The following contributions were solicited by Global Forest Watch from two experienced researchers in the field of Indonesian forestry. Both are based on personal experiences and offer some frank insights into the obstacles that can block the path of those who wish to compile and analyze credible forestry statistics for Indonesia. The stories are backward-looking in that they generally describe conditions prevailing under the Suharto regime.
Secrecy in the Indonesian Forest Products Sector:
A Researcher's Experience
By David W. Brown
How difficult is it to obtain information on the Indonesian forest products industry? It is possible to get this type of information, but researchers must be tenacious and willing to live with setbacks of years at a time
In 1993, I was awarded a grant from the U.S. Social Science Research Council and the Ford Foundation to study the Indonesian forest products industry. I was to have initiated my work that very summer, but I had to wait 2 years for approval from Indonesian authorities to begin my research. I managed to use the first year in the United States productively, but the second year was almost totally wasted. In experiencing such delays, I was not alone. In the first half of the 1990s, many researchers were denied permission to study even innocuous topics in Indonesia. However, because I was never actually denied permission to enter the country, I do not have evidence that anyone in the government objected to my topic.
I never did get formal approval from the Indonesian government to conduct research. Instead, I contacted a tropical forestry expert with the World Bank in Indonesia and asked him to sponsor my work. He agreed and arranged for a 1-year appointment in the Bank as an unpaid natural resource specialist. The visa that accompanied that appointment was indispensable to my being able to start my research.
But problems quickly emerged at my sponsoring institution, the World Bank. The forestry expert who arranged for me to enter Indonesia was reassigned to Washington. Some of those who remained in Jakarta were hostile to my research. For example, one staffer withheld a document she had been instructed to pass along to me and told me, in her own words, that she did not “trust” me. The real setback came when the Bank's Chief of Mission barred me from coming into the Bank’s offices. I did not insist on the Bank's honoring its commitment to me because this could have resulted in my visa being revoked. I made a decision to lay low and did not return to the Bank until years later.
Fortunately, a forestry aid project sponsored by the United Kingdom’s Department for International Development (DFID) saw value in my work. At the end of my formal scholarly research, the DFID hired me for a consultancy, which helped me obtain a wealth of data. Later I went to work there full time. The DFID had built up a great deal of trust and goodwill in the Indonesian Department of Forestry over the course of a decade and, as an employee of their project, I benefited from that trust. When I asked the department for sensitive documents, I would usually receive them, but only because I was affiliated with the project.
Even though I came to enjoy a solid institutional entrée to the Indonesian Department of Forestry, I occasionally ran into resistance. This first happened when I was given obviously fake data on the domestic price of Indonesian roundwood. The department told me that Indonesian mills were buying logs from Indonesian timber concessionaires for US$100 per m3, when in fact our project knew that mills were buying legal wood for half that price and illegal wood for one fifth that price. Why would the department deliberately overstate the domestic price of logs? The government wished to obscure the fact that Indonesian plywood factories were making enormous windfall profits from buying Indonesian logs at low prices on the glutted domestic market and then processing those cheap logs into plywood and selling them at full prices on the world market. Meanwhile, Indonesia was taxing timber concessionaires and wood processors at suboptimal rates. Therefore, instead of the majority of potential revenue being officially collected by the government to pursue national economic development objectives, the timber industry and their patrons in the government unofficially appropriated the majority of revenue. To some extent, the Department of Forestry was able to hide this practice by giving out inflated domestic log price information.
A second instance of obstruction came when an official in the Indonesian Department of Forestry expressed reservations about my borrowing annual work plans for timber concessions in eastern Indonesia. When I left his office with harvesting plans for a dozen concessions, he warned me, “Don't leak these.” When I analyzed the work plans, I began to see why he had issued this warning. Maps of one concessionaire, Brata Jaya Utama, owned by the National Police, showed that the company was logging inside a biodiversity hotspot, Manusela National Park, on Seram Island. (I never leaked this information but did report it to the former head of the department’s planning body in an official letter.) I also discovered that another timber concession, located in a biologically sensitive buffer zone between two proposed parks on Halmahera island, which had been turned over to one of the state forestry corporations for the purpose of rehabilitation, was not being rehabilitated at all, but instead its virgin forests were being harvested.
Although I did encounter resistance from various institutions, I do not wish to characterize them as nontransparent just because some of their employees went out of their way to withhold information. Rather, it is important to take a broader view of the structural constraints on these institutions. Tropical timber as a commodity embodies high levels of windfall profit, whose very existence creates a strong disincentive for the proper management of the resource. Years of rent-seeking at all levels of the Indonesian government, especially at the top, have crippled the ability of institutions, including the Department of Forestry, to regulate industry properly. Meanwhile, multilateral and bilateral donors have their own sets of constraints. On the one hand, donors are compelled to give out loans or grants to economically distressed governments but, on the other hand, are institutionally incapable of ensuring that these funds are not simply appropriated by government leaders.
In summary, agencies that work in and around the tropical timber sector face structural barriers that prevent their employees from doing the right thing. Nevertheless, all these agencies have at least some good employees working in them. These staff are genuinely committed to the survival of the forest and to the people whose lives most directly depend upon it. Researchers must strive to identify these employees, befriend them, not place them in danger, and above all, report the truth.
David W. Brown worked as a political economist for the UK-Indonesia Tropical Forest Management Programme, and as a forest products investment analyst with the global investment bank of Dresdner Kleinwort Benson. In recent years he has also undertaken consultancies for the World Bank, the Indonesian Bank Restructuring Agency, and The Nature Conservancy. Brown was recently awarded a Ph.D. by the Political Science Department of the University of Washington. His dissertation explains how the secret appropriation of timber windfall profits by political leaders undermines timber revenue policy in developing nations.