Logging Costs Indonesia $36Bn

Land clearance by hundreds of mine and plantation companies operating illegally on Indonesia’s Borneo island has cost the country $36 billion, an official said Thursday.

“Encroachment of forest areas for illegal mining and plantation activities including logging in Kalimantan has caused losses of around Rp 311 trillion ($36.4 billion),” Forestry Ministry information centre head Masyhud told AFP.

More than 1,200 mining firms and 500 oil palm plantation companies operating illegally in Central, East and West Kalimantan provinces, on the Indonesian side of Borneo, are now being investigated by the Forestry Ministry, he said.

“Besides the companies, we’re also investigating officials who may have abused their authority in the issuance of operating permits,” he added.

The investigation, he said, would take three months.

Indonesia is the world’s third-biggest emitter of greenhouse gases, due mainly to deforestation by the palm oil and paper industries, which is fuelled by corruption.

President Susilo Bambang Yudhoyono has been under pressure from environmentalists to implement a promised two-year moratorium on the clearing of natural forest and peatland, which was due to begin January 1.

Norway agreed in May last year to contribute up to $1 billion to help preserve Indonesia’s forests, in part through the moratorium.

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