Wednesday, June 2, 2010

Cancellation of Forestry Permits

During his visit to Oslo last week, President Susilo Bambang Yudoyono reached an agreement with the Norwegian government in which the latter promised to provide Indonesia with US$ 1 Billion in grant if it stop deforestation.

In this connection, Reuter (below) reported that Indonesia shall cancel forestry permits that have been issued to Palm Oil and Timber companies, and shall not issue new permits in the next two years.
I hope that it would not be very difficult for Indonesia to keep this promise.                                          
Indonesia to scrap permits to save forests-official 
By Sunanda Creagh
JAKARTA May 31 (Reuters) - Indonesia will revoke existing forestry licences held by palm oil and timber firms to save natural forests under a $1 billion climate change deal signed with Norway last week, a government official said on Monday.

Indonesia's president, Susilo Bambang Yudhoyono, who announced the deal last week in Oslo, said new concessions for the conversion of natural forest and peatlands would be suspended for two years. But he did not say at the time how existing concessions would be affected. [ID:nJAK326556].

Preserving forests is seen as crucial to slowing climate change because trees absorb enormous amounts of greenhouse gases.

Indonesia has huge tracts of tropical forests but a rapid deforestation rate. It has pledged to cut emissions by 2020 to 26 percent lower than the level if no action were taken or 41 percent lower if it is able to secure foreign funding and other assistance, like technology.

Part of the $1 billion promised by Norway will be spent on compensating businesses that have existing concessions cancelled in order to keep forests standing, said Agus Purnomo, head of the secretariat of Indonesia's National Climate Change Council.

"When you revoke licences, when you cancel things, it involves money," Purnomo told Reuters by telephone.
"It's not that we will cancel all licences but (only) if there is a need to do so" to keep primary forest intact, he said.

Compensation to permit holders could include cash, land swaps or other "amicable, workable and realistic solutions", he said.

Palm oil firms such as Wilmar (WLIL.SI) and Indofood Agri Resources (IFAR.SI) have ambitious expansion plans in Indonesia, already the largest producer of an oil used to make products ranging from chocolate to soap.

Palm oil and pulp and paper firms are most likely to be affected, said Purnomo.
"But I am not ruling out any possibility. The spirit of the agreement was to save the remaining natural forest and peatland and we will do whatever humanly possibly to make it happen, within the legal context of Indonesia," he said.

"If we have to go through cancellations in the court system, we will do it."
Permit holders will find out within six months if their concessions will be honoured, he said.

"Some of them don't have a valid permit, they are just making a claim," said Purnomo. "If they don't have a valid permit, we are not going to compensate. If they are getting it through bribery, we are not going to give" compensation.

A text of the Oslo agreement, seen by Reuters, suggests that the moratorium on new concessions for conversion of peat and natural forests will not be implemented until 2011. The document said that the deal will be broken into two phases.

The first phase, which runs until the end of 2010, focuses mainly on preparing and implementing pilot projects under a U.N.-backed forest preservation scheme called reduced emissions from deforestation and degradation (REDD).

REDD allows developing nations to earn money by not chopping down their forests.
The second phase of the deal, running from 2011 to 2013, will focus on REDD, law enforcement and capacity building.

The commitment to a two-year suspension on all new concessions for conversion of peat and natural forests is listed in phase two, suggesting it does not come into effect until 2011. (Editing by Sara Webb and Sugita Katyal)


Amit Ganguly said...

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H. Nizam said...

Thank you for your visit and comment

colson said...

It is great news at first glance. However the comments by Purnomo seem to be realistic and telling: we may hope, but our expectations should not be sky high.

Simon said...

I hope too that progress will be made here.

I do have to admit though that reading SBY's pledge to the Norwegian government about 'making sure personally for improvement in this area' did leave a bittersweet taste in my mouth.

I respect that forestry is a serious problem here, but I'd have a lot more respect for SBY when he shows similar passion and commitment in his words when he's NOT with foreign leaders.

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umihoney said...

It may sound a bit mercenary to accept $ in order to save the forest.But its lost income for the state so its understandable. Having said that what are the alternatives for those that are dependent on forest for a living (read the villagers and hinterland population)Has a sustainable re forestration plan been drawn up for the next 2 years.He has to walk the talk la.

H. Nizam said...

It is obvious that officials of present govt cannot ascertain implementation of this deal. Because in 2014 SBY will finalize his last office term. No one can guarantee that the next prez. will honor the promise to reduce gas emission by 2020.

If SBY can show similar passion & commitment in his words when he is not with foreign leaders, things would be quite different here.

Thank you for your offer.

Greeting to you too.

The money should also cover compensation for those who are dependent on the forest for living.
Reforestation program should at least be until 2020 that's what the prez promised world leaders last September.

Edwin's Personal Blog said...

It's time to take a real action for REDD stipulated in Bali in 2008.

Blog Ekspor Impor said...

Forest degradation has been remarkably acute. A real action to save earth is not to be postponed..

H. Nizam said...

Yes it is time to implement what have been agreed in Bali in 2008.

@Blog Ekspor Impor,
Efforts to save the forests should not be postponed any further

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REDD-Monitor said...

There's more information and analysis about this billion dollar forest deal on REDD-Monitor (including a copy of the Letter of Intent):

Mixed messages on the Norway-Indonesia billion dollar forest deal |

Norway-Indonesia forest deal: US$1 billion dollars worth of continued deforestation? |

H. Nizam said...

Thank you for your kind information. I'll check it out.