The Norway - Indonesian REDD deal - an insight

The governments of Indonesia and Norway signed recently a US$1 billion partnership to cut Indonesian emissions from deforestation and forest degradation to resist climate change. Indonesia, the world’s third-largest forest nation with 120 million hectares, pledged a two-year suspension on issuing new permits to convert natural forests or peatlands. Forestry Minister Zulkifli Hasan spoke with the The Jakarta Post’s Adianto P. Simamora about the two countries’ forestry partnership. Below are excerpts from the interview.

Question: Could you explain the reasons for the two-year moratorium?   

Answer: Let me first explain about the partnership (between Norway and Indonesia). It did not come out of the blue. It was made through long negotiations. The agreement could be realized because of Norway’s trust in Indonesia’s strong commitment to deal with climate change. It is an appreciation for Indonesia by the international community.

Our government under the leadership of President Susilo Bambang Yudhoyono has made the commitment to slash emissions by 26 percent by 2020 with our budget. We are committed to meeting the target with or without money from other countries. Isn’t that an extraordinary commitment?

The items stipulated in the Letter of Intent (LoI) are actually the programs that we have implemented so far. We have included items from the LoI in national action plans for reducing emissions from deforestation and degradation (REDD plus).

Thus, the moratorium on natural forests and peatlands is not a result of the money from Oslo. With or without money from any foreign country, Indonesia will protect remaining natural forests and peatlands for the sake of the next generation. It is not for Oslo. It is not right if one says Indonesia is dictated to by Norway.

The two-year suspension on new permits was because our partnership with Norway will last for two years. The two parties will assess results after 2013. Hopefully, we can extend it later. But, the moratorium is not because of the compensation from Norway — it is because we want to manage our forests.

Since I was appointed minister, I have not signed a single permit for companies to convert natural forests or peatlands. The difference is we never announced this as a moratorium though in fact we have stopped new permits for natural forests and peatlands since last year.

How about companies that have secured permits to convert peatlands but have not begun to operate yet?

The moratorium on new concessions will be effective between 2011 and 2012. It is clear in the agreement.

Any business activities including plantations, mining or agriculture that secured permits before the year 2011 have nothing to do with the moratorium. They can run their businesses as usual except in peatlands that are more than 3 meters deep.

I don’t know yet how many companies there are that have permits for peatlands or natural forests that have not begun operating yet. There is also no concept of a land-swap option for those companies.

But as I said before, I have not issued any permits for plantations or mining companies wishing to operate in peatlands since November.

Conversions will temporarily be halted starting 2011. That does not mean there won’t be any  new permits issued to plantations or mining companies after that.

We will support them in running their businesses. They can propose new permits to expand their business but they must utilize the country’s idle and degraded land.

We currently have a huge area of degraded forests. The National Land Agency (BPN) still has some 12 million hectares of idle land that could be used for business purposes. There are another 40 million hectares of degraded forests that could also be turned into plantations.

In Riau, for example, there are huge areas of idle and degraded forests, so why do the companies prefer doing business on thick peatlands?

We will promote the availability of idle and degraded land to meet the country’s target for self-sufficiency in sugar cane. So, I think, there is no need to worry about the moratorium’s impact on our economy.

I have spoken with groups of business players to clarify the moratorium. I ask them to support the government including by planting trees to deal with climate change. It is time for us to properly manage our forest. Our remaining natural forests are now less than  40 million hectares.

How will you ensure the moratorium is enforced in the field?

I must admit that is not an easy task. The moratorium could be ineffective if law enforcement does not work. The main key is to seriously enforce the law.

I myself demand that the enforcement of laws against illegal logging and timber trading and related forest crimes and the creation of a special unit to tackle the problem be included in the LoI.

We will empower the unit with the National Police, the Attorney General’s Office and the Corruption Eradication Commission.

If there is no law enforcement, deforestation will increase in speed during the moratorium era.

The success of the moratorium also depends on the role and cooperation of local authorities from governors to regents. This must be translated in the draft of the presidential decree to implement the partnership that is currently being deliberated.

Indigenous people will be a crucial element in making the moratorium a success. We must share with them the financial incentives from Norway.

We intensively promote communal forests as one of the main programs for resolving tenure snags and give financial benefits to the local people. We grant them between Rp 5 million and Rp 8 million for every hectare they develop. It shows that before the Oslo agreement, we were taking steps to empower indigenous people.

What is the nature of the relationship between your office and the planned new REDD agency?

We are currently holding intensive meetings to discuss the plan to set up a special agency reporting to President Yudhoyono.

The agency, which is likely to be led by Kuntoro Mangkusubroto, would coordinate the implementation of partnerships and pool all the money from Norway. The agency would act to conduct independent MRVs (measurable, reportable and verifiable schemes) to assess the rate of deforestation and forest degradation.

The MRV will apply international standards and should be independent to avert conflicts of interests.

We, the Forestry Ministry, would only work in the field to implement the program but verification would come from the special agency. We hope the MRVs will begin soon.

We plan to visit Brazil to learn about their implementation of the REDD project, which was also funded by Norway this month.

When will Norway disburse its pledged money?

We agreed on a three-phases approach covering from preparation and transformation to contribution for verified reductions. In the third phase, Norway would pay us based on emissions reductions from deforestation and forest degradation. I don’t know the value of each phase.