After more than 10 years in effect, Indonesia has terminated its 2010 Letter of Intent (LOI) with Norway, ending the countries’ collaborative efforts under the REDD+ initiative, i.e. reducing greenhouse gas (GHG) emission from deforestation and forest degradation. According to the Indonesian Ministry of Foreign Affairs, the termination was due to the “lack of concrete progress on the implementation of the obligation of the government of Norway to deliver the results-based payment for Indonesia’s achievement in reducing 11.2 million CO2eq greenhouse gas emissions in 2016/17.” Indonesian Deputy Minister for Environment and Forestry Alue Dohong similarly cited a lack of payment from Norway—despite agreeing in 2019 to remit approximately USD56 million—as a possible reason behind the termination.
Norway has since responded by reaffirming its support to Indonesia in latter’s efforts to protect its forests and peatlands.
Our comment
This new development has certainly led to some raised eyebrows. Recent data shows that Indonesia has been making headway in forest protection, recording a steadily declining deforestation rate in the last four years.
Together with the Singapore Institute of International Affairs (SIIA), Segi Enam Advisors has explored Indonesia’s success story in the Haze Outlook 2021. Indonesia lost 115,459 hectares to deforestation in 2020, a historic low considering the millions of hectares lost in the previous years as well as the generally increasing trend of deforestation happening globally despite the Covid-19 pandemic. The archipelago’s achievement meant it slipped from its regular top three place for primary forest loss countries to fourth in the World Research Institute (WRI)’s global forest review for the first time since 2000.
From SIIA/Segi Enam Advisors (2021): “Official deforestation rate for Indonesia and forward targets, 1990-2030. Note: Forest areas refers to zones that should legally be maintained as forests, while non-forest areas are zones that lack such legal status (but may still have tree cover). The spikes in deforestation correspond to previous severe transboundary haze incidents, linked to weather conditions and economic factors such as the Asian Financial Crisis and growing demand for vegetable oils (including for biofuels). Source: Official data and targets (annualised), KLHK.”
As for GHG emissions, agriculture, forestry, and other land use (AFOLU) typically generates at least half of Indonesia’s annual emissions, recording approximately 67% in 2015 and approximately 50–60% in a more normal year). Official data puts average emission levels from the forestry sector between 2000–2018 at about 439.9 million tonnes of carbon dioxide equivalent (CO2e); the level is 214.0 million tonnes of CO2e if emissions from peat fires are excluded.
To get more perspective, we spoke to a specialist on regional climate change policy. “Indonesia received some payments. But we have been hearing about their dissatisfaction.” It looks like payments have been significantly below the headline figure, were there issues on milestones or other? “It seems to be about the use of payments.”
From SIIA/Segi Enam Advisors (2021): “Indonesian national GHG emissions (including peat fires), 2000-2016. Note: Graph tracks Industrial Process and Product Use (IPPU), Forestry and Other Land Use (FOLU), and other sources of emissions. Source: UNFCCC.”
research@segi-enam.com | 13 Sep 2021, 3 p.m.