Forest Misuse Costs Indonesia $7 Billion in Revenue, Report Says

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http://www.bloomberg.com/news/2013-11-10/forest-misuse-costs-indonesia-7-billion-in-revenue-report-says.html

Illegal logging and mismanagement of Indonesia’s forestry industry may have prevented more than $7 billion flowing to state coffers from 2007 to 2011, costing the government more than its health budget, Human Rights Watch said.

In contrast, the Indonesian government’s 2011 revenue from timber royalties and reforestation fees was $300 million, said Emily Harwell, the lead author of a report released by Human Rights Watch.

“This is a very conservative estimate,” Harwell, a partner at Natural Capital Advisors LLC, said at a briefing in Jakarta on Nov. 8 of lost revenue. “The calculation doesn’t include any wood that’s smuggled.”

The report indicates weak governance is chipping away at revenues in the world’s fourth-most populous nation, as budget and current-account deficits this year hurt the rupiah. In 2011, revenue missed from forestry totaled more than $2 billion, exceeding the government’s health spending for that year, New York-based Human Rights Watch said in the report.