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Indonesia’s Ambitious Forest Moratorium Moves Forward

Beth Gingold — Thu, 09 Jun 2011 15:49:11 -0400

A summary of key elements, and unanswered questions, in Indonesia’s recent moratorium on new forest permits.

On May 20, 2011, Indonesian President Susilo Bambang Yudhoyono signed a Presidential Instruction (“decree”) putting into effect a two-year moratorium on issuing new permits for use of primary natural forest and peatland.

The highly anticipated moratorium is part of a broader $1 billion Indonesia-Norway partnership to reduce emissions from deforestation and degradation (known as REDD+).

According to government statements, the decree applies to between 64 and 72 million hectares of primary forest and peatland, shown in a map attached to the decree. The decree highlights governance as a key area for improvement, critical in addressing the underlying causes of forest loss. The President calls on ministries and agencies to work together nationally and locally to implement the moratorium.

It is difficult to assess the likely effectiveness of the moratorium in achieving its goal of reduced greenhouse gas (GHG) emissions, since the decree includes a number of exemptions (such as cases in which licenses are pending) without providing details on the exempted areas’ location or size.

In order for the public to fully assess the impact of the decree, the government would need to make all exemptions public in such a way that a quantitative spatial analysis can be independently prepared and published. Only with this information can the various partners in Indonesia’s efforts to reduce GHG emissions see whether the spirit of the decree is being met.

In the meantime, this article provides a summary of how key elements are addressed, identifies unanswered questions to be further explored once the digital maps and additional information are publicly available, and suggests priority actions for the two-year moratorium period that can produce lasting benefits to Indonesia’s forests and the people and businesses that depend on them.

The moratorium makes progress in some key areas…

Despite stiff opposition from advocates of business as usual, a moratorium has been signed and issued.
It highlights the importance of improved governance.
It recognizes the importance of ministries and agencies working together to make implementation of the decree successful.
It includes a map of areas that should not be deforested. The representation of this decree in map form makes it easier for stakeholders to carry out monitoring and support law enforcement.

…but some important issues remain:

Areas of secondary forest are not covered. These are widespread and valuable for carbon, biodiversity and livelihoods.
There is no mention of the Minister of Mines and Energy in the decree, and it is not clear how permits for non-exempted mining activities (i.e. coal and minerals) will be addressed. The Ministry of Agriculture is also not mentioned in the decree.
Community-based forest management and other sustainable activities that do not result in forest conversion are not included in the exemptions.
No information is provided on the extent and location of existing permits that are exempted from the moratorium.
It is unclear what will happen with the many permits that may have been issued illegally.

What is addressed in the Presidential Decree?

The Presidential Decree gives instructions to specific government agencies regarding a two-year suspension of new permits on areas of primary natural forest and peatland shown in an attached “Indicative Map of New License Suspension” (Indicative Map).

The Presidential Decree addresses key elements in the following ways:

Objectives: Does the preamble clarify the objectives of a temporary suspension of new permits to achieve long term improvements in land use planning and permitting processes

The decree itself states that the objective is to balance economic, social, and cultural development and efforts to reduce greenhouse gas emissions from deforestation and forest degradation. The explicit inclusion of governance is notable and should be applauded, as this starts to get to the root causes of Indonesia’s high rates of forest loss. It will be especially important in the coming months to reach agreement on what specific improvements in governance are needed most and how these improvements can be achieved.

Definitions: Are terms clear and consistent with achieving the stated objectives

The decree does not include definitions of terms. The decree refers to primary natural forest and peatland, but not secondary forest. Large areas of secondary forest, with high carbon content and important biodiversity, will therefore likely not be covered by the decree.

The terms primary natural forest and peatland have not been defined in Indonesian law. In this context they have been interpreted as descriptions of vegetative cover and soil characteristics, as distinct from legal designations. The decree also refers to legal designations such as conservation forest, protected forest, and production forest, which have been previously defined in Indonesia’s 1999 Forestry Law. Media reports suggest there is ongoing confusion regarding whether or not primary natural forest refers to a legal designation.

Data: Are the data and maps that will be used or created to determine the areas impacted by the moratorium accurate and adequate

There is insufficient information on the data and methods used to develop the Indicative Map, and indeed, on who produced it. This map shows peatland and primary forests, yet there are no definitions of these terms. It is also not clear which areas are under which forms of protection, and whether any information on existing or already exempted permits was used to generate the map. Crucially, no information is provided on the extent, location, and status of existing and exempted permits.

A more detailed analysis can be conducted only once the digital maps, source data layers, associated methods, and accurate information on the extent, location, and status of existing and already exempted permits, are made publicly available.

Permits: Which permits are included and excluded from the moratorium?

The moratorium applies to “new permits” (e.g. for the clearing of land to start oil palm, timber or other large estate crops) in the areas specified by the Indicative Map, with a considerable number of notable exemptions, including those for:

forest area release and use permits that have been approved in principle by the Ministry of Forestry;
geothermal, oil and gas, electricity, rice and sugar cane development;
extension of existing and valid forest use permits (e.g. logging permits); and
ecosystem restoration concessions.

No exemptions are provided for the multiple types of use or management rights that can be issued to communities, even though community based forest management and monitoring has been recognized as an effective strategy for achieving sustainable forest management and balancing economic, social, and environmental development goals.

The types of permits which will not be exempted include loan use and business permit use for timber in natural forests issued by Ministry of Forestry, lease rights and use rights issued by the National Land Agency, and recommendations for and location permits issued by Governors and Regents/Mayors. There is no mention of exemptions or inclusion of forest use for mineral or coal mining.

The process for determining the validity of existing forest use permits is unclear. It is also not clear what the implications are for companies that have existing location permits (which are exempted) but not business use permits (called HGU permits). These existing permits may cover millions of hectares (an estimate from Daemeter Consulting is at least three million hectares).

Agencies: Which government agency is responsible for producing the relevant maps associated with the moratorium

Instructions to suspend issuing permits apply to all areas in the Indicative Map. This applies to the Ministry of Forestry, National Land Agency, as well as to all Governors, Regents and Mayors. The Minister of Interior is instructed to coach and supervise Governors and Regents in implementation.

For new permits that are exempted and may still be issued inside the Indicative Map areas, the Minister of Environment is instructed to reduce emissions of the business activities by issuing environmental licenses. It is assumed to mean that these licenses will restrict allowable GHG emissions.

The Ministry of Forestry is given primary responsibility for reviewing and updating the Indicative Map and reporting to the president at least once every six months, in cooperation with the Head of the National Spatial Planning Coordinating Agency, Head of the Coordinating Body for National Survey and Mapping, Governors, Regents, Mayors, and the Head of the REDD+ Task Force. The Head of the REDD+ Task Force is instructed to monitor implementation and submit a report to the president.

This updating process does not only have consequences on the physical delineation of primary forest and peatlands, it also moves the licensing authority on non-forested lands (other usage areas) to the Ministry of Forestry as stated in Section Four of the decree.

This decree does however involve many of the important ministries and agencies and specifies their role and the need to work together. This is an important step forward in managing lands and forests more efficiently and sustainably. This is also consistent with indicators of ‘good governance’.

Process: What processes will be put in place regarding reviewing permits, cooperation and coordination of government agencies, increasing transparency and participation, making maps and spatial data publicly available, and settling disputes

The decree includes some instructions to agencies regarding improving governance. For example:

The Minister of Forestry is instructed to: (1) improve policies on issuing permits on the use of timber in natural forest areas and (2) improve management of lahan kritis (“critical” or degraded forest) through ecosystem restoration concessions.
The Minister of the Environment is instructed to improve governance of business activities within the areas shown on the Indicative Map through environmental permits.
Multiple agencies are instructed to coordinate the map revision process and provide information to monitor and report to the President on a regular basis.
The Head of the National Spatial Planning Coordinating Agency is instructed to accelerate the consolidation of the Indicative Map into the spatial planning map revision as part of land use governance reform, in cooperation with other agencies. This could ensure that primary forest and peatland that is not already under some form of legal protection is appropriately zoned through the spatial planning process, with the status change lasting beyond the two-year moratorium period.

The decree does not make any specific provisions for reviewing or revoking permits, increasing transparency and participation, or making maps and spatial data publicly available.

The omission of an exemption for community forestry permits—when many exemptions were made including for industrial activities— is a major weakness in the decree.

Addressing Unanswered Questions

An effective moratorium would help to improve land use planning and permitting processes that contribute to Indonesia’s development goals and respect local rights, continuing beyond the two-year suspension period.

Important unanswered questions include:

What specific areas are included in the moratorium and what data and methods were used to identify them? What are the extent, location, and status of existing and already exempted permits? How will this information be made publicly available?
What instructions will be given to the Minister of Mines and Energy?
How will provisions be made to allow legal community-based forest management during the two-year period, and to strengthen local management options in the future?
How will government agencies interpret and by what process will they implement the instructions provided regarding ‘improving governance’?
What additional actions will be taken regarding the governance of areas not identified on the Indicative Map?

The Indonesian government can begin to help answer some of these questions by ensuring that a digital version of the Indicative Map, source data layers, associated methods, and accurate information on the extent, location, and status of existing and already exempted permits, are made publicly available.

What are additional priorities for the two-year moratorium period?

In addition, as acknowledged by the government, achieving these goals will require taking many actions in the two-year moratorium period that are not addressed in the Presidential Decree. This includes putting in place REDD+ policies such as improved land use planning and permitting processes, reviewing or revoking illegal permits, encouraging expansion of agriculture and timber plantations onto degraded land instead of forested land (e.g. sustainable palm oil expansion on degraded land) and developing incentives for existing permits on forested lands to be swapped for permits on degraded lands (e.g. voluntary land swaps).

The main purpose of this decree, as identified in a previous article, is to create time for the government, business and civil society to develop and implement changes that will lead to more sustainable land management while stimulating economic growth, such as:

Comprehensive, accurate, and regularly updated spatial data and maps on land cover and forest type, land use, land status, and land rights—including permits—made publicly available through easily accessible websites.
Revised land use plans (zoning) such that appropriate natural forest and peatlands are classified for conservation or sustainable management and appropriate degraded lands are classified for agricultural or other uses, through a process that incorporates best practices in participatory spatial planning.
Transparent and participatory processes for reviewing, revoking, reissuing, or relocating permits that are illegal or are in areas that are inappropriate for development, incorporating best practice stakeholder engagement and including the free prior and informed consent of relevant communities.

Whether this Presidential Decree contributes to achieving the goals of the Indonesia-Norway agreement on REDD+ is highly dependent on how remaining unanswered questions are addressed and what additional actions the Indonesian government takes—with the participation of industry and civil society—during the two-year period.

Restoring the World's Forests While Feeding the Poor

Nigel Sizer — Wed, 18 May 2011 09:35:43 -0400

Trees are being cut down for farming, but a new study shows that a lot of land already cleared could be used instead.

This piece originally appeared in The Guardian.

“We are one shock away from a full-blown crisis,” stated Robert Zoellick, the president of the World Bank, at a recent meeting of the bank and the IMF. He was referring to a critical increase in poverty, resulting from the escalating cost of food. The UN’s food price index has risen 37% since March 2010. Basic cereal prices are up 60% over this period. Wheat is up 63%, and maize 83%.

Roughly 1 million people slide into extreme poverty for each 1% rise in global food prices, the bank’s analysts calculate.

Availability of land for farming is a key factor in long-term food supply and prices. As the human population expands, the remaining forests, wetlands and other fragile ecosystems will come under greater threat as farmers push further into the frontiers of the Amazon, Borneo and the Congo, as well as intensifying production in North America, Europe and beyond. Feeding billions more and feeding the poor properly will be possible only if better use is made of available land.

About half the world’s forest has been cleared for farming or seriously damaged by logging, fires, drainage, pollution and other ills. But where forests once grew they can grow again.

A new analysis, carried out by the World Resources Institute, South Dakota State University, the International Union for Conservation of Nature and the Global Partnership on Forest Landscape Restoration, found that more than 1bn hectares of land where forest once stood is now degraded, and could be put to more productive uses. This is an area larger than the entire United States.The World from a Forest Landscape Restoration Perspective

Some of this degraded and underused land could be used for food and tree crop production without cutting down another square inch of standing forest. In order to make this possible, governments and development agencies need to invest in more careful planning, incentives, investment and controls. Special care is needed to ensure that local communities that may be using parts of the land are respected and fully involved in decisions to intensify use or to restore forest.

The remainder of the 1bn hectares could be restored to forest and woodland. Once restored, it will also play a greater role in supporting nutrient cycling, reducing erosion, sequestering carbon,managing water and further supporting food production across the wider landscape downstream.

In Indonesia, the World Resources Institute, together with a local partner, Sekala, is putting these ideas to the test by working with the Indonesian government, communities and industry to shift new oil palm estates on to already cleared and burnt land instead of cutting species-rich rainforest. Indonesia has rapidly become the world’s largest producer of palm oil. The government plans to expand oil palm plantations by about a million hectares a year to meet surging global demand for vegetable oil and biofuel. Until now, it was assumed that most of this expansion would result in the clearing and burning of precious rainforest. With more careful mapping and analysis, a new vision has emerged. Top officials are proposing new plans to use degraded land for the expansion of plantations. Mapping has shown that there is more than enough such land potentially available to meet demand.

Brazilian groups are looking to the Indonesian experience as they struggle to find space for that country’s expanding beef, soya and sugar cane enterprises. Through a careful process of defining degraded land, mapping it, and consulting with existing landowners and local communities, plans and policies encourage a shift in future investment to this kind of land and away from the forests of the Amazon.

Development agencies, charities, national governments and business should transfer some of their attention to the opportunity of restoring already cleared and degraded land to more productive use. This needs to be done equitably and should be driven by the local communities, who have the most to gain from the long-term potential of these efforts to contribute to enhanced food production, ecosystem services and poverty reduction.

Global Well-Being: Rooted in the World's Forests

Jonathan Lash — Tue, 26 Apr 2011 13:25:40 -0400

This piece originally appeared in the Washington Post Environmental Leadership supplement on April 20, 2011, and is reposted with permission.

This year, 2011, has been declared the International Year of Forests, and while a few bright spots exist, forests today face a host of challenges. Mounting pressures from agricultural expansion, rapid economic development, and growing demand for products are leading to deforestation and degradation of forests at alarming rates. The expanding global population— expected to reach 9 billion people by mid-century—is increasing demand for food, encroaching on forests and the value they hold.

Globally an estimated 1.5 billion hectares have already been lost to deforestation. Countries like Brazil and Indonesia face critical situations as millions of acres of rainforest are felled or burned each year to make room for cattle ranches, soybean and oil palm plantations, and the production of pulp and paper. Closer to home, the United States Forest Service predicts that more than 30 million acres of forests in the southern U.S. could be lost to suburban sprawl in the coming generation.

Forests, which cover one-third of the world’s land, are a precious natural resource. They offer food, shelter and income for around a billion of the world’s poorest people. More than half of land-based animal and plant species live in forests. And trees absorb vast quantities of carbon dioxide from the atmosphere and protect vital freshwater sources.

The challenges are clear, but solutions have been harder to find. Certainly there is no single magic bullet, but evidence is growing from remote corners of the world— Colombia, Brazil, Niger, Nepal, Indonesia, and beyond— that offer reasons for hope and hold the promise for further success.

In Niger, West Africa, tree cover has increased dramatically across a vast swath of the southern landscape. This turnaround came after political leaders and forestry officials began to recognize the property rights of local farmers to manage trees on their land. Now, forests are being restored, erosion is being reduced, water tables are rising, soil is becoming more fertile, and crop yields are increasing.

In Latin America, some governments, including those in Colombia and Brazil, have been handing back vast forest reserves to the descendants of their original owners, including indigenous Amerindians and other local communities. Evidence is emerging that forest cover is preserved when coupled with ancestral land rights.

After decades of deforestation, Nepal has also begun to reverse course, especially in areas where local “community forests” have been established. Community forests account for approximately 20 percent of forested land in Nepal, where decision- making is accomplished locally by empowered villagers and supported by the national government. Over 12,000 Community Forest User Groups have engaged local communities in the business of protecting, rejuvenating and managing forested landscapes to produce fodder, wood and other products to use and sell.

Increased rights and recognition of land tenure can be a win-win, benefitting both people and forests.

Local control and decisionmaking is the common thread connecting these stories. Nearly a decade ago, the authors Andy White and Alejandra Martin proposed that the recognition of indigenous rights and community ownership offer “an historic opportunity for countries to dramatically improve the livelihoods of millions of forest inhabitants.” While there is still a long way to go to fulfill this vision, growing evidence suggests that increased rights and recognition of land tenure can indeed be a win-win, benefitting both people and the forests on which they depend.

Creative thinking around governance is also playing a hand in one of the best and most innovative opportunities to restore forests. In West Kalimantan, Indonesia, the World Resources Institute is working with local partners to encourage the restoration and reuse of degraded lands, including for palm oil production. By some estimates, more than half of oil palm expansion in Indonesia since 1990 occurred at the expense of forests. This project, which has growing support from the Indonesian government, would help divert some planned oil palm plantations away from natural rainforests and toward degraded lands instead.

Recent analysis by WRI and its partners shows that about three billion acres worldwide—an area larger than Brazil—of previously forested land ~~have become deforested or degraded over the last decade~~ provide opportunities for restoration. While some of these areas could be restored as healthy forests, other areas could be converted to food production. This, in turn, can bring a multitude of benefits, such as creating jobs, easing pressure to clear more forests, reducing carbon emissions, and protecting biodiversity.

While none of the actions alone is enough, together they offer strategies that would help restore and protect forests for future generations. Governments, international development agencies, and nongovernmental organizations—together with local communities—must now build on these approaches and expand the number of success stories in the years to come.

Indonesia’s Moratorium: An Opportunity for Forests and Industry

Beth Gingold — Fri, 22 Apr 2011 14:57:49 -0400

A highly anticipated two-year moratorium on new forest conversion permits could bring fundamental improvements to forest and land management in Indonesia.

Baca dalam Bahasa Indonesia | Read in Indonesian
Download PDF versi Bahasa Indonesia (PDF, 4 pages, 516 Kb)

In mid-2011, Indonesian President Susilo Bambang Yudhoyono is expected to sign a Presidential Decree for the implementation of a two-year moratorium on issuing new permits for conversion of natural forest and peatland. This planned moratorium was announced in May 2010 as part of a $1 billion Indonesia-Norway partnership agreement on reducing emissions from deforestation and degradation (known as REDD+).

An effective moratorium will allow time for the government—with participation from industry and civil society—to develop improved processes for land use planning and permitting, create information systems and build institutions that can achieve Indonesia’s ambitious low carbon and agricultural development goals. These goals include both reducing greenhouse gas emissions by 26 percent and doubling palm oil production by 2020.

What is “conversion?”

Which permits are included in the moratorium will depend on how “conversion” is interpreted and defined. Conversion has been defined in different contexts to refer to a physical change in land cover (i.e. from forested to non-forested), to include a change in land use (i.e. from forestry to agriculture) or to a change in legal status (i.e. from inside to outside the Forest Estate). According to international definitions, timber harvesting or logging is not considered to result in deforestation unless it is followed by a long term change in land use.

Implementing an effective moratorium will require a well-deliberated, clear Presidential Decree that is consistent with Indonesia’s development goals, results in cooperation between government agencies and provides public access to relevant information. A several month delay has allowed time for the government to address concerns raised by industry and to reconcile several draft decrees submitted by multiple national government agencies. The drafts contain different interpretations of how the moratorium should be implemented, with different implications for forests and people.

The following analysis of the content of the publicly available draft presidential decrees identifies key elements of the expected decree and recommends priority actions for the two-year moratorium period that can produce lasting benefits to Indonesia’s forests and the people and businesses that depend on them.

What can an effective moratorium accomplish?

An effective moratorium would produce improved land use planning and permitting processes that achieve Indonesia’s development goals and respect local rights, continuing beyond the two-year suspension period.

The Current State of Land & Permit Allocation

Current processes have resulted in inefficient and inequitable land and permit allocations that are inconsistent with Indonesia’s development goals. For example:

In many areas, land that is not forested is legally classified as “forest” and therefore unavailable for agricultural expansion, while forested land is legally classified as “non-forest” and therefore at risk of conversion.
According to the Indonesian Palm Oil Producers Association, half of all existing concessions cannot be utilized because the land is inappropriate for plantations or inhabited by people who may claim the land as theirs.
Timber and oil palm plantations have been associated with costly ongoing social conflicts when expansion has occurred without respecting local rights.
Permits often overlap and have been issued in high conservation value forest and protected areas.

A common misperception reflected in the media is that the moratorium is designed to immediately halt all deforestation and prevent the expansion of industries such as palm oil, timber, and mining. However, according to the text of the Indonesia-Norway agreement, the moratorium is a two-year suspension of new permits for the conversion of natural forest and peatland.

Revoking existing permits—many of which may be illegal—appears to be outside the scope of the proposed moratorium. In addition, since the moratorium would only apply to new permits that result in conversion of natural forest or peatland it will likely not include selective logging permits or permits for oil palm cultivation in other areas.

The two-year period in which no new forest conversion permits are issued would provide the time for the Indonesian government to begin putting in place REDD+ policies such as improved land use planning and permitting processes, reviewing or revoking illegal permits, encouraging sustainable palm oil expansion on degraded land, and developing incentives for voluntary land swaps.

What are main elements of the anticipated Presidential Decree?

As of February 2011, at least three publicly available drafts had been submitted to the Indonesian president by different national government agencies.

All of the drafts contain the following:

Two-year suspension of new permits related to forest conversion.
Instructions to specific government agencies to suspend activities on issuing new permits related to natural forest and peatland conversion.
Exemptions for existing legal permits and activities in the national interest (e.g. energy generation).
Reference to a map that will guide implementation and be updated on a regular basis. These maps are not available for analysis, and may not yet exist.

However the draft decrees also differ substantially. The impact of the forthcoming Presidential Decree will depend on how it addresses the following key elements:

Objectives – Does the preamble clarify the objectives of a temporary suspension of new permits to achieve long term improvements in land use planning and permitting processes?
Definitions – Are terms clear and consistent with achieving the stated objectives? Key terms which have not yet been defined include: conversion, natural forest, primary forest, secondary forest and peatland.
Data – Are the data and maps that will be used or created to determine the areas impacted by the moratorium accurate and appropriate? Appropriate data will depend on definitions, but at a minimum would include information on land cover and forest type, land use, legal status, and land rights—including but not limited to permits.
Permits – Which permits are included and excluded from the moratorium? This will determine the project development options of companies, communities, and local governments, each with different economic, environmental, and social costs and benefits. If the moratorium exempts existing “legal” permits there will need to be a clear definition or process for reviewing legality.
Agencies – Which government agencies are given instructions, and which government agency is responsible for producing the relevant maps associated with the moratorium? Cooperation, coordination, and commitment to transparency by all relevant agencies will be critical to the success of the moratorium.
Process – What processes will be put in place regarding reviewing permits, cooperation and coordination of government agencies, increasing transparency and participation, making maps and spatial data publicly available, and settling disputes? The current lack of easily accessible public data on the appropriate national and sub-national scales is a major barrier to transparent and participatory policy-making.

What do the differences between the draft decrees mean?

Recent media reports reflect ongoing confusion regarding the objectives, content, and implications of the various draft decrees. Much of the public debate regarding the options has focused on how much and what type of land will be affected by the moratorium. Questions include: Will it apply to secondary or “degraded” forest and shallow peat (peat less than three meters deep)? Will forested land outside the “Forest Estate” (Kawasan Hutan) be included?¹

These options have significant implications for forests, people, and climate change. According to government statistics:

58 percent of forests (58 million hectares) in Indonesia are secondary forests.²
80 percent of peatlands (17 million hectares) in Sumatra, Kalimantan, and Papua are shallow peat.³
8 percent of Indonesia’s forests (8 million hectares) are located outside of the “Forest Estate.”⁴

Since none of the drafts contain definitions or provide the maps and data that the government will use during implementation, it is unclear how much and what type of land will be affected by the moratorium. The government has suggested that the moratorium could apply to 64 million hectares, although this estimate likely includes forested areas that are already under some form of protection.

An important factor that has received much less media attention is which permits will be included in the moratorium. Since the moratorium is only a suspension of new permits for conversion, the area that will be affected is not the total amount of natural forest and peatland, but rather the amount of natural forest and peatland that is not already under some form of legal protection and is not already covered by existing permits.

All of the drafts exempt existing legal permits from the moratorium, which is consistent with the text of the Indonesia-Norway agreement. Some drafts refer to legal permits for specific activities including timber, plantations, and mining, while others refer only to new permits related to forest conversion. None of the drafts refer to community timber plantations or other community rights.

None of the drafts clarify the definition of a “legal” permit or provide a review process for determining legality. Likewise, none of the drafts include procedures for revoking permits or refer to existing procedures such as those which have been recently implemented by the Ministry of Forestry.

Ambiguity regarding permits—combined with a lack of accurate public data on the extent, status, and location of all existing permits issued by different agencies, levels and geographical jurisdictions of government—makes it impossible to quantitatively assess the options presented by the various drafts. However the area affected by the moratorium is significantly reduced when available data on existing permits is considered.

What are priority actions for the two-year moratorium period?

Whether the moratorium is ultimately a success depends not only on the text of the Presidential Decree, but on what the Indonesian government—with the participation of industry and civil society—accomplishes within the two-year period.

In order to achieve its ambitious low carbon development goals, the Indonesian government can use the two-year moratorium period to begin to implement the following priority actions:

Produce comprehensive, accurate, and regularly updated spatial data and maps on land cover and forest type, land use, land status, and land rights—including permits—made publicly available through easily accessible websites.
Revise land use plans (zoning) such that appropriate natural forest and peatlands are classified for conservation or sustainable management and appropriate degraded lands are classified for agricultural or other uses, through a process that incorporates best practices in participatory spatial planning.
Develop transparent and participatory processes for reviewing, revoking, reissuing, or relocating permits that are illegal or are in areas that are inappropriate for development, incorporating best practice stakeholder engagement and including the free prior and informed consent of relevant communities.

A clear, well-deliberated Presidential Decree that results in an effective moratorium on new forest conversion permits can help Indonesia “buy time” in which to implement fundamental policy changes, ensuring that there is no return to ‘business as usual’ at the end of two years. If done effectively, this will bring long-term benefits for forests and industry.

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Moratorium Indonesia: Kesempatan bagi Hutan dan Industri

Sebuah moratorium yang akan menghentikan pengeluaran izin baru konversi hutan selama dua tahun sedang ditunggu-tunggu. Kebijakan ini dapat memperbaiki tata kelola hutan dan penggunaan lahan di Indonesia.

Pada pertengahan 2011, Presiden Susilo Bambang Yudhoyono diperkirakan akan menandatangani sebuah Instruksi Presiden (Inpres) yang menghentikan sementara pengeluaran izin-izin baru untuk konversi hutan alam dan lahan gambut. Rencana pembuatan moratorium ini diumumkan bulan Mei 2010 dan merupakan bagian dari kesepakatan kerjasama antara Indonesia dan Norwegia senilai 1 milyar dolar Amerika, untuk mengurangi emisi dari deforestasi dan degradasi hutan (juga dikenal dengan sebutan REDD+).

Apa yang dimaksud dengan “konversi”?

Izin yang akan dimasukkan ke dalam moratorium sangat bergantung pada penafsiran dan definisi “konversi”. Konversi telah diartikan dalam beberapa konteks sebagai perubahan fisik suatu tutupan lahan (misalnya dari daerah berhutan menjadi daerah tidak berhutan), untuk menandai adanya perubahan dalam penggunaan lahan (seperti dari hutan menjadi perkebunan), atau untuk mengubah status legal suatu kawasan (seperti dari Kawasan Hutan menjadi Areal Penggunaan Lain – APL). Menurut definisi internasional, penebangan kayu atau “logging” tidak dianggap deforestasi apabila tidak diikuti dengan perubahan penggunaan lahan jangka panjang.

Sebuah moratorium yang efektif dapat memberikan waktu bagi pemerintah Indonesia – tentu saja dengan dukungan dari sektor industri dan lembaga swadaya masyarakat – untuk memperbaiki perencanaan penggunaan lahan dan proses mengeluarkan izin baru baik di kawasan hutan maupun areal penggunaan lain (APL), menciptakan sistem informasi yang memadai, serta membangun lembaga-lembaga yang dapat mendukung target Indonesia yang pro-growth dan pro-green. Target yang dinilai cukup ambisius ini termasuk mengurangi emisi gas rumah kaca sebanyak 26 persen dan meningkatkan produksi kelapa sawit sebanyak dua kali lipat pada tahun 2020.

Moratorium ini harus dipikirkan secara matang. Instruksi Presiden tersebut harus jelas dan konsisten dengan rencana pembangunan Indonesia. Berbagai instansi pemerintahan perlu mendukung dan bekerja sama supaya peraturan ini berjalan dengan efisien. Penundaan penandatangan selama beberapa bulan ini telah memberikan waktu bagi pemerintah untuk mempertimbangkan kekhawatiran sektor industri dan merundingkan jalur tengah atas beberapa rancangan Inpres yang diserahkan oleh berbagai kementerian dan mengandung penafsiran berbeda tentang bagaimana moratorium ini akan dijalankan. Kebijakan yang dibuat akan sangat mempengaruhi kehidupan masyarakat setempat dan kelestarian hutan.

Berikut adalah kajian dari beberapa rancangan Inpres yang dapat diakses publik. Analisa ini mengidentifikasikan elemen-elemen penting dari Inpres yang akan ditetapkan dan merekomendasikan langkah-langkah yang perlu dilakukan dalam moratorium dua tahun ini, supaya menghasilkan manfaat yang berkelanjutan bagi hutan Indonesia, masyarakat setempat dan dunia usaha yang bergantung pada sektor ini.

Apa yang bisa dicapai oleh moratorium yang efektif?

Moratorium yang efektif dapat memperbaiki proses pemberian izin dan perencanaan penggunaan lahan yang mendukung target pembangunan ekonomi nasional dan menghormati hak-hak masyarakat setempat. Diharapkan efek moratorium ini bisa dirasakan lebih dari dua tahun.

Keadaan saat ini tentang lahan dan pengalokasian izin

Proses yang dilakukan selama ini dalam pengalokasian konsesi lahan dapat dinilai kurang efektif dan adil. Pemberian izin dilihat tidak konsisten dengan target pembangunan Indonesia. Sebagai contoh:

Di banyak daerah, lahan yang tidak berhutan berstatus “hutan” atau berada dalam Kawasan Hutan sehingga tidak dapat digunakan untuk ekspansi pertanian dan perkebunan. Sementara itu, banyak lahan berhutan tapi secara hukum berada di daerah yang diklasifikasikan sebagai Areal Penggunaan Lain (APL) dan secara legal dapat dikonversi.
Menurut Gabungan Pengusaha Kelapa Sawit Indonesia (GAPKI) setengah dari semua konsesi yang diterbitkan tidak dapat digunakan karena lahan tersebut tidak sesuai untuk dijadikan perkebunan kelapa sawit atau ditempati oleh warga yang sering kali menyatakan lahan tersebut milik mereka.
Banyak laporan terjadinya konflik sosial di Hutan Tanaman Industri (HTI) dan perkebunan kelapa sawit ketika adanya ekspansi industri-industri ini dimana hak masyarakat setempat sering tidak dihormati.
Izin-izin sering tumpang-tindih dan dikeluarkan di daerah hutan dengan nilai konservasi tinggi (HCV) dan daerah hutan yang sebenarnya dilindungi secara hukum.

Persepsi salah yang sering disebut dalam media adalah moratorium ini dibuat untuk menghentikan semua penebangan hutan di Indonesia dan menghambat ekspansi industri-industri seperti industri kelapa sawit, HTI, dan tambang. Namun, menurut isi dari kesepakatan Indonesia-Norwegia, moratorium ini adalah suspensi atas pemberian izin baru konversi hutan alam dan lahan gambut.

Pencabutan izin-izin yang sudah dikeluarkan – banyak di antaranya yang mungkin ilegal – sepertinya berada di luar rancangan moratorium ini. Selain itu, karena moratorium hanya diberlakukan pada izin baru konversi hutan alam dan lahan gambut, kemungkinan besar peraturan ini tidak mencakup izin penebangan pohon selektif (selective logging permits) atau izin perkebunan kelapa sawit di daerah APL.

Jangka waktu dua tahun, di mana tidak ada izin baru konversi hutan, memberi kesempatan bagi pemerintah Indonesia untuk mulai menjalankan kebijakan REDD+, seperti memperbaiki perencanaan penggunaan lahan, mengkaji dan mencabut izin ilegal, mendorong ekspansi perkebunan kelapa sawit yang berkesinambungan di “lahan terdegredasi”, dan mengembangkan insentif untuk melakukan “landswap” untuk pembangunan antara daerah berhutan dengan lahan yang tingkat karbonnya rendah.

Apa elemen-elemen utama dalam rancangan Instruksi Presiden?

Setidaknya tiga rancangan Inpres dapat diakses publik sejak bulan Februari 2011. Draft-draft tersebut telah diserahkan kepada Presiden Susilo Bambang Yudhoyono oleh beberapa lembaga pemerintah.

Semua draft mengandung hal-hal berikut:

Penghentian pengeluaran izin baru konversi hutan selama dua tahun.
Instruksi kepada lembaga-lembaga pemerintah terkait untuk menghentikan pemberian izin baru yang berhubungan dengan konversi hutan alam dan lahan gambut.
Pengecualian atas peraturan ini terhadap izin legal dan kegiatan yang dinilai menyangkut kepentingan nasional (seperti di bidang energi).
Sebuah peta yang menjadi panduan pelaksanaan moratorium yang dapat di-update secara teratur. Perlu dicatat bahwa peta ini belum ada sehingga tidak dapat dianalisa.

Namun, terdapat beberapa perbedaan mendasar pada rancangan-rancangan Instruksi Presiden tersebut. Dampak Instruksi Presiden yang akan ditetapkan akan bergantung pada beberapa hal penting berikut, yaitu:

Tujuan – Apakah peraturan ini dapat menjelaskan tujuan penghentian sementara pemberian izin baru untuk memperbaiki proses perencanaan penggunaan lahan dan pemberian izin baru di masa yang akan datang?
Definisi – Apakah istilah dan terminologi yang digunakan cukup jelas dan konsisten dengan pencapaian tujuan yang ada? Beberapa istilah yang belum didefinisikan dengan baik termasuk: konversi, hutan alam, hutan primer, hutan sekunder, dan lahan gambut.
Data – Apakah data dan peta yang digunakan atau yang akan dibuat untuk menentukan daerah yang termasuk dalam moratorium ini akurat dan sesuai? Data yang sesuai akan tergantung pada definisi yang ditentukan. Namun setidaknya data yang dimasukkan mencakup penutupan lahan, fungsi kawasan hutan, penggunaan lahan, status legalnya, dan persoalan-persoalan mengenai kepemilikan lahan.
Izin – Kejelasan tentang izin mana yang termasuk dan tidak termasuk dalam moratorium ini. Hal tersebut menentukan peluang-peluang bisnis dan pembangunan yang dimiliki oleh perusahaan, komunitas, dan pemerintah daerah (masing-masing dengan keuntungan dan kerugian ekonomi, lingkungan, dan sosial yang berbeda).
Lembaga dan Institusi – Lembaga/Institusi/Kementerian mana yang akan diberikan wewenang untuk mengimplementasikan moratorium ini? Institusi/Kementerian mana yang akan membuat peta-peta yang berhubungan dengan moratorium ini? Apabila terdapat pengecualian terhadap izin yang sudah dikeluarkan dan yang dinilai “legal”, perlu ada definisi yang baik atau proses yang jelas untuk mengkaji ulang legalitas izin tersebut.
Proses – Proses apa saja yang akan digarap untuk mengkaji ulang legalitas izin, kerjasama dan koordinasi dengan berbagai lembaga pemerintah, meningkatkan transparansi dan partisipasi, membuat peta dan data spasial publik, dan menyelesaikan konflik lahan?

Apakah arti dari perbedaan beberapa rancangan Instruksi Presiden?

Beberapa laporan media menggambarkan kebingungan mengenai tujuan, isi, dan implikasi beberapa rancangan Inpres. Sebagian besar debat publik mengenai pilihan-pilihan yang ada terpusat pada berapa banyak dan tipe hutan yang akan terkena dampak dalam moratorium ini. Pertanyaan-pertanyaan yang beredar termasuk: Apakah moratorium ini akan berlaku pada hutan sekunder atau hutan terdegredasi, dan lahan gambut dangkal (gambut dengan kedalaman kurang dari tiga meter)? Apakah daerah berhutan di luar kawasan hutan akan dimasukkan dalam moratorium ini?

Hal-hal ini mempunyai pengaruh yang signifikan bagi hutan, manusia, dan perubahan iklim. Menurut statistik yang dikeluarkan oleh Kementerian Kehutanan:

58 persen hutan (58 juta hektar) di Indonesia adalah hutan sekunder.
80 persen lahan gambut (17 juta hektar) di Sumatera, Kalimantan, dan Papua adalah lahan gambut dangkal.
8 persen daerah dengan tutupan hutan di Indonesia (8 juta hektar) berada diluar Kawasan Hutan.

Karena tidak ada satupun rancangan Inpres yang menjelaskan definisi tersebut ataupun petunjuk mengenai peta atau data yang akan digunakan oleh pemerintah untuk menjalankan moratorium ini, maka tidak jelas berapa banyak dan tipe hutan apa yang akan terkena dampak. Pemerintah Indonesia memperkirakan moratorium ini dapat diberlakukan pada 64 juta hektar area di Indonesia, meskipun kemungkinan prediksi ini termasuk daerah berhutan yang sudah dilindungi.

Sebuah faktor penting yang tidak mendapat banyak sorotoan media adalah izin mana yang akan dimasukkan dalam moratorium ini. Karena moratorium ini hanya merupakan penghentian sementara konversi hutan, daerah yang akan terkena dampak bukan semua daerah hutan alam dan lahan gambut, melainkan daerah hutan alam dan lahan gambut yang tidak dilindungi oleh peraturan tertentu dan belum ada izin atas daerah tersebut.

Semua rancangan Inpres membuat pengecualian atas izin yang masih berlaku. Hal ini konsisten dengan isi kesepakatan Indonesia-Norwegia. Beberapa draft menyebutkan izin-izin tertentu seperti izin pemanfaatan kayu, izin perkebunan, dan izin pertambangan, sementara terdapat draft lainnya yang menyebutkan izin baru yang hanya berhubungan dengan konversi hutan saja. Tidak satupun draft yang membahas persoalan hutan masyarakat atau hak-hak masyarakat lainnya.

Tidak ada draft yang menjelaskan apa yang dimaksud dengan izin “legal” atau mengacu pada sebuah proses yang dapat digunakan untuk mengkaji tingkat legalitas suatu izin. Prosedur bagaimana caranya untuk mencabut izin yang dinilai melanggar hukum, sebagaimana dilakukan baru-baru ini oleh Menteri Kehutanan, tidak dimasukkan pula dalam draft-draft yang ada. Ketidakjelasan tentang izin – ditambah dengan kurangnya data publik yang akurat tentang status hutan dan lokasi izin yang telah diterbitkan oleh lembaga-lembaga pemerintah di berbagai tingkat (pusat, propinsi, dan kabupaten) – membuat analisa kuantitatif pada rancangan Inpres sangat sulit dilakukan. Namun, daerah-daerah yang masuk dalam moratorium ini benar-benar berkurang ketika data publik mengenai izin yang masih berlaku dimasukkan.

Apa kegiatan utama yang perlu dilakukan ketika moratorium dua tahun ini keluar?

Kesuksesan moratorium ini tidak hanya bergantung pada isi dari Instruksi Presiden yang ditandatangani, tapi juga pada apa yang akan dicapai oleh pemerintah Indonesia – dengan partisipasi dari industri dan lembaga swadaya masyarakat – dalam dua tahun ke depan. Supaya Indonesia dapat mencapai target ambisiusnya untuk melakukan pembangunan ekonomi dengan beremisi karbon rendah, pemerintah dapat memanfaatkan moratorium dua tahun ini untuk mulai melaksanakan kegiatan-kegiatan berikut ini:

Memproduksi data spasial dan peta-peta yang lengkap, akurat, dan yang diperbarui secara teratur mengenai tutupan lahan dan tipe hutan, penggunaan lahan, status lahan, dan hak-hak atas tanah – termasuk informasi tentang lokasi izin yang telah diberikan – yang dapat dengan mudah diakses publik melalui internet.
Merevisi perencanaan penggunaan lahan (zoning) sehingga hutan alam dan lahan gambut yang sesuai diklasifikasikan untuk konservasi atau dengan tata pengelolaan yang berkesinambungan. Lahan terdegredasi juga harus diidentifikasikan sehingga dapat digunakan untuk kegiatan perkebunan atau penggunaan lainnya melalui proses yang menggunakan praktek-praktek terbaik dalam kegiatan perencanaan tata ruang secara partisipatif.
Mengembangkan proses yang transparan dan partisipatif untuk mengkaji ulang, mencabut, menerbitkan kembali izin-izin yang ilegal atau yang dilihat tidak sesuai untuk pembangunan, dan menggunakan praktek-praktek terbaik untuk berhubungan dengan instansi-instansi yang berkepentingan termasuk terjaminnya pemberian informasi kepada masyarakat setempat secara bebas, sebelum terjadinya “konversi” laha (prinsip FPIC).

Instruksi Presiden yang jelas dan benar-benar dipikirkan secara matang akan menghasilkan moratorium efektif yang menghentikan sementara pemberian izin baru konversi hutan dapat membantu Indonesia “menarik nafas sejenak” untuk membuat perubahan kebijakan fundamental dan memastikan tidak terjadinya skenario “business as usualbisnis seperti biasa” pada akhir dua tahun tersebut. Apabila dilakukan secara efektif, moratorium ini akan membuat keuntungan jangka panjang bagi hutan dan industri di Indonesia.

In Indonesia, “Forest Estate” is a legal designation referring to land under the jurisdiction of the Ministry of Forestry (regardless of whether or not the land contains trees or forests). Land that is zoned Non-Forest Estate in some cases includes forest cover and peat. ↩
Source: Ministry of Forestry using Landsat imagery 7 ETM+ of 2005/2006 (217 scenes). Interpreted in 2007 and published in 2008. ↩
Source: Indonesian Development Planning Agency. 2009. Reducing carbon emissions from Indonesia’s peat lands. Table 1: “Land Use allocation (conservation, protection or development) and land cover in Indonesia’s peat land by main island with peat in 2006.” Data provided is for Sumatra, Kalimantan, and Papua only. These three regions contain the majority of peat in Indonesia. ↩
Source: Ministry of Forestry using Landsat imagery 7 ETM+ of 2005/2006 (217 scenes). Interpreted in 2007 and published in 2008. ↩

The World Bank Group, Palm Oil, and Poverty

Beth Gingold — Tue, 22 Mar 2011 12:11:01 -0400

The World Bank Group should aim to achieve and measure poverty reduction, not palm oil investments.

In March 2011, the World Bank Group (WBG)’s President Robert Zoellick is expected to decide whether to lift a global moratorium on WBG palm oil investment. The moratorium was instituted as a result of the findings of a 2009 internal audit (PDF, 4.5 Mb). The audit was triggered by civil society concerns regarding an International Finance Corporation (IFC) investment in a major palm oil company in Indonesia.

His decision will be based on a review of a revised version of this draft of “The World Bank Group Framework and IFC Strategy for Engagement in the Palm Oil Sector.” The strategy document is IFC’s response to this letter and is the result of an extensive public consultation process.

Palm Oil and Public Consultations

The World Resources Institute (WRI) was an active participant and “lead discussant” in the public consultation process. WRI’s input was informed by our experience from Project POTICO. This project aims to promote sustainable palm oil production on degraded land in Indonesia in accordance with the principle of free prior and informed consent and the principles and criteria of the Roundtable on Sustainable Palm Oil (RSPO). WRI is currently receiving funding from the IFC’s Biodiversity and Agricultural Commodities Program (BACP) to support related work. The IFC is not responsible for the implementation or administration of the project.

The WBG’s engagement in the palm oil sector has potential to contribute to poverty reduction and social and environmental sustainability if country- and project-specific IFC and World Bank strategies are designed and effectively implemented to achieve this mission.

If the WBG removes the moratorium on palm oil investment, it is critical that issues such as the treatment of free prior and informed consent are addressed on an institutional level, and that country- and project-specific strategies be guided by clear measurable objectives, informed by relevant research, implemented with appropriate staff incentives, and measured according to its long term success in achieving poverty reduction.

Agreement on Palm Oil Potential

Despite the focus of the media on the palm oil “controversy” and “debate”, which often pits proponents of “development” against those concerned with deforestation and human rights, many voices in the private, public, and civil sectors have recognized the potential of the palm oil sector to contribute to poverty reduction. Many groups have expressed agreement with key points detailed in the WBG strategy document such as:

Palm oil is the world’s most traded and most affordable cooking oil as well as a versatile product with many uses.
Oil palm, the crop that is used to produce palm oil, has a higher yield of vegetable oil per hectare than any other major oil crop.
Palm oil production has contributed to economic benefits such as government revenues, profits for companies, employment, and raised incomes for smallholders. In Indonesia—the world’s largest producer—the industry generated US$12.4 billion in foreign exchange from palm oil exports in 2009, and supports millions of jobs and opportunities for rural farmers.
Many of the negative consequences that have been associated with the sector can be avoided when rights of local people are recognized, land use planning considers long term social and environmental impacts, and companies follow improved practices such as those required for certification by the Roundtable on Sustainable Palm Oil.

In the recent public consultations, many stakeholders agreed that some form of IFC and World Bank engagement could contribute to poverty reduction. Many participants expressed continuing willingness to engage with the IFC and World Bank, noted ongoing improvements in the process, and welcomed revisions to the second draft such as increased focus on poverty and smallholders and emphasis on coordination between the World Bank and IFC.

Potential Challenges for Poverty Reduction

Whether this poverty reduction potential can be achieved will depend on how decisions are made regarding when and how to engage or invest in particular countries, programs, or projects. Investing in the palm oil sector should be viewed as one possible means to achieve poverty reduction, not a goal in itself.

As noted by many stakeholders, and acknowledged in the WBG document, different countries and policy contexts will require different responses by both the IFC and World Bank. For example, countries in Africa and Latin America—such as Ghana or Colombia—have relatively small industries with growth potential with their own opportunities and challenges, some similar and some quite different from those in Indonesia.

As acknowledged by the strategy, the “impacts of oil palm depend on where and how it is developed.” Information from the public consultation and research conducted by the World Bank demonstrate that under some conditions IFC investment in the palm oil sector is unlikely to reduce, and may increase, poverty. For example:

Investment in some business models may not result in poverty reduction. According to a World Bank analysis of district level data in Indonesia, only smallholder production—not production by private estates—is positively correlated with poverty reduction.
Investment in some business models may increase poverty. Large-scale land acquisition for agriculture has resulted in loss of livelihoods and increased poverty (PDF, 3.5 Mb) where the regulatory and policy environment did not recognize existing rights to land and natural resources or support sustainable practices.
In some countries the prospect of IFC financing may provide little leverage for improving company practices. For example, in Indonesia the palm oil sector is already “largely self-financing” according to the government (PDF, 1.6 Mb).

Many of these challenges are not unique to the palm oil sector but rather depend on the IFC and World Bank’s institutional approaches to strategy and project implementation. Many problems can be avoided by following IFC’s existing performance standards with appropriate safeguards, and by effective coordination with the World Bank and host country governments. However, some of these issues have not yet been addressed on an institutional level (for example through the Performance Standards Review process)—such as the treatment of free prior and informed consent.

Both the institutional organization of the IFC and its standard monitoring and evaluation (M&E) tools encourage the separate treatment of “economic benefits” on one hand and “social and environmental costs” on the other. This institutional approach does not explicitly acknowledge that economic, environmental and social sustainability are key parts of poverty reduction, or sufficiently address equity concerns related to the distribution of costs and benefits among different groups. In addition, past experience (PDF, 4.5 Mb) has shown problems in implementation resulting from inappropriate staff incentives and insufficient training.

Recommendations for the World Bank Group

If the WBG removes the moratorium on palm oil investment, it is critical that country- and project-specific strategies include the following:

Application of relevant research and decision-making tools. Relevant research would need to address the following questions on an appropriate country and project level: Which models result in poverty reduction? What investment needs are not met by the private sector and could be addressed by IFC investment? What necessary policies are or are not in place and how are they implemented? A new “risk analysis tool” proposed in Annex XII of the WBG document may help address these questions.
Clear measurable objectives aligned with the WBG’s mission. Objectives should aim to achieve poverty reduction, not investment in a particular sector.
Clear roles and responsibilities for the World Bank and IFC. To ensure cooperation, mechanisms for coordination and communication should be established at the outset.
Suitable measures of success. M&E tools should measure indicators related to poverty and social and environmental sustainability. Current standard tools focus on measuring financial returns and positive development impacts, while negative development impacts—such as loss of livelihoods of local people and local environmental degradation—are treated separately as “social and environmental risks” to be mitigated. Local communities are not included as stakeholders under the IFC’s standard economic performance indicators.
Appropriate staff incentives and support. Staff incentives should be aligned with poverty reduction and social and environmental sustainability goals, and not based on financial returns. Staff members also need appropriate training and support, including incentives to cooperate and coordinate across teams and institutions.
Room for improvement. Any effective strategy should explicitly include processes that allow flexibility to continually improve and receive and incorporate feedback. The recent public consultation process, which demonstrated increasing transparency and continued openness to civil society inputs, can provide a positive basis for further improvements.

The Year in Illegal Logging: A Look Back

Craig Hanson — Fri, 07 Jan 2011 11:13:09 -0500

2010 was a significant year for global efforts to tackle illegal logging. Here’s a look back on some of that progress.

Long a problem in many of the world’s forests, illegal logging has unsustainable impacts. It deprives governments of tax revenue. It puts law-abiding companies at a competitive disadvantage. And it negatively impacts forest-dependent peoples, not to mention the world’s biodiversity and climate.

But 2010 brought encouraging news on the illegal logging front, and from both ends of the supply chain.

Let’s start with wood-producing countries. In July, the world learned from a Chatham House report that illegal logging fell by 50-75 percent during the past decade in Indonesia, Cameroon, and the Brazilian Amazon, three forest-rich nations. Better law enforcement, improved forest monitoring and increased focus on the issue all contributed to these improvements. More recently, Indonesia announced that it will deliberate a bill to toughen penalties for those involved in illegal logging, while Malaysia revised its Forest Act to stiffen penalties for illegal logging.

These are significant reductions and actions. Governments, many in the private sector, and civil society should be congratulated for their respective roles in these accomplishments.

2010 brought good news from wood-consuming countries, too. The United States indicated that it is serious about using the amended Lacey Act to curtail trade in illegal wood. For instance, reports came to light of a U.S. Fish & Wildlife Service seizure of tropical hardwoods from Peru and of movement on the investigation into Gibson’s alleged purchase of illegal wood from Madagascar.

Likewise, the European Union (EU) approved the EU Illegal Timber Regulation in 2010. Similar to Lacey, the law prohibits the sale in Europe of timber logged illegally under the rules of the country of origin. Furthermore, the Australian government recently announced plans to introduce a Lacey-like ban on illegal timber products.

Climate agreements regarding “Reduced Emissions from Deforestation and forest Degradation in developing countries” (REDD+) have the potential to reinforce existing efforts to curtail illegal logging. The same is true for the visionary forest-climate bilateral agreements between forest-rich countries such as Indonesia or Brazil and nations such as Norway.

The groundwork, therefore, appears to be laid for another year of progress. If so, 2011 would take a further cut out of the illegal cut.

Converting Palm Oil Companies from Forest Destroyers into Forest Protectors

Craig Hanson — Tue, 04 Jan 2011 15:09:26 -0500

The following interview with Craig Hanson and Moray McLeish was conducted and compiled by Jeremy Hance and Rhett A. Butler for mongabay.com and is reposted with permission. Read the entire piece here on the Mongabay website.

In efforts to save the world’s remaining rainforests great hopes have been pinned on “degraded lands” — deforested lands that are presently sitting idle in tropical countries. Optimists say shifting agriculture to such lands will help humanity produce enough food to meet growing demand without sacrificing forests and biodiversity and exacerbating social conflict. But to date, degraded lands remain an enigma, especially in Indonesia, where deforestation continues at a rapid pace. Degraded lands are often misclassified by various Indonesian ministries—land in a far-off province may be listed as “wasteland” by Jakarta, but in reality is blanked by verdant forest that sequesters carbon, houses wildlife, and affords communities with food, water, and other essentials. Granting logging and plantation concessions on these lands can result in conflict and environmental degradation.

Therefore key to unlocking the potential of non-forest land, and thus setting Indonesia on a low carbon development pathway, is determining where degraded lands actually exist. But the process goes beyond mere land cover mapping. Decision-makers must have the full picture of the land: its ownership and use, its state of degradation and suitability for agriculture, and an understanding of the actions needed to restore it to productivity.

Under the billion dollar Indonesia-Norway partnership to reduce deforestation, some money has been allocated for degraded lands mapping. But even before the pact was signed this past May, the World Resources Institute (WRI) had launched a project to identify degraded lands in the country. Working with local partners, WRI is focusing on ways to address one of Indonesia’s most important drivers of deforestation: palm oil production.

Over the past twenty years, palm oil has emerged as a economic juggernaut in Indonesia and Malaysia. With its high yield, oil palm is an astoundingly profitable crop and accordingly, plantations have spread across Sumatra, Borneo, New Guinea, and other islands, taking a heavy toll on forests. By some estimates, more than half of oil palm expansion since 1990 occurred at the expense of forests. In the absence of action, the trend is expected to continue, driven by rising demand for vegetable oil.

WRI is interested in ensuring that future growth doesn’t lay waste to remaining forests. Therefore its mapping project aims to identify sites for “land swaps” whereby concessions on forest land could be shifted to deforested grasslands. The initiative also provides guidelines to plantation companies for obtaining the free, prior, and informed consent of communities living near the degraded area and achieving Roundtable on Sustainable Palm Oil (RSPO) certification.

In a December 2010 interview with mongabay.com, WRI’s Craig Hanson and Moray McLeish discussed how the initiative could turn palm oil companies from drivers of deforestation into forest protectors.

Degraded Lands

What is the definition of degraded land?

“Degraded land” refers to areas that were cleared of their natural vegetation cover, now contain low levels of biodiversity and low stocks of carbon, and are not used for productive agriculture or human habitation. Alang-alang grasslands (Imperata cylindrica) are an example of such degraded lands in Indonesia.

Area cleared of forest where alang alang grass and tropical bracken now dominate the landscape. (Photo: Sekala)

Note that what we are talking about is not strictly degraded “land.” The areas do not necessarily have poor soil quality. Rather, what we are referring to is degraded “land cover.” The area’s ecosystem is degraded relative to what was there before—in the case of Indonesia, tropical rain forest.

Definitions fit within a context. Since the context in which we are working—breaking the link between oil palm development and greenhouse gas emissions—involves policies and actions designed to reduce greenhouse gas emissions, the definition of “degraded land” given above is taken from a “forest carbon” perspective.

Definitions are important. The recent interaction between Greenpeace and the Government of Indonesia over “loose definitions” of land conditions, what lands may or may not be developed into plantations, and related matters highlights this importance.

Could secondary forests, which may have biodiversity or climate potential, be considered degraded land?

Many secondary forests (or degraded forests) certainly do have biodiversity and climate (carbon storage) potential. It is critical that these forests are identified and prioritized for rehabilitation. But other secondary forests may be so badly cleared that restoration is not economically feasible or practically realistic. This is why clear and pragmatic definitions of “degraded” are so important—to help stakeholders plan what to do with what land and where to focus efforts to maximize benefits to local people, biodiversity, the economy, and the climate.

Food or Forest?

Should degraded lands be restored to forests or converted to agriculture?

Decisions about degraded land use should be determined by individual countries in careful consultation with the communities living near them. The decisions should respect existing land rights, including customary use rights. Factors to consider when making choices about different land uses include: To what degree is agricultural expansion a direct driver of deforestation? What is the level of food security in the region or country? What is the relative ease, biophysically and economically, of restoring the land to either forest or farms? Is the area of degraded land in question adjacent to a waterway where erosion is a problem? What is the country’s forest conservation and REDD+ aspirations? In short, these considerations are about what ecosystem services are desired from these landscapes.

How these and other questions are answered should guide decisions regarding the optimal use of a particular degraded area. For example, if agricultural expansion into natural forests is the number one driver of deforestation in country X and the country has committed to curbing deforestation, then utilizing already cleared and degraded areas as a “pressure-relief valve” for agricultural expansion may make sense. However, if agricultural expansion into forests is not a driver of deforestation in country X but another issue, say erosion, is a big concern, then restoring degraded areas back to their natural ecosystem (e.g., forests) may make the most sense.

And finally, we shouldn’t forget that it isn’t necessarily “either/or”. Some tracts could be restored to agro-forestry landscapes.

Since degraded land at one time was usually forest, shouldn’t some degraded land be reforested for biodiversity and climate?

Yes, certainly. This relates to our earlier point of needing to manage land to provide a bundle of ecosystem services—freshwater, erosion control, climate regulation, food, recreation and cultural values, etc. As a result, some degraded areas should be restored back into forests or whatever natural ecosystem the landscape was before it was degraded, especially where these areas provide valuable ecosystem services such as freshwater.

Potentially how much degraded land worldwide could be restored to forests?

A recent analysis by the World Resources Institute (WRI) and partners suggests that there are more than one billion degraded hectares globally—an area larger than Brazil—that offer forest landscape restoration opportunities. These lands could be restored to their native forest state, creating habitat for wildlife, reducing erosion, ensuring clean water supplies, and combating climate change by absorbing carbon dioxide, or restored into mosaic, agro-forest ecosystems.

Global Map of Forest Landscape Restoration Opportunities

Some of these lands could be cultivated, as well. But exactly how much could and should be turned into cultivation requires a more detailed country-by-country analysis that includes asking “cultivation for what?” We have not conducted that assessment. This should be a participatory process. Furthermore, one should note that WRI’s analysis only looked at degraded forests; we did not look at degraded grasslands, wetlands, or other ecosystems.

How does one identify degraded lands that could be amenable for agriculture, such as palm oil?

While the specifics will differ by crop, by region, etc., most methods would need to screen for biophysical suitability, economic viability, social acceptability, and legal availability of the land.

Along with partners, WRI has developed a methodology for identifying degraded lands, determining which of these are economically viable and socially acceptable for sustainable oil palm, and assessing their legal availability for plantation development. Figure 1 summarizes the key screens used in this methodology:

Environmental. The area is degraded from a forest carbon perspective (e.g., <40 tons of carbon per hectare). Developing the area will not result in significant greenhouse gas emissions or reduce critical environmental “high conservation values” including biodiversity preservation and clean water supply;
Economic. The area is biophysically capable of profitable oil palm production in terms of climate, topography, and soil properties. Highest priority areas meet minimum plantation size and proximity to infrastructure requirements;
Social. Local people are likely to benefit from plantation establishment and agree to participate in a free prior and informed consent process; and
Legal. Legal land status allows for conversion to oil palm plantation and expansion does not conflict with existing concessions or other rights, including traditional rights of indigenous communities.

Measurable parameters underlie these screens.

Figure 1: Screening Criteria for Identifying Acceptable Areas for Sustainable Oil Palm Expansion

One should note that some areas that are acceptable according to environmental, economic, and social criteria may be currently unavailable to planters for legal reasons. For example, some of these degraded areas may not be zoned for agricultural activities. This does not mean, however, that the area should necessarily be removed from consideration, since zoning can be changed.

Challenges Confronting Degraded Land

Often logging a forest is used to pay the ‘down payment’ on starting a plantation. Given this, how would new plantations on degraded land be financed?

This may be true in some cases, particularly when stands of commercial timber-rich forest are granted for palm oil. But times may be changing. In collaboration with the Prince’s Rainforests Project and agricultural economist Thomas Fairhurst, we recently interviewed a number palm oil companies in Indonesia about the value to them of expanding into land with tree cover vs. expanding into areas without trees. Many stated they would rather expand onto non-forested land due to the set-up costs and the lengthy bureaucratic processes of getting a permit in forested areas. None of the companies interviewed cited financing—and thus the need for a timber cut to generate cash—as a factor restricting their expansion. Rather, they emphasized the importance of improved spatial planning as the main requirement to reach oil palm development targets as well as forest conservation goals in Indonesia.

In some places such as Indonesia, degraded land has been claimed by small-scale farmers or local communities. How should landownership be determined in such cases?

In all cases, genuine land use and ownership claims must be respected, including the claims of indigenous peoples. In many cases, such claims are not clearly documented, are overlapping, or are conflicting. Our close partner, Sekala, has shown community mapping to be an effective and conflict-reducing way of agreeing and documenting land ownership and use claims – both within a community, and between a community and government or land-using industry.

If communities are to be compensated for providing degraded land to companies, who will pay them?

Of primary importance is ensuring a fair decision making process. The approach of Free, Prior and Informed Consent (FPIC) has been designed to help ensure that communities are not forced into relinquishing land against their will, and that they are appropriately compensated for any land based values or use rights they do choose to relinquish.

Land Swaps

How would land swaps work?

One approach for reducing deforestation and peatland degradation in Indonesia that WRI has been working on is to divert planned oil palm plantations away from natural forests and toward degraded lands instead. We sometimes refer to this as a “land swap”. Under a swap, a company that has a permit to clear a tract of natural forest and convert it into an oil palm plantation does not “exercise” that permit but rather develops the plantation on a roughly equivalent-sized tract of degraded land, such as an alang-alang grassland (Imperata cylindrica). Under our model, plantation development in the degraded area follows the procedures of the RSPO (Roundtable on Sustainable Palm Oil), including obtaining the free, prior, and informed consent of communities living near the degraded area. Likewise, a sustainable forest management or conservation plan is put in place for the forest previously slated for conversion. Ecosystem restoration concessions (ERCs) are one mechanism for pursuing the latter. Under an ERC, the government grants the permit holder long term rights to sell ecosystem services produced by the land in return for the obligation to manage the land for ecosystem conservation or restoration with only limited extraction.

Land swaps are part of a broader strategy of utilizing degraded land for plantation development as a means of relieving agricultural pressure on natural forests. In essence, land swaps are an approach for undoing the mistakes of the past—that is, permits or concessions that were allocated on natural forests or peat lands. But only allocating oil palm plantation permits on degraded lands going forward—a strategy supported by Indonesia’s president—would prevent mistakes in the future.

In short, degraded land utilization could allow a country to have its palm oil and its forests, too.

You have written that for degraded land to be used for agriculture it should be “physically suitable, economically viable, legally available, and socially acceptable to nearby communities”. How much land do you think actually fits all of these requirements?

Based on field surveys in just one portion of Borneo, we believe that there is a lot of such land, enough to help relieve some of the pressure agriculture has on natural forests. But “how much degraded land is there?” is less important than “where are these areas?” Answering the former is helpful for headlines; answering the latter is required for land-use decisions. Our methodology is aimed at figuring the latter out. The important thing now is to apply this methodology at national, provincial and district levels, developing maps of where environmentally sustainable agricultural expansion could potentially occur.

Having Your Food and Forests, Too

Moray McLeish — Wed, 17 Nov 2010 16:48:23 -0500

Expanding agriculture onto already degraded lands could relieve pressure on the world’s remaining forests.

Enabling tropical countries to boost their economies and feed global populations while conserving forests and combating climate change is a developmental and environmental nut that has yet to be cracked. On Thursday, The Prince of Wales will gather international leaders from governments, environmental and social NGOs, agribusiness and finance sectors to highlight ways in which agricultural production can expand without causing further deforestation. One of them is revolutionary in its practicality - restoring degraded lands to absorb agricultural expansion.

This novel approach has enormous potential.

The world is awash with degraded land, which doesn’t necessarily mean land with poor soil quality. Rather, it is land where natural vegetation—often forests—was cleared years ago and where the forests did not recover. These areas often have low levels of biodiversity and low stocks of carbon.

The World from a Forest Landscape Restoration Perspective: (Click to enlarge)

Download High Resolution Bitmap (PNG, 3300 x 1650 px, 3.9 Mb)

A recent analysis by the World Resources Institute (WRI) and partners suggests that there are more than one billion degraded hectares globally—an area larger than Brazil. Some of these lands can and should be restored to their native forest state, creating habitat for wildlife, reducing erosion, ensuring clean water supplies, and combating climate change by absorbing carbon dioxide. But others could be utilized for agriculture and thus relieve pressure on the world’s remaining virgin forests while creating local livelihoods.

Imagine a future where increased demand for beef, soya, and palm oil is met not by converting tropical forests and carbon-rich peatlands but by utilizing just a portion of these degraded areas.

Area cleared of forest where alang alang grass and tropical bracken now dominate the landscape; Indonesia. (Photo: Sekala)

The Prince of Wales has. Indonesian President Susilo Bambang Yudhoyono has, too, when he announced a policy to develop Indonesia’s palm oil industry on degraded lands instead of in forests. This is visionary leadership.

The Norwegian government sees this future, as well. In May of this year, Norway committed $1 billion to Indonesia if the country can demonstrate reduced tropical deforestation and greenhouse gas emissions. Utilizing degraded lands is a pillar of this commitment.

WRI has been lending this vision practical support in Indonesia, working to divert planned oil palm plantations away from natural forests and on to degraded land. We have been popularizing this strategy by constructively engaging palm oil companies, NGOs and government agencies. Using satellites and field surveys, we have mapped the province of West Kalimantan to identify tracts of degraded land that are candidates for sustainable oil palm. In addition, we have initiated a pilot “land swap” that will steer a planned plantation away from natural forests on to a tract of degraded land.

The Prince of Wales and Craig Hanson, Director of WRI’s People and Ecosystems Program, discuss degraded land. Photo credit: Moray McLeish

Our experience suggests, however, that if degraded lands are to absorb agricultural expansion at sufficient scale, countries need to answer three key questions: “what, where, and how?”

First, “what is degraded land?” Governments, companies, and NGOs who may have different perspectives must agree on a definition. And if sustainable agricultural expansion is to be achieved, the definition will need to include some threshold for carbon and biodiversity content below which the area can be considered “degraded.”
Second, “where is the degraded land?” To put degraded land into productive agricultural use, governments, companies, and farmers need to know exactly where these areas are located. And these lands need to be physically suitable, economically viable, legally available, and socially acceptable to nearby communities. Working with other NGOs and the Prince’s Rainforests Project, WRI has developed a methodology for identifying degraded lands that meet these criteria for oil palm development in Indonesia.

If we are to feed nine billion people by 2050, successfully tackle climate change, and conserve the world’s biodiversity, we need to break the link between food security and deforestation.

Third, “how can degraded land be transformed into productive use?” Analyses have shown that converting degraded areas to agricultural production can be financially attractive. However, local communities need to have given their free, prior, and informed consent before tracts of land are restored into farms, plantations, or ranches. At the same time, the “cost” of expansion into virgin forests needs to increase—through policies and enforcement—since degraded land is often a symptom of a cheap frontier.

Agricultural development has traditionally pushed forward into forests. But the time has come to look back to the areas cleared years ago. If we are to feed nine billion people by 2050, successfully tackle climate change, and conserve the world’s biodiversity, we need to break the link between food security and deforestation. As Thursday’s meeting convened by The Prince of Wales will highlight, using degraded lands is an important part of severing that link.

We just might be able to have our food and forests, too.

FAQ: Indonesia, Degraded Land and Sustainable Palm Oil

Beth Gingold — Thu, 04 Nov 2010 14:37:06 -0400

Common data and clear definitions will enable the Roundtable on Sustainable Palm Oil and REDD+ policy-makers to achieve a shared goal: sustainable oil palm expansion on degraded land in Indonesia.

In May 2010, Indonesian President Susilo Bambang Yudhoyono announced a national policy to develop oil palm plantations on “degraded land”– instead of on forest and peatland — as part of an ambitious plan to reduce greenhouse gas emissions from deforestation and forest degradation (REDD+). Indonesia’s draft national REDD+ strategy, which has been made available for public consultation, reflects this intention.

The Roundtable on Sustainable Palm Oil (RSPO), comprised of over 350 members from government, NGOs, and businesses, has developed a set of principles and criteria for sustainable palm oil production. According to the RSPO, new plantations in Indonesia must not replace primary forest or reduce high conservation values and should use “previously cleared and/or degraded land.”

This November, the RSPO convenes in Jakarta as REDD+ policy-makers continue developing a degraded land national policy. This piece answers frequently asked questions by both groups and aims to provide a common factual starting point for moving the policy dialogue forward.

Who makes the decisions?

Implementation of a national policy for Indonesia will require effective participation by many decision-makers in the public, private, and civil sectors engaged in planning and management related to the palm oil sector (Table 1). Companies that have already committed to sustainable practices in accordance with the RSPO stand to benefit from—and can contribute to—this effort.

Table 1. Critical Decisions and Decision-Makers
Decisions	Decision-Makers
National strategy development – How to balance national priorities including REDD+, food security, poverty reduction, and biodiversity preservation?	Government (national)
Spatial planning – Which areas are acceptable for plantation expansion or other activities? Decisions include legal land classification/zoning.	Government (national/province/district)
Project planning – Which projects should occur in these areas? Decisions include permitting and free prior informed consent. Decisions will be highly influenced by market factors.	Government (district/local)
	Communities
	Companies
	Civil Society
Project management – How are projects implemented (i.e., according to Roundtable on Sustainable Palm Oil Principles & Criteria and/or legal/government sustainability criteria?)	Companies
	Employees/smallholders
	Communities
Measuring, reporting & verification and enforcement – How are plans/management monitored and enforced?	Government (national/province/district)
	RSPO/industry bodies
	Civil Society

To participate in meaningful debate around this proposed policy, decision-makers across sectors need to have a common understanding of the answers to the following frequently asked questions:

What is degraded land?
How much degraded land is there in Indonesia?
How much oil palm expansion is expected in Indonesia by 2020?
How can acceptable areas for sustainable expansion be identified?
What can be done to enable critical decision-makers to address these questions?

Right now there is simply not enough accurate spatial data to answer these questions for the entire archipelago. This gap can be addressed by a well-designed “degraded land database” that may be developed under the Indonesia-Norway partnership on REDD+, and/or by the “spatial data management mechanism” described under Indonesia’s draft national REDD+ strategy (Section 3.2.1, paragraph 1.c).

What is “degraded land”?

Area cleared of forest where alang alang grass and tropical bracken now dominate the landscape. (Photo: Sekala)

In the context of developing policies to reduce emissions from deforestation and degradation, degraded land refers to areas with low carbon stocks, typically with low tree cover.

There is no single internationally-approved definition of “degraded land” and no single corresponding definition in Indonesian law or policy. The policy dialogue regarding reducing emissions from deforestation and degradation (REDD) has suffered from this lack of clarity regarding definitions.

Land degradation is generally understood as a human-caused process that results in long term loss of natural productivity.

Forest degradation generally refers to loss of services provided by forested ecosystems, including but not limited to carbon storage.

According to Indonesia’s draft national REDD+ policy:

“Degradation is the change in the forest that has negative impacts on the structure or function of stand or forest land, so that it reduces the forest capacity to provide forest services/products. In the REDD+ context, degradation may be interpreted as the forest carbon stock degradation.”

No specific level of carbon stock degradation is specified.

Government officials, private companies, NGOs, and academics have used the term “degraded” in multiple contexts to describe land with a wide variety of characteristics. General terms that have been used interchangeably with “degraded land” include:

Degraded forest – secondary or selectively logged forests that provide reduced levels of ecosystem services, including but not limited to carbon storage. Ecologists and environmental NGOs are concerned that allowing the conversion of these forests could result in significant carbon emissions as well as lost “co-benefits” such as biodiversity preservation.
Marginal/waste land – areas with low agricultural productivity and economic potential. Companies are concerned that these areas would be unprofitable to develop.
Idle/unused/abandoned land – areas that are empty or not being used productively, often from a legal standpoint. These terms are controversial because legal designations do not always consider existing local or traditional rights, claims, or uses.

In Indonesia, related legal terms include:

Lahan kritis (literally “critical” land, often translated as “degraded”) — land legally designated as having reduced ecological functions by the Ministry of Forestry, based on biophysical characteristics.
Tanah terlantar (unused/abandoned land) — land on which a permit has been issued but has not yet been utilized by the permit-holder.
Lahan tidur (idle land, set-aside lands, literally “sleeping” land) — areas that are considered unproductive according to national or provincial regulations.

Under WRI’s Project POTICO, degraded land refers to areas that were cleared of forests long ago and that now contain low carbon stocks and low levels of biodiversity, such as alang alang grasslands. According to a detailed economic analysis conducted by WWF and fieldwork carried out by WRI’s local partner Sekala, many of these areas have suitable soil for oil palm cultivation, can produce comparable yields relative to recently deforested land, and are viewed as unproductive by local communities.

How much “degraded land” is there in Indonesia?

If degraded land refers to areas that were cleared of forests long ago and that now contain low carbon stocks, various sources suggest that there are likely at least 6 million hectares of degraded land in Indonesia (an area larger than the Indonesian province of Aceh).

Since there is no single definition of degraded land, estimates of the extent of degraded land in Indonesia vary widely. Therefore the extent, location and status of Indonesia’s “degraded” land—particularly from a social and legal standpoint—remain unclear.

Many quoted estimates do not include sufficient information regarding how the estimates were made, or what definitions were used. In many cases, estimates refer to legal land status rather than carbon stock levels. Recent estimates related to the extent of degraded land that may be used for oil palm in Indonesia include:

6 million hectares of degraded land “available for oil palm expansion” according to a senior official of the Indonesia Investment Coordinating Board (Reuters 2010).
7 million hectares of unused/abandoned degraded land (“tanah terlantar yang kondisinya sangat kritis”) according to Ministry of Forestry, February 2010.
8.5 million hectares of alang alang grassland (Garrity 1997).
7-14 million hectares of degraded, abandoned lands that may be used for agricultural development according to Fitrian Ardiansyah, director of climate and energy WWF-Indonesia, (Jakarta Post 2010).
12 million hectares of “idle land” the National Land Agency (BPN) indicates could be used for business purposes, according to the Forestry Minister (Jakarta Post 2010).
31 million hectares of “unused land” considered “suitable” and “available” for agriculture (Agricultural Research & Development Body 2007, cited in Indonesia’s draft REDD+ policy).
40 million hectares of “degraded forests” within the forest estate according to the Forestry Minister (Jakarta Post 2010).
55 million hectares of land designated as non-forest, in other words, land outside the forest estate (Ministry of Forestry 2008, cited in Indonesia’s draft REDD+ policy).

To understand the possible implications of a national policy to promote the development of land that is “degraded” from a carbon standpoint will require distinguishing between terms that refer to physical status and carbon content, and those that refer to legal status.

How much oil palm expansion is expected?

Experts expect 3-7 million hectares of land will be required to accommodate expected oil palm expansion in Indonesia up to 2020.

How much land is considered “enough” for expansion will vary depending on different viewpoints regarding how much and/or whether expansion is desirable in a particular area. Considering this question on a national scale disregards critical questions related to the distribution of the costs and benefits of expansion, particularly at a local and district level.

Estimates of the current area of land under cultivation for oil palm in Indonesia range from 6-8 million hectares. Total expansion will be highly dependent on global demand, yields, and many other factors.

Recent estimates for projected or expected expansion in Indonesia by 2020 include:

3 million hectares, predicted by experts to meet the growing global demand.
5 million hectares to fulfill national production target of 40 million tons crude palm oil by 2020.¹
7 million hectares projected expansion using FAO data as a base case scenario (Wicke et al, 2008).
20 million hectares of planned concessions according to an assessment of provincial spatial plans. However, the same study found that in the past only about one third of the 18 million hectares of forest cleared under planned oil palm concessions have resulted in plantation establishment.

These estimates suggest that there is likely enough degraded land to accommodate the expansion expected to achieve Indonesia’s production goals by 2020.

How can acceptable areas for sustainable expansion be identified?

Acceptable areas for sustainable oil palm plantation expansion can be identified using a methodology that balances environmental, economic, social, and legal considerations—including but not limited to whether an area is degraded.

Just because a tract of land is degraded does not necessarily mean that the tract is acceptable for sustainable palm oil expansion. There is a significant and growing consensus—as reflected by growing industry participation in the Roundtable on Sustainable Palm Oil (RSPO) and in recent government statements—regarding the need to balance environmental, economic, and social concerns in order to ensure that the expansion of oil palm plantations is “sustainable.” Identifying acceptable degraded areas for expansion will require that policy-makers develop a participatory decision-making process informed by accurate and up-to-date spatial data that addresses environmental, economic, social, and legal considerations.

WRI and Sekala have developed a working methodology for identifying acceptable areas for sustainable palm oil using a set of criteria that address these considerations (Table 2). This methodology consists of a desktop analysis using available data and applicable screening criteria, followed by fieldwork for verification and in-depth site analysis. WRI and Sekala are engaging with other organizations conducting similar assessments—including WWF, Conservation International, The Nature Conservancy, and Fauna and Flora International—to further develop this methodology.

Table 2. Screening Criteria for Identifying Acceptable Areas for Sustainable Expansion
Considerations	Screening Criteria
Environmental — Is the area environmentally suitable? Can be assessed and mapped using a combination of spatial data analysis and on-the-ground visits—using established methodologies for identifying high conservation values (HCV).	Carbon Stocks (above and below ground)
	Biodiversity (HCV 1,2,3)
	Ecosystem Services (HCV 4)
	Forest Regeneration Potential
Economic — Is utilizing the area for a plantation economically viable? This will vary between oil palm growers—including smallholders—and depend on management practices.	Agricultural suitability (climate, topography, soil)
	Size
	Proximity to infrastructure
Social— Is converting the area to a plantation acceptable to local communities? Needs to be determined through a participatory planning process that addresses “free prior and informed consent.”	Risk of displacement (HCV 5)
	Risk of loss of cultural identity (HCV 6)
	Local people benefit from balanced economic development and are interested in participating in free prior informed consent process.*
Legal— Do zoning and other regulations allow the degraded area to be used for plantations? Can be changed—and may need to be clarified—by policymakers.	Legal land status (zoning)
	Legal claims (permits)

*These criteria should be primarily understood as screening criteria for responsible projects, unlike the rest of the screening criteria listed here which apply to identifying acceptable areas for plantations.

Figure 1 shows another way of looking at the screening criteria:

Figure 1. Screening Criteria for Identifying Acceptable Areas for Sustainable Oil Palm Expansion

Some areas that are acceptable according to environmental, economic, and social criteria may be currently unavailable to planters for legal reasons. For example, some of these degraded areas may be legally classified as forest where agricultural activities are not allowed. These legal barriers can be removed by policymakers. However, developing a transparent and fair process for removing legal barriers requires accurate information. Current spatial data regarding legal feasibility—such as the location of outstanding permits or other rights and claims—is often unavailable or inconsistent across multiple data sources.

How can decision-makers address these questions?

A publicly accessible website that provides up-to-date, accurate spatial data and established methodologies for identifying acceptable areas for expansion can enable improved decision-making for sustainable palm oil across the public, private, and civil sectors.

A well-designed “degraded land database” or “spatial data management mechanism” as proposed by national REDD+ policy-makers can support improved decision-making for sustainable palm oil on all levels if it:

Contains comprehensive, accurate, and regularly updated spatial data;
Takes the form of a publicly available and easily accessible web-based application that allows users to generate maps based on pre-determined screening criteria and user-defined parameters;
Is designed to address needs of relevant decision-makers—including REDD+ policy makers, national and local government officials, private companies, communities, and civil society organizations (Table 1);
Includes sufficient data to carry out the desktop analysis portion of a common methodology for identifying acceptable areas for sustainable expansion (Table 2); and
Is integrated with the “independent institution for a national monitoring, reporting and verification system” also described in the Indonesia-Norway agreement.

Ensuring public access to accurate up-to-date spatial data would provide all decision-makers with a common basis for taking actions—and engaging in constructive dialogue—regarding the development of degraded land.

Feed the World. Indonesian Chamber of Commerce and Industry 2010. ↩

What’s Next for Indonesia-Norway Cooperation on Forests?

Kemen Austin — Tue, 13 Jul 2010 16:14:06 -0400

In May 2010, Norway agreed to contribute up to $1 billion towards reducing deforestation and forest degradation and loss of peatland in Indonesia, which now account for more than 80 percent of the country’s greenhouse gas emissions. The “Letter of Intent” is a promising first step, yet the two countries must still settle key details of the agreement. Below is WRI’s analysis of the Letter of Intent and recommendations for what should be addressed next.

Deforestation and forest degradation in Indonesia have led to greenhouse gas (GHG) emissions and biodiversity loss of global significance. The recently announced Indonesia-Norway Letter of Intent (LOI) on “Cooperation on reducing greenhouse gas emissions from deforestation and forest degradation” aims to support Indonesia’s national strategy to reduce emissions from the land use sector, and to contribute to the international forest and climate dialogue. The effective implementation of this phased strategy can help protect Indonesia’s carbon- and biodiversity-rich tropical rainforests while promoting local prosperity.

Forest Cover Loss in Indonesia, 2000-2005: The Starting Point for the Norwegian Billion to Reduce Deforestation

The initiative proposed in the Letter of Intent will be funded by Norway with US $1 billion, with $100 million paid up front and the rest as contributions-for-delivery. Implementation will occur in three phases:

1. A preparatory steps phase to be achieved by January 2011, including:

Development of a national strategy to reduce emissions from deforestation and forest degradation (known as REDD+);
Establishment of a special coordination agency;
Formation of an independent institution for monitoring, reporting and verification (MRV);
Establishment of a funding instrument based on payment for emissions reductions; and
Selection of a province-wide pilot project.

2. A readiness phase starting in 2011 and lasting 3-4 years, including:

Capacity building, policy development and implementation in 1-2 pilot provinces;
Legal reform to address land tenure conflicts, compensation claims and law enforcement;
A two-year suspension of new forest conversion concessions;
Creation of a degraded land database; and
Development of an independent international verification mechanism.

3. A contributions-for-verified-emission-reductions phase beginning in 2014 which will allow Norway and potentially others to pay for emission reductions through a fund mechanism.

The phased approach and payments based on deliverables is a promising strategy. Additionally, emphases on alignment with international processes, coordination with other REDD+ initiatives (both multi- and bi-lateral), participation of all stakeholders, and full transparency are important. However, because of the inherent briefness of such a LOI, ultimate success will depend on the details.

Next Steps for Protecting Forests

Over the coming months, Norway and Indonesia will write a document detailing the deliverables of this agreement, planned for release in October 2010. If it is to fulfill its potential for reducing greenhouse gas emissions from deforestation, forest degradation, and peatland conversion in Indonesia, the agreement that emerges should address at least five critical objectives:

Coordinate agencies. The LOI mentions two new institutions, a “special agency reporting directly to the president” and an “independent institution for a national monitoring, reporting and verification system”. The roles and responsibilities of these institutions relative to those of the already existing National Climate Change Council (DNPI) and National Development Planning Agency (BAPPENAS) will need to be clarified. The roles of these four institutions also will have to be clarified in light of the new Climate Change Center announced during the G-20 meeting in Toronto as part of the U.S.-Indonesia Comprehensive Partnership. In addition, the new institutions will need to be coordinated with the horizontal (between ministries) and vertical (national, provincial and district government) decision-making structures of Indonesia.
Clarify definitions. Point VII.C of the LOI introduces a degraded land database as a pillar of a strategy to expand agriculture development onto degraded areas instead of into forests. However, a clear definition of “forest,” “degraded land” and “peat” is missing. Definitions are important; for example, defining peat based on depth can result in very different definitions of peatland as peat depth varies considerably. Similarly, the screening criteria to classify land as degraded or suitable for agriculture are not mentioned. Environmental, economic, legal and social factors should be taken into account in these definitions. Without clear definitions, the push to utilize “degraded land” could result in the clearing of high value secondary forest or agro-forests important for communities, or even incentivize the “creation” of new degraded land, which then becomes available for development by virtue of its legal status.
Develop a low carbon land use strategy. The forest monitoring system mentioned in the LOI (the monitoring, reporting and verification system or “MRV”) will be a tool to measure greenhouse gas emissions and inform where emissions occur, but will not actively reduce emissions. Thus, Indonesia first should develop a low carbon land use strategy that targets development onto lands with low carbon content (for example, zoning tree-less areas as candidates for agricultural development), while incentivizing protection or other sustainable uses in dense forest areas. With all the pressures on forests from oil palm, timber, pulp and paper expansion, mining and other activities, a spatially-explicit national land use strategy vetted and integrated with all horizontal and vertical agencies, through a participatory process, will be a critical step in reducing emissions from the land use sector.
Address existing concessions. Although the announcement of a two year suspension of “new concessions for conversion of peat and natural forest” in 2011 is an important step to lower greenhouse gas emissions, this suspension does not address existing concessions. Many companies already have been issued clear-cut licenses for agricultural or timber-plantation development on forested areas that have not yet been converted, and more concessions may be issued between now and the end of 2010. The government has suggested this problem may be addressed through “land swaps” implemented on a voluntary basis in cooperation with civil society and industry. However, since no specific policies have been announced, it is unclear that the moratorium will result in reduced deforestation in the short term. It is essential that a final agreement include plans for the existing, but not yet exercised licenses that are not addressed by the moratorium.
Define the emissions reference level. The LOI says that in phase 3 (point VIII.A), payments will be based upon a reference level and Indonesia’s pledges. This refers to the pledge to reduce greenhouse gas emissions by 41 percent below a historical baseline with international assistance. However, historical reference levels can vary considerably by choosing different data sources or choosing different time periods on which to base the reference level (e.g. the 1990-2000 deforestation rate was 1.8 million ha/yr, while the 2000-2005 deforestation rate was 0.7 million ha/yr according to Hansen et al. 2009). In order to achieve desired reductions in greenhouse gas emissions, the reference level should be set to encourage continued reductions below current emissions levels.

A Good Start

The LOI demonstrates significant support for Indonesia’s national strategy to reduce emissions from the land use sector. In order to be successful, the forthcoming agreement should include further clarification of institutional arrangements, define key terms such as “degraded land,” incorporate plans for low carbon land management, clarify what will fall under the conversion suspension, and determine which reference level will be used. If these elements are clarified, the partnership between Norway and Indonesia holds great promise for achieving reduced emissions from deforestation and forest degradation.

Degraded Land, Sustainable Palm Oil, and Indonesia’s Future: A new policy to develop oil palm on degraded land could protect Indonesia’s forests. But what does “degraded” really mean?
Low Carbon Palm Oil for Indonesia?: An upcoming United States-Indonesia partnership is an opportunity to tackle deforestation.
Map: Forest Cover Loss in Indonesia