The Improvement of Willingness to Pay for Land in Forest Revitalization Development in Kalimantan Timur Province

Abstract

The factors of wood scarcity were the longtime ago exploitation and the high demand of wood for export and import which may not always be relied on the supply from natural forest. To solve, it needed the development of forest planting industry by planting fast and slow grows plant through the expectation value of land.

The purposes of this study were to know the increment volume of fast-growing and slow-growingwood, to know the profit of forest cultivation  and to know willingness to pay to land.

The method of collecting the data was conducted using direct observation and interview to the administrator and the worker. The collected data was analyzed by using financial analysis with Payback Period (PP), Net Present Value (NPV), Net B/C ratio, Internal Rate of Return (IRR), Equivalent Annual Annuity (EAA) and Willingness Pay to Land (WPL) method based on technical and economic cycle.

The calculation showed that the kinds of fast-growing plant (P.falcataria, A. Mangium and E.deglupta) in the age of 10 have bigger increment than 15m³/ha/year.  In the other hand, the kinds of slow-growing plant (S. macrophylla, S.leprosula and G.arborea) had smaller increment than 15m³/ha/year. In addition, the variations of each plant increment plant were different, which can affect the financial value.

Financially, under technical cycle, almost all the plants were good to be cultivated except G.arborea. While, under economic cycle, all the plants were good to be cultivated because their IRR value were higher than Minimum Accessibility Rate(MAR=4.5%).

The fast-growing plants had higher wished price land than the slow-growing plants, in which under the technical cycle, G.arborea had negative willingness pay for land. In the other hand, under the economic cycle, the result showed that P. falcataria had the highest willingnesses pay for land, while plant with the lowest wished price land was G.arborea.

The revitalization of forest will give tax potency that must be paid by the company based on the wished price land from every kinds of plant about 15% (per unit) as the plants tax that will be charged into the selling price of the wood.

The forest revitalization which was conducted by the company, the government and the public can be the source of company profit, government revenue, and public income for a long period. With economic cycle, the income will be higher than the one under technical cycle.

Keywords: Willingness to Pay for Land, Forest Revitalization Development