A South Korean-owned company is cutting down primary rainforests for timber and then setting fires to clear the land to plant oil palm in apparent violation of Indonesian law, according to an investigation by environmental groups.
The investigation points to “systematic and widespread use of fire” by the Jakarta-based Korindo Group PT, which adds to the pall of smoky haze choking large parts of Southeast Asia during the annual dry season, the environmental groups said in a report published on Thursday.
Korindo has already cleared more than 50,000 hectares of tropical lowland forest for palm oil plantations in the remote provinces of Papua and Maluku, and at least 75,000 hectares are at “immediate risk” of being cleared, the report said.
“I’ve never seen evidence so strong to prove that a company intentionally burned,” AidEnvironment Indonesia senior consultant Erik Wakker told reporters in a telephone interview.
One of Korindo’s main customers, Wilmar International Ltd, told reporters that it has stopped buying palm from Korindo for violating it’s “no deforestation” policy, Wilmar said in an e-mailed statement.
Korindo blamed local people living near its timber concession area for “lighting fires for hunting wild animals living in the forests.”
“Accusations that the Korindo Group were a big contributor to the smoke and haze last year and consequently had an effect on the economy and damaged the environment in Indonesia are not true,” the company said in a statement.
The Indonesian Ministry of the Environment has sent a team to Papua “to collect material and information,” after it was presented with the findings from the report, the ministry’s law enforcement director Muhammad Yunus told reporters.
Indonesia is home to the world’s third-largest area of tropical forests.
Korindo holds a total of 160,000 hectares of oil palm concessions in eight areas of Papua and Maluku, according to the report, and an estimated 900,000 hectares of logging areas that could also be converted. It is one of the largest plantation companies in eastern Indonesia.
About 90 percent of the world’s palm oil crop grows in Malaysia and Indonesia.
Indonesian President Joko Widodo in April imposed a moratorium on expanding palm oil plantations, with the industry under mounting pressure from global companies that use palm oil in products, ranging from soups to soaps and chocolates, to adhere to environmentally sustainable plantation practices.
Consumer giants such as Unilever and Kellog are increasingly demanding “sustainability certification” from watchdog groups, including no use of fire to clear land, before buying products from palm oil producers.
Last year’s forest fires in Indonesia burned 2.5 million hectares, an area the size of Great Britain, causing total economic losses of US$16 billion, a World Bank report said.
Many forest communities throughout Indonesia practice “slash and burn” agriculture, using fire to clear land. However, the World Resources Institute, which runs an extensive database on forest fires in Indonesia, says more than one-third of the fires last year were on pulp wood concessions, and a good proportion of the rest were on palm oil plantations.
According to Indonesian law, a company found guilty of clearing land by burning can be fined up to 10 billion rupiah (US$735,000), and the management faces up to 10 years in jail. Companies that fail to control fires started elsewhere but which spread into their concession land also face punishment.
Korindo Group employs about 20,000 people across 30 affiliated companies mainly involved in plywood, paper and pulp and palm oil, according to the company’s Web site.
It is majority-owned by South Korea’s Seung family.
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