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Illegal logging and timber smuggling have become focal points in discussions between Indonesia's international creditors and the Jakarta government in recent years. Since 2000 tackling illegal logging has become a condition for loans from the main creditor grouping, the CGI. However, only token efforts have been made to tackle the problems and, in many areas, the situation has worsened.
Indonesian NGOs are critical of the narrow focus on illegal logging. They argue that a moratorium on all commercial logging in Indonesia is the most effective and immediate way to address the wider problem of forest destruction in Indonesia. (See also DTE 50)
The FLEG conference resulted in a declaration in which ministers pledged to take immediate action to deal with forest crime, particularly illegal logging, the illegal trade and corruption. There was some positive feedback from NGOs, particularly that the issue of indigenous communities' rights to forests was discussed in a "frank and open manner". However, the declaration failed to make any commitment to upholding forest peoples' customary rights. Instead, participating countries pledged to "involve stakeholders, including local communities, in decision-making on the forestry sector". Action on promoting community-based forest management and protecting 'forest-based livelihoods' was relegated to the declaration's annex.
As Indonesian NGOs point out, there have been many conferences on the forest crisis before - but none have resulted in the kind of policy changes and legal reform needed to have a real impact on the ground. Until there is some sign of genuine commitment by the government to take action to save the forests, scepticism over the result of this latest effort will remain high.
(Jakarta Post 14/Sep/01)
The FLEG ministerial statement and other FLEGdocuments are on the World Bank's Indonesian website http://wbln0018.worldbank.org/eap/eap.nsf/2500ec5f1a2d9bad852568a3006f557d/efcbbd15119f322747256ac3001ad16a/
Newly installed forestry minister M. Prakosa and trade and industry minister Rini M.S. Suwandi announced a moratorium on the export of logs and wood chips in October in order to "safeguard the conservation of Indonesian forests." The move, which goes against the IMF's economic recovery strategy for Indonesia, is also seen as an attempt to rescue Indonesia's domestic timber and pulp industries by ensuring them a supply of raw materials. Indonesian timber smuggled to other countries, such as China and Malaysia, is enabling those countries to undercut Indonesia in international plywood and other wood product markets.
According to figures from the department of industry and trade, Indonesian log exports fetched US $25.91 million from January to July this year. In 2000 they were worth US$66.67 million with a volume of 449,840 m3, almost double 1999's exports of US $37.85 million from 298,560 m3. But legal exports are believed to be a small proportion of smuggled volumes estimated at 10 million m3/year to Malaysia alone.
The new ban will be a boost to the country's highly-indebted wood industry and the timber tycoons whose businesses have suffered from a lack of raw materials. A total of 128 companies are under the control of the Indonesian Bank Restructuring Agency (IBRA). A previous commitment to close half of these companies down has not been fulfilled.
Whether the export ban will be helpful in tackling timber smuggling is open to question. It is not likely to curb smuggling while Indonesia's notoriously corrupt police force, government apparatus and courts continue as before.
Standing alone, the ban will also not address the underlying causes of forest loss. The new minister has promised to initiate a thoroughgoing reform of the timber concession system, and to continue with plans to tackle the problem of over-capacity in the wood industry. But similar promises made by previous ministers have had little result.
Decentralisation, which is supposed to hand over control to district (Kabupaten) level - is itself under a process of reform (see below) and there is uncertainty over how far central government decisions will be implemented by regional governments.
(Tempo 16-22/Oct/01; Sinar Harapan 9/Oct/01; Bisnis 16/Oct/01)