The rise of robber barons speeds forest decline

Faith Doherty had gone to Borneo to confront one of Indonesia's newest timber barons. But as she looked at the blood on her colleague's face, and their captor waving a gun, she wondered if the price was worth it.

They were sitting in a sparse office on the second floor of a cheap shophouse in downtown Pangakalanbuun, a scruffy capital city in West Kotawaringin, a district of Indonesia where illegal logging is now rampant.

The street-smart, chain-smoking Englishwoman couldn't be blamed for fearing the worst. At the time, back in January 2000, the rule of law in Pangakalanbuun was disappearing. And it continues to fade.

With the 1998 fall of President Suharto, a new breed of businessmen is on the rise, and they are bending the local government to their will as efficiently as any Colombian drug cartel. Yet their business isn't cocaine or heroin. It is the illegal and unregulated logging of Asia's last great rainforests. The lowland jungles of Sumatra and Indonesian Borneo, the most diverse ecosystems on earth, are expected to vanish within a decade, according to a paper published in the journal Science in May.

"It's chaos,'' says Jim Jarvie, a botanist and conservationist, who was one of the paper's authors. "The loggers can do whatever they want.''

The new timber barons - like the resource-based mafias that emerged to feed on the disorder of post-Soviet Russia - are shaping Indonesia's era of political reform by taking advantage of the weak legal and political institutions that are authoritarianism's legacy.

Roughly $3 billion of timber is stolen annually, says the World Bank, and that buys a lot of influence in a poor, transitional nation that's ranked the third most corrupt in the world, according to Transparency International. "The only law now is money,'' says Sesep Zainuddin, a conservationist in West Kalimantan.

That's what Ms. Doherty, an investigator for the Environmental Investigation Agency (EIA), a Britain-based nonprofit, was finding out. She and Ruwindrijarto, her Indonesian colleague from the local environmental group Telepak, had come to Pangakalanbuun to confront sawmill owner Abdul Rasyid, who they - and the Indonesian Forestry Ministry - allege is the biggest logger in Tanjung Puting National Park.

Though they believed Mr. Rasyid to be involved in illegal activities, they'd never expected to be in personal danger by attending a meeting. But they were wrong.

At Raysid's timber company offices here, they were met by his nephew Sugianto Sabran Effendi and a group of men. Mr. Ruwindrijarto was repeatedly kicked in the head while Mr. Sugianto held a pistol and threatened to have them killed. That ended when the police arrived and arrested Doherty and Ruwindrijarto. "As if we were the criminals,'' recalls Doherty.

Logging in Indonesia's national parks began with the end of the Suharto regime. The retired general held power for 32 years, and logging concessions were used to reward generals, friends, and family. Ten conglomerates with ties to Suharto were given logging rights to 50 percent of Indonesia's forests; just three Suharto-linked firms owned concessions the size of Iowa.

While the environmental toll was enormous, the profits were enjoyed by just a handful of beneficiaries. But the national parks, at least, were left untouched.

When Suharto fell, Indonesia began to give power back to the regions to address the resentment created during his reign. But rather than breed democracy, it has given locals - whose noses were pressed jealously to the glass during the past three decades - an opportunity to cash in.

Finding most timber stands logged out, they've turned to protected forests. "They're just doing to Jakarta what Jakarta did to them,'' says Chris Barr, who studies illegal logging for the Center for International Forestry Research, a World Bank and United Nations funded research center in Bogor, Indonesia. "It's going to kill the forest even faster, since more people are involved.''

The area around Pangkalanbuun is just one of dozens of districts where these forces are at work. The police and military collect payoffs from loggers, and run prostitution and gambling dens, say local activists, investigators, and scientists.

Meanwhile, some of the new timber barons are moving into politics. Mr. Rasyid was recently appointed to the upper house of Parliament. "The new mafia is consolidating [power],'' says a Jakarta-based diplomat, referring not just to Rasyid, but to the whole class of emerging loggers.

The price of forest loss could be staggering, particularly since only a fraction of the value of the timber is being captured in taxes to pay for education, law enforcement, or better infrastructure.

"It might be OK for a people to trade in their natural capital for financial capital, but Indonesia is trading in its natural capital for nothing,'' says Rod Taylor, the head of the World Wildlife Fund's Asian forests program.

Forest products are among Indonesia's biggest foreign exchange earners and generate $20 billion of economic output a year - about 10 percent of gross domestic product. Indonesia's crisis-hit economy remains heavily reliant on the World Bank and the International Monetary Fund for its financing. The alarmed institutions have repeatedly warned of the long-term social and economic costs of forest destruction - and the implication for the blossoming national debt.

While they sometimes find a sympathetic ear in Jakarta, the capital, "the central institutions are becoming increasingly irrelevant,'' says Tom Walton, coordinator of the World Bank's environmental efforts here. "Local people are ignoring the ministers.''

And, as logging quickens, the social and environmental disruptions are multiplying. Roughly 70 million Indonesians - a third of the population - rely on forests, either directly through logging or through the protection from flooding and fire that forests provide.

Unlogged rainforest is damp enough and dense enough that fires tend to be localized. But logged-over forests are dryer, with massive amounts of dead wood to act as fuel on the ground. This year, hundreds of thousands of farmers have been hit by floods and landslides.

"The first victim may be the forest,'' says Mr. Zainuddin. "But the people are going to be the real losers.''

Activists like Zainuddin worry that communities will be pitted against each other as the forest disappears and a general lawlessness seeps into the region. A series of massacres of Madurese settlers by native Dayaks appear to bear him out. The killings, which have left at least 2,000 dead and created 150,000 Madurese refugees since 1997, have been centered in logging areas.

Tanjung Puting - the national park Doherty was trying to protect - is an unique corner of the planet, named a Global Biosphere Reserve by the UN in recognition of its immense biodiversity.

This swampy jungle is home to 11 of Borneo's 13 primate species and a boat-ride into the park is like entering a slightly menacing Eden. Pot-bellied proboscis monkeys sit on overhanging branches, proudly displaying one of the largest noses in the animal kingdom. Crab-eating macaques, another type of monkey, paw at the water's edge, and estaurine crocodiles lurk in the shallows.

The park is also home to Camp Leakey, a famous orangutan rehabilitation center. The orangutans, once pets, are taught how to forage, climb, build nests, and otherwise "be wild" again. But logging has put the camp under siege. With the park's estimated 2,000 orangutans squeezed into smaller areas by habitat destruction, wild orangutans have been showing up at Camp Leakey looking for handouts. "We're being turned into an orangutan refugee camp,'' complains an employee of Orangutan Foundation International, which runs the camp.

The cuddly orange primates are what drew EIA and Telepak here. The groups thought they could use Camp Leakey's high profile to mobilize international pressure on Indonesia to enforce its laws. Since Indonesian prosecutors rarely pursue illegal loggers, the activists decided to follow the logs leaving the park. Their investigation led them to Rasyid.

From small beginnings, he built his Tanjung Lingga Group into the biggest timber processor in the district. In town, locals proudly point out the bright pink tiles of his house. Posing as timber buyers in early 1999, the investigators discovered those tiles were being paid for with wood stolen from the park, particularly ramin - a swamp-dwelling species that yields a blond timber that's popular in the US for futon frames, picture frames, tool handles, and pool cues. In a series of meetings with Sugianto, Rasyid's nephew, they saw "vast quantities of ramin'' at one of Rasyid's mills, and were told by Sugianto how Tanjung Lingga would help them generate the paperwork to cover up illegal activity.

Sugianto did not respond to Monitor telephone calls and a fax seeking comment. Mr. Rasyid also did not respond to a fax, receipt of which was confirmed by a secretary at Tanjung Lingga's Jakarta office, or phone calls seeking a response to allegations of illegal logging.

A big ramin tree can yield $5,000 worth of wood and the species has been logged to the brink of extinction here and in neighboring Malaysia, the only other place it grows.

By August of 1999, EIA delivered a report to the government that they expected would guide an official investigation and lead to Rasyid's prosecution. That year, a Ministry of Forestry team had visited Tanjung Puting National Park, and the ministry's then secretary general, Suripto, told reporters that Rasyid's family was processing 60 percent of all the timber stolen in the area.

"The only source for that wood was the park,'' explains Doherty. "If the law was ever going to be enforced, this was a perfect case.''

Instead, a lesson was delivered in the decline of Jakarta's influence and the rise of Rasyid's. The Central Kalimantan governor created a Tanjung Puting oversight commission, but named Rasyid's brother Ruslan, a shareholder in the family companies, to be its chairman.

Conditions in the park deteriorated toward the end of 1999, with a station conducting research on proboscis monkeys burned by loggers, prompting Doherty' s return in January 2000. That was when the activists were taken hostage. In addition to Ruwindrijarto's beating, they spent three days at the police station, while a mob screamed threats from outside the gate. They were then taken to the airport and warned by the police to never return. "Rasyid was sending a message,'' says Doherty, in Jakarta a year later. "It's his town.''

Activists aren't the only ones being pushed around. In February 2000, a team of central government officials, responding to complaints from aid donors like the World Bank, arrived to audit and close a Tanjung Lingga mill. A mob of Rasyid's workers was waiting for them with axes and machetes.

The officials then went to the national park, where they confiscated some logs, but within hours another mob had burned the park office in protest. The delegation fled, and since then, there's been little interference from Jakarta.

Abdul Razak, West Kotawaringin's regent, or bupati, thinks that's for the best. The regents are the highest officials in the districts. "People don't want to be told what to do by Jakarta anymore. Jakarta says we have to protect the park, but they don't send us money.'' Mr. Razak, a mustachioed former forestry official, can't explain why no logger has been prosecuted in his district. He characterizes illegal logging as a problem of poverty, and declines to discuss Rasyid: "Don't single anyone out."

Thanks to decentralization, Razak and Indonesia's 350 or so other district heads have gone from mere figureheads to some of the most important people in the country. They've inherited administrations with limited income and expertise, and are under pressure to bring in cash from day one, say political analysts.

"Regents either get smart and cooperate with illegal loggers,'' says Zainuddin, the community activist, "or they're replaced by someone who gets smart and cooperates.''

Prompted by the World Bank and EIA, Indonesia asked in April for ramin to be placed on a banned export list under the UN Convention on International Trade in Endangered Species (CITES). The CITES ban kicked in Aug. 9, and Indonesian officials say the ban was effective immediately domestically.

Traders say ramin demand has fallen, but logging has simply shifted to other tree species.