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Indonesia fines palm oil and mining companies $2.3billion for operating in forests

A government task force in Indonesia has fined dozens of palm oil companies and mines a total of 38.62 trillion Rupiah (2.31 billion dollars) for illegally operating in forest areas. An official confirmed this on Monday. The forestry taskforce of President Prabowo, which is made up by military personnel and officials from law enforcement, has cracked down this year on a scale that was unprecedented on illegal plantations and mines in forest areas.

The task force has seized 3.7 million hectares (9.1million acres) of plantations, and more than 5300 hectares (more than 6,000 acres) of mining operations. Its goal is to reach 4,000,000 hectares before the end of this year.

Barita Simanjutak, a member of the task force and an official in the Attorney General's Office, confirmed that following the seizures, the Attorney General's Office issued fines to 22 mining companies totaling 29.2 trillion Rupiah and 9.42 trillion Rupiah. He said that they were some of the former owners of the assets, but refused to disclose their names.

He said that palm oil companies would be expected to pay 25,000,000 rupiah for each hectare of land per year. However, he did not explain how the fines are calculated.

Simanjuntak stated that some companies had paid and others had objected. He said the task force would listen to any dialogue, but enforce the law with strictness.

He said, "We encourage companies to cooperate."

He added that "it is not impossible" for the taskforce to take legal actions if compliance was not observed. The task force handed over 1.5m hectares to Agrinas Palma Nusantara. This state-owned firm was established early this year and is now the largest palm oil company in the world. The palm oil industry has been shaken by the military-backed seizure. Analysts have predicted that the military-backed seizures, along with Indonesia's plan to produce biodiesel, would put upward pressure on prices globally, as they were expected to disrupt productivity. Indonesia is the largest exporter in the world of palm oil and thermal coal. It also produces nickel, tin, and tin.

(source: Reuters)