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Since the reform of Indonesia’s Forestry Law in 1999, newly empowered forest-
dependent communities have been allowed to negotiate directly with logging companies
for access to financial and social benefits. Fieldwork undertaken in May and June 2003
attempted to assess the impacts of this decentralization reform on communities in the
subdistrict of Sekatak in Bulungan, East Kalimantan. Results suggest that the process
of negotiations influenced the benefits that accrued to these communities. It seems
that the most important factors were increased collective action and co-operation
among the communities situated in and sharing forest areas, prior experience of
dealing and conflicts with logging companies, plus strong and relatively transparent
local leadership. Taken together these factors enabled communities to obtain benefits
at the higher end of the scale for the area as a whole and provided a mechanism by
which to deal with problems as they arose. These results suggest that in the absence
of other means by which to protect the interests of local communities and to enforce
the law, local capacities for collective action may be a potential and effective substitute
for future development.