Jakarta – The Plantation and Forestry Department is set to bring a score of timber tycoons to the arbitration court for failure to repay Rp 96.9 billion in loans taken from the department's reforestation funds (DR). Debtors include timber baron 'Bob' Hasan, once ex-president Soeharto's golfing buddy, and timber tycoon Prajogo Pangestu, a close associate of Soeharto's son Bambang Trihatmodjo.
"The department will bring the timber estate (HTI) businessmen to arbitration if they are still unwilling to repay Rp 96.9 billion in loans, which are already overdue," the department's acting secretary general Suripto told Astaga.com.
Suripto said the five companies are Prajogo's PT Mudi Hutan Persada with debts totaling Rp14.4 billion due July 1999; Hasan's PT Surya Hutani Jaya (Rp56.428 billion due July 1998); Hasan's PT ITCI Hutani Manunggal (Rp15.7 billion due July 1998); Sumalindo Group's PT Sumalindo Utami Jaya (Rp7.3 billion); and state-owned PT Inhutani II (Rp3 billion due January 2000).
"Before we go to arbitration, we will first send them a warning followed by an administrative sanction in the form of fines," Suripto said, adding that the amount of the fines is still being calculated.
Under Soeharto, who was forced down in May 1998 after 32 years in power, corruption flourished in all sectors, including the forestry sector, with cronies as well as high-ranking military and government officials enjoying the lion's share of the country's then-vast tropical forest area.
As if the looting was not enough, the reforestation funds were also channeled to irrelevant sectors, including to money-losing aircraft manufacturer PT Industri Pesawat Terbang Nusantara, the pet project of Soeharto protigi BJ Habibie, who replaced Soeharto as president.
"The five companies have asked for a rescheduling of their debts, citing forest fires and the prolonged economic crisis as factors that have caused losses. "Nevertheless, we will keep going after them," Suripto said.
Debt rescheduling violates Presidential Decree No. 16/1994 and Forestry Minister's Decree No. 375/1996 which stipulate that loans from the reforestation funds must be repaid ten months later.
In another development, the department also demanded that PT Gatari Hutama Air Service, controlled by Soeharto's son Hutomo 'Tommy' Mandala Putra, return three helicopters the company used to operate on behalf of the ministry.
Similar to many shady deals made under Soeharto, the department's deal with Gatari has made it a laughing stock, since the department pays handsome fees to fly its own choppers, operated by Gatari. The Attorney-General's Office is prepared to bring the graft case involving Gatari to court. Gatari used to operate eight helicopters and one Skyliner plane.
Five choppers and the aircraft were later impounded by the Attorney-General's Office and retained as evidence. "The company was supposed to return the other three one month before the Attorney-General's Office brings the case to court in early October," Suripto said. "The choppers have not been returned yet because they are now in a very bad condition. We want them back, intact and in good condition," he added.