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Fading Greens and Empty Stumps: Deforestation in Indonesia

Updated: Mar 4, 2019

Indonesia is home to one of the fastest growing economies and emerging markets in South-East Asia. Since its founding in 1945, Indonesia has transformed itself from a land rife with civil conflict to one of great opportunity. But Indonesia’s stellar growth rate has consistently cast a long shadow over its environment.  Once richly covered in dense tropical rainforest, today Indonesia stands at a disheartening 50.24% of coverage. Where has the vibrant shades of Indonesian green gone? One might find the answer at the hands of an age old Indonesian problem, deforestation.

(Graph: Forest Change in Indonesia by Concession Type)

What drives the unceasing momentum of deforestation? Logging, mining, industrial wood plantations and last but by no means least, palm oil plantations are to be blamed. Logging, specifically illegal logging according to the Natural Resources Defence Council (NRDC), estimates that approximately 40-55% of Indonesian timber logged are illegally sourced. Vast areas of rainforests are cleared to make way for mining companies in search for precious minerals beneath the roots of ancient trees. Yet, falling trees are not the only adverse effect; by extension, water contamination and pollution have seeped into the lives of nearby communities. A study showed that rice grown in Sumbawa indicated “methyl mercury concentrations greater than 100 parts per billion, five times above the legal limit in China.” The expansive growth of certain industrial wood plantations has contributed to the loss of natural forest. A study published on acacia tree plantations found that “55% of people near acacia plantations expressed the view that conditions had become worse over time, compared with just 4% who indicated improved conditions.”. Another study found that between 1973 and 2015, industrial wood plantations expanded by an alarming 9.1 million hectares. Palm oil plantations and companies have found great freedom to expand under what critics point out as an overly lenient legislation. Since 2005 the conversion of rainforest to plantations has increased steeply, continuing to pose a threat to the Indonesian environment.

(Graph: Primary forest loss inside and outside the concessions across Indonesia)

The Global Forest Watch estimates that 55% of forest loss occurs inside legal concessions areas (more than 11 million acres) and 45% outside legal concessions areas. Outside concessions include unregistered palm oil plantations as well as illegal logging. A study conducted between 1973 and 2015 demonstrated that in 1973, 76% of Borneo was old-growth rainforest (note: includes Malaysia). But between 1973 and 2015 approximately 18.7 million hectares was cleared, due to various driving factors. Another study also showed that companies often cultivated more area than required, all of which contribute to the declining Indonesian rainforest.

Much of the debate centred on the criticisms of environmental degradation in Indonesia has boiled down to where the line must be drawn between environmental protection and economic development. It must be conceded that while the environment has been degraded, Indonesia has benefited from it in terms of economic growth. Illegal logging admittedly has contributed to approximately “73% of the $1.6 billion-worth of forest products… the EU imported from Indonesia”. Similarly, industrial wood plantations have contributed to local development as a positive consequence of expansion. Furthermore, mining projects in Indonesia have contributed to the creation of employment opportunities for many Indonesians. Its impact was notable when the mining company Sorikmas laid off workers in 2013, sparking a protest that led to the burning of some buildings. Being the largest producer and exporter of palm oil, the palm oil industry has left a notable mark on Indonesian development. In 2016 it was estimated that Indonesia contributed to 36,000,000 metric tons to the global palm oil production, in turn providing $18.6 billion in foreign exchange revenue.  True enough, palm oil is not necessarily a bad thing, it has generated sizeable revenue for people on limited land, instead what is critical is not the cultivation of the crop but where the cultivation is taking place. It is also important to note that some participants of this debate have forgotten that environmental protection and economic development are not necessarily mutually exclusive. Many forget that part of economic development is sustainability. Thus, if Indonesia wishes to develop its country the aspect of sustainability must be taken into consideration. Should it decide not to heed warnings and continue its pursuit of economic development without sustainability, Indonesia will undoubtedly suffer in the long-run.

But not all hope is lost. In recent years, analysis has shown that the loss of rainforest inside palm oil and industrial wood plantations concessions has decreased (although that is partly due to greater expansion outside concessions). There are ways in which the Indonesian government can take to improve its environmental protection strategies. In order to do so certain policies must be strengthened. Firstly, enforcing moratorium as well as widening the scope to include secondary natural forest high in carbon stocks and biodiversity is critical for prevention of outside concessions and carbon emissions. Secondly, it is imperative that the government takes the necessary step to improve data collection. The more comprehensive the data, the better monitoring of deforestation. Such an effort has been made by the private sectors, national and local governments as well as other organisations, attempting to map smallholder palm oil plantations. However, the effort is scattered and desperately needs greater synchronisation. Updated data will provide increased transparency which is critical for more precise analysis and thus strategic planning. Finally, the Indonesian government must strengthen law enforcement to prevent and reduce illegal logging and trade as well as monitoring the annual implementation plan (RKT) of companies. All of which will be crucial in the effort against the loss of rainforest and reducing carbon emissions.

(Image: Riau Deforestation 2016)

Time for the Indonesian rainforest is waning. The Indonesian government must act if not for the environment then at the very least for its people. Continued environmental degradation is a threat to the Indonesian people and future economic development. The underlying causes of deforestation are clear and there is an abundance of solutions in which the Indonesian government can act upon. Now all that remains is for the Indonesian government to take up the initiative that will prove not only beneficial to the preservation of the rainforest but also pave the way forward to a sustainable future. Should Indonesia decide to take a greener route it can uphold a standard and model for other developing South-East Asian economies, demonstrating that a greener bank account and greener environment are not mutually exclusive.