Jakarta, August 15, 2018 - Asia Pulp & Paper (APP) and Asia Pacific Resources International Holdings Limited (APRIL) are still buying wood from companies that cut down natural forests, as shown in their reports on the fulfillment of industrial raw materials recorded in the government's official system, known as Rencana Pemenuhan Bahan Baku Industri (RPBBI) Online. In 2017, both groups purchased wood from PT Fajar Surya Swadaya (FSS), an industrial timber plantation concession in East Kalimantan that, according to satellite imagery analysis, has cleared approximately 20,000 hectares of natural forest since 2013. APP is also recorded as buying wood from PT Silva Rimba Lestari, another HTI concession in East Kalimantan, which based on satellite imagery analysis has cleared approximately 12,000 hectares of natural forest since 2013.

The finding that APP and APRIL are still buying wood from HTI concessions that clear natural forest raises fundamental questions about the sincerity of their zero deforestation and human rights commitments in their supply chains. APP made these commitments in 2013, followed by APRIL in 2015. Moreover, without providing convincing data on their plantation supply capabilities, both APP and APRIL are significantly increasing the capacity of their pulp mills and/or downstream processing.

Indeed, evidence of APP's ties to companies involved in large-scale deforestation extends beyond the Djarum affiliate's HTI concession in East Kalimantan. Last year, for example, it was revealed that PT Muara Sungai Landak (MSL), an HTI concessionaire in West Kalimantan linked to APP's parent conglomerate, the Sinar Mas Group, cleared natural forest on peatlands after APP announced its zero-deforestation commitment. APP's violation of its zero-deforestation commitment can also be attributed, in part, to the industrial development of OKI Pulp & Paper, its giant-scale pulp and tissue mill in South Sumatra, which began operations in late 2016. With a production capacity of 2.8 million tons/year, OKI Pulp & Paper has resulted in a 75% increase in APP's wood fiber supply needs to 31 million m3 of wood per year.

APRIL's purchase of wood from supplier PT Fajar Surya Swadaya comes at a time when the conglomerate is expanding its industry. As noted, RGE Group, APRIL's parent conglomerate, is currently building a large viscose staple fiber (VSF) mill and converting one of its pulp production lines into a dissolving pulp (DP) producer in Pangkalan Kerinci, Riau, where RGE's flagship mill is already located.

RGE's industrial expansion does not appear to be in line with the Government of Indonesia's efforts to avoid forest and land fires. One of the priorities of President Joko Widodo's administration is to prevent a repeat of the 2015 fires. There is no other way, the government must restore peatlands that have been drained, including by forest plantations. More than half of RAPP's 480,000 ha of plantations are located in such areas, and therefore peat restoration will result in the loss of hundreds of thousands of hectares of plantations that have been supplying RGE's industries.