Indonesia to Sell and Give Away Forests Soon
2/1/99
OVERVIEW & COMMENTARY by EE
Indonesia is poised, perhaps, to take a new direction in forest
management. Three million hectares of recently expired concessions
are to be given free to small firms and cooperatives in the forest
areas, and a another three million will be auctioned off. It will be
interesting to see whether the massive and historically mismanaged
forest sector can be reformed before the resource is committed
entirely and irrevocably to commercial over-harvesting.
g.b.
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RELAYED TEXT STARTS HERE:
Title: INTERVIEW - INDONESIA TO SELL 3 MLN HA FOREST SOON
Source: Reuters
Status: Copyright 1999, contact source for permission to reprint
Date: January 29, 1999
Byline: By Gde Anugrah Arka
JAKARTA - Indonesian Forestry and Plantation Minister Muslimin
Nasution said he expected to start auctioning three million hectares
of forest concessions next week as part of the country's asset
redistribution drive.
"We expect to start the auction process next week," Nasution told
Reuters in an interview.
"(The auction) is part of the drive to redistribute forestry assets,
particularly to those communities living in the forest area and
nearby," Nasution said.
The move would boost a sense of belonging for the local people,
improve their well-being and help the government secure their support
in dealing with any fresh forest fires.
Forest fires in Indonesia in 1997 and 1998 were regarded as one of
the world's worst environmental disasters this century.
The World Wildlife Fund had said the fires affected five million
hectares mostly consisting of forest and small scale plantations,
mainly on the islands of Borneo and Sumatra.
Environmental activists had blamed the fires partly on bad forest
management by large companies controlling the concessions.
Conglomerates currently hold most of Indonesia's 51.5 million
hectares of forestry concessions, with Barito Pacific among the
largest, holding around 2.7 million hectares.
Nasution had said the concessions which would be auctioned came from
about nine million hectares of concessions that recently expired.
Three million would be given free to small firms and cooperatives in
the forest areas. The existing concessions would be extended for the
remaining three million hectares.
"We are doing our best to involve cooperatives and small scale firms
in the area so that they also have a chance," he said. "If all of
concessions go through auctions, they will have no chance (to profit
from the forest)."
Small firms or cooperatives would be given a maximum 50,000 hectares
each. Bidders at the auction would be allowed to buy a maximum
100,000 hectares each.
He said the auction was aimed at increasing transparency as part of a
raft of reforms required by the International Monetary Fund in return
for financial assistance to help Indonesia through its worst economic
crisis in three decades.
The auction would be partly determined on buyers' commitment to
sustainable forestry, rather than just the highest price, he said.