pais 565 assignment- (dwi ristyadi)

8/3/2019 Pais 565 Assignment- (Dwi Ristyadi)

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University of New England Page 1Dwi Ristyadi, November 2010

PAIS 565 POLITICS AND ENVIRONMENTAL

COORDINATOR: Dr. TONY LYNCH

LITERATURE REVIEW ON INDONESIAS FOREST AND TIMBER TRADE

BY: DWI RISTYADI - 220068250

Introduction

Indonesia is one of few countries that have the most magnificent tropical forests in the

world. There is a conviction, based on estimate of potential vegetation cover with appropriate

climatic and ecological condition, that long time ago almost all of the lands in Indonesia were

covered with forests (MacKinnon, 1997). It is known that Indonesias forests have the highest

and unique biological richness in the world. In spite of Indonesia land is only 1.3% of world

land, this country is home for 11% of worlds plants species, 10% of worlds mammals

species, and 16% of worlds birds species (FWI/GFW, 2002). Therefore, Indonesia has an

important responsibility to keep this world heritage remain sustainable, as these forests play

important environmental roles for nature balance in all over the world. However, these

natural habitats cannot be kept untouchable since human population increase significantly

which lead to the increased exploitation of natural resources. There are many types of

exploitation happened in Indonesias forests, but significant deforestation is mostly caused by

timber industries, which also responsible for many natural disasters that happened in

Indonesia, and contribute to the global climate changes.

Economic and national development reasons have been used to legitimate timber

trade in Indonesia. In this paper, I argue that over exploitation of Indonesian forests will only

benefit certain group of people rather than to the national development of this country, while

it will bring significant impact on the environment. For that, in this paper I will briefly


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provide an overview of Indonesias forests and timber industries, and discuss about political

and economical aspect behind that, and also environmental impact of this industries.

Overview of Indonesias Forests and Timber Industries

Indonesias Forests And Its Environmental Roles

Indonesia is a tropical country with very large forestswhich is in the third position

behind Brazil and The democratic of Congo (Sunderlin & Resosudarmo, 1996). This fact is

perceivable as the vegetation map produced by Indonesian government in 1950 showed that

84% of Indonesia lands are covered by forests. This area percentage is equal to 162,290,000

hectares of forest which comprise of 51,400,000 hectares in Kalimantan, 40,700,000 hectares

in Irian Jaya or Papua, 37,370,000 hectares in Sumatra, 17,050,000 hectares in Sulawesi,

7,300,000 hectares in Maluku, 5,070,000 in Java, and 3,400,000 hectares in Bali and Nusa

Tenggara Barat/Timur (Indonesian Ministry of Forestry, 2008). In these wide areas, there are

up to19 different types of forests with different characteristic of habitats, namely mangroves,

nipah, palm, peat, swamp, wetland, evergreen, and montane forests (greenlinescare, 2009).

Furthermore, Indonesian archipelago which consists of 17,000 islands that are

covered by dense forests has enormous biodiversity. The high biodiversity in this country has

made Indonesia become one of mega-diversity countries, since 17% of the total number of

species in the world are endemic to Indonesia (Krattiger, 1994). To illustrate, there are more

than 2,904 mamalian species in Indonesian forests which made Indonesia on the first-rank

holder for mamalian diversity, and also on the third-rank for reptile diversity, fourth for Aves,

and fifth for amphibians (Welp etal, 2002 ). In addition to that, the English biologist Alfred

Russel Wallace (1859) implied that these enormous biodiversity were extremely unique since

he found that animal and plant species present in one island were not present on another


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island only 40 km away. Then he also has made an invisible line, popularly known as

Wallace line, across Indonesian archipelago which is the dividing point between Asian and

Australian flora and fauna.

This high level of biodiversity is highly valuable as genetic resources which may be

useful for many aspects of human live as it will provide more options for future use through

science developments. For instance, these genetic resources have been proved useful for

human health since there are at least 1000 species of plants from these forests have been

known and used as medicines and traditional biomedicines (Zuhud, 1989). Additionally,

these genetic resources may also be useful for improving agricultural plants through genetic

technology. Besides that the high biodiversity in these forests may also be valuable as

biological control for agricultural pests. This is because high biodiversity of insect species, in

these forests, may increase parasitism and predation which can affect major shift in

community structure by controlling the abundance of other subdominant predators and prey

species (Gullan and Cranston, 2005). Indeed, this may also affect on the dynamic population

of insects pest in agricultural areas near to these forests.

These very large forests also play important ecosystems services which may affect all

off living things in the world, as they may provide biospheric and ecological services that

can tackle climate change, regulate regional rainfall, prevent flood and erosion, and

supporting high level of biodiversity. In term of tackling climate changes, the highly dense of

trees in these forests may serve as a part of worlds lungs which may stabilise levels of

atmospheric CO2 by sequestering carbon dioxide through photosynthesis. In fact, forests

ability to sequester and store carbon is higher than other types of land cover, which represent

the most significant terrestrial carbon store. For instance, tropical rainforests have been found

have sequestered carbon more than four times higher per hectare than cropland in the tropics

(Eliasch, 2008). Moreover, according to FAO (2001), the total biomass of forest vegetations


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in Indonesia is more than 14 billion tons, which is equal to about 3.5 billion tons of carbon.

This figure is more than any other country in Asia, and equal to roughly 20% of the biomass

in all Africas tropical forests. Globally, worlds forests which only 30% of earth total land

area play important role that remove about 3 billion tonnes of carbon from the atmosphere

every year, which is about 30% of all CO2 emissions from fossil fuel burning and net

deforestation (UNEP, 2009).

Moreover, tropical forests also play an important role in regulating climatic conditions

and safeguarding the environment from flooding and soil erosion. On the contrary,

deforestation of tropical forests leads to negative ecological effects such as changes in run-off

patterns leading to soil erosion, and increased risks of subsequent flooding in lowlands. When

river catchments areas are deforested, large regions are devastated down stream by massive

floods which also lead to soil degradation (Schneider 2001).

Apart from responding to climatic conditions of a certain region, tropical forests

essentially influence climate. After a massive downpour, these forests as well as the massive

number of plants located in these regions trap huge quantities of water in their leafy system

and humus system which they later transmit to the atmosphere through transpiration. A single

tree can trap and later release more than 755 litres of water into the atmosphere every year

(Mastrantonio 2010). Additionally, the environment of the tropical forests is quite different

from other environments. The thick layer of the rainforests implies that much of the rain does

not reach the ground since leaves act as umbrellas. When the forests are cut, the amount of

rain that would have been absorbed by the vegetation is directly transferred into rivers

causing serious flooding in neighbouring regions. Thus, it means that tropical forests

moderate the speed of stream flow, and reduce the onslaught of tropical downpours, store and

use huge quantities of rain water, and hold the soil together. Besides that, there are many


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other benefits can be provided by the forests in condition that the forests are still kept

sustainable.

Recent Condition of Indonesias Forest & Timber Industry

Nowadays, Indonesia has experienced significant increase in human population and

development since its independence day 65 years ago. These changes have reciprocals

relations with political and economic movements in Indonesia which also drive the

exploitation of natural resources in this country. Significant deforestations in Indonesia is an

inevitable effect of forests exploitations by economic sectors like mining, agriculture, and

timber industries which are supported by certain groups of people with political power.

In the name of economic and development, deforestation started to become a serious

problem in Indonesia in 1970s when this country started to develop timber industries to

accelerate economic growth. Obviously, In this timber boom era Indonesia has become the

biggest log exporter in the world, and in the end of the 1990s Indonesia become the biggest

plywood producer in the world, which supplied 75% of the world market demand

(Indonesian Working Group on Underlying Causes of Deforestation and Forest Degradation,

2010). Indeed, this sector has significantly contributed foreign exchange to Indonesian

economy. For instance, wood and wood products exported in 1994 has contributed US$ 5.5

billion revenue to Indonesia (Economist Intelligence Unit, 1995). Similarly in 1997,the total

export of plywood has contributed about US$ 3.5 billion , and about US$ 2 billion from pulp

and paper (FWI/GFW, 2002). Besides that, this sector has also provided job opportunities for

many people around the forest regions, as based on World Bank (1995) data there were at

least 700.000 people employed in the formal forest sector in Indonesia. However, these

economic achievements have sacrificed the forests, and significantly degraded the

ecosystems.


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The growth of timber industry has lead to significant increase of deforestation every

year. It was estimated that the annual deforestation rate in 1970s was 300,000 hectares per

year, then doubled in 1981 to 600,000 hectares per year, and reached 1,000,000 hectares per

year in 1990 (World Bank, 1990). As the result, Indonesia has lost a lot of its forest only in a

very short time. Based on Indonesian government report, the areas with forest cover have

declined to 119 million hectares in 1985, which was 27% less than in 1950s. Then, the

government and world bank survey in 1999 concluded that the rate of deforestation during

1985-1999 has reached 1.7 million hectares per year, which has make each of Sumatra,

Kalimantan, and Sulawesi loss 20% of their forests during that period (ISAI, 2004).

Admittedly regarding to the above data, it should be noted that there was an

ambiguity in the estimation of annual average of deforestation in Indonesia. Review on some

literatures indicated that the estimations of annual average of deforestation in Indonesia are

widely varied, ranging from low to very high. Even, the World Bank had to acknowledge that

their estimations were based on weak data (World Bank, 1994). In relation to that, Sunderlin

and Resosudarmo (1996) implied that there are two primary reasons behind that ambiguity,

which are the lack of appropriate primary data on the rate and causes of forest cover change,

and also various meaning of term deforestation in Indonesian has resulted in confusion.

In stead of those ambiguous data, it is real that the level of destruction in Indonesias

forests until now has reached severe level which will not only threaten the biological richness

inside the forests but also stimulate natural disasters as it disrupts the natural balance. The

recent update by Indonesian ministry of forestry (2008) indicated that within the 133.57 ha of

designated forest only 64% are still covered by forest vegetations, which means that at least

39 million hectares of natural habitats have been destroyed by human activities. Obviously,

the accumulated affects of these destructions will adverse all living things, especially human

live, while most of the benefits of these exploitations are only taken by a few groups of


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people. However, it is not easy to determine who have to responsible for all of the negative

impacts.

It is tempting to conclude that the massive destructions of ecosystems are caused by

timber industry, since significant growth of timber industry in Indonesia occur over the same

period of time with rapid acceleration of deforestation. In details, the fast growth of timber

industries were made possible by the national government since it was lead by the New Order

regime of Soeharto. The 1967 forestry act provided the legal basis for government to award

timber harvesting rights, which made many companies were granted 20 year-logging

concessions (Hak Pengusahaan Hutan or HPHs) for large areas (FWI/GFW, 2002). For that,

the national government has made Indonesias forest resources available to privately-owned

logging companies, which was by 1980 up to 50% of nations total land area were available

for private investors (Barr, 2006). As the result, in 1983, there were 560 private companies

held the Forest Concessions or HPHs which covered 65.14 million hectares of the Indonesias

forests (WRM, 2010).

Political and Economical Aspect Behind Timber Trade

Obviously, political changes in Indonesia have strongly affected the environment and

economic in this country. I suggest that the first political decision to exploit the forests was

really taken for national benefit to develop this country, which was really young since its

independence day in the 17th Augustus 1945. Furthermore, the fact that Indonesia has been

colonized by the Dutch for more than 350 years was really made Indonesia become

underdeveloped and lack of educated human resources. Therefore, the rich of natural

resources become a solution for the national government to develop this country.


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However, as the value of timber was like brown gold, it was tempting for some

people to exploit the forests for mostly their own benefit rather than for the nations benefit.

As a result, the political decision on this sector has lead to untransparent and uncontrolled

exploitation of Indonesias forests. The report by Forest Watch Indonesia and Global Forest

Watch (FWI/GFW, 2002) emphasized that the very fast deforestation in Indonesias forests is

mainly caused by the corrupt political and economical systems in this country, which have

been exploiting the natural resources for the benefit of individuals and political groups.

It seems that mismanagement of Indonesias forests have been started since Indonesia

was lead by Soeharto and his New Order regime. With his political power, Soeharto awarded

most of the logging concessions or HPHs to his relatives and political supporters (ISAI,

2007). As a result, although until 1990s there were 585 logging concessions covering a total

of 62 million hectares of forests, most of the concessions with very large area were hold only

by several groups (table.1) which involved in patron-client network with Soeharto, namely

Barito Pacific, Djajanti, Alas Kusuma, Kayu Lapis Indonesia (KLI), and the Bob Hasan

Group (Brown, 1999). To illustrate, Bob Hasan which is also known as the king of the

Jungle is the most powerful timber businessman in Indonesia, which is also a close friend

and strong supporter of Soeharto and his regime. For that, Bob Hasan made partnership with

Soeharto daughter Siti Hardijanti Rukmana in a US$ 1 Billion pulp and paper mill, and he

also drive several big timber companies like Barito Pacific and Nusantara Ampera Bakti

(Dauvergne, 1997).


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Table 1. Ranking of Top 10 Timber Groups by HPH Holdings, in 1994-1995, and 1997-1998

Source : Brown, 1999.

This patron-client network in Indonesia has successfully supported Soeharto to keep

in his position as the national leader for up to 32 years, while it has also made the concessions

holders can freely exploit the forests without concerning the sustainability of the forests.

Casson & Obidzinski (2007) reported that these large scale companies, which were backed up

by the New Order regime, have long been harvesting timber over the Ministry of Forestrys

approved level, and also obtaining timber from illegal sources in order to meet increasing

demand. Similarly, based on my work experiences in this Industry in Sumatra (2005), the

timber company seemed to have double different maps for their operations and report to the

government, which means that over exploitations of the forests were not only happen in the

concession areas but also in protected and conservation areas.


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Furthermore, global economic crisis in1997 has result in the unstable political

condition during 1997-1998 in Indonesia, and forced Soeharto to leave his position in May

1998. Following that Indonesia started a new reformation era, in which decentralization

become the major issue since centralized government has failed to provide even development

to all areas in Indonesia. So, decentralization in Indonesia was proposed to guarantee that

every region can get more benefit from their richness in natural resources (NRM, 2000). In

that case, decentralization was the only best solution to prevent the disintegration of this

nation.

Unfortunately, this political change has created conditions that contributed to a boom

in illegal logging (Khan, 2001). This is probably because of the regional autonomy has made

the management of natural resources become unintegrated, as the national government has

given the responsibility to the local governments. There is a fact that the rate of deforestation

in period of 1997-2000 have increased to 3.8 million hectares per year, which mean twice

higher than the rate in 1980s (ISAI, 2007). Another possible reason behind this is because

regional autonomy has been used by local governments as political and economical

legitimating to exploit the forest for regional developments.

In relation to that, Rhee (2003) reported that the provocative set of decentralization

laws no.22 has made local communities, government, companies, and NGOs in certain areas

are strategically manoeuvring and positioning themselves to take actions on using natural

resource based on their respective understanding of what decentralization means. As a result,

local leaders in many regional areas have awarded more logging concessions to timber

companies. For example, in the regional area of Muna, there were 10 new concessions have

been given in 2002, and not less than 100 concessions were in a process of approval by the

regent of Muna. Again, patron-client network are built in this process as 90% of that

concession were given to the people that have strong relation with this local leader (Intip


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Hutan, 2004). This means that the forest exploitation model of the Soehartos regime has

been replicated at the local level. Thus, it is clear that political and economical changes have

significant role in increasing the rate of deforestation in Indonesia.

Military and Indonesias Forests

Military institution, which is as powerful as political institution, is one of factors that

stimulate conflicts and violence in Indonesias forests, and also directly and indirectly

involved in exaggerating deforestation in Indonesias forest (Jarvie et al, 2004). The

involvement of military and police institutions in both legal and illegal logging have made

conflicts on utilisations of forest resources cannot be solved as the law become obscure and

fail to be enforced. This condition has made legal and illegal parties freely log the forests

without hindrance (MacKinnon, 2006).

Direct involvement of military in timber Industry has been started since the earliest

day of this industry appeared in Indonesia, as Soeharto also handed out logging concession to

military for several reasons like to benefit loyal military officers, appease potential

opponents, and bolster the military budget. Obviously, handed out large logging concessions

were needed by Soeharto for these all political reasons, to save his position. This was because

of the New Order regime of Soeharto was strongly underpinned by The Indonesian Armed

Forces, which acted as the key coercive tool of the nation, helping the New Order regime to

suppress any potential threats (Dauvergne, 1997). Additionally, to ensure his control over the

nation and its natural resources, in 1987 Soeharto has appointed 21 governors with military

background over 27 provinces in Indonesia, and also most of the members of his cabinet were

taken from military (Hidayat, 2005).


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As a result, many concessions were linked to various military organisations, and the

total logging concession that hold by military, in 1997, has reached more than 1.8 million

hectares (Table. 1) (Brown, 1999). With those very large concession areas, central and

regional military commands driven over a dozen timber companies, which made them

directly involved in harvesting and trading the timber. However after the fall of New Order

regime, the new government investigated the involvement of military in deforestation of

Indonesias forests. One of the finding is that the Yamaker, one of militarys companies, has

run an illegal business by destroying Kalimantan forest and smuggling the log in a massive

scale to Malaysia (Human Rights watch, 2006).

In fact, although the new order regime has been fallen, militarys companies still

involved in destroying Indonesias forest until now. One of methods that they use is by using

plantation hoaxwhich is common in Indonesia. This strategy work by providing guarantee

that after the clearance of the forests, the land will be used for palm oil plantation which can

provide thousand job opportunities for people lived near the forest. However, based on NGOs

estimation, from 3 million hectares that have been cleared in East Kalimantan, only 10%

really have been used for palm oil plantation (Human Rights Watch, 2006).

Environmental Impact

Deforestation and Natural Disaster in Indoneasia

The rapid decline of forest coverage in Indonesia has made most of the lands in

Indonesia become more susceptible to the threats of natural disasters. Based on data from

national coordinating body for disaster management, there were 647 natural disasters

happened in Indonesia during 1998 to 2003, with most of them were flood, and landslide

(ISAI, 2007). Undoubtedly, all of those disasters, that have killed many people and caused


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massive economical loss, were the consequences of the accumulation of negative impacts of

on going deforestation started by the New Order regime in 1960s.

Logically, Erosion is one of consequences of deforestation, as it will reduce soil

quality by affecting its chemical and physical properties (Hajabbasi etal, 1996). In relation to

that, Jimenez et al (2006) found that removing natural vegetations can increase the bulk

densities of the soil, while also reducing organic matter and the apparent saturated hydraulic

conductivity values. Under these conditions erosion can be stimulated, and the possibility of

the disaster increase as the deforestation increase. This is because, deforestation can alter the

hydrologic cycle by reducing the landscapes capacity to intercept, retain, and transport

precipitation, which in turn may lead to faster surface water runoff (Thorpe, 2009). Thus, the

accumulation of faster surface water runoff in heavy rain condition will result in flash

flooding or more extreme floods.

However, there is a tendency that the government does not want to be blamed as the

caused of the disasters. For instances, there were possibly conspiracy and hoax on the

government reports on the cause of flash flood in Bahorok, North Sumatra in 2 November

2003, which has killed about 300 people and destroyed at least 400 houses. Maley (2004)

reported that the government has tried to ensure the public by broadcasting a hoax that the

disaster were purely caused by the extreme weather, and global climate changes rather than

as the direct effects of deforestation on water and soil balances in that area. Although before

the disaster happened, the government has repeatedly admitted there were potential threats of

disaster as the effect of the massive destruction of the forest in that area.

Similarly, about the recent horrible flash flood that happened in Wasior, Papua, in 4

October 2010, the Indonesias president insisted that it was not caused by illegal logging as

he said that the forests were still well maintained (Harisumarto, 2010). However,


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environmentalists and activists challenged president Susilo Bambang Yudhoyonos claim that

the forests were reasonably good and was not to blame for the flood (The Jakarta Post,

2010a). While, it was reported by the Green Indonesian Institute that activities like mining,

and logging have increased in that area and are responsible to 25% of deforestation in

Indonesia, as by 2010 the government has awarded 20 logging concession with total areas of

3.5 million hectares, 16 permits to mineral and coal mining companies covering 2.7 million

hectares, 13 licences to oil and gas companies with areas of 7.1 million hectares, and also

219,021 hectares for plantation firms (The Jakarta Post, 2010b).

Deforestation in Indonesia and Global Climate Changes

Obviously, the high rate of deforestation in Indonesia has significantly contribute to

the global climate changes as most of the forest areas have lost its function on stabilizing

levels of atmospheric CO2. While at the same time the increase of human population and

urbanisation since 1850s has exponentially increased CO2 level from burning of fossil fuels,

which have exceeded 8 Gt C/y by the early 2000s (Houghton, 2007). This change is harmful

for our planet, as Carbon dioxide is the single most important greenhouse gas worldwide

which account for about 56 % of the total greenhouse gases. However, other greenhouse

gases like CFCs, CH4, N2O, and O3 also make a significant contribution to the global

warming (Committee on Science, Engineering, and Public Policy (U. S.), 1992)

There are several sources of greenhouse gas emissions which can be from both

anthropogenic (man-made) and natural sources. A study by Shao etal (2008) found that the

levels of atmospheric CO2 has continued to increase but less than 50% of this CO2 was from

combustion of fossil fuels. In relation to that, Streck et al (2008) emphasized that

deforestation is the greatest source of greenhouse gases emissions in many developing


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countries, which has made Brazil and Indonesia as the worlds biggest greenhouse gases

emitter after the USA and China.

Indonesias status as one of the biggest emitter of greenhouse gases is conceivable

since massive deforestation in Indonesia has made the forests releasing its stored carbon to

the atmosphere. Osborne (2006) explained that there are several ways that deforestation may

release the carbon fixed in the tree biomass and in the soil. For instance, it either directly

release the carbon when the wood is burn for clearing the land, or slowly through

decomposition. Furthermore, Osborne (2006) also explained that deforestation was the major

cause of increasing atmospheric CO2 level in the 1960s, which was at the same period with

the beginning of timber industry in Indonesia. Thus, it means that timber industry in

Indonesia has significantly contributed the global warming which can elevate sea levels and

increase frequency of extreme weather events in global scale.

Effects of Deforestation on Biodiversity

The destruction of rain forests in Indonesia will threat most of worlds biodiversity

richness. This is because, based on NASA observation on tropical forests, the deepest end of

the planetary gene poll is located in tropical forests, although tropical forests only cover

about 7% of the earths dry land (Lindsey, 2007). Certainly, the unsustainable forestry

practices in Indonesia has lead to extensive habitat loss, which in turn may result in grave and

irreversible consequences for biodiversity. This is possibly happen as many species are so

specialized to microhabitats within the forests. To illustrate, Schoonhoven et al (2008)

explained that microclimate at the ground surface under a vegetation differ significantly from

that at a bare soil surface. Further, Schoonhoven etal (2008) also emphasized that insects,

which represent very extensive taxa of living organisms, are strongly influenced by

microclimate around host-plant as it provides a unique condition which is suitable for insect

to complete its life cycle, and also provide refugee for insects from their natural enemies.

Thus, changes in forests lanscapes may strongly affect the dynamic population of insects and


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many other species, which also possibly lead to the extinction of some species. In that case,

the entire ecosystems may collapse if the critical species become extinct (Trucksess, 2003).

Conclusion

In conclusion, it is clear that there is a strong reciprocal relation between politic,

economy, and environment. The case of Indonesias forests briefly shows how political

power has been wrongly used to benefit certain groups of people which monopolising, and

exploiting the natural resources. Although this fact is contradictive with the Indonesias laws

which dictate that all of natural resources are belong to the nation and should be used for the

collective prosperity of the nation. Then, the fall of New Order regime, which was the

ultimate result of the competition between state and non-state organizations in the society

arena, seems cannot solve this problem as the new decentralisation system has result in the

more increase of deforestation. Thus, it implies that economic reasons have strong roles in

determining political decisions, and depleting natural resources.

Next, it also can be concluded that engagement of the political and economical

interests of certain groups of people in managing Indonesias forests has result in injustice in

utilization of natural resources in Indonesia. This condition has caused only certain groups of

people enjoyed most of the benefits, and uneven development in Indonesia, while it has

adversely impacted local and global environment, and caused massive casualties, economical

loss, and also loss of biodiversity richness. Finally, an integrated forestry management with

strong good political and economical intentions are needed to solve these complex problems,

which can be said as by-products of the capitalist treadmill of production and consumption.


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