Minister to recommend credit for concessionaires

JAKARTA (JP): The minister of forestry, Djamaludin Suryohadikusumo, has promised his ministry will help timber companies to get bank loans.

The minister said his ministry would issue recommendations if banks asked for them, Antara reported Saturday.

"Banks so far have never asked for a recommendation from the ministry of forestry," he said commenting on reports that many timber companies had trouble getting bank credit.

According to earlier reports, many banks were reluctant to extend loans to timber companies because they thought forestry was no longer a feasible business.

The minister said the reports were not entirely true because many banks still trusted good timber companies like PT Kiani Lestari and PT ITCI.

Djamaluddin said the ministry would assess the performance and reliability of timber companies before recommending them for loans.

He said his ministry would recommend only timber companies that were performing well because banks would not lend money to poor performing companies with no future.

"At present banks look only at forest resources and company assets when lending money. They never ask for the ministry's help in checking whether the timber company has problems or not," Djamaludin said.

He said banks' reluctance to lend forestry companies money was partly because of his ministry's tough supervision measures.

He said the government only took action against poorly performing timber companies, but that banks were afraid stern measures like license revocation would also be imposed on timber companies that were doing well. (08)