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From:   George J. Aditjondro
Sent:   03 September 1996 11:53
To:     kdpnet@usa.net
Subject:        Suharto's global forestry interests


THE SUHARTO CLAN'S GLOBAL FORESTRY INTERESTS
George J. Aditjondro

        A new trend of South-South colonialism has emerged recently, where
southern transnational companies are making heavy investments in more
backward Thirld World countries. This observation was raised by a
spokesperson for the World Rainforest Movement, Marcus Colchester, in an
interview with the Sydney Morning Herald , last Saturday, August 31, 1996.
In this article, titled "How Asia's logging companies are stripping the
world's forests," several examples of this new trend has been mentioned,
with Malaysian and Indonesian companies at the forefront.

        The only Indonesian company mentioned explicitly, is MUSA, which
has a 60,700-hectare concession in Suriname. This is actually an
understatement, because Indonesian companies have also began to log, or
began large timber plantations and associated wood-based industries, in
several other countries. The brief reference to MUSA is also an
understatement, because it omits the high-power backing which this company
enjoys in Suriname and in Indonesia. It is, in fact, a company owned by
President Suharto's relatives from his home village of Kemusu in
Yogyakarta, which has branch offices in Suriname, Hong Kong, and Singapore.


        Hence, the following cases delineate some of the (known) overseas
forestry and/or wood-processing industries controlled or owned by the
Suharto clan.


Case No. 1: How dictators support each other:  Tommy Suharto, the first
Indonesian foreign investor in Burma
----------------------------------------------------------------------------

        The first Indonesian investor in Burma is PT Rante Mario, one of
the numerous companies under the Humpuss Group, controlled by President
Suharto's youngest son, Hutomo Mandala Putra, aka as Tommy Suharto. Through
a joint venture with a Burmese state company, Myanmar Timber Enterprise
(MTI), PT Rante Mario is planning to build a wood processing industry with
an investment of US$ 75 million.

        In the first five years (since 1994), this joint venture will only
produce logs and lumber. After that, it will go into plywood production.
"Rante Mario will become a test case in involving foreign investors in
Myanmar in forest management," said Herry Sunardi, general director of PT
Rante Mario to an Indonesian business magazine, Swasembada , in its
December 1994 edition, page 41. "If this projects succeeds, then other
investors will be attracted, and that is when Myanmar will be a challenge
to Indonesia's timber export market," adds the Humpuss Group executive.

        Sunardi bases his argument on his data of Burma's excellent
forestry potentials. According to him, from Burma's total forest of 66
million hectares, 32.4 million consists of high-density forest.

        The Humpuss executive's data, however, contradicts some other
sources. According to WWF data, Burma's natural environment is already
worse off than Indonesia. As published on page 42 in the November 20, 1995
edition of another business journal, Warta Ekonomi , Burma has already lost
71% of its natural habitat, compared with 49% in the case of Indonesia.
Area wise, Indonesia still has nearly 750,000 Km2 of natural habitat, while
Burma only has nearly 226,000 Km2. So, one can say that to conserve
Indonesia's own natural forest, President Suharto is allowing his beloved
youngest son to destroy a friendly nation's forest.

        No wonder that Suharto so vehemently opposes any "Western
interference" in ASEAN's "domestic affairs", after the SLORC's Myanmar --
not Aung San Suu Ky's Burma -- has been accepted as an observer in ASEAN.
Especially since another son of the Indonesian ruler is also involved in
the telecommunication industry in Burma. PT Elektrindo Nusantara, which is
51% owned by Bambang Trihatmojo, Suharto's second son, has followed his
younger brother's step by investing in small telephone central units for
256 subscribers in Rangoon, as a pilot project for a much bigger deal with
the SLORC (Swasembada, August 1995: 16, 28).


Case No. 2: Bambang Trihatmojo's forestry interests in Malaysia, Papua New
Guinea, and China
----------------------------------------------------------------------------

        While his younger brother operates directly in the global forestry
sector, his older brother, Bambang Trihatmojo, operates in this field more
indirectly. Bambang, who himself controls his own business empire, the
Bimantara Group, is a major shareholder in another conglomerate, the Barito
Pacific Group. This group is led by a Sino-Indonesian businessman, Prajogo
Pangestu. In the group's bank, Andromeda Bank, Bambang owns 25% shares,
Prajogo 50%, and another Sino-Indonesian businessman, Henry Pribadi, also
25%.

        Under Prajogo Pangestu's leadership, Barito Pacific has ventured
into various forestry operations in Malaysia and Papua New Guinea. Two
years ago, Barito Pacific acquired a Malaysian company, CASH (Construction
and Supplies Houses Berhad) for M$ 1.3 billion, to reforest 500,000
hectares of land in Sabah, East Malaysia. Apart from that, Prime Minister
Mahathir has contracted CASH to establish a one million hectares timber
plantation in Malaysia. To finance that project, the Malaysian government
has issued 'timber bonds' to be sold on US and European stock-markets, with
the full support of Mahathir.

        Apart from CASH, Prajogo Pangestu also owns three other overseas
forestry operations, namely Rindaya Wood Processing in Malaysia, Lombda Pty
Ltd in Papua New Guinea, and Nantong Plywood Industry in Shanghai, China
(Info-Bisnis , April 1994: 12-13;Swasembada , December 1994: 41; Asia,
Inc., July 1995: 53). With all these business connections between the
Indonesian and Malaysian elites, it is also no wonder why Mahathir is as
vehemently opposed as Suharto against international criticism of their
countries environmental policies.


Case No. 3: Banking on ethnic Javanese connection: The MUSA Group in Suriname
----------------------------------------------------------------------------

        Suharto is indeed a very family-type person, who always wants to
please all his family members. Not only his immediate family, but even his
relatives in his home village of Kemusu in the province of Yogyakarta. The
notorious MUSA (Mitra Usaha Sejati Abadi), which has been mentioned in the
SMH   article, is owned by Yayasan Kemusuk Somenggalan, a family foundation
of Suharto's relativds in his childhood village.

        MUSA, which first came to Suriname in 1993, has had big ambitions
in this country, with a large ethnic Javanese population. Despite protests
from the Afro-Maroon people, it soon managed to obtain logging rights of
150,000-hectare in the Apura district in West Suriname, without the
approval of Suriname's parliament. According to an Indonesian independent
journalist's bulletin, Suara Independen, MUSA's investment approval was
obtained after visits to Indonesia by Suriname's Minister for Social
Affairs, Willy Soemita, who is of Javanese origin. A subsequent visit of
Suriname's president, Mr Venetiaan, to Indonesia in 1994, had established a
20-years cooperation agreement between Indonesia and Suriname in the field
of forestry.

        MUSA's ethnic Javanese connections has not been limited to its cozy
relationship with Mr. Willy Soemita, who is known in his country to be a
corrupt politician. A Suriname weekly, de Surinaamse Weekkrant, has alleged
that MUSA has also bribed the leaders of KPTI, a conservative Javanese
party and NPS, amounting to US$ 11 million.

        Despite international protests from the world rainforest movement,
MUSA is said to stand side by side with the Berjaya Group from Malaysia and
another Indonesian company, PT Suri Atlantic, in eyeing another concession
rights of more than 1 million hectare. The Indonesian anti-deforestation
organisation SKEPHI has found inextricable links that Suri Atlantic may be
coming from the same timber industry sources in Indonesia, as MUSA did
(SKEPHI press release on Apakabar, 28 August 1995; Suara Independen, August
1995; Guardian Weekly, July 21, 1996).

        So, from this case we can see, how Suharto has successfully
transformed his international political role as head of the Non-Aligned
Movement (NAM), into financial assets for his extended family, from his
children all the way to his relatives in his home village of Kemusuk in
Yogyakarta. No wonder that he has attempted, at all costs, even taking the
risk of killing between 47 and 100 members of the Indonesian Democratic
Party (PDI) on July 27, 1996, when thugs and troops loyal to Suharto
stormed the PDI headquarters.

        This brutal crackdown, as well as the following arrest, detention,
torture, and eventually trial of numerous Indonesian pro-democracy
activists are simply carried out  to avoid anybody to take away his
'throne' and 'crown', a throne of bones and a crown of the blood of up to
two million Indonesian people and more than 200,000 East Timorese people.

        Hence, there is no way to avoid him from doing more harm in
Indonesia, in East Timor, and world wide through his hundreds of companies,
than to carry out world wide sanctions of all Indonesian businesses
associated with the Suharto clan and their cronies. These worldwide
sanctions should be aimed at their banks, their consumer goods businesses,
as well as their forestry interests as well, by picketing their offices,
showrooms, and banks (Lippo, BCA, Hibernia), by picketing Lippo Bank, BCA,
First Pacific and MUSA offices in Hong Kong, a major centre of the clan's
business enterprises,  by persuading supermarket managers all over the
world to boycott Indofood products, by blocking the toll roads, highways
and fly passes built by Suharto's eldest daughter, Tutut, and her nephew,
Ari Sigit Suharto in Malaysia and the Philippines, by boycotting Tommy
Suharto'sSempati Airlines, by boycotting Kia cars from South Korea which
has currently forged a preferential deal with Tommy Suharto, and whatever
other means one can imagine.

Newcastle, 3 September 1996

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