Minister suggests Inhutani hold all forestry rights

JAKARTA (JP): Minister of Forestry and Plantations Nur Mahmudi Ismail proposed on Thursday the appointment of state-owned Perum Inhutani as the single holder of the country's forestry concession rights.

The minister said private or state companies that were interested in logging activities or developing forest estates should operate under joint operation contracts with Inhutani.

"Under this scheme, timber companies will act only as contractors," he said, adding the change would enable the country's forestry resources to be managed in a more sustainable manner.

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 or forest estates.

Mahamudi 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.

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

"The point is that these forests belong to the nation," he said, " ... a state firm should manage the forests while companies could operate on them."

The scheme proposed by Mamudi is similar to the one used in the oil and gas industry. There, oil and gas production activities can only be carried out under a production sharing contract with state oil company Pertamina.

He 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.

Mahmudi said royalties to the provinces should be, for example, at least 70 percent, with the remaining 30 percent 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.

Meanwhile, chairman of the Indonesian Forestry Society (MPI) Soedradjat expressed no objections to the minister's proposal, but warned that clear regulations should follow.

"We will comply to schemes set up by the government, but the rules of the games have to be clear," Soedradjat said.

He added that the Perum should cover the payments of taxes on land and buildings.

MPI executive Kristiono saw also no problems with the proposal, saying that the government would certainly look after the interest of forestry companies.

In fact, he said, with the government managing the forests, companies could leave security matters in the government's hands.

The government has recently reported an increase in conflicts between logging companies and locals demanding compensation for their land. (bkm)