Michael Richardson, Straits Times 20 Jul 09;
INDONESIA'S tropical forests, the most extensive in Asia and the third largest in the world, are rich in many ways. Striking a balance between their continued development and conserving them is difficult.
It is one of many contentious points in the negotiations on a successor to the Kyoto Protocol, the treaty to combat climate change that expires in 2012. Officials from Indonesia and other countries will meet again in Bonn, Germany, next month in an effort to conclude a deal by December.
Forests play a crucial role in regulating greenhouse gases blamed for global warming. Their foliage absorbs and stores huge quantities of carbon dioxide (CO2), the main greenhouse gas. When forests are cut or burned, they release the gas into the atmosphere.
However, Indonesia's forests and the land they cover are also a major source of wealth for the world's fourth most populous nation. Exports of timber and other forest products, including pulp and paper, are worth more than US$5 billion (S$7.3 billion) a year. Though the value of wood sales has been falling over the past decade, forest-related activity remains an important source of income and employment for hundreds of thousands of people in Indonesia.
In the 1960s, 82 per cent of Indonesia was forested. Today, the figure has dropped to 49 per cent. Even in parts of this vast area, valuable hardwood trees have been cut down and there is pressure for further opening.
Between 1990 and 2005, Indonesia lost 28 million hectares of forest, including nearly 22 million ha of virgin forest. The destruction is the result of various forces: Logging (much of it illegal), mining, human settlement, subsistence farming and chopping of trees for fuelwood have all played a part.
So too has the clearance and burning of forests to make way for plantations growing palm oil and timber for pulp and paper mills.
Palm oil - widely used worldwide for cooking, processing food, making cosmetics and as a biofuel - earned US$10.7 billion for Indonesia last year, about 10 per cent of its non-oil and gas exports.
Like forestry, the palm oil industry generates jobs and income for many people, especially the rural poor. Indonesia is the world's top producer of palm oil, followed by Malaysia. It has 7.1 million ha of oil palm plantations, about 65 per cent owned by companies and the rest by smallholders. The industry is planning a major expansion, supported by the government.
Scientists say that this pattern of development, including the draining of vast peat swamps for plantations, comes at a high cost.
About one-fifth of the world's CO2 emissions stems from deforestation. By some measures, Indonesia has become the third largest greenhouse gas polluter in the world, after China and the United States, if its emissions from deforestation and changes in land-use are included.
Scientists warn that unless forests can be conserved, the world has no chance of avoiding catastrophic climate change. Yet the 1997 Kyoto Protocol failed to include effective provisions to protect and restore forests.
The negotiations for a follow-on pact are focusing on a new approach called Reducing Emissions from Deforestation and Forest Degradation (Redd). Although Redd can take a number of forms, the main idea is that companies or governments in advanced economies compensate those in the developing world for preserving forests, either by paying into a fund or by purchasing credits on carbon markets.
Under the latter, legislation now being considered in the US Congress puts a price on carbon, limiting the amount of CO2 industry can emit but allowing trade in emission permits. The proposed law would enable companies to offset six billion tonnes of CO2 by investing in forest conservation projects until 2025.
Earlier this month, Indonesia's forestry ministry released revenue-sharing rules for forest carbon projects. The rules set the shares for Redd financial compensation for central and local governments, as well as local communities. Some analysts suggest that logging and plantation companies will also have to be compensated if Redd is to work.
Whether the international community can agree on a well-funded Redd programme remains to be seen. Implementing forest conservation in a country like Indonesia, where corruption is rife, will be a major challenge.
But if successful, it would give a big boost to poverty alleviation in remote rural areas. It would also help control greenhouse gas emissions and climate change.
The writer is a visiting senior research fellow at the Institute of Southeast Asian Studies
