Pulp investors should collaborate with govt
Pulp investors should collaborate with govt
JAKARTA (JP): Minister of Forestry Djamaludin Suryohadikusumo
announced yesterday that private companies intending to invest in
the pulp industry will have to collaborate with state-owned
forestry firms to gain operational permits.
Speaking to reporters after a hearing with Commission IV of
the House of Representatives, which oversees forestry and
agricultural affairs, Djamaludin said the policy will become
mandatory in addition to other requirements, such as that on the
availability of appropriate land for industrial purposes.
"By having shares in the industry, the state firms -- which
have helped concessionaires to manage their industrial timber
estates -- can also gain profits from such cooperation," he said.
Earlier this week Djamaludin announced that the government
will resume issuing licenses for the establishment of industrial
timber plantations to boost the country's pulp and paper and cut
back paper prices in the long run.
The Ministry of Forestry had previously limited the issuance
of such permits to only 13 concessionaires for environmental
reasons.
The existing concessionaires include PT Musi Hutan Persada,
owned by Prajogo Pangestu, PT Tanjung Redeb Hutami, PT Surya
Hutani Raya, PT ITCI Hutani Manunggal and PT Alas Helau, all of
which are owned by Muhammad (Bob) Hasan.
The concessionaires also include PT Inti Indorayon Utama and
Riau Andalan Pulp, owned by Sukanto Tanoto, PT Arara Abadi and PT
Wira Karya Sakti, owned by Eka Tjipta Wijaya, Henzo Forest of
Finland, PT Tekongan Pulp & Paper, owned by Ibrahim Risjad, PT
Adindo Foresta, owned by Benny Luhur, and PT Mercu Buana Hutani,
owned by Probosutedjo.
Encouragement
With the new policy, new investors will be encouraged to enter
the pulp industry. However, they have to comply with government
regulations which stipulate that the industrial wood supplies
must come from plantations grown by the concessionaires on
infertile, flat and empty land with an area of 300,000 hectares
or more.
Industries are not allowed to fell trees from the existing
natural forests.
To ease investments, however, the regulations may be revised
to allow prospective investors to establish plantations in areas
of about 150,000 hectares.
Djamaludin said that two of the 13 concessionaires -- Mercu
Buana and Henzo -- have already agreed to include state firms as
shareholders in their pulp industries.
Djamaludin said he expected the other concessionaires to
follow suit.
He explained that out of the 13 pulp concessionaires, four
have established industrial timber estates with their own funds
and the other nine with reforestation funds collected by the
ministry from other concessionaires.
Djamaludin told House members yesterday that the pulp and
paper industry currently has a capacity of 1.04 million tons per
year which needs a supply of 5.2 million cubic meters per year.
Raw material for the industry is still obtained from small-
sized wood from land-clearing and conversed forest projects.
Until the end of the Fifth Five-Year Development Plan which
ended last year, 1.05 million hectares of industrial timber
plantation had been planted, of which 396,071 hectares were used
in the pulp industry.
Djamaludin said that based on an eight-year cycle, the timber
estates are expected to start being harvested from 1996 to 1998.
"Timber supply for pulp and paper industries from these
estates will hopefully ease the burden on natural forests," he
said.(pwn)