Indonesia Merging Deforestation Rules to Spur Carbon Trading

Jakarta Globe, Fidelis E Satriastanti, March 24, 2010

A forest in South Sumatra. Indonesia has enacted three regulations to stem deforestation, and now wants to consolidate them to ease implementation and investment in carbon-trading schemes. (JG Photo/Afriadi Hikmal)

Less than a year after finalizing them, the government is set to untangle regulations aimed at reducing deforestation and forest degradation in a bid to attract carbon-trading investment.

Wandojo Siswanto, head of the climate-change working group at the Forestry Ministry, said the three regulations to be reviewed all cover the same ground, including demonstration activities, carbon-storage activities and Reducing Emissions from Deforestation and Degradation procedures.

REDD is a United Nations initiative aimed at reducing carbon-dioxide emissions from deforestation and degradation. In the scheme, rich nations provide incentives for developing countries to preserve woodlands.

“We want to review [the regulations] so people have a better understanding which one to follow,” Wandojo said.

The regulations are to be combined into one because they are all tied to a single purpose.

Indonesia is the first nation to establish a legal framework for REDD, which has not yet been implemented at international level, Wandjojo said.

“We want to keep the lead in the world and also at the negotiation table, and we have been trying to look at troubles for investment” resulting from the regulations, Wandojo said.

“We want to make sure that this [new regulation] can be easily implemented,” he said.

He added that the review was expected to be finalized before the Mexico climate summit in November.

The World Bank says 20 trial schemes are in various stages of development in Indonesia. Banks, including Merrill Lynch and Macquarie Group of Australia, are among the investors.

Indonesia is also under increasing international pressure to curb deforestation, particularly illegal logging.

The fate of indigenous peoples will also be dealt with in the revised regulation, offering legal grounds for tribes struggling to claim forests as their homes and their main source of support.

The first regulation, issued in December 2008, focuses on pilot projects for REDD, simply known as demonstration activities.

The second regulation, issued last May, deals with technical implementation for the REDD mechanism, starting with developers, verifiers and certifications. The rule outlines the rights and obligations of those who have implemented the scheme.

The same month, the ministerial regulation for procedures on carbon-storage activities was issued. It details benefit-sharing of REDD proceeds by the government, developers and local communities.

Commenting on the planned revision, Andri G Wibisana, an expert on environmental law at the University of Indonesia, said that it was not about reviewing the regulations but determining the country’s position at the inter national level.

“It’s obvious that overlapping regulations need to be sorted out. However, this is not just about the ministerial regulations but rather on clarity of the whole mechanism,” Andri said.

“There are no specific regulations made for REDD, even at the international level. There’s no standard for the measurement, definition and so on.”

Agus Setyarso, executive chairman of the National Forestry Council, said the government had not been very clear on where it wanted to go when it initially issued the regulations.

“From the beginning, the council strongly criticized the regulations, especially on the benefit-sharing part, because it is no different from concessionaires’ rights [HPH],” Agus said.

“REDD is to encourage people to take the initiative and help the government reduce emissions,” he said.

“They are supposed to be given incentives, not disincentives like this. I mean that these people should be rewarded for protecting forests and not merely trading carbon.”