Unpaid reforestation fees reach Rp 170b

Unpaid reforestation fees reach Rp 170b

JAKARTA (JP): Unpaid reforestation fees have reached more than
Rp 170 billion (US$22.6 million) as of October this year,
according to a senior official at the Ministry of Forestry.

Director General of Forest Utilization Harnanto H.
Martosiswojo said on Wednesday that the timber companies would be
given two months from now to settle their debts.

"Timber companies will be given a warning and a two percent
fine per month will be imposed. If they fail to pay their debts
after two months, their logging contracts will be revoked and the
cases will be handed over to the State Receivership Agency," he
said.

Harnanto said many timber companies might not pay their
obligations on time due to a lack of liquidity resulting from low
wood prices and sluggish demand in the market this year.

Minister of Forestry and Plantations Muslimin Nasution has
pledged to reveal the names of the timber companies which do not
pay the arrears this month.

But Harnanto said that his office was still hesitant to reveal
the debtors because its data "is not complete".

"If we accuse the wrong companies we could be sued," he said.

The reforestation fund is a mandatory fee imposed by the
government on forest concessionaires to ensure that forests are
managed in an environmentally sustainable manner. The size of the
fee depends on the volume and type of timber felled.

Since April 1, the government has accounted for reforestation
funds collected from timber companies in the state budget as
nontax receipts. Previously, the funds were transferred into the
Ministry of Forestry's bank account and its allocation was
governed by presidential decree.

The ministry expected to collect Rp 1.35 trillion in
reforestation funds in the 1999/2000 fiscal year, up 20 percent
from the Rp 1.13 trillion estimated this fiscal year.

Earlier this month, the ministry announced that timber
companies would be obliged to pay reforestation funds in advance
and not after they sold their logs or wood products in a bid to
avoid late payments.

The ministry is also considering increasing the fine on late
payments to between 1.5 and two times the current banking
commercial rates in a bid to force timber companies to pay the
fees on time. (gis)