Indonesian Political, Business & Finance News

Minister slammed for forestry policy proposal

Minister slammed for forestry policy proposal

JAKARTA (JP): A former top government official criticized on Monday Minister of Forestry and Plantations Nur Mahmudi Ismail's plan to transfer control of the country's forests to state-owned forestry firm Perum Inhutani.

Former director general of forest utilization at the ministry Titus Sarijanto called on the minister to cancel the plan, saying it would only lead to greater destruction of the country's forests.

"The plan should be canceled. Many parties are opposed to the plan, including foreign agencies that provide aid to help protect the country's forests, because they believe the policy would cause greater destruction to the forests," said Titus, who is about to retire from the ministry.

Mahmudi earlier proposed the appointment of Inhutani as the single holder of the country's forestry concession rights.

All private or state companies interested in logging or developing forest estates should operate as contractors under joint operation contracts with Inhutani, he said.

At present, timber companies have to obtain forestry concession rights of up to 20 years from the Ministry of Forestry and Plantations to operate in logging areas or forest estates.

Mahmudi said if the House of Representatives approved the proposal, the new scheme would apply to forestry concessions which had already expired.

Former forest concessionaires, he said, could continue operating these forests as contractors, providing they showed a good track record of forestry management.

Titus said the scheme would discourage the existing concessionaires from good maintenance of the forests because they would assume they would not be able to control them in the future.

"Thus, they will not care about the management of the forests."

Titus said previous ministers tried to minimize the logging activities in the country's natural forests, and eventually halt them altogether, by encouraging forestry companies to develop timber estates to become alternative sources of raw materials.

He said investors would not be interested in developing timber estates if they were not given the right to control the forests.

On the other hand, Titus said, Inhutani lacked the financial capability to invest in timber estates.

Titus said the government planned to develop 375,000 hectares of timber estates per year, which required total investment of Rp 1.8 trillion (US$214 million) or Rp 5 million per hectare.

"Thus, if the government implements the new policy, the development of timber estates will stop. All companies and people will go to natural forests to get timber, causing greater destruction there."

Titus said the country's remaining natural forest area was 64 million hectares.

He also noted the policy contravened the new regional autonomy law which gave provinces and regencies the right to manage their natural resources, including forests.

"With the new policy, the provinces and regencies will accuse the government of trying to maintain its control over their forests."

Titus also noted the policy would lead to greater corruption in the forestry sector as investors would have to deal with a "longer chain of bureaucracy" in obtaining licenses.

"Today, investors need only to go to the ministry to obtain their licenses. In the future, if the policy is implemented, they have to go to both Inhutani and the ministry to obtain their licenses. Thus, they will have to 'handle' more people," Titus said.

Based on government data, relatives and associates of former president Soeharto own the majority of forest concessions, which they allegedly obtained through close ties with the authorities.

Mahmudi has said centralizing forest management under one state firm would not contravene the spirit of autonomy as long as the provinces received a fair share of the royalties.

He said royalties to the provinces should be at least 70 percent, with the remainder going to the central government.

Of the 70 percent, he said, 30 percent should be allotted to regencies, 30 percent to the provincial administration and the rest to people living around logging operations.

"This way, the local people's net income should also be high," he said. (jsk)

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