Two Indonesian Timber Smuggling ‘Kingpins’ Named

LONDON, UK, August 5, 2010 (ENS) – Environmental groups in the UK and Indonesia today named two of the “kingpins” in Indonesia who are making a killing in the lucrative international trade in stolen timber.

In a new report based on their undercover investigations, the London-based Environmental Investigation Agency and the Indonesian group Telapak identify businessmen Ricky Gunawan and Hengky Gosal as two of the major players in smuggling illicit merbau timber.

Hengky Gosal, May 2010 (Photo courtesy EIA/Telepak)
Ricky Gunawan in 2006 (Photo courtesy EIA/Telepak)

Merbau is a valuable dark hardwood used to make flooring, decking, outdoor furniture, doors and window frames. Merbau logs in Papua are sold for between $250 and $300 per cubic metre, the groups report.

Merbau is targeted by illegal loggers and timber smugglers due to heavy demand for raw timber in China and India, and for merbau products in Australia, the European Union and the United States.

Within Indonesia, almost all merbau trees are found in Papua in the eastern part of the country. Papua’s forests form part of the last significant tract of intact tropical forests in the Asia-Pacific region, but about a quarter of Papua’s forests have been logged over the past 12 years.

The report, “Rogue Traders: The Murky Business of Merbau Timber Smuggling in Indonesia,” is the result of the groups’ undercover investigations. In it, the groups call on the Indonesian government to launch criminal investigations into the activities of Gunawan and Gosal.

They urge the government to advance protection for merbau under the Convention on International Trade in Endangered Species, CITES.

During the past year, undercover investigators from EIA and Telapak followed the illicit merbau trade in China and Singapore, as well as Surabaya, Makassar and Papua in Indonesia.

Tanjung Priok Port Customs Officers display merbau logs to the media following seizure of 23 containers belonging to Hengky Gosal’s company UD Menara Mas, October 19, 2009.

Following the October 2009 seizure in Jakarta, Indonesia of 23 containers of merbau logs destined for China, India and South Korea, EIA and Telapak investigators posing as timber buyers uncovered a smuggling operation headed by Hengky Gosal that employed bribery and exploited failings in the monitoring system to acquire documentation for the shipment.

“The seizure exposes serious flaws in Indonesia’s system for checking the legality of timber systems,” the groups claim.

While unwittingly speaking with investigators, Gosal admitted smuggling up to 50 containers a month of merbau square logs to China, in contravention of Indonesia’s log and sawn timber export bans.

He also claimed to bribe customs officers to ensure safe passage out of Indonesia for the containers.

Another illicit timber trafficking hotspot is the city of Surabaya, in East Java, the base of operations for prominent merbau smuggler Ricky Gunawan.

EIA and Telapak say they have submitted several reports on his activities since 2007 to Indonesian authorities, but he has not yet beeen investigated. As recently as December 2009, he was still shipping illegal merbau to southern China.

Illegal merbau logs in Seremuk, South Sarong, West Papua, 2003 (Photo courtesy EIA/Telapak)

The groups cite a recent incident to demonstrate how much influence Gunawan wields. When one of his China-bound merbau shipments, falsely labeled “bridge components,” was detained by Indonesia customs in April 2009, swift intervention on his behalf by government officials and members of the local parliament ensured the timber was released for shipment.

EIA Campaigns Director Julian Newman said, “While the huge quantity of illegal timber flowing from Indonesia during the first half of the decade has declined, effective law enforcement against those responsible – the financiers, company bosses and corrupt officials – has been woefully inadequate.”

A 2005 report from EIA and Telapak, “The Last Frontier,” exposed smuggling of merbau to China on a scale so massive that the Indonesian government embarked on an unprecedented crackdown on illegal logging.

But the groups said today that “despite significant progress being made against illegal logging in the past five years, enforcement action against the main players has stalled. The threat to Indonesia’s precious forests remains.”

In April, the extent of ongoing illegal logging prompted President Susilo Bambang Yudhoyono to voice his frustration at the lack of progress in prosecuting illegal logging cases through the courts and to order his government’s taskforce on eradication of judicial corruption to investigate.

Hapsoro of Telapak said, “It is no wonder the Indonesian President has ordered the country’s judicial mafia eradication taskforce to scrutinize illegal logging cases.

He said of the taskforce, “It should certainly focus its attention on two merbau smugglers named in this report – Ricky Gunawan and Hengky Gosal. It is time for Indonesia to redouble its efforts to combat illegal logging and timber smuggling by going after the main culprits.”

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