Presentation on theme: "Prabianto Mukti Wibowo Coordinating Ministry for Economic Affairs"— Presentation transcript:
1 BALANCING AGENDAS: a Governmnet perspective on implementing “Zero Deforestation” commitments Prabianto Mukti WibowoCoordinating Ministry for Economic AffairsRepublic of IndonesiaANNUAL WORLD BANK CONFERENCE ON LAND AND POVERTYMARCH , 2015WASHINGTON, DC
2 AREA OF PALM OIL PLANTATION NOYEARAREA (Ha)Smallholders%PrivateTOTAL119806.175298100199026743200028724201040605201142586201243577201382014*)I have highlighted the latets figures percentages with a red circle*) Prelimenary dataSource: Ministry of Agriculture, 2014
3 PRODUCTION OF CPO NO YEAR PRODUCTION (Ton) Smallholders % Private YEARPRODUCTION (Ton)Smallholders%PrivateTOTAL119807700,1199,891002199015,6284,383200027,2272,784201038,5261,485201138,0961,91100 6201235,3564,657201336,0363,97 10082014*)36,463,59Worth noting here, the difference in CPO productivity between smallholders and private firms – their yields are somewhat lower (compared to the almost 50/50 split on hectarage)*) Prelimenary dataSource: Ministry of Agriculture, 2014
4 EXPORTS OF PALM OIL BY MAJOR COUNTRIES OF DESTINATION ( Net Weight in '000 Ton)Country of Destination2010201120122013China2.174,42.032,82.842,12.343,4Singapore696,8737,2952,1844,0Malaysia1.489,71.532,61.412,3514,3India5.290,94.980,05.253,85.634,1Pakistan90,3279,2749,11.080,3Bangladesh771,2804,9743,5655,4Sri Lanka12,725,410,829,4Egypt488,7790,7494,1735,5Netherlands1.197,3873,01.358,31.361,4Germany379,3263,6219,5283,1Others3.700,64.116,84.809,47.097,1TOTAL16.291,916.436,218.845,020.578,0Worth noting that Asia dominates as a market which presents a challenge for market demand for Zero deforestation palm oilSource: Statistics Indonesia, 2014
5 PALM OIL CONTRIBUTION TO ECONOMY Exportthe largest agricultural exports and its most valuable non-oil and gas export.generated about $15.8 billion in foreign exchange.Employmentabsorbed about 5 million workers (at least 15 million people are directly affected by oil palm related employment).provides more jobs per hectare than other large scale farming (it employs about 0.4 people per hectare), and the jobs are year-round rather than seasonal.Rural Developmentlocal infrastuctures : road, electricity, school, economy activities, etc.Poverty alleviationThe role of palm oil industry in lifting people out of poverty is significant.
6 PALM OIL PLANTATION AND DEFORESTATION Source: Ministry of Forestry, 2014
7 Palm oil plantation and deforestation Source: Ministry of Forestry, 2014
8 Decreasing trends of forest conversion? Source: Ministry of Forestry, 2014
9 Current Government interventions The government of Indonesia has taken steps to ensure sustainability:Government Regulation 71/2014 on the protection and management of peat land.Presidential Decree No. 6/2013 on the moratorium on issuing new licenses in primary natural forests and peat land.Presidential Decree No. 62/2013 on the establishment of REDD+ National Agency.Regulation of Ministry of Agriculture No. 19/2011 on the Indonesian Sustainable Palm Oil (ISPO) standard.Regulation of Ministry of Forestry No. 43/2014, regarding Sustainable Production Forest Management and Timber Legality Verification Standards.Those regulations and standards have some form of prohibition on the clearing of forests and other natural ecosystems including maintenance and enhancement of high conservation values forests (HCV), legal compliance, protection of peat land, and respect for local and indigenous people’s rights to give or withhold free, prior, and informed consent (FPIC).Is there reference to HCV in Indonesian regulations?
10 Potential negative impacts and implementation challenges Lack of clarity on concept and implementation:What is the scope of deforestation-free commitments?Is absolutely no conversion of forestland allowed? or is conversion possible within certain bounds?Is it a stand alone objective or as a component of existing instruments to combat deforestation?Oil palm smallholders may be marginalized by escalating costs and loss of market access for palm oil products. How do we include smallholders and who will bare the cost?How do we involve other stakeholders (producers and local governments)?What are the incentives?Driven by European buyers – trade discrimination? More negative rather than positive perception.
11 THE WAY FORWARD: toward greater collective responsibility Zero-deforestation committments should not be a trade barrier.Deforestation is all about governance issues and effective implementation.To improve governance, Indonesia is looking for integrated landscape management (ILM) for long-term economic, social and ecological sustainability:Completing spatial plans at national and sub-national under Law 26/2007 Spatial Planning ActMoving into one land administration solution --- establishment of Ministry of Agraria and Land-use PlanOne Map policyCan Zero deforestation commitments help to provide momentum, leverage change and effectively implement these initiatives?