Indonesian Political, Business & Finance News

RI calls on donors to stop importing illegally cut timber

| Source: DPA

RI calls on donors to stop importing illegally cut timber

Deutsche Presse Agentur, Jakarta

Indonesia on Tuesday called on its major donors to stop
importing illegally cut timber or associated products from the
country, but failed to put into place constraints on its own
booming forestry industry.

"Asking one country to combat illegal logging while at the
same time receiving or importing illegal logs of course does not
support efforts to combat these forest crimes," Indonesian
Forestry Minister Muhammad Prakosa told an annual gathering of
the country's leading international and country donors.

Indonesia last year signs agreements with China, the U.K. and
Northern Ireland to cooperate in halting the import of illegal
timber or timber products in an effort to stem the rampant
deforestation taking place in the Indonesia, which is losing
about 2 million hectares of forest land each year, much of it to
illegal logging.

Prakosa said that Indonesia was working on similar cooperative
agreements on illegal timber import bans with the U.S., Japan and
the European Union.

Indonesia's repeated failure to curb illegal logging, much of
it conducted with the collusion of government officials, has been
raised as a serious issue at the Consultative Group for Indonesia
(CGI), a group of some 30 donors who have been financing the
country's budget deficits for the past four years, but the
government failed to respond to policy suggestions.

The World Bank and IMF, hosting the CGI meeting, have this
year put pressure on the Indonesian Bank Restructuring Agency
(IBRA) to slow its sale of bad debts owed to banks by the
forestry sector in an effort to let more forestry companies go
under.

"There was essentially no response on the IBRA issue," said
Thomas Walton, the World Bank's lead environmentalist expert in
Indonesian. "The results on the ground have been very small."

The World Bank and many environmentalists argue that most of
Indonesia's illegal logging is the result of the huge domestic
demand from local forestry industries such as pulp and paper,
plywood and furniture.

Indonesia's giant pulp an paper industry, with a capacity to
consume 25 million cubic metres of wood per year, is deemed the
major single source of deforestation in the country, and yet the
government has made no effort to curb production.

Although forestry minister Prakosa threw his support behind
the World Bank and environmentalists' proposal to let some of the
ailing forestry companies go under to decrease the industry's
capacity, but neither IBRA nor the finance ministry endorsed the
plan.

"If we lose the momentum and do not close down these forest
companies, it will be politically difficult to close them down
later on," warned the minister.

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