With a dozen timber firms set to receive new government soft loans to finance 'reforestation' projects, critics say that the money will translate into logging subsidies for the timber lobby.

Six of these firms are from the timber-rich state of Sarawak. Five others have already signed up for loans under a forest replanting programme that aims to create plantations of latex timber clone (LTC) rubber trees and acacia.

The federal government has set an initial target of dispensing RM200 million in loans that will support up to 12,000ha of tree plantations for 2006 and a further 24,000ha for 2007 and 2008. Over a billion ringgit has been allocated for financing tree plantation projects until 2011.