The remains of a burnt tree in East Kalimantan, Indonesia
The Indonesian government is failing to make firms convicted
of illegal deforestation pay
more than US$1 billion in fines, hampering efforts to restore the peat and
forest habitats damaged by their operations.
In 2016, a Supreme Court verdict ordered the timber firm PT
Merbau Pelalawan to pay 16 trillion rupiah (US$1.2 billion) for illegally
clearing 5,590 hectares of forest near Sumatra’s east coast. But the firm has
not yet paid the fine, and recently filed a case review challenging the Supreme
In 2015, the oil palm company PT Kallista Alam was fined 360
billion rupiah – more than US$27 million – for clearing 1,000 hectares of land
in the Tripa peat swamp region of Sumatra’s northwest coast. Initially, the
firm filed a case review against the court’s decision, which was rejected.
Then, in July 2017, the company sued the government, alleging that the
coordinates for its concession used by the ministry in court were wrong.
Observers have questioned why the issue was not settled during the original
The Ministry of Environment and Forestry is considering new
measures to force companies to pay, including forming a task force invested
with more power to enforce the rulings. The proposal would unite officials from
several relevant government agencies, including the Financial Transaction
Reports and Analysis Center, the Financial Services Authority, the Attorney
General’s Office and the Ministry of Law and Human Rights.
Fines levied on firms for illegal deforestation serve two
purposes: compensation for the state, and funds to fully restore the affected
forests back to their original condition. Failure to collect fines prevents
these restoration efforts taking place, according to Ministry officials.