Indonesian Political, Business & Finance News

MPI Reformasi calls for forest concessions to be redistributed

| Source: JP

MPI Reformasi calls for forest concessions to be redistributed

JAKARTA (JP): The Indonesian Forestry Society for Reform (MPI
Reformasi) called on the government on Wednesday to transfer
forest logging rights which have expired to cooperatives.

Organization chairman Sofyan Siambaton said 105 forest
concessions covering five million hectares of forest would expire
over the next three years.

The breakdown is 20 concessions this year, 35 concessions next
year and 50 concessions in 2001.

"Cooperatives could turn the forests into small timber estates
with each of them controlling an area of between 1,000 and 5,000
hectares," Sofyan said after the organization's national
congress.

MPI Reformasi was recently established by businesspeople in
the forestry sector to rival MPI, an organization once controlled
by timber baron Mohamad "Bob" Hasan, a crony of former president
Soeharto.

Hasan's MPI is a holding (umbrella) organization for all
forestry-related organizations, including the Association of
Indonesian Wood Panel Producers (Apkindo), the Association of
Indonesian Concessionaires (APHI) and the Indonesian Saw Millers
Association (ISA).

MPI Reformasi has pledged to help the Ministry of Forestry and
Plantations manage the country's forests in an environmentally
sustainable manner and in a way which would benefit local people
living in forested areas.

The new organization also called for the abolition of several
levies imposed by Hasan's MPI, which it charged burdened timber
companies.

Sofyan said cooperatives operating around the concession areas
and the employee cooperatives of former concessionaires should be
given first offer to control the forest after the forest
concessions expired.

He said the government had thus far awarded forest concessions
to 600 concessionaires, 436 of whom are still active. All the
concessions expire by 2007.

A forest concession is effective for 20 years.

Sofyan was confident cooperatives would be able to operate
their forests in an environmentally sound manner.

"Our people are an agricultural society. We are experienced in
managing forests," Sofyan said.

Minister of Forestry and Plantations Muslim Nasution said last
month at a hearing with the House of Representatives that the
government was considering limiting corporate and personal
ownership of the country's forest concessions to prevent a
concentration of forest assets in the hands of a small number of
companies.

According to forestry ministry data, the country's biggest
concessionaire is Hunawan Wijajanto of the Kaju Lapis Indonesia
Group who holds logging rights to 3.49 million hectares of forest
across the country.

In second place is Burhan Uray who controls 2.95 million
hectares.

Prajogo Pangestu is in third place with concessions covering
2.72 million hectares, followed by Bob Hasan with concessions
covering 1.63 million hectares. (jsk)

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