Indonesia: Holding up the sky


Patrick Anderson & Brihannala Morgan – Inside Indonesia

Date of publication: 
25 July 2011

Indonesia has set ambitious targets to reduce its greenhouse gas emissions that will require major changes in how forests and agricultural lands are managed

Indonesia is one of the first nations from the global south to commit to reduce its greenhouse gas emissions by 2020. Three quarters of Indonesia’s emissions result from deforestation and land degradation, so meeting this commitment will require major changes in how the country manages its forests. Many groups are hoping that efforts to reduce deforestation will include respecting the right of traditional communities to own and manage their customary forests.

The challenges are enormous. In 2006, reports by the World Bank and Wetlands International revealed that the destruction of Indonesia’s forests and peatlands were causing very high emissions of greenhouse gases, making Indonesia the third largest greenhouse gas emitter in the world, after the USA and China. At first Indonesian officials denied the reports but studies over the coming years confirmed that deforestation and peat soil loss was releasing about two billion tons of carbon dioxide annually. Per capita greenhouse emissions in Indonesia are therefore about ten tons annually, higher than China (five tons per year) and similar to Europe (eight to ten tons a year), but less than half the per capita emissions in Australia or the US (both more than 20 tons).

Climate villain to global leader

In 2009, the President of Indonesia, Susilo Bambang Yudhoyono, announced at the G20 Major Economies Summit in Pittsburgh, USA, that by 2020 Indonesia would unilaterally reduce its greenhouse gas emissions by 26 per cent below business as usual projections, and by up to 41 per cent with international support. As about 80 per cent of Indonesian emissions are a result of forestry and agriculture, these sectors are where Indonesia is planning to cut emissions to achieve the target. In May 2010, Indonesia signed a Letter of Intent with Norway to undertake measures to reduce its emissions from deforestation and forest degradation. Under the agreement, Norway will provide one billion dollars over five years to assist efforts to reduce emissions, including a two-year moratorium on granting new forest conversion permits. In May 2011, President Yudhoyono issued an Instruction requiring a two-year moratorium on the issuing of new licenses for development in primary forests and peat lands. A Presidential Task Force is developing Indonesia’s national plan for Reducing Emissions from Deforestation and Degradation (known as REDD+), and will monitor implementation of the moratorium. REDD+ can include activities that maintain and increase carbon stocks, such as low impact logging and tree planting, as well as efforts to reduce deforestation.

Indonesia has about 20 million hectares of peat swamp forests, which contain some 40 billion tons of carbon. Peat swamps are areas where the water table is at or above ground level for most of the year. Leaves, sticks and dead animals falling into the swamp do not rot due to the acid conditions, and build up as soil organic matter which can reach more than ten metres in depth. As the pulpwood and oil palm industries seek to expand operations in Indonesia today, there are few available areas of mineral soils which haven’t already been cleared for agriculture or are reserved for permanent forests. Peat swamps offer some of the few areas where companies can obtain obtain permits to convert large contiguous areas of forest into agriculture. But clearing and draining peat soils releases about 70 tons of carbon dioxide per hectare per year. Whether or not Indonesia can revise its plans to clear and drain its remaining peat forests is yet to be seen.

Although the Indonesian president made a clear commitment to reduce greenhouse gas emissions, the ministries of forestry and agriculture and the industries which they serve lobbied successfully for the right to continue to clear forests during the moratorium period if in principle permits for forest conversion had already been issued. Commentators have noted that in many districts such permits already cover most of the available forests. As an alternative to reducing deforestation, the forestry department is planning to plant a billion trees as a way to absorb carbon dioxide. However, it takes decades for the carbon released into the atmosphere by clearing a forest to be drawn down again by the trees in a plantation. The simplest way for Indonesia to reduce greenhouse gas emissions is to stop deforestation, and to force plantation expansion to take place on lands that have already been cleared. There are signs that industry is starting to move in the right direction.

The simplest way for Indonesia to reduce greenhouse gas emissions is to stop deforestation, and to force plantation expansion to take place on lands that have already been cleared.

Industry takes the lead?

Following a campaign by Greenpeace targetting its international consumers, including Unilever and Nestle, in February this year, Golden Agri Resources (GAR), one of the largest oil palm plantation companies in Indonesia, owned by the conglomerate Sinar Mas, announced that it will no longer convert peat forests and will only establish oil palm plantations on areas which contain less than 35 tons of carbon per hectare. If implemented, this means the company will not clear degraded secondary forests, and will limit its plantation establishment to existing agricultural areas or grasslands. While it remains to be seen if the company can abide by its commitment (it made a similar promise in early 2010 which was immediately broken) it is helpful in showing government and industry that companies are willing to give up on expanding the agricultural frontier, and can leave the country’s remaining rainforests and peat forests standing.

GAR’s accouncement included a commitment to respect the rights of indigenous peoples, and to identify and protect high conservation values before establising plantations, which are requirements of the voluntary international standard for oil palm, the Roundtable on Sustainable Palm Oil (RSPO).

The pulp and paper industry is also causing massive greenhouse gas emissions as it clears peat forests and drains peat soils, especially in the provinces of Riau (see article by Silvia Irawan in this edition) and Jambi in Sumatra. As with the oil palm industry, peat forests are the only areas available where pulp and paper companies can get big, contiguous blocks covering tens of thousands of hectares. Asian Pulp and Paper, which is owned by the same conglomerate as GAR, has so far refused to give up on its plans to clear peat forests and drain peat soils. It is also taking over community lands without the consent of communities. The other major pulp and paper company in Indonesia, APRIL, is also clearing deep peat to plant Acacia pulpwood plantations. Both companies are attempting to develop REDD projects to avoid emissions from deforestation, but these efforts appear to be little more than attempts to green the companies’ images, given the massive ongoing emissions both firms create by clearing forests and draining peatlands.

Forest peoples are the best forest managers

Indonesia’s forests are home to more than 50 million people, most of whom are members of indigenous peoples who continue to practice systems of forest management that maintain forest health and diversity. Recent studies by the University of Illinois in a dozen tropical countries consistently demonstrate that where communities have management control, their forests hold more carbon and biodiversity and generate greater revenue into the local economy than when forests are managed by governments. Indonesia’s efforts in recent decades to develop forestry industries and convert forests for oil palm plantations have come at enormous cost to its indigenous communities, who are still treated by the forestry department as illegal squatters on state land. The government’s commitment to reduce emissions from deforestation may be the best chance in decades to get it to respect community rights.

The government’s commitment to reduce emissions from deforestation may be the best chance in decades to get it to respect community rights.

Some of the most complicated issues that will need to be addressed for REDD+ to be effective involve forest tenure. The forest zone designated by the Ministry of Forestry covers 70 per cent of the land area of Indonesia. Forestry law in Indonesia recognises private forests and state forests, and requires the Forestry Department to establish which forest areas are burdened with rights before determining the boundaries of the State Forests. In practice, such deliniation has almost never happened, and the Forestry Department has assumed that all forests are State Forests, and that local communities living in these areas or using the forests are illegal. Permits for industrial logging and plantation development have been handed out over the last three decades covering tens of millions of hectares of forests. The impacts on local communities dependent on forests have often been severe, with loss of livelihoods, and criminal prosecution for accessing their customary resources.

The international framework for REDD+, which the Indonesian government has agreed to follow, requires REDD+ developments to respect the rights of indigenous peoples, including their right to give or withhold their consent to planned developments that may affect them, called Free, Prior and Informed Consent (FPIC). So, although forestry developments to date have ignored or violated the rights of local communities and indigenous peoples, there is a commitment from the government for REDD+ to be developed in a different way.

Whether or not this commitment in principle can be put into practice remains to be seen. Since 1979, the Indonesian government has imposed a system of local government on indigenous peoples and local communities regardless of their own systems of decision-making and local rules and regulations. In many communities, due to decade of impositions by the State, the traditional systems of Adat, or custom, are weak. The principle of Free, Prior and Informed Consent includes the right of communities to chose which institutions they will use to discuss and negotiate with outsiders. Indications from other sectors where the right is respected are that communities may choose a hybrid of traditional institutions, government systems and respresentatives, which these days are elected by the community rather than being appointed.

In early 2011, the Ministry of Forestry completed research showing that there are more than 25,000 villages within Indonesia’s forest zone. The overall population of these villages is probably in the range of fifty million people. Small as it may seem, admitting that communities live in the forest zone is a major step forward by the government. Human rights and community support groups hope to turn this acknowledgement into positive steps to recognise the rights of those communities to manage their customary forests. With international donors requiring respect for human rights, Indonesia’s commitment to reduce emissions from deforestation may lead to greater livelihood security and poverty reduction for tens of millions of Indonesia’s rural poor.

Patrick Anderson (patrickanderson1960 [at] gmail [dot] com) is Policy Advisor with the Forest Peoples Programme. He has lived in Indonesia for ten years, and works closely with Indonesian organisations concerned with forests and community rights.


Community engagement – Don’t ignore REDD’s impacts on communities!

Brihannala Morgan – Inside Indonesia

25 July 2011

Consider it from the businessman’s perspective: It all makes so much sense. The rainforest, vital for people, biodiversity, and global climate, is being cut down to make money. But what if he was able to pay good money to those same people who are cutting down the forest to keep the forest intact? What if he was able to convince those people (and companies and governments) who insist that they care about stopping climate change to actually pay those costs? As a bonus, he can take a few cents out of every transaction, and make a fortune. Sounds like a great deal.

Now consider it from the perspective of a villager in Central Kalimantan: It looks a bit more complicated. Farming much as his parents farmed, he learns that the fallow field he has been clearing in his family’s secondary forest has been sold, and that he is no longer allowed on it. He has few options to respond legally, since he never had formal legal rights to the land, though his family has used it for generations. The police may even warn him that he is no longer allowed to touch the trees. It’s not that someone else is going to cut them down. Some foreigners want the forest to stay the way it is, and they are paying the government to make it so. He may get something in return, but the government or the company taking over his land has determined his compensation for giving it up. Most likely, they have never even consulted him.

REDD in the community

At the extreme, this is the local reality for REDD (Reduced Emissions from Deforestation and forest Degradation). In 2009 and 2010 I investigated 23 privately sponsored REDD projects in Indonesia. Investors hope to sell carbon credits to individuals and companies wanting to reduce their personal ‘net’ carbon emissions or green their image. I looked at how these international projects engage with communities living in or near REDD project areas. I wondered whether it is possible for REDD projects to engage indigenous and local communities using fair and just mechanisms to share benefits of REDD projects, with their ‘Free Prior and Informed Consent’, or if that is a pipe dream in the context of the international carbon market.

Most private REDD project developers, including Indonesian and foreign individuals and companies, accept that it is necessary to engage communities in REDD projects. Without governments using REDD credits to fulfill their CO2 emission reduction obligations, individuals and companies are the only confirmed buyers for forest carbon credits. In this voluntary market, additional benefits like biodiversity conservation and community development are also marketable commodities. Ecosystem Marketplace, an American-based industry research group, finds that the community development co-benefits promised by REDD project developers are highly attractive to offset buyers.

While raising prices for carbon credits is an important incentive, most REDD project developers also consider it important to engage local communities to help protect the carbon at the core of their investment. They hope that providing forest-dependent communities with acceptable alternative livelihoods will keep them from cutting down forests (and hence negating any carbon storage from the project), or moving forest-destroying activities to other areas where the forest is not protected. As one American project developer working in Central Kalimantan put it, ‘We cannot just throw them all in jail, so we need to find a way to engage with them.’

Community engagement

Project developers try to ‘engage’ communities in REDD projects in four significant ways: through services, jobs, cash and (in a few rare cases) land rights. All of the projects surveyed claim to create new jobs or alternative livelihoods to enable communities to live without relying on the forest or on forest products (with some small exceptions, generally for handicraft sale). The most common jobs that projects provide are as forest wardens to protect and monitor forest conditions during the project’s lifespan. Other common alternative livelihoods include support for developing and marketing non-timber forest products like rattan and sandalwood. Yet these alternative livelihood provisions were usually developed with little or no input from the community, and often create jobs for only a small percentage of the people whose livelihoods they displace. It is unlikely that these projects will provide sustainable and fulfilling alternatives to traditional local practices in the long run.

Of the 23 projects I investigated, nine projects planned to provide services like health clinics and primary schools. These services were often combined with gifts to each family or individual to generate good will for the project (laptop computers, solar panels, cook stoves, etc). The Rimba Raya project in Central Kalimantan, for example, focused on gifts rather than engaging the communities in other ways to compensate communities for losing access to their land. Providing services as part of a project begs the question of whether REDD project developers will withhold classes or health services if communities continue using the forest as before, or cut forest elsewhere.

Nine projects paid cash to communities in return for communities’ promises to stop using the forest for food or fuel. Five of the 23 projects surveyed explicitly mentioned a Payment for Environmental Services model, paying communities in cash to conserve resources that provide ecosystem services. For example, a project may pay upstream communities to conserve a forest in order to protect downstream communities from flooding. Projects may pay per individual or per family, payments to the community as a whole, as cash or a bank ATM card. Micro-credit schemes, a variant on cash payments, were proposed by four projects. Communities may take out small loans to support local projects to provide alternative livelihoods.

Only two projects – one in the Danau Sentarum area of West Kalimantan and another in Aceh – prioritise rights of communities within their project areas. Both of these projects use participatory forest management techniques, designing the REDD project on traditional land use patterns within village customary forest areas, and developing access plans with communities based on their traditional lands rights and management practices. Community members are developing access rules and restrictions themselves, and community groups will manage forest blocks. Both of these projects’ management plans emphasise community members’ ‘Free Prior and Informed Consent’.

Community engagement saves money – and costs money

Project developers understand that communities who depend on the land and forests will continue to make use of otherwise forested land for farming and to gather forest products, unless they are given a compelling reason to stop. Yet engaging the community costs money. The more effort project developers invest in community engagement and benefits, the less profit they are likely to make. Yet project developers have quickly discovered that sharing benefits with communities may save them money in the long run.

Providing jobs, services, and cash payments are quick and relatively cheap compared to actually recognising communities’ continuing land rights in REDD project areas. But they may be the most cost effective way to increase projects’ ability to save forests. Both projects that made a point of supporting community land rights have found that building community-led projects takes a lot of time and trust. These projects’ developers also had trouble securing initial funding, since they cannot guarantee marketable credits as quickly as other projects. These community-based projects focus on passing profits to the community, so project developers do not profit themselves.

Most carbon credit buyers do not know the difference. Cheap carbon credits are more attractive since they appear ‘cost effective’ on paper. There are no minimum standards for community engagement in the voluntary carbon credit market and most people and companies who purchase carbon credits either do not care about communities whose livelihoods and forest uses are displaced by REDD projects, or do not have the experience to judge what is better or worse in terms of community co-benefits. Such information is also not easily available for those who do care.

More insidious and systemic, project developers are able to market REDD carbon credits while providing only minimal compensation to forest communities because no laws or regulations require them to do more. Only about two per cent of traditional communities in Indonesia have formal legal rights to their land and therefore have the legal right to decide if they want to be part of REDD projects approved by district government agencies, or demand equitable benefits sharing. Project developers are able to work directly with the local government, and engage community members as much or as little as they want.

REDD projects fail communities

Trends in Indonesian REDD project development are emerging. While a few smaller projects attempt to base REDD in community land rights and Free, Prior and Informed Consent, the vast majority of projects aim primarily to move ahead quickly and make profits for investors and developers. REDD projects systematically fail to include Indigenous Peoples and affected community members in any meaningful fashion. REDD incentives reward project developers for moving projects forward fast, and cutting corners on involving affected communities or sharing benefits with them.

None of the projects surveyed ignore communities completely, but they attempt to buy community compliance with promises of jobs, gifts, and money. Impacts of this type of alienation have been seen time and time again, whether the perpetrator is an extractive industry, a national park, or a climate mitigation project. Cultures are destroyed when communities are no longer able to use the land for traditional hunting, farming, and spiritual practices. REDD projects will also start a vicious cycle of risk for communities dependent on an unstable global carbon market, far beyond local communities’ control.

If REDD is to become a real tool for sustainability and conservation, communities themselves must be able to decide about and manage REDD projects. Only when land rights are ensured before the development of a REDD project, and communities are allowed to make decisions for themselves, can REDD fulfill its promises to reduce emissions from deforestation while sustaining forest communities.

Brihannala Morgan (brihannala [at] borneoproject [dot] org) is the executive director of The Borneo Project. She has lived in Indonesia for nine years, and has formerly worked for the Center for International Forestry Research and the Rainforest Action Network. The survey discussed in this article was part of her Masters thesis from the University of Michigan.