Timber firms called on to help cope with crisis

JAKARTA (JP): Noted businessman Probosutedjo called yesterday on the government to raise money from the country's forest concession holders to cope with the currency crisis.

Probosutedjo, President Soeharto's half brother, proposed the government charge all concession holders US$100 for every hectare of forest.

With such a rate, the government would be able to collect about $5 billion from the concession holders, who currently control about 55 million hectares of forest.

"The funds are enough to pay our foreign debt that has matured," Probosutedjo was quoted by Antara as saying after a ceremony to take the oath as a new House of Representatives' member.

Probosutedjo, chairman of the Mercubuana Group, said the measure was reasonable given that concession holders were only obliged to pay a small reforestation fund, while their profit was "very big".

According to the existing law, forest concession holders have to pay reforestation funds and forest royalties relative to the amount of trees they fell. The funds and royalties are adjusted by the government every six months.

The Forestry Ministry said the reforestation funds collected last year totaled Rp 880.7 billion (US$275 million) up from Rp 809.6 billion in 1995. Forest royalties increased to Rp 592.78 billion in 1996, from Rp 539.33 billion in 1995.

But Probosutedjo said the government had to issue a ruling to legalize such a measure.

Concerns regarding the country's monetary situation peaked again in the past few days after the rupiah continued declining.

The rupiah reached a new low of Rp 3,405 yesterday on the spot market, currency dealers said.

Speculative attacks on Southeast Asian currencies this week were the most powerful since regional currencies buckled under massive selling after the de facto devaluation of the Thai baht on July 2.

The Thai crisis also spilled over to other Southeast Asian currencies.

Since July 1, the ringgit has fallen about 29 percent against the U.S. dollar, the baht by 47 percent, the peso by 31 percent, the rupiah by 38 percent and the Singapore dollar by 8 percent. (jsk)