Inside Malaysia's Shadow State

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Violations of forest permits cause losses of Rp 1,000t to state

The Jakarta Post, Jakarta | Thu, 05/20/2010 10:41 AM

The Corruption Eradication Commission (KPK) is investigating alleged violations of forest permits that have reportedly cost the state more than Rp 1,000 trillion (US$110 billion).

KPK deputy chairman Mohammad Jasin said in Jakarta on Wednesday the violations ranged from the misuse of forest permits for other activities such as logging, to conducting mining operations in forest areas without proper licenses from the Forestry Ministry.

Jasin said the anticorruption agency had found indications that many plantation companies paid bribes to local administration officials to enable them to carry out illegal practices, such as using forest areas for other purposes.

“Many companies that received permits to use forest areas for plantations did not carry out their plantation activities. They only took the wood and left,” he said.

Jasin said that as many as 470 coal mining permit holders were also involved in the destruction of forest areas because they carried out mining operations without proper licenses.

According to the forestry law, a mining company is required to obtain a license from the Forestry Ministry to carry out mining activities in forest areas even if the areas are located in their concessions.

Jasin also said that many forest concession holders avoided their tax payments.

The findings indicated that about one-third of the 2.3 million hectares of forest areas granted to be use as plantations were not used in accordance with the permits.

He said that 79 forest concession holders in Riau were found to have violated their permits. The companies, for example, carried out logging activities but left the area without conducting rehabilitation programs such as replanting the areas as required by the regulation, he said.

“It shows that these forest concession holders only want the wood from our forests and these kinds of activities violated their permits,” Jasin said.

The findings from the KPK investigation, which is expected to be finished by the end of this year, also indicate the weakness of forestry regulations and systems and the lack of the credibility on the part of the forestry and local government officials involved in the supervision of the forests.

“For example, the commission found that a one forest concession area overlapped with another because the officials in charge issued the permit without a prior survey,” he said.

Forestry Minister Zulkifli Hasan says he supports the KPK’s allegations on the misuse of forest permits.

Zulkifli said that 6.7 million hectares of peat areas, which had already been granted licenses for oil palm plantations had been abandoned.

“So it is no longer necessary to issue new permits,” he said.

According to the Indonesian Palm Oil Producers Association (Gapki) secretary general Joko Supriyono, the ministry’s decision was regrettable.

He said the government should not punish the industry by not issuing new permits just because some businesspeople failed to follow regulations.

“They should resolve the problems with the business people who violate their permits without dragging the rest of us into it,” he said.

“If we cannot get new permits, it will affect the growth of palm oil plantations in the country.” (rch)

News focus: forest mafia fight focused on Sumatra, Kalimantan

Antara News, Andi Abdussalam, Friday, April 23, 2010

Jakarta (ANTARA News) - The government`s joint team of investigators from the police force, prosecutor`s office and the ministry of forestry will focus its first phase investigations on alleged forest mafia cases in North Sumatra and Central Kalimantan provinces.

"We have set 2010 as the year of law enforcement in the forestry field. In the first phase, investigations will focus on alleged forest crimes in North Sumatra and Central Kalimantan," Aulia Ibrahim, forest investigation and protection director of the Directorate General of Forest Protection and Nature Preservation (PHKA), said.

In the two provinces, a number of companies are believed to have annexed state forests. In North Sumatra, for example, there are 21 plantation companies which have allegedly annexed state forests. In the first phase, five major firms of the 21 companies will become the operation target of the team.

"Two owners of the five firms have been investigated and those of the other three companies are now in the process of being named suspects," Aulia Ibrahim said.

The joint team is launching operations against forest crimes following President Susilo Bambang Yudhoyono`s instruction that mafia behind forest crimes should be eliminated.

The president also instructed all regional government heads, namely governors and district heads to help protect forest in their respective regions.

According to Aulia Ibrahim, all of the regional government heads are also ordered to take stock of damaged forests for rehabilitation purposes. All forest squatters must be expelled from production, protected and conserved forest areas.

"All forest squatters must get out of production and protected forest areas controlled by the governmet," Aulia Ibrahim said.

In an effort to fight all kinds of forest crimes in the current year of law enforcement in the forestry fields, the government will act indiscriminately upon all forest offenses.

"All violators will be acted upon indiscriminately," Forestry Minister Zulkifli Hasan said meanwhile. The minister even disclosed that the joint team was also conducting an investigation into an alleged forest mafia case at his own ministry.

However, Zulkifli Hasan is still waiting for the results of the investigation. "The joint team of investigators from the police, the prosecutor`s office and forestry ministry is still carrying out its investigation. I could not yet disclose how many names now being examined," the minister said after granting a 14,000 hectare community forest concession for five thousand farmers in Lampung province on Thursday.

The investigation is being launched to follow up a report by a number of non-governmental organizations about the presence of forest mafia in the forestry sector. However the minister acknowledged that he has not received any report so far about the results of the joint team`s investigation.

"I cannot yet talk a lot about the matter before the team accomplished its task. It is unethical for me to speak about it while the team has not yet finished its investigation," the minister said.

The results of the investigation will be reported to the president. Believing that forest mafia did exist, the president in a cabinet meeting last week ordered the judicial mafia task force to examine various forest offenses whose cases received lenient punishment or even acquitted by the court.

"I believe a mafia is behind the illegal logging activities. I call on the judicial mafia eradication task force to also tackle this problem, reduce and put an end to these activities," the president said before leaving for Hanoi, Vietnam, to attend an Asean summit recently.

According to data, out of a total of 92 illegal logging cases handled in courts recently, 49 ended in acquittals, 24 with jail sentences averaging only one year and 19 with jail sentences between one and two years.

"This will not have a deterrent effect. Therefore, the President has ordered the task force to examine the court verdicts to see why they were so lenient," Informatics and Communications Minister Tifatul Sembiring said after the cabinet meeting last week.

Forestry Minister Zulkifli Hasan said that the mafia task force would carry out auditing in all regions where illegal logging were still rampant and where forests had been turned into plantations without licenses from the forestry ministry.

"The task force will be fielded to carry out auditing of cases suspected to involve abuse of power by regional government heads, such as the issuance of licenses for conversions of production and protected forest functions, and conversion of forests into oil palm plantations," the minister said.

After all, there are many forest areas and plantation areas are overlapping with each other. In West Kalimantan for example, the local government of a certain district has issued licenses for plantation firms whose areas overlap those of forests.

"In a certain district, the local government has issued a license for plantation firms to operate on hundreds of thousands of hectares which overlap forest areas," Head of Forest Protection and Nature Conservation of West Kalimantan Forestry Service, Sunarno said.

But he reluctant to mention the name of the district concerned in West Kalimantan.

He revealed that data in 2008 showed the local district government had issued licenses for 42 plantation firms, with areas covering 300,000 hectares. These areas overlapped forest areas.

For this year, the latest data showed that the local government had issued licenses for 84 plantation companies. "Logically, the plantation areas overlapping those of state forests must be wider than the 300,000 hectares," Sunarno said.

NGOs to meet taskforce, questions seriousness in probing illegal logging mafia

Bagus BT Saragih, The Jakarta Post, Jakarta | Thu, 04/22/2010 1:28 PM

A number of NGOs grouped under the "Anti-Forestry Mafia Coalition" are scheduled to meet the Judicial Mafia Taskforce at 2 p.m. on Thursday to discuss the plan to eradicate the illegal logging mafia.

"In the meeting with the taskforce, we will question President Susilo Bambang Yudhoyono's seriousness to tackle the mafia in the forestry sector," Indonesia Corruption Watch deputy coordinator Emerson Yuntho said.

In his speech earlier this month, Yudhoyono vowed to crack down on the illegal-logging mafia.

He also invited NGOs concerned with forestry and environment to work together with the government to save Indonesia's forest.

However, Emerson said, the government had yet to show concrete actions.

The meeting is scheduled to take place at the Financial Transaction Analysis and Reports Center (PPATK) office in Central Jakarta.

The coalition will submit data about some alleged illegal logging cases to the taskforce, mostly in Sumatra.

"We will urge the taskforce to probe 14 illegal logging cases in Riau which the investigations have been stopped by the police. The Riau cases have allegedly caused Rp 2.8 trillion [US$310.8 million] in state-losses.

"We will also share data we have collected about 15 methods of forestry mafia practice," Emerson said.

The NGOs claimed that the illegal logging practices across the country had caused at least Rp 30 trillion in annual state losses.

The core issue is credibility

The Jakarta Post | Thu, 04/01/2010 9:46 AM | Editorial

Eighteen major palm oil producers and the Directorate General of Plantations decided here Monday to set up an independent team to verify Greenpeace’s allegations of deforestation by Indonesian companies.

The action was adopted as more big buyers in Europe have been pressured by environmental campaigners such as Greenpeace to stop buying palm oil from Indonesian producers that have not gained green certification under the Round table on Sustainable Palm Oil (RSPO) scheme.

The government and palm oil plantations have been concerned that as green campaigners and consumers turn up the heat on European companies the buyers may arbitrarily use the NGO pressures as a bargaining weapon to demand lower prices from suppliers in Indonesia, given the country’s position as the world’s largest producer.

Unilever, the world’s single largest industrial consumer of crude palm oil (CPO) last December moved to cancel new contracts with Indonesia’s largest producer Sinar Mas group after being shown by Greenpeace photographic evidence of Sinar Mas clearing rainforests in protected areas.

In February, the giant Anglo-Dutch consumer goods company also told its dealers not to source palm oil from Duta Palma, a major palm oil producer, on concerns over rainforest destruction.

Then last month, Nestle threatened to boycott palm oil from Sinar Mas, unless the Indonesian big producer could prove that Greenpeace’s allegations of illegal rainforest clearance are groundless.

The problem, though, is that an independent team to be set up by the government and national palm oil producers would not be effective in countering the green campaign against Indonesian palm oil.

The core issue is credibility. As long as the verification team includes only Indonesian government agencies, palm oil companies and environment NGOs its work and finding will not be accepted by international organizations as credible, given the country’s notorious reputation as one of the world’s third largest emitters of CO2 and one of the most corrupt countries in the world.

The Kuala Lumpur-based RSPO would actually be the most effective forum for Indonesia to develop a better reputation in regard to green certification because that organization groups the largest palm oil producers from Indonesia and Malaysia, which together account for over 85 percent of the world’s palm oil output, major industrial consumers and such respected NGOs as WWF, Oxfam and Sawit Watch.

The right mix of members and founder prevents any perception that RSPO is an organization controlled by developed countries who want to protect their own edible oil industries (mainly corn, soybean and peanut).

The principles of sustainable management promoted and assessed by RSPO in its certification process fully meet our development needs as they promote such elements as transparency, legal and regulatory compliance, best production practices, environmental responsibility and commitments to local community development.

The RSPO principles are similar to those promoted by the Bonn-based Forest Stewardship Council, which groups the representatives from environmental and conservation groups, timber industries, forestry professions and forestry communities, for its forest certification standards.

Instead of setting up a counter green certification scheme to RSPO it is much more effective for Indonesian companies and NGOs to be more active within RSPO to make improvements in green certification.

Even though our palm oil exports to Europe account only for a small portion of our output as most of our exports go to India, China, Pakistan and African countries, we can no longer ignore the green consumer movement which has been escalating around the world.

In fact, several big producers which have gained RSPO certification, have never encountered problems from European buyers with regard to green labeling.

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Justice for all

The Jakarta Post | Tue, 12/29/2009 8:22 AM

Grandma Minah, a villager living near Purwokerto, Central Java is embraced by actor Butet Kertaredjasa after receiving a cacao seedling from the anticorruption organization Kompak in Jakarta on Monday. The woman, who made newspaper headlines after a local court sentenced her to 45 days in jail for stealing three cacao pods from a plantation company, was named one of Kompak’s People of the Year. JP/Nurhayati

Homecoming

The Jakarta Post, Mon, 12/28/2009 5:20 PM | National

Hundreds of farmers from Rengas village, South Sumatra stage a protest in front of the governor’s office in Palembang. They demanded the governor audit and the land permit of state plantation firm PT Perkebunan Nusantara, which has allegedly expired and return the land to the farmers. (JP/Khairul Saleh)

KPK to question two forestry ministry officials

Antara News, Wednesday, December 16, 2009 16:27 WIB

Jakarta (ANTARA News) - The Corruption Eradication Commission (KPK) is scheduled to question two Forestry Ministry officials, Boen Poernama and Wandoyo Siswanto in an alleged corruption case.

KPK spokesman Johan Budi said Boen Poernama and Wandoyo Siwanto would be questioned later on Wednesday for an alleged corruption case in the procurement of Integrated Radio Communication System (SKRT) at the Forestry Ministry.

"The two Forestry Ministry officials will be questioned as witnesses in the SKRT procurement," Johan Budi said, adding that their testimony would be used to complete the dossier of Putranevo A Prayugo who has been named as as suspect in that case.

In that similar case the KPK will also question two employees of PT Masaro Radiokom namely Sigit Prayogo and Elvita Dewi as witnesses.

Johan Budi said the investigation into the SKRT procurement at Forestry Ministry was in relation with a bribery scandal to a number of legislators to smoothen the SKRT project.

In the bribery scandal, Johan Budi said the KPK had named PT Masaro Radiokom President Director Anggoro Wijoyo as suspect but the later remained at large up to the present.

Anggoro Wijoyo and three other PT Marao top officials Putronevo A Prayugo, David Angka Wijaya, and Anggono Wijoyo were then suspended by the KPK from going overseas.