Jakarta – When it comes to the forestry industry, development and conservation always seem to be at loggerheads. While the government is happy to see that investment in the timber-consuming pulp and paper industry is on the rise, environmentalists warn that it should be more prudent in giving new concession rights to industry players.
Minister of Forestry M. S. Kaban said most investors were interested in investing in pulp and paper.
A group of investors from India and Malaysia offered to develop an integrated pulp and paper plant late last year, valued at some US$1.3 billion, in West Kalimantan or Central Kalimantan.
According to data from environmental group Greenomics Indonesia, 205,000 hectares of natural forest in Riau have been cleared to provide raw materials for the pulp and paper industry.
Two large pulp and paper manufacturers in Riau, PT Riau Andalan Pulp and Paper (RAPP) and PT Indah Kiat Pulp and Paper (IKPP), still obtain up to 50 percent of their raw material from natural forests, Greenomics Indonesia chairman Elfian Effendi said on Thursday.
"This is an alarming trend. All Riau's natural forests will have been cleared by 2009 if this continues, resulting in more flooding in other parts of the island," Elfian said.
"If it is proven that the companies have failed to obtain their raw materials exclusively from industrial forests, the government should revise the permits for their installed capacity," Elfian added.
RAPP and IKPP were given concession rights in the early 1990s and the late 1980s, respectively, to develop pulp and paper mills and industrial forests up to 370,000 hectares in size.
Companies given such concession rights are allowed to first clear natural forests before replanting them with homogeneous trees to supply their raw materials.
However, Law No. 41/1999 stipulates that only barren areas are allowed to be replanted as industrial forests.
Greenomics' study showed that in the last couple of years, RAPP and IKPP consumed some 8.06 million cubic meters and 7.99 million cubic meters of wood, respectively, from cleared natural forests.
RAPP, a subsidiary of the Singapore-based Asia Pacific Resources International Holding Ltd (APRIL), which is part of the Indonesian Raja Garuda Mas Group, denied the allegations.
RAPP environmental affairs manager Canesio P. Munoz said the land his company cleared was degraded forest and not productive natural forest.
A study by Greenomics, however, showed that 59 percent of industrial forest concession areas were productive natural forests.
RAPP, which has operated since 1995, said it got up to 40 percent of its raw materials from its industrial forests and that it would start getting all of the raw materials from the forests in 2009 or 2010.
It also claimed to have replanted more than 115,000 hectares of industrial forests since 2004. Meanwhile, IKPP representative Soebardjo said IKPP was still partly relying on nonindustrial forests for its raw materials.
"Our industrial forests took seven years to yield while we needed more raw materials," he explained, adding that the company would start getting 100 percent of its raw materials from industrial forests in 2009.
APP is a Singapore-registered company and part of the Asia Pulp and Paper Group.
In its Sustainability Action Plan, APP said it set aside US$7 million to fund conservation management projects in Indonesia.