitation by some
companies.