Indonesia, Norway to Sign $1b Forestry Deal

Jakarta Globe, Camelia Pasandaran& Fidelis E Satriastanti, May 24, 2010

Indonesia and Norway are expected to sign a $1 billion agreement on the forestry sector at a two-day meeting in Oslo this week, a senior Indonesian official said on Monday.

The Oslo Climate and Forest Conference, to be held on Wednesday and Thursday, is expected to be attended by at least 10 heads of states from countries with rain forests.

The conference aims to come up with a nonbinding framework on the UN-backed carbon trading mechanism known as REDD (Reducing Emissions from Deforestation and Forest Degradation). The framework will be called REDD-plus Partnerships.

President Susilo Bambang Yudhoyono will co-chair the Oslo meeting.

“The Oslo meeting is a very important step in realizing all the promises that have been made by [developed countries] and to sort out how the financing will be determined,” said Liana Bratasida, the environment minister’s assistant for global environmental affairs and international cooperation.

Liana said $3.5 billion in funding had been promised to rain- forest countries by Norway, Australia, France, Japan, the United States and the European Union.

She also said the REDD-plus Partnerships that were expected to be launched at the meeting in Oslo would represent a major breakthrough in climate change negotiations.

“If this can move forward then it might push other negotiations to move forward also,” Liana said of the new framework.

Environment Minister Gusti Muhammad Hatta said the Oslo meeting would benefit Indonesia because Norway’s promised funding would boost optimism that the country could reach its emission cuts targets.

Indonesia last year made a voluntary pledge to cut its emissions by 26 percent by 2020 and by up to 41 percent if assisted with international funding.

“If we get the funding from Norway, we will channel it for activities on peatland areas, considering that these areas have a bigger impact [in the release of more carbon dioxide],” Gusti said.

The discussions at the conference will include involving governors with peatland areas.

Meanwhile, Dino Patti Djalal, Yudhoyono’s spokesman for international affairs, said they expected pledges on the REDD-plus Partnerships would be increased to $5 billion.

“This funding mechanism, what we call interim REDD-plus Partnerships, will effectively and efficiently coordinate the implementation of the forest and climate change program,” the spokesman said.

Dino said the partnerships would be replaced if the climate change negotiations reached an official agreement on an international mechanism related to REDD-plus.

Yudhoyono will also meet the Norwegian prime minister, Jens Stoltenberg to discuss bilateral relations and sign a letter of intent concerning cooperation in forestry issues.

Dino declined to provide more details of the agreement.